Microsoft Copilot Agents Explained: A Business Guide for 2026

Last updated: February 2026

Microsoft has declared 2026 the year of "agent readiness". If you're preparing for the AB-730 or AB-900 certification exams, understanding Copilot agents is no longer optional—it's essential.

This guide explains what agents are, how they work, and what you need to know for your certification journey.

What Are Microsoft Copilot Agents?

According to Microsoft Learn, agents are "specialised AI assistants tailored to specific domains that extend the functionality of Microsoft 365 Copilot."

Think of agents as the apps of the AI era, with Copilot as the interface. While standard Microsoft 365 Copilot responds to individual commands across productivity apps, agents are built for specific business processes and can operate with minimal user input.

Key capabilities of agents:

Respond to and resolve user inquiries in real time
Operate independently based on data and predefined goals
Run complete business processes from start to finish
Adapt and improve over time

How Agents Differ from Standard Copilot

Feature	Standard Copilot	Copilot Agents
Scope	General productivity tasks	Specific business processes
Autonomy	Responds to commands	Can operate independently
Knowledge	Broad organisational access	Focused domain knowledge
Workflows	Assists with tasks	Owns end-to-end workflows

Types of Microsoft Copilot Agents

Microsoft provides several types of agents to suit different needs:

1. Built-in Agents

Microsoft 365 Copilot includes purpose-built agents available out of the box:

Researcher Agent Works within Copilot Chat to synthesise information, brainstorm ideas, and create in-depth content quickly.

Analyst Agent Transforms complex data into clear insights and visualisations directly in Copilot Chat.

Facilitator Agent Manages Teams meetings by taking notes, providing quick answers, and generating summaries with action items.

Interpreter Agent Enables real-time speech-to-speech translation in Teams meetings, supporting nine languages including English, French, German, Spanish, and Japanese.

Project Manager Agent Automates project management in Planner—creating plans, generating status reports, and assigning tasks based on meeting notes.

2. Declarative Agents

Declarative agents are custom agents that use Copilot's orchestrator and foundation models. They run within Microsoft 365 and inherit its compliance and security standards automatically.

Core components:

Custom instructions to shape responses
Custom knowledge connecting to Microsoft 365 data sources
Custom actions integrating with external APIs

Best for: Focused Microsoft 365 scenarios where you want faster implementation with minimal code.

3. Custom Engine Agents

For complex requirements, custom engine agents let you bring your own orchestrator and models. These require additional hosting (typically Azure) and offer advanced capabilities like proactive messaging and agent-to-agent communication.

Best for: Complex workflows requiring custom AI models or deployment outside Microsoft 365.

4. SharePoint Agents

The SharePoint Knowledge Agent helps manage, organise, and get more value from content by making files and sites Copilot-ready. It suggests autofill columns and ensures consistent organisation across libraries.

Real Business Use Cases

Organisations are already seeing measurable results with Copilot agents:

Sales

Microsoft's sales team achieved a 9.4% increase in revenue per seller
Agents summarise CRM activity, draft outreach emails, and recommend next steps
Qualify and engage leads around the clock to drive revenue growth

Finance

Automate invoice processing and expense approvals
Forecast cash flow and detect fraud
Dow uses supply chain agents to automatically process PDF invoices

HR

Screen CVs and schedule interviews
The Employee Self-Service Agent answers policy questions and helps employees understand benefits
Microsoft improved HR answer accuracy by 42%

Customer Support

Resolve cases nearly 12% faster
Handle tier-1 support requests like password resets and software access approvals

Real-World Examples

Pets at Home built an AI agent to detect retail fraud by scanning transaction data for anomalies and duplicate images in claims.

The Estée Lauder Companies created ConsumerIQ to analyse documents, identify trends, and deliver strategic recommendations.

Clifford Chance, a global law firm, uses Copilot to draft emails, track legislation, and ensure compliance.

How to Get Started with Agents

Agent Builder (No-Code)

Agent Builder is the easiest way to create declarative agents in Microsoft 365 Copilot. It offers an interactive AI development experience perfect for quick projects.

Key features:

Build agents in context without any code
No advanced technical training required
Create personalised agents in minutes
Uses natural language to configure agent behaviour

When to Use Copilot Studio

Choose Microsoft Copilot Studio when you need:

Actions that integrate with external services
Department-level deployments
Advanced capabilities beyond basic Q&A
Integration with Microsoft Power Platform

Security and Governance

Microsoft has built robust security into Copilot agents:

All data encrypted in transit and at rest
Data isolation prevents cross-tenant leakage
Persistent label inheritance—new content inherits sensitivity labels from sources
Microsoft Defender monitors tool invocations in real time
Granular control over knowledge sources via Power Platform admin centre

Licensing and Pricing

Option	What's Included	Cost
Microsoft 365 Copilot Chat	Access to Agent Store agents	Included with M365 subscription
Microsoft 365 Copilot Add-on	Full Copilot + custom agent creation	$30/user/month
Copilot Studio (Pay-As-You-Go)	Advanced agent building with Azure	Metered billing

Note: Agents that access shared tenant data generate metered consumption charges via Copilot Studio.

AB-730 and AB-900 Exam Relevance

Understanding agents is critical for both certification exams.

AB-730: AI Business Professional

The AB-730 exam includes a dedicated section on agents worth 35-40% of the total:

Key objectives:

Understand the difference between chat and agent experiences
Know when to use the Agent Store versus creating a new agent
Create an agent using a template
Configure agents with knowledge, instructions, and capabilities
Share agents with team members

AB-900: Copilot and Agent Administration Fundamentals

The AB-900 exam allocates 25-30% to agent administration:

Key objectives:

Configure user access to agents
Create and approve agents
Monitor agent usage, metrics, and lifecycle
Use Microsoft 365 and Power Platform admin centres

Key Concepts to Memorise

Declarative vs Custom Engine Agents - Know when to use each
Built-in agents - Researcher, Analyst, Facilitator, Interpreter, Project Manager
Agent Builder - No-code creation in Microsoft 365 Copilot
Copilot Studio - Low-code platform for advanced agents
Licensing models - Copilot Chat (free tier) vs Copilot add-on vs pay-as-you-go

Decision Matrix: Choosing the Right Agent Type

Requirement	Declarative Agent	Custom Engine Agent
Simple Q&A from SharePoint	Recommended	Overkill
Complex workflow automation	Limited	Recommended
Runs only in Microsoft 365	Yes	Yes + external
Proactive messaging	Not supported	Supported
Automatic compliance	Yes	Manual responsibility
Development effort	Low	Higher

The 2026 Agent Readiness Framework

Microsoft has identified six pillars for successful agent adoption:

Ability for anyone to turn intent into agents - Democratising creation through natural language
Agents that own workflows end to end - Moving from assistance to autonomous management
Power to coordinate agents - Multi-agent systems that collaborate toward shared objectives
Flexibility to control agent models - Support for diverse AI models
Agents that act across systems - Navigation and actions across platforms
Capability to scale without sacrificing control - Enterprise governance and lifecycle management

Frequently Asked Questions

Do I need coding skills to create Copilot agents?

No. Agent Builder in Microsoft 365 Copilot uses natural language—simply describe what you want the agent to do. For more advanced scenarios, Copilot Studio offers low-code tools.

What's the difference between agents and standard Copilot?

Standard Copilot responds to commands across productivity apps. Agents are specialised for specific domains, can access focused knowledge sources, and operate more autonomously.

Which built-in agents are available?

Microsoft 365 Copilot includes Researcher, Analyst, Facilitator, Interpreter, and Project Manager agents. Industry-specific agents for Sales, Service, and Finance are also available.

Do agents require a Copilot licence?

Access to Agent Store agents is included with Microsoft 365 Copilot Chat (no additional cost). Creating custom agents requires a Copilot add-on licence or Copilot Studio subscription.

How do agents handle security?

Agents inherit Microsoft 365 compliance and security standards. Data is encrypted, sensitivity labels carry forward, and Microsoft Defender monitors agent actions in real time.

Start Practising Today

Ready to test your knowledge of Copilot agents? Examinotion offers practice questions specifically covering agent topics for the AB-730 and AB-900 exams.

Our questions are based on official Microsoft exam objectives and include detailed explanations to help you understand not just the correct answer, but why it's correct.