Good and bad A.I.

Ultimately, artificial intelligence / synthetic data can drive forward data gathering, risk detection and organisational efficiency.

AI also poses a risk, according to the Financial Conduct Authority (FCA).

Risks cited by FCA include unintended bias in AT data that itself lacks diversity therefore produces misleading results, which ultimately can have knock-on risk to integrity of markets and consumer safety.

FCA is keen for AI to be used in a safe, ethical way – and is considering how much regulation is needed to achieve that. (“Building Better Foundations in AI” FCA 24 Jan 2023).

The financial services sector may have to prove “responsible adoption” of AI technology. 

The FCA is consulting into whether more regulation is needed for financial services firms, and will shortly publish a feedback statement.   Ahead of feeding back, FCA has shouted out to financial firms that:

1. effective governance and risk management are “essential” to the use of AI, and
2. good governance must be teamed with healthy organisational culture.

We think, that a good strategy for firms – ahead of FCA feeding back – is for company Boards to sense-check ‘data driven’ decision making, in a human way, so Boards can be confident of inclusion / diversity by their own ethical barometer as a second pair of eyes, over raw data.

By practising application of culture- consistency checks, in board meetings generally, firms will be more ready to interpret, use and deploy AI in ethical and responsible ways.

Board Originator prompts and stores your culture journey – and brings you automated risk management – ready for anything.

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