As artificial intelligence moves from experimentation into enterprise execution, organisations are confronting a governance question that reaches far beyond technology. AI systems, agents and automated workflows can analyse information, coordinate processes, make recommendations and increasingly take action across enterprise environments. Yet before any system can act, one question must be answered: what is the organisation actually authorised to rely upon?
For Chris Kechagias, AI has not created a new governance problem. It has exposed, accelerated and brought into sharper focus a long-standing organisational one.
Across three decades in civilian and government sectors, Kechagias has worked across procurement, commercial governance, security and risk, with additional experience in systems enablement, technology implementation and solution development. Across these environments, he repeatedly encountered the same challenge. Organisations could have policies, delegated authorities, risk assessments, approvals and controls in place, yet still lack a clear, authorised and implementation-ready governing position connecting those mechanisms.
The question he kept returning to was not simply, “Was this approved?” It was more fundamental:
How did organisational reliance become acceptable?
That question became the foundation for Governance Formation™ and Governance Five™ ©, a body of work focused on how organisations form, authorise and preserve governing judgement before it is translated into systems, controls, workflows and AI-enabled execution.
Kechagias describes Governance Formation™ as the upstream organisational governance discipline concerned with how governing judgement becomes sufficiently formed, authorised and implementation-ready before organisational reliance begins. Governance Five™ © provides the structured and repeatable method through which that discipline is applied, supporting the formation and translation of an authorised governing position into requirements that can be carried through procurement, contracts, technology, workflows, controls, automation and AI-enabled environments.
The distinction is increasingly important. Technology can govern, constrain, test and evidence execution within authorised boundaries. It can support people, coordinate processes and preserve evidence. But it should not independently become the source of the organisational governing judgement from which those boundaries derive.
For Kechagias, the central challenge of the AI era is therefore not simply how organisations govern AI. It is how they form an authorised governing position before reliance begins, then preserve that position as decisions move through people, procurement, technology, automation and increasingly autonomous systems.
From Commercial Governance to a New View of Decision Formation
Throughout his career, Kechagias worked in environments where decisions carried financial, operational, commercial, security and stakeholder consequences. He saw that consequential decisions rarely belonged neatly to one function.
Legal might interpret an obligation. Risk might assess potential consequences. Procurement might structure commercial commitment. Security might define constraints. Technology might determine what could be implemented. Executives or committees might ultimately approve a recommendation. Each function could perform its role exceptionally well.
The difficulty was ensuring that these different perspectives became one coherent organisational position before the organisation committed itself.
In traditional operating environments, experienced professionals often bridged this gap informally. Context carried through meetings and relationships, people asking about meaning or intent, recognising changing circumstances, resolving ambiguity and escalating when necessary.
This model becomes increasingly difficult when execution moves into automated workflows, interconnected platforms and AI systems that can operate continuously and at scale.
The question, therefore, is not whether organisations have governance. They do. The question is whether the judgement connecting their governance mechanisms has been sufficiently formed and authorised before people or systems begin relying upon it.
This distinction sits at the heart of Kechagias’ thinking.
For Kechagias, an authorised governing position is more than a recommendation, approval or policy statement. It is the organisational position that has been sufficiently formed, resolved and authorised by the appropriately authorised person or body — and that the enterprise is then entitled to implement and rely upon.
Legal, risk, procurement, security and technology may each contribute part of the answer. The key is bringing those inputs together into one clear position, without confusing expertise or participation with the authority to make the final decision.
Governance Formation™ is the upstream governance discipline concerned with how legitimate organisational governing judgement is formed before consequential reliance. Governance Five™ © is the proprietary structured method through which that discipline is applied, supporting the formation and translation of one authorised governing position into implementation-ready governance requirements.
The distinction is important. Governance Formation™ addresses the upstream governance problem, while Governance Five™ © provides the structured method through which that discipline is applied.
Nor is Governance Five™ © a technology platform. In Kechagias’ model, Governance Formation™ sits upstream of technology as the organisational governance discipline, while Governance Five™ © provides the structured method through which that discipline is applied. Together, they help organisations establish the authorised governing position that downstream systems, controls, workflows and AI-enabled environments can implement and preserve.
A Method Born Before the AI Governance Boom
The practical method now known as Governance Five™ © was already being independently applied in practice by Kechagias in 2010, well before the current wave of generative and agentic AI. The formal terminology, Governance Formation™ discipline and Governance Five™ © method expression were subsequently named and codified.
In March 2011, Power Group Purchasing™ became the continuing commercial, publishing, licensing, provenance and stewardship environment for the work. It now operates as the Governance Solution Authority for the Governance Five™ © architecture, defining how authorised governing positions are translated toward implementation, downstream technologies, evidence and assurance.
The early applications emerged through community and member-based energy initiatives involving households, community organisations, councils, associations and commercial suppliers across several Australian states.
What interested Kechagias was not simply the purchasing result. It was the governance challenge behind it.
Participants had different interests, expectations, information and constraints. The challenge was to bring those perspectives together without diminishing the authority of the people ultimately responsible for deciding whether to proceed.
Community organisations helped shape participation and identify what mattered to the people involved. Participants could influence the market proposition, including service, pricing and contractual terms, rather than simply being presented with a finished offer.
The model therefore did more than aggregate demand. It created a structured environment in which people could influence the proposition while retaining the authority to accept or reject the resulting offer.
Kechagias did not decide on their behalf. His role was to structure the process so that different interests and information could contribute to an outcome without transferring authority to the process itself.
The work also extended into digital commercial execution.
Power Group Purchasing developed an online energy deal-review and sales system through which consumers could examine an available offer and, if they chose to proceed, move into a contractual relationship with the participating energy retailer.
That experience reinforced a distinction that remains central to Kechagias’ thinking today.
The technology could present information, structure the proposition and support execution. But it did not become the source of the customer’s authority to contract. The participant retained the decision. The retailer retained its contractual role.
Technology could enable the transaction without becoming the source of authority behind it.
Long before contemporary AI systems began acting across enterprise environments, the same underlying question was already visible: how can a process or system support consequential action without displacing the authority of the people or organisation entitled to decide?
The early community work also became an expression of what Kechagias now describes as leadership without authority: creating the conditions for meaningful participation and influence without directing the outcome or displacing the authority of those ultimately making the decision.
Those experiences provide public evidence of the practical governance problems and foundational principles from which his later work developed.
They involved participation, authority, aggregation, commitment, commercial reliance and changing circumstances. The method now known as Governance Five™ © was already being applied in practice at that time and was subsequently formalised and expressed within the broader Governance Formation™ discipline.
At a high level, that method is expressed as:
Govern → Engage → Aggregate → Deliver → Evolve
The early energy initiatives illustrate why those stages matter. Participation had to occur within an understood environment. Different interests needed to be brought together. A proposition needed to be capable of being delivered back to those with authority to decide. And circumstances could change.
Where change affected the basis on which reliance remained acceptable, an earlier decision was not automatically enough. The matter could need to return to the appropriate authority for reconsideration — a principle now reflected through Governed Re-entry™.
The formal terminology, discipline and architecture were subsequently named and codified. What remained constant was the underlying organisational problem and the method being applied to address it: how different participants can contribute to one consequential position without confusing participation, expertise or process with authority.
The participants have changed.
In 2010, they included communities, households, associations, suppliers and energy retailers.
Today, they may include executives, lawyers, risk professionals, procurement teams, engineers, technology providers, AI platforms, agents and runtime controls.
The technology has changed dramatically. The speed and scale of execution have changed dramatically.
The underlying governance problem has not.
The fundamental question remains:
How can different participants contribute to one governing position without confusing participation, expertise or technological capability with the authority to decide?
Why Governance Mechanisms Are Not the Same as Governing Judgement
One of Kechagias’ key distinctions is between having governance mechanisms and forming governing judgement.
Committees, policies, risk registers, legal advice, regulatory requirements and controls can all contribute important inputs. But they are inputs to the formation of a governing position – they are not, by themselves, the governing position.
The governance task is to bring those inputs together, resolve their implications, establish where decision authority sits, and form the organisational position the enterprise is prepared to implement and rely upon.
That distinction becomes particularly important in AI environments.
A policy may require human review for a particular AI decision. Legal may interpret that requirement one way. Risk may recommend a different threshold. Technology may configure the system around a third assumption.
The technical control may operate exactly as designed.
But if the organisation never resolved those different inputs into one authorised governing position, the control may be enforcing a position the organisation never actually formed.
That is why Kechagias argues that “precision of execution does not compensate for ambiguity of governing judgement.”
The same principle applies to regulation.
A law or regulation may establish mandatory duties or boundaries. Those requirements constrain the position available to the organisation. The organisation must still form its authorised governing position within those requirements, bringing together the applicable obligations, authority, risks and implementation conditions.
Regulatory requirements inform and constrain the governing position. They do not remove the need for the organisation to form the position it is authorised to implement and rely upon.
Procurement Makes Governance Tangible
Kechagias’ procurement experience gives this principle a practical dimension.
Once an organisation signs a contract, commits capital, mobilises a supplier or deploys technology, ambiguity becomes more expensive to unwind. Procurement decisions rarely depend on a single factor. Price, legal obligations, risk, security, operational requirements, technical capability, supplier performance, stakeholder expectations and delegated authority all influence the outcome.
The cheapest option may not be the right option. The technically possible option may not be organisationally authorised.
An organisation purchasing an AI platform, for example, may find the technology and commercial proposition attractive while still needing to reconcile data-use restrictions, cybersecurity requirements, supplier obligations, regulatory expectations, operational risk and the authority required to accept the resulting position.
For Kechagias, procurement should carry the governing position into the market. It should not have to invent that position while attempting to buy something.
This also creates a basis for assessing governance value. Kechagias’ Governance Value-for-Money Signal™ (GVFM) expresses that relationship as:
GVFM=Avoided Risk+Efficiency Gain+Assurance ValueRuntime Control Costs+Upstream Decision Formation Costs
Or symbolically:
GVFM=Ra+Eg+AvCr+Cf
“where Rₐ represents avoided risk, E₍g₎ efficiency gain, Aᵥ assurance value, Cᵣ runtime control cost and C𝒻 upstream decision-formation cost.”
“Where different forms of value or cost are used, comparison requires an agreed financial or normalised measurement basis.”
The purpose is not to reduce governance to a single financial number, but to give organisations a disciplined way to assess whether clearer governance upstream is reducing rework, duplication, assurance effort and downstream control burden while improving the value created by the decision.
This illustrates why Governance Formation™ has relevance beyond AI. Procurement, outsourcing, technology investment, risk acceptance, policy and major operational change all involve consequential decisions where different interests must eventually converge around an authorised position.
Preserving Judgement Through the Technology Stack
Once an authorised governing position is formed, the next challenge is preserving it through implementation and execution.
Within Governance Formation™, that means carrying forward more than the final decision. The organisation must preserve the authority, evidence, assumptions, boundaries, constraints and consequences that made reliance acceptable.
Governance Five™ © provides the method for translating that position into implementation-ready governance requirements across procurement, contracts, enterprise architecture, identity, workflows, technical controls and evidence.
In AI-enabled environments, those requirements may also be expressed in structured or machine-readable form so that downstream platforms, agents, workflows and runtime controls can operate against the same governing position.
This is where the governance solution authority role sits: defining the governance architecture, translation requirements and interfaces without replacing the customer’s executive, technical or operational authority.
The distinction is important.
Runtime systems can govern, constrain, test and evidence execution within authorised boundaries. They do not, by themselves, form the organisational governing judgement from which those boundaries derive.
An AI agent may have technical permission to act. But technical permission alone does not establish organisational authority.
Whether an action remains authorised may depend on value, purpose, customer type, regulation, fraud indicators, delegated authority or other conditions attached to the governing position.
If those conditions materially change, a runtime system may determine that the existing position is no longer applicable to the proposed action.
What it should not do is independently reform the organisation’s governing judgement.
Where new judgement is required, the matter should return to the appropriate organisational authority for reconsideration.
Execution can operate within authority. It should not become the source of the authority it is operating against.
Building the Governance Layer for Agentic AI
The urgency becomes clearer as enterprise AI develops into an ecosystem rather than a collection of isolated applications.
Organisations are connecting AI platforms, models, agents, workflows, enterprise data, business applications, identity controls, cybersecurity, runtime safeguards, observability and evidence capabilities.
Each component may perform its function correctly while the enterprise still lacks one coherent governing position across them.
That creates an immediate governance challenge: identifying where authority, judgement and implementation requirements remain fragmented before those gaps become embedded further into the technology environment.
Technical architecture can connect capabilities. Orchestration can coordinate models, agents and workflows. Identity can establish who or what is acting. Runtime controls can govern, constrain, review or deny execution. Observability can show what happened. Assurance can examine the evidence.
But technical coordination is not the same as forming organisational governing judgement.
Those downstream layers still need a common authorised basis defining what the enterprise is entitled to do, which constraints apply, which risks have been accepted, where authority sits and what should happen when circumstances change.
That is where Kechagias positions Governance Formation™ and Governance Five™ ©.
Governance Formation™ addresses how the organisational governing position is formed. Governance Five™ © provides the structured method through which that discipline is applied, supporting formation, traceability and translation into implementation-ready governance requirements.
Within this model, Power Group Purchasing™ operates as the Governance Solution Authority for the Governance Five™ © architecture. Its role is to define and protect the governance solution architecture, translation requirements, interoperability boundaries and assurance expectations connecting an authorised governing position to implementation and downstream technology environments, without replacing the customer’s executive, technical, security or operational authority.
Those capabilities may include identity and authority controls, orchestration, runtime decision controls, cybersecurity and trust mechanisms, provenance, observability, evidence and assurance.
Each performs a different function, while the governance architecture connects them to the same authorised organisational position without displacing the customer’s executive, technical or operational authority.
The distinction can be expressed simply:
Orchestration connects the technology. Runtime systems govern execution within defined boundaries. Governance Formation™ forms the organisational position those boundaries are intended to preserve.
AI did not create the governance problem.
It made the cost of leaving it implicit much harder to ignore.
From Insurance to Capital Investment
The practical implications can be seen across industries.
Consider insurance. An insurer may use AI across underwriting, claims, fraud detection and customer service. Behind an automated recommendation sit organisational judgements about product rules, fairness, acceptable evidence, delegated authority, customer impact, regulatory obligations, risk and when human intervention is required.
The technology may execute those decisions efficiently. But the organisation first needs to establish what position it is actually prepared to rely upon.
A similar issue appears in major capital expenditure.
Traditionally, a board might approve a processing facility, logistics hub or enterprise technology platform based on a business case, risk assessment, procurement strategy and executive recommendation. Yet much of the judgement behind that approval can remain distributed across assumptions about operating conditions, supplier capability, acceptable risk, implementation tolerances, customer impact and circumstances that would require the organisation to stop or reconsider.
In a human operating model, experienced project managers, engineers, procurement professionals and executives can often interpret these assumptions as circumstances evolve.
In an AI-enabled environment, procurement agents may shortlist suppliers, AI systems may evaluate bids, automated workflows may approve variations, digital twins may recommend operating changes and runtime systems may alter production settings.
If the original governing judgement was never made explicit, different systems can begin operating from different interpretations of what the organisation authorised.
The project may remain technically “within control” while gradually moving away from the judgement that made the original investment acceptable.
For Kechagias, a CAPEX approval should not end with a number and a signature. The conditions that made the investment acceptable should be explicit enough for procurement, implementation, AI-enabled operations and assurance to work from the same governing position.
If circumstances materially change, the original approval should not automatically remain sufficient. The issue may need to return to the appropriate authority.
The objective is not more governance everywhere. It is more explicit governance where it matters most.
Leadership Without Authority
The development of Governance Five™ © has also shaped Kechagias’ philosophy of leadership.
His early community work demonstrated that leadership does not always require formal authority. Working with households, community organisations, associations and suppliers meant creating clarity around purpose, participation, evidence, roles and process without directing people toward a predetermined outcome.
That lesson remains relevant inside modern enterprises.
A CEO cannot personally possess all the expertise held by a lawyer, cybersecurity specialist, procurement professional, actuary, risk specialist or AI engineer. Effective leadership is not about pretending to know everything. It is about creating the conditions in which the right expertise can contribute to a judgement that someone with appropriate authority is prepared to stand behind.
This principle also informs his approach to mentoring.
Kechagias prefers helping people understand why a process exists rather than simply instructing them to follow it. When people understand the consequences of a decision, the evidence behind it and where accountability sits, they are better positioned to exercise judgement.
For him, that is the difference between teaching process and developing judgement.
People should be able to challenge assumptions and contribute expertise without every contribution becoming the final decision. Participation and expertise can improve decision quality while final authority remains clearly established.
This becomes even more important as AI becomes more capable. Professionals should use technology to become better informed and more effective without losing sight of the human responsibility behind consequential organisational decisions.
Provenance, Professional Trust and the Path Ahead
Kechagias also places considerable importance on provenance — not simply as a matter of intellectual property, but as a matter of organisational assurance.
As AI governance becomes an expanding professional and commercial field, governments and organisations are being asked to assess an increasing number of frameworks, methods, platforms and governance claims.
Before relying on them, they need to understand what sits behind the proposition: who authored it, where it originated, what problem it was designed to address, how it developed and who remains responsible for its stewardship.
For Kechagias, those questions become more important as governance moves closer to operational and AI-enabled decision-making.
If a method is intended to influence how organisational judgement is formed, translated into implementation and preserved through execution, its provenance should itself be capable of scrutiny.
Provenance matters because organisational reliance depends on trust.
Selected aspects of the work are therefore made public deliberately: to support professional learning, strengthen industry literacy, enable meaningful evaluation and provide a transparent record of authorship, method origin and published provenance. Power Group Purchasing™ maintains that public provenance, publication and stewardship environment so organisations can understand where the work originated, what constitutes the authorised body of work and what they are being asked to rely upon.
That is particularly important for governments, regulated industries and organisations operating across jurisdictions, where assurance may ultimately need to satisfy boards, executives, regulators, auditors, procurement teams, legal advisers and technical assurance functions.
The Governance Formation™ body of work therefore has a traceable developmental history.
Publicly evidenced commercial and community initiatives dating from 2010 provide evidence of the governance practices, operating conditions and foundational principles later codified within the method now known as Governance Five™ ©.
That work was subsequently formally named and codified within the broader Governance Formation™ discipline and expressed through Governance Five™ © for contemporary organisational and AI-enabled environments.
The broader body of work now includes the Governance Formation™ Canon, Practitioner’s Guide, Governance Formation Workspace™ Public Edition™, evaluation materials, professional publications, sector resources and implementation specifications.
Together, these provide a pathway from understanding the governance problem through evaluation and implementation to organisational reliance:
Learn → Evaluate → Acquire → Implement
Organisations can begin with public materials, examine the architecture and reasoning, evaluate its relevance against their own requirements, acquire the appropriate publications or specifications and, where operational application is required, progress to licensed implementation.
This staged approach provides sufficient transparency for meaningful evaluation and assurance while preserving appropriate protection around proprietary method architecture, implementation mechanics and intellectual property.
For Kechagias, that balance matters.
Authorship, provenance, authority and evidence form part of the assurance chain itself.
Where Consequence Requires Governing Judgement
Governance Five™ © becomes most relevant where organisations face consequential decisions, complex projects or programmes involving multiple functions, responsibilities and implementation dependencies.
In those environments, judgement is often distributed across legal, risk, commercial, technical, operational and executive functions. Having governance, controls and approvals is not always the same as having one clear governing position the organisation can confidently implement and rely upon.
Governance Five™ © provides a structured method for forming that position and carrying it forward.
Its breadth works in two directions:
Across the organisation — bringing together the relevant judgement, obligations, consequences and authority.
Along the governance lifecycle — carrying the authorised position into implementation, execution and assurance, and returning matters to the appropriate authority where material change requires renewed judgement.
Technology can govern and enforce what happens within defined boundaries. Governance Formation™ addresses the step before that — how the organisation formed and authorised the governing position those boundaries are intended to reflect.
The value is practical: clearer authority, fewer conflicting interpretations, reduced rework, stronger traceability, improved regulatory readiness and greater confidence that what is implemented reflects what the organisation actually authorised.
As AI and automation increase the speed, connectivity and complexity of execution, that clarity becomes even more important.
The practical question is:
What is the authorised governing position this decision, project or programme is actually relying upon?
A Future Where Governance Enables Capability
Looking ahead five to ten years, Kechagias does not frame the future as people versus AI.
He sees professionals using increasingly capable technology to understand more, test more and act faster, while organisations remain clear about where judgement and authority ultimately sit.
Technology can surface regulatory obligations, analyse scenarios, identify inconsistencies and consequences, verify identity and delegated limits, coordinate models and workflows, govern execution within defined boundaries, capture evidence and support assurance.
What it should not do is independently become the source of the organisational governing judgement those boundaries are intended to preserve.
As AI moves further from recommendation toward action, that distinction becomes increasingly important.
The question is not simply what the technology is capable of doing.
It is:
What position is the organisation actually authorised to implement and rely upon?
The future architecture Kechagias envisages places organisational authority upstream, governance solution architecture translating the authorised governing position into implementation-ready requirements, enterprise technology implementing and preserving that position downstream, evidence throughout the lifecycle, and re-entry to the appropriate human authority when new judgement is required.
That vision captures the broader contribution he hopes Governance Formation™ and Governance Five™ © can make.
The objective is not to add another layer of bureaucracy to already complex organisations. It is to establish a coherent governing position that existing professionals and technologies can work from.
One method upstream. Many technologies downstream. One governing position connecting them.
Technology is increasingly capable of carrying, applying, constraining, testing, observing and evidencing that position.
The organisation must still form it.
For Kechagias, that is the central governance challenge of the AI era.
And his advice to enterprise leaders is direct:
Do not wait for agentic AI, automation or operational complexity to expose a governance gap that was previously manageable while judgement remained implicit. Make the governing position explicit before execution begins.
Explore Governance Formation™ and Governance Five™ © through Power Group Purchasing™
This Callout Section Would be Designed Separately with the working links.
| Resource | Link |
| Practitioner’s Guide — Governance Five™ © | https://powergrouppurchasing.com/practitioner-s-guide—-governance-five-tm-c/ |
| Governance Formation Workspace™ Public Edition™ | https://powergrouppurchasing.com/governance-formation-workspace-tm-public-edition-tm/ |
| Governance Formation™ Publications Centre | https://powergrouppurchasing.com/publications-centre-governance-formation-tm/ |
| Governance Formation™ Canon | https://powergrouppurchasing.com/governance-formation-tm-canon/ |
| Evaluation & Engagement Pathway™ | https://powergrouppurchasing.com/evaluation-and-engagement-pathway-tm/ |
| Public Record Evidence | https://powergrouppurchasing.com/public-record-evidence/ |
| Governance Formation™ / Governance Five™ Background | https://powergrouppurchasing.com/about-us/ |
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Commercial, Risk & Procurement Executive | Governance Solution Architect
Founder of Governance Formation™ | Author of Governance Five™ ©
Power Group Purchasing™
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