2026 Governance Best Practices Survey: M&A, Artificial Intelligence Drive Boardroom Change

The merger activity that kicked off in 2025 is impacting bank boardrooms, as the skills populating those seats adapt to an evolving environment.

A majority of the CEOs and directors responding to Bank Director’s 2026 Governance Best Practices Survey, sponsored by Bradley Arant Boult Cummings, report a moderate level of change in board composition since January 2023, with most (56%) adding one or two directors.

New directors can add valuable perspectives to the boardroom. The usual skill sets are still commonly found on bank boards: finance/accounting (91%), audit (87%), real estate (69%), legal (61%) and risk expertise (57%). However, the survey finds an increased percentage of boards with M&A expertise, at 44%, up 10 percentage points from last year’s research. The number of deals climbed last year due to quicker regulatory approvals and improved valuations.

Along with the rise in M&A, more banks have adopted artificial intelligence, including generative AI tools. That’s impacted strategies and created new risks for boards to oversee. In this year’s survey, 21% say their board has a director with AI expertise. That should help drive in-depth discussions on the issue for those boards. Almost half of respondents say the risks associated with AI are discussed as a board, and 31% discuss the issue within a board-level committee. Sixty percent say the board has adjusted policies, reporting or oversight around the use of AI.

Twenty-one percent say AI risks aren’t overseen by the board. “Do [directors] have knowledge that it’s being utilized?” says Robert Maddox, a partner with Bradley. Absent a policy, communication and training, bank staff could use AI in ways that don’t protect the bank or sensitive client information. “If you don’t think that your employees are taking documents and loading them [into an AI platform] for reference or for quick tabulation and review, you’re missing what’s happening,” he says. Not addressing AI in board deliberations could put the bank at risk.

Looking ahead through 2027, 57% expect one or two directors to retire. Thirty-seven percent expect no director retirements, with smaller institutions reporting lower levels of turnover. Some may find it difficult to attract new talent to the board. I “believe it’s getting more difficult to find competent directors who are willing to make a long-term commitment to the organization,” wrote one independent director at a private Midwestern bank below $1 billion in assets.

Some boards could revisit their recruiting practices. Most rely on directors’ (83%) and executives’ (70%) personal and professional networks. And compared to the survey two years ago, an increased percentage look outside those networks to professionals in their bank’s markets. Few (9%) leverage consultants or search firms.

AI in the Boardroom
Artificial intelligence has made its way into board meeting practices, but adoption remains low. A minority say their bank uses AI to prepare meeting minutes (26%) or transcribe board discussions (22%). When it comes to the creation of board materials, 22% use AI to compile the board book, and the same percentage use the technology to examine bank performance.

Strategic Planning
Strategic planning practices remain varied, similar to last year’s survey. More than half say the board establishes the bank’s risk appetite, with the plan developed by management and approved by the board. Almost a quarter report the board drives the process in collaboration with management. Many see room for improvement in the strategic planning process, including improved measurement and monitoring (44%), a greater understanding of banking’s future (39%), more creative thinking and debate (34%), and better competitive analysis or benchmarking (33%).

Board Assessments
Thirty-nine percent report their board conducts an annual board assessment. Of those, 59% report changes in the boardroom as a result. Most revisited or changed the bank’s strategic plan (56%), changed the agenda to better reflect the board’s priorities (51%) or changed the board’s committee structure (51%).

Virtual Attendance
The vast majority (87%) allow directors to attend board and committee meetings virtually. Of those, few have formal restrictions on virtual attendance. Just 11% cap virtual attendance at a specific number of meetings per year, and 6% limit virtual meetings to emergencies, unexpected travel and other unique circumstances.

Policy Review
More than half of respondents adjusted policies, reporting or oversight in several key areas since January 2025: liquidity planning/monitoring (64%), asset quality/credit monitoring (61%), the use of AI (60%), asset/liability management (60%), Bank Secrecy Act/anti-money laundering compliance (56%) and capital planning (55%). Maddox believes more boards should revisit BSA/AML oversight. “That world has changed radically,” he says, due to increased activity from the Financial Crimes Enforcement Network (FinCEN).

Debanking Scrutiny
Following an August 2025 executive order from President Donald Trump, just 20% have examined whether their institution could be subject to scrutiny from examiners for debanking activity, or the denial of banking services based on religious beliefs, political views or other affiliations. Notably, the survey was conducted in May, before the Justice Department subpoenaed several large banks about claims of discrimination against politically conservative individuals and industries, according to The Wall Street Journal.

To view the high-level findings, click here.

Bank Services members can click below to access the complete results, broken out by asset category and other relevant attributes. To find out how your bank can gain access to this exclusive report, contact [email protected].