AI Legal Watch - January 2025

AI Governance in Focus for Proxy Season

Glass Lewis, one of the leading proxy advisory firms, recently updated its policy guidelines for 2025 to include recommendations regarding board oversight of AI. In the new guidelines, Glass Lewis emphasizes the importance of effective oversight and disclosure of AI practices for companies engaging with AI but falls short of prescribing the structure of such oversight. Instead, Glass Lewis advised that it will generally not make voting recommendations based on a company's oversight or disclosure of AI unless there is evidence that insufficient AI oversight or management may have harmed shareholders. In such cases, Glass Lewis intends to review the company's overall governance practices generally and the board's oversight of AI matters specifically and thereafter may recommend voting against one or more directors should it determine the oversight, response or disclosure of the AI incident to be insufficient.