How boards can use Artificial Intelligence to transform a company value chain

At Thomson Reuters, president and CEO Steve Hasker has used artificial intelligence to radically transform the company into a technology business. Here’s what he has learned about the pluses and minuses of AI.

We like to think of ourselves as one of the world’s leading content-enabled technology companies. The vast majority of our business provides content-enabled and AI-enabled software to lawyers, tax and accounting professionals, auditors, risk compliance professionals and law enforcement. For example, we have a flagship legal product called Westlaw. We’ve recently acquired and developed an AI legal assistant called CoCounsel. We have a leading piece of tax calculation software called ONESOURCE, which covers direct tax, indirect tax, sales tax and excise.

Then we have about US$750m in revenue, predominantly with the US Department of Defense, FBI and Department of Homeland Security.

The smallest part of our business is the Reuters news agency. That accounts for a bit less than 10 per cent of our revenue and a bit less than five per cent of our profit. In many places, it’s the only part of the company that anyone recognises. Reuters is the largest wholesaler of news in the world. That is managed or overseen by an independent board, which is actually chaired by a Sydneysider, Kim Williams AM [also chair of the Australian Broadcasting Commission].

How should Australian boards think about AI, both as a risk but also as an opportunity for their organisations?

Australian boards shouldn’t view it differently than boards anywhere else. To state the obvious, here’s how I think about AI, particularly generative AI and large language models.

I’ve lived through the advent of the internet, mobile, social, cloud and now AI. In my view, artificial intelligence is bigger than any of those in terms of its potential to transform professions and large portions of any company’s value chain.

We’re already seeing generative AI fundamentally transform tasks such as the first draft process or initial research memos. The tools we’re putting in place weekly — such as new features, functionalities and skills within CoCounsel — are extraordinary and our competitors are doing this, too.

We’ve got the largest law firms in the world — our “luminary customers” — going all-in on these tools. Many firms are hesitant because they worry about per-hour billing and navigating aggressive general counsels, but they also see the potential efficiencies. They’re questioning the apprenticeship model, the pyramid structure, client-attorney privilege and especially data privacy and protection.

Law firms currently spend about two per cent of revenue on technology compared to seven or eight per cent on other professional services. This gap will close significantly. Firms will spend less on real estate and more on technology, creating new revenue streams.

Ultimately, every business will find areas fundamentally rewired by access to large language models, creating great opportunities, but also some scary cliffs ahead.

What structures are in place at Thomson Reuters to ensure your data is protected?

We’ve been in advanced machine learning for 30 years. We put a functioning search algorithm on the Westlaw database in the early 1990s, before Google was commercialised, so we’re not new to this. But that doesn’t mean we won’t make mistakes.

Whenever we’re in front of customers anywhere, we guarantee their input won’t become part of our AI output. We’ve built our systems so if any professional puts a query into CoCounsel, it won’t tune our models. Most importantly, data won’t leak into the large language or foundation model we use. The vast majority of our competitors don’t offer that guarantee, creating significant risks unacceptable to the professions we serve — tax, accounting, legal, auditing or law enforcement.

There have been publicised incidents, like a junior associate at an advertising agency doing work for Samsung who asked, “If the handset release schedule looks like this, what’s the best marketing plan?” That information leaked into a model, exposing it to competitors — a “Signalgate” type moment.

How has that private capital conversation changed in boardrooms and how should directors think about private capital coming in?

Private equity is here to stay and will keep growing. In 1996, the US had close to 8000 listed companies — now there are fewer than 4000, partly due to the rise of private equity. In Australia, you’ve got behemoth firms that aren’t purely private equity anymore. They’re diversified financial services providers and also specialised, Australia-centric firms stacked with talent, making the market highly competitive.

My private equity experience came through Nielsen, during one of the largest leveraged buyouts before the financial crisis. We undertook a significant transformation behind private equity ownership, working with five marquee firms. One key benefit was making tough decisions quickly, without quarterly public pressures.

Private equity professionals are extremely thorough with due diligence. At every board meeting, it felt like ongoing due diligence, which wasn’t always helpful operationally, but was useful financially. There’s also a clear focus in private equity about what investors want, unlike in public markets with competing agendas.

What can publicly listed companies learn from privately owned companies?

When I joined Thomson Reuters, it was the day before the pandemic started. My first meeting was at 9am on a Sunday, deciding if we should send our 25,000 people home. We, like everyone else, chose to do that — and we thrived through it.

In that first year, I worked closely with our long-time CFO on our “Change” program. Customers had told us, “We love your content and people, but the experience of working with TR is difficult, hard-to-find products, confusing billing, inconsistent customer service.” We spent US$600m over two years to fix these issues.

Doing this privately would have been easier. My first analyst call involved explaining that large investment, offset by providing three years of guidance due to our predictable revenues. In private ownership, we could have spent more aggressively without public market pressures. We benefited greatly from having an experienced CFO and the Thomson family as majority owners.

How does Thomson Reuters navigate declining trust in media and can that trust be improved?

Internally, we say, “This is our moment.” The Reuters agency is almost 175 years old. Julius Reuters was the first to use carrier pigeons and undersea cables to transmit news.

We have a history of innovation, coupled with our Trust Principles, established in 1941, when news agencies in Europe were being co-opted by governments. The Reuters board at the time chose independence and fact-based reporting over government directives.

Today, every piece of news from Reuters is triple-checked — at least three people must go on the record to verify a fact. That’s why we’re often beaten by competitors on things like M&A news, which can be speculative. Still, I think this is a great moment for Reuters to cut through the noise.

Many media issues in the US stem from cable television rather than just social media. Social media users eventually see multiple perspectives, but cable news viewers typically get only one point of view. I suspect we’re stuck in this doom loop for a long time, but clearly labelling news versus opinion and facts versus something else, could help.

How does Reuters balance speed and accuracy in an era of AI-driven news?

As a company, we’re investing US$200m a year to inject AI into our products. All that investment is available to our newsrooms, who have developed a product called Fact Genie. This is accessible to our journalists, videographers and photographers, providing daily headlines and producing a first draft for them to review. Fact Genie scans every press release from public and private companies, creating alerts reviewed by a human before publication. AI, with a human in the loop, makes journalism more productive, fun and effective.

This article first appeared under the headline 'As a matter of fact’ in the May 2025 issue of Company Director magazine.