June 5, 2026 4:31 pm EDT
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Microsoft uses a lot of AI agents. To help manage them, it’s starting to think of them like human employees.

CEO Satya Nadella said the software giant is figuring out what kinds of tools and policies it needs to oversee all the agents it’s created. That includes giving agents specific permissions for what they can and cannot access within the company, as well as ways to audit their work, he said.

“You need to give them identities, you need to give them sandboxes, then you need to set policies to govern them,” Nadella told Reid Hoffman in an episode of the “Possible Podcast” posted on Friday.

During the discussion, Hoffman also said that after 10 years, he’d be leaving Microsoft’s board to return to what he called “founder mode.”

While companies are spending vast sums to adopt AI, many are still figuring out how their AI agents will work with their human employees. Figuring out how to manage AI agents represents a particularly tough problem.

It’s a challenge that Nadella himself has dealt with, he told Hoffman. The Microsoft CEO said that he often runs 100 AI coding agents at once, and guiding each through a chat interface is tough. “The cognitive load on me managing this is so high,” he said.

Microsoft has created Agent 365, a suite of tools that includes Entra, its digital identity and network access product, as well as Purview, which the company uses to label data AI agents create, he said.

“I think security, containment, managability, and observability is the way we’re going to have confidence around these agents,” Nadella said.

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