AI Insights

Good governance holds the key to successful AI innovation

Published

2 hours ago

September 15, 2025

Organizations often balk at governance as an obstacle to innovation. But in the fast-moving world of artificial intelligence (AI), a proper governance strategy is crucial to driving momentum, including building trust in the technology and delivering use cases at scale.

Building trust in AI, in particular, is a major hurdle for AI adoption and successful business outcomes. Employees are concerned about AI’s impact on their job, and the risk management team worries about safe and accurate use of AI. At the same time, customers are hesitant about how their personal data is being leveraged. Robust governance strategies help address these trust issues while laying the groundwork for standardized processes and frameworks that support AI use at scale. Governance is also essential to compliance — an imperative for companies in highly regulated industries such as financial services and healthcare.

“Done right, governance isn’t putting on the brakes as it’s often preconceived,” says Camilla Austerberry, director at KPMG and co-lead of the Trusted AI capability, which helps organizations accelerate AI adoption and safe scaling through the implementation of effective governance and controls across the AI life cycle. “Governance can actually be a launchpad, clearing the path for faster, safer, and more scalable innovation.”

Best practices for robust AI governance

Despite its role as a crucial AI enabler, most enterprises struggle with governance, in part because of the fast-moving technology and regulatory climate as well as an out-of-sync organizational culture. According to Foundry’s AI Priorities Study 2025, governance, along with IT integration and security, ranks among the top hurdles for AI implementations, cited by 47% of the responding organizations.

To be strategic about AI governance, experts recommend the following:

Focus on the basics. Because AI technologies and regulations are evolving so quickly, many organizations are overwhelmed by how to build a formal governance strategy. It’s important to create consensus on how AI strategy aligns with business strategy while establishing the proper structure and ownership of AI governance. “My advice is to be proportionate,” Austerberry says. “As the use of AI evolves, so will your governance, but you have to start somewhere. You don’t have to have it all baked in from the start.”

Include employees in the process. It’s important to give people easy access to the technology and encourage widespread use and experimentation. Companywide initiatives that gamify AI encourage adoption and promote feedback for AI governance frameworks. Establishing ambassador or champion programs is another way to engage employees by way of trusted peers, and an AI center of excellence can play a role in developing a foundational understanding of AI’s potential as well as the risks.

“Programs that are successful within organizations go that extra mile of human touch,” says Steven Tiell, global head of AI Governance Advisory at SAS Institute. “The more stakeholders you include in that conversation early, the better.”

Emphasize governance’s relationship to compliance. Effective governance means less friction, especially when it comes to regulators and risk auditors slowing down AI implementation. Given the varied global regulatory climate, organizations should take a forward stance and think beyond compliance to establish governance with lasting legs. “You don’t want to have to change business strategy or markets when a government changes regulations or adds new ones,” says Tiell. “You want to be prepared for whatever comes your way.”

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AI Insights

This Artificial Intelligence (AI) ETF Has Outperformed the Market By 2.4X Since Inception and Only Holds Profitable Companies

Published

30 minutes ago

September 16, 2025

The Editors

For well under $100, you can buy one share of this under-the-radar AI exchange-traded fund (ETF) that looks poised to continue to outperform the market.

For this article, I asked myself: Where would I start investing if I had less than $100 to invest?

Image source: Getty Images.

An AI ETF that’s concentrated and full of leading and profitable companies

This answer to my question popped into my head: I’d want a concentrated exchange-traded fund (ETF) focused on leading and profitable companies heavily involved in artificial intelligence (AI), but with enough differences among themselves.

Why an ETF? Because I’d not want to put all my (investing) eggs in one basket.

Why AI? Because it’s poised to be the biggest secular trend in many decades or even generations.

Why concentrated? Because I believe if investors are going to buy a very diversified ETF, they might as well buy the entire market, so to speak, and buy an S&P 500 index ETF. Indeed, buying an S&P 500 index fund is a good idea for many investors, and recommended by investing legend Warren Buffett. That said, over the long run, I think an AI ETF full of only leading and profitable companies will beat the S&P 500 index.

Roundhill Magnificent Seven ETF (MAGS): Overview

And bingo! There is such an ETF — the Roundhill Magnificent Seven ETF (MAGS 1.92%). It has seven holdings — the so-called “Magnificent Seven” stocks: Alphabet (GOOG 4.38%) (GOOGL 4.53%), Amazon (AMZN 1.42%), Apple (AAPL 1.06%), Meta Platforms (META 1.18%), Microsoft (MSFT 1.01%), Nvidia (NVDA -0.10%), and Tesla (TSLA 3.54%). This ETF closed at $62.93 per share on Friday, Sept. 12.

These megacap stocks (stocks with market caps over $200 billion) were given the Magnificent Seven name a couple of years ago by a Wall Street analyst due to their strong growth and large influence on the overall market. The name comes from the title of a 1960 Western film.

Two other main traits I like about this ETF:

Its expense ratio is reasonable at 0.29%.
It provides equal-weight exposure to the seven stocks. At each quarterly rebalancing, the stocks will be reset to an equal weighting of about 14.28% (100% divided by 7).

Since its inception in April 2023 (almost 2.5 years), the Roundhill Magnificent Seven ETF has returned 160% — 2.4 times the S&P 500’s 65.9% return.

Roundhill Magnificent Seven ETF (MAGS): All stock holdings

Stocks are listed in order of current weight in portfolio. Keep in mind the ETF is rebalanced quarterly to make stocks equally weighted.

Holding No.	Company	Market Cap	Wall Street’s Projected Annualized EPS Growth Over Next 5 Years	Weight (% of Portfolio)	1 Year/ 10-Year Returns
1	Alphabet	$2.9 trillion	14.7%	17.72%	55.9% / 677%
2	Nvidia	$4.3 trillion	34.9%	15.00%	49.3% / 32,210%
3	Apple	$3.5 trillion	8.8%	14.13%	5.6% / 812%
4	Tesla	$1.3 trillion	13.4%	13.81%	72.3% / 2,270%
5	Amazon	$2.4 trillion	18.6%	13.30%	22% / 762%
6	Meta Platforms	$1.9 trillion	12.9%	13.16%	44.3% / 725%
7	Microsoft	$3.8 trillion	16.6%	12.76%	20.3% / 1,250%
Overall ETF	N/A	Total net assets of $2.86 billion	N/A	100%	40.5% / N/A
N/A	S&P 500	N/A	N/A	N/A	19.2% / 300%

Data sources: Roundhill Magnificent Seven ETF, finviz.com, and YCharts. EPS = earnings per share. Data as of Sept. 12, 2025.

All these companies are profitable leaders in their core markets, and heavily involved in AI. Nvidia produces AI tech that enables others to use AI, while the other companies mainly use AI to improve their existing products and develop new ones.

Alphabet’s Google is the world leader in internet search. Its cloud computing business is No. 3 in the world, behind Amazon Web Services (AWS) and Microsoft Azure. The company also has other businesses, notably its driverless vehicle subsidiary, Waymo. (You can read here why I believe Nvidia is the best driverless vehicle stock.)

Nvidia is often described as the world’s leading maker of AI chips — and that it is. But it’s much more. It’s the world leader in supplying technology infrastructure for enabling AI. It’s also the global leader in graphics processing units (GPUs) for computer gaming.

Apple’s iPhone holds the No. 2 spot in the global smartphone market, behind Samsung. However, it dominates the U.S. market. The company’s services business is attractive, as it consists of recurring revenue and has been steadily growing.

Amazon operates the world’s No. 1 e-commerce business and the world’s No. 1 cloud computing business. It also has many other businesses, notably its Fresh and Amazon Prime Now (Whole Foods) grocery delivery operations.

Meta Platforms operates the world’s leading social media site, Facebook, as well as Instagram, Threads, and messaging app WhatsApp.

Microsoft’s Word has long been the world’s leading word processing software. Word is part of Microsoft Office, a suite of popular software for personal computers (PCs). Its Azure is the world’s second-largest cloud computing business.

Tesla remains the No. 1 electric vehicle (EV) maker, by far, in the U.S. despite struggling recently. In the first half of 2025, China’s BYD surpassed Tesla as the world’s leader in all-electric vehicles by number of units sold. CEO Elon Musk touts that the company’s robotaxi and Optimus humanoid robot businesses will eventually be larger than its EV sales business.

In short, the Roundhill Magnificent Seven ETF is poised to continue to benefit from the growth of artificial intelligence. Technically, it doesn’t have a long-term history. But if it had existed many years ago, it’s easy to tell that its long-term performance would be very strong because the long-term performances of all its holdings have been anywhere from great to spectacular.

Beth McKenna has positions in Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends BYD Company and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

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AI Insights

Tech industry successfully blocks ambitious California AI bill | MLex

Published

2 hours ago

September 15, 2025

The Editors

By Amy Miller ( September 15, 2025, 23:52 GMT | Insight) — The deep-pocketed tech industry has proven once again that it can block efforts to regulate artificial intelligence, even in California. Even though California legislators approved more than a dozen bills aimed at regulating AI, from chatbot safety, to transparency, to data centers, several proposals attempting to put guardrails around AI died after facing concerted opposition, including the closely watched Automated Decisions Safety Act, which would have set new rules for AI systems that make consequential decisions about individuals.The deep-pocketed tech industry has proven once again that it can block efforts to regulate artificial intelligence, even in California….

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AI Insights

These fields could see job cuts because of artificial intelligence, federal data says

Published

2 hours ago

September 15, 2025

The Editors

Artificial intelligence has some excited and others scared, as the rapidly evolving technology impacts the job market.

Lucas Shriver is working hard at LEMA in St. Paul. A solar-powered battery station can now be used as a power source in a desert. It’s a project and a job that’s been a long time coming.

“I think I was about 7 years old when I built a tree house by myself,” Shriver said.

He earned his engineering degree from the University of St. Thomas in June. As a full-time employee, he is one of the lucky ones.

“In my own searching for jobs and my friends, the job market right now is quite difficult, and it does seem like people are looking for someone with five years of experience,” Shriver said.

His professor, John Abraham, agrees.

“The jobs at the bottom rung of a ladder for people to climb up to a corporation. Those are going away in the last two years,” Abraham said. “There’s 35% fewer entry-level, you’re a recent college graduate and you’re looking for a job, you’re up a creek, you’re up a creek.”

Federal data suggests three fields that will feel potential cuts because of AI: Insurance adjusting, credit analysis and paralegals. The data also suggests growth could come in the software, personal finance and engineering fields.

For job seekers of any age or field, Abraham suggests learning how to use artificial intelligence.

“This is a tool that increases effectiveness so much, you just have to know it if you’re going to compete,” he said.

And Shriver has the job to prove it.

“I have no idea where this is going, but as for today, I am gonna use AI,” he said.

Abraham says jobs with empathy, like counseling and health care may be safer from AI; he also says the trades will likely still be in demand.

Susan-Elizabeth Littlefield

Susan-Elizabeth Littlefield loves sharing the good news. She hosts a show on Sunday mornings based on local “positivity and empowerment,” leading right into CBS Sunday Morning.

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