By Aparna Turner
for the 2025 Risky Women Writing Competition, presented in partnership with Ocorian
Our greatest fear may not be malfunctioning AI tech but the possibility that it might amplify our outdated mindsets! As we race towards innovation, are we merely training a smarter groupthink machine while overlooking the very human voices that need to be heard?
My career has been shaped by stepping into uncertainty – whether leading change in disrupted industries, championing customer-first reforms following the Financial Services Royal Commission or responding to institutions in crisis as a financial regulator. As anyone who has responded to a crisis will know, impact stems less from what’s learned in lecture halls and more from the judgment and instinct that only lived experience and adversity can forge. More than ever the future of risk management and innovation, particularly in the age of AI, should not be driven by those who conform, but by those willing to think differently and challenge the status quo. In highly regulated sectors like financial services, where leadership is often drawn from a narrow talent pool, AI risks becoming less of a solution and more of an accelerant of group think.
The Homogeneity Problem
The 2025 APRA Governance Review recommended Board tenure limits – not just as good governance, but to tackle persistent cultural issues (Governance Review – Discussion Paper | APRA). The Review highlighted something deeper: industries drawing leaders from a narrow talent pool end up with narrower thinking, and a heightened chance of collective misjudgment, without a concerted plan to address the risk. Regulators aren’t immune. Too often they reflect the industries they oversee, not the public they serve. When those enforcing the rules don’t resemble or understand the people who must trust those rules, legitimacy erodes. That, in turn, fuels political pressure to weaken regulation, not always because rules are faulty, but because the institutions applying them are perceived as disconnected, exclusive, and undeserving of expansive authority. Regulatory stagnation is not simply legal – it’s cultural.
Lessons from the Global Financial Crisis
The 2008 GFC remains a warning of what happens when dominant voices drown out dissent. Financial institutions and regulators failed to recognise escalating risks in complex financial products. Those at the table often had the same educational backgrounds and ideological commitments and missed the same threats. Some did speak up. Brooksley Born, then Chair of the US Commodity Futures Trading Commission, pushed for derivative oversight but was shut down (Brooksley Born to Recieve John F. Kennedy Profile in Courage Award – In Brief – Stanford Lawyer Magazine – Stanford Law School). Raghuram Rajan, the Indian born, then IMF Chief Economist, warned in 2005 that unchecked incentives could trigger crisis. Larry Summers, the then US Treasury Secretary, reportedly called him a “Luddite” Raghuram Rajan: the banker who warned of meltdown in 2005 | Banking | The Guardian. Paul Moore, Head of Regulatory Risk at HBoS (later the UK’s biggest bank failure of the crisis), warned executives about reckless expansion. He was fired (Paul Moore obituary | HBOS | The Guardian). Any culture of courage and challenge was feared – not celebrated.
Recruitment Alone Won’t Fix It
Hiring diverse talent isn’t enough. Without an environment that values difference, rather than tokenises it, new recruits often stay silent, burn out, or leave. Real diversity is about embedding new patterns of thinking into organisational DNA.
Representation as an Ethical and Innovation Imperative
When leadership reflects the full spectrum of the humanity they serve – policyholders, customers, citizens – decision-making becomes more attuned to possibilities, fairness, access, and long-term systemic risk. Lived experience changes what questions get asked, how organisations resource and innovate. Representation isn’t box-ticking. It’s a precondition for ethical legitimacy and smarter judgment in industries where public trust will either make or break an organisation.
Strategy Shift: Portfolio Thinking for Talent
Think of leadership diversity similar to portfolio risk management:
- Short-term: Plug capability gaps with outside expertise. This approach risks “outsourcing empathy”. Nonetheless, it’s a start.
- Medium-term: Bring in unconventional thinkers alongside incumbents to promote constructive tension. Both sides should agree an exit plan, should the organisation turn out to be culturally immature.
- Long-term: The ultimate goal is to build leadership teams whose lived experiences reflect purpose, stakeholders, and societal expectations.
Just as negatively correlated assets reduce volatility, varied cognitive perspectives help surface hidden risks. But this requires leadership KPIs, deliberate planning, and Board accountability – not just HR checklists.
Change Takes Time – But Delay Carries Risk
Cultural change is uncomfortable and slow – especially in risk-averse sectors. But the cost of inertia is growing. Currently, AI is being embedded or trialed across regulatory supervision, risk assessment, credit, compliance, and customer interaction. If built on culturally stale foundations, these tools will scale bias, entrench blind spots, and create false confidence – potentially triggering the next crisis rather than preventing it.
Why It Matters Now
APRA has rightly shone a light on the risk of cultural stasis in the industries it supervises. Meanwhile the Australian Public Service, long held up as a model, is grappling with its own diversity gaps (Federal public service has an ‘Asian penalty’ problem, study by Crawford School of Public Policy finds). Layering AI onto existing cultures without tackling deep-rooted sameness risks embedding today’s biases into tomorrow’s algorithms. As AI begins to shape high-stake decisions in finance and supervision, the voices we most need will be the ones that sound different. The next time you encounter someone suggesting something novel, challenging consensus, or asking uncomfortable questions – back them. Protect them. Learn from them. Because the next crisis won’t be stopped by AI built on today’s cultural norms, or by leaders who blend in, but by those brave enough to stand out.