Cognizant Technology Solutions Corp. has become the first homegrown information technology (IT) services company to grant its board complete oversight of artificial intelligence, underlining the technology’s importance amid an uncertain demand environment.
As part of its AI guidelines, the company’s board of directors will monitor the use of AI tools and their financial impact on the company. It will also award top executives for implementing AI-related ideas and passing AI benefits to clients.
This decision comes as automation disrupts business models and threatens to erode IT outsourcing firms’ revenues.
“Our Board understands that AI presents both strategic opportunities and risks across our business. The board provides active oversight of the company’s AI strategy, governance and risk management through a combination of full board review and delegated committee responsibilities,” read Cognizant’s 2026 proxy statement filed with the US Securities and Exchange Commission on 17 March.
Cognizant has also announced a five-pillar plan for the use of automation tools, called the TRUST framework. These are five principles-based standards that govern how the company develops, deploys and monitors AI systems, both internally and in client engagements.
The framework has been created by the company’s Responsible AI Office, led by the chief responsible AI Officer, Amir Banifatemi, who took over the role in October 2024.
AI oversight
Cognizant has assigned additional responsibilities to three board committees overseeing compensation, audit, and finance to strengthen AI oversight.
First, the compensation committee, which oversees senior management pay and its alignment with the company’s strategic priorities, has expanded the basis for executives’ bonuses.
“Beginning with the company’s 2024 annual cash incentive program, the Compensation Committee approved the inclusion of a strategic initiative focused on innovation, which looked at the number of Bluebolt and gen AI ideas generated and implemented,” read Cognizant’s proxy statement.
For 2025, this innovation strategic initiative was refined to further focus on gen AI innovation, including productivity improvements generated through the use of gen AI, the statement added.
On the other hand, the audit committee, responsible for overseeing risks facing the company’s business, will now check its internal controls around AI and their efficacy. It will also receive regular management reports on whether AI tools are being used safely in the company and if underlying issues have been fixed.
Lastly, the finance committee has received updates on the impact of AI on the company’s pricing models with clients and the productivity passed through in IT services delivery. It also keeps a tab on new revenue opportunities from providing AI services.
“A new, detailed section on ‘AI Governance and Oversight’ signals our robust approach to managing the opportunities and risks associated with AI,” said Cognizant’s spokesperson in response to Mint’s email.
“We have implemented a robust AI Governance Framework to oversee opportunities and risks associated with AI across the enterprise. The board, including through its committees, maintains direct oversight: the audit committee reviews AI-related risk management, including responsible AI practices and data security,” the spokesperson added.
The company refreshed committee charters in late 2025 to explicitly include oversight of technology (including AI), the spokesperson said.
Nasdaq-listed Cognizant, which follows a January-December fiscal calendar, is an Indian heritage IT firm, as almost three-fourths of its 351,600 associates are stationed in the country. It ended last year with $21.1 billion in revenue, up 7% year-on-year.
For now, none of the homegrown IT service companies specifies the kind of board oversight on automation tools.
“I am unaware of any other tech services with board oversight of an AI framework. That said, several other firms, including Accenture Plc, have similar or more investment in AI,” said Peter Bendor-Samuel, the founder of Dallas-based IT research firm Everest Group.
Accenture is the only other firm whose board monitors and links performance incentives to AI usage.
“It’s unclear if others will follow suit with board oversight. It signals intent but does not do anything for competitiveness,” Bendor-Samuel added.
For now, most homegrown IT players broadly outline gen AI as a risk that the boards monitor, but do not specify if they are the ombudsman on all automation tools.
AI challenges
Alongside listing additional board responsibilities, Cognizant has also outlined challenges with its AI usage.
“In the future, we may face difficulties acquiring the necessary rights from third parties due to market competition, pricing changes, licensing restrictions and other factors. This challenge could hinder our ability to develop, implement or maintain AI technologies,” read Cognizant’s 2024-25 annual report released on 17 April.
The company added that its AI framework might not be sufficient to keep up with changes in laws across countries and address all other risks.
“Although we maintain a responsible AI framework aligned with recognized international standards that includes risk assessment processes, oversight structures and controls across the AI lifecycle, it may not be sufficient to identify, assess and mitigate all AI-related risks,” read the annual report.
It added that the effectiveness of its AI framework depends on the accuracy of its risk assessments, the adequacy of implemented controls, and its ability to adapt to changes in AI technologies.
“There can be no assurance that our responsible AI framework will adequately identify, assess and prevent all AI-related risks,” read the annual report.
A second expert attributed Cognizant’s specifications on AI usage to listing requirements in the US. “Cognizant, being Nasdaq-listed and under heavier US institutional scrutiny, has been more forward in articulating the board’s role in AI oversight in public filings,” said Phil Fersht, chief executive of HFS Research.