The Monday
Board Brief

01 / Governance

AI concentration: when everyone relies on the same technology.

What changed

On 1 October, ECB President Christine Lagarde addressed the European Systemic Risk Board’s annual conference, focusing on the systemic implications of artificial intelligence.

She highlighted the widespread adoption of generative AI in financial institutions and the risks associated with dependence on a limited number of technology providers and models.

Nearly nine out of ten significant euro-area banks already use generative AI, according to the figures cited in her remarks.

Why it matters

AI can improve decision-making and operational efficiency. But widespread reliance on the same external technologies creates a different type of exposure.

An institution may believe it has diversified its technology risks while several critical services ultimately depend on the same underlying provider.

For boards, vendor concentration is no longer exclusively a procurement question. It can become a strategic resilience issue.

The boardroom question

How many of our critical activities ultimately depend on the same AI providers, models or infrastructure?

What to ask management: Map material AI dependencies, concentration exposures and credible alternatives if a critical service becomes unavailable.

Source: ECB, Where AI risks meet, 1 October 2026

02 / Strategy

AI investment: who is financing the transformation?

What changed

On 2 October, ECB researchers published findings from a survey examining AI investment plans among approximately 5,000 euro-area companies.

Among businesses planning AI investments, 72% expected to use internal funds such as cash flow or retained earnings.

Investment priorities included AI tools, employee training and data infrastructure.

Why it matters

When companies finance technology transformation from internal resources, AI competes directly with other capital priorities.

A technology initiative can be promising without being the best use of scarce capital.

Boards should understand which projects address genuine strategic needs, which offer measurable operating improvements and which remain exploratory.

For a closer look at investment ownership, read Technology investment deserves a business owner.

The boardroom question

Which AI investments would still deserve funding if our available investment budget were reduced?

What to ask management: Separate experimental spending from committed investments, establish expected benefits and clarify when funding should be reconsidered.

Source: ECB, How firms are planning to finance AI adoption, 2 October 2026

03 / Execution

Europe’s T+1 transition: less time for the same dependencies.

What is changing

European securities markets are preparing to shorten the settlement cycle to one business day, with 11 October 2027 identified as the target date.

ESMA, the European Commission, the ECB and industry representatives are coordinating the transition.

The initiative seeks to improve settlement efficiency and strengthen European market integration. This is an ongoing implementation programme, rather than a new announcement this week.

Why it matters

Shorter settlement periods compress the time available to complete transactions and resolve exceptions.

For asset managers, brokers, custodians and financial institutions, successful implementation depends on processes and counterparties beyond any single organisation’s control.

An internal programme can be on schedule while end-to-end readiness remains uncertain.

The boardroom question

Are we testing our own readiness, or the readiness of the entire chain on which we depend?

What to ask management: Identify critical counterparties, manual processes, funding constraints and unresolved operational dependencies.

Source: EU T+1 Industry Committee, High-level roadmap to T+1 securities settlement in the EU, June 2025

04 / Zoom

Insurance: what makes governing an insurer different?

What are we talking about?

Insurance is fundamentally a business of accepting risk today in exchange for commitments that may extend years or decades into the future.

Insurers collect premiums, manage claims, invest assets and maintain capital to meet their obligations.

How does it work, and who decides?

European insurance governance operates within the Solvency II framework. Boards oversee strategy, capital adequacy, risk management and the effectiveness of the governance system.

Management, actuarial, risk, compliance and internal audit functions contribute distinct perspectives to the organisation’s control environment.

The precise allocation of responsibilities depends on the company’s legal form and national governance arrangements.

What should a director understand?

A profitable underwriting year does not necessarily demonstrate long-term financial strength.

Claims development, investment risks, reserving assumptions and capital requirements can materially affect the insurer’s future position.

Directors must understand how these elements interact rather than considering them as isolated reports.

The boardroom question

Which assumptions about future claims, investment returns or capital needs could most materially change our financial position?

Source: EIOPA, Solvency II, Article 41: General governance requirements. Background explainer.

The Boardroom Question

Do we understand the dependencies behind our most important decisions?

Efficiency is valuable. But an AI system may concentrate technology risk. An investment may consume capital needed elsewhere. A faster settlement process may leave less time to manage operational dependencies.

In insurance, today’s apparent financial strength may depend on assumptions that will only be tested years later.

The board needs to understand these dependencies and their consequences before something fails.

Practical resources

Continue the discussion

• Who can stop an automated decision?
  What directors should check about the authority, information and alternatives needed to intervene when an automated result is wrong.
• Technology investment deserves a business owner
  Why approving a budget is only part of the decision, and who needs authority to turn the investment into operating results.

All Executive Insights

What would be most useful to you?

What questions are you facing in your board or leadership role? Tell us which topics you would like us to explore, or where a conversation could help.

Write to Colibri Advisory.

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