CalSTRS working group recommends embedding AI oversight into existing board structures

Staff presented findings from the board–staff AI technology working group and recommended integrating AI oversight into existing governance structures rather than creating a standalone board function. The working-group lead said the group engaged public‑pension peers, academic experts and external advisors and recommended: embedding AI considerations into existing board reporting and materials, designating two trustees to work with the CEO on initial integration, developing board-level AI governance principles, and creating an AI risk/materiality framework to guide when the board should engage more directly.

The staff presentation cited prior board education in January and March and said Dr. Param Singh (Carnegie Mellon Tepper School of Business) and Mosaic Governance Advisors will support the development of principles and trustee education. Staff said a short survey from Mosaic would be distributed to trustees and results would inform a facilitated discussion at the July board off-site.

Trustees applauded the rapid progress and urged structured trustee education to ensure a shared understanding of board responsibilities for oversight, policy and risk. Trustee Michael Gunning praised the speed of the work; Trustee Juarez, who described himself as initially “a cynic,” said trustee-focused training (he proposed an OCERS presenter) would be helpful. Public commenter Don Stauffer asked staff to clarify whether “AI” refers to investment opportunities, staff tools and operations, or AI embedded in CalSTRS systems; staff acknowledged the need for clarity and planned targeted follow-up.

This item was presented for board feedback as an information item; no policy vote was taken. Staff will send a Mosaic survey to trustees and bring a facilitated discussion and proposed principles to the July off-site for further board consideration.