So why is AI a game changer in Risk
Management? AI can teach computers to identify potential risks. Traditional
methods could not handle the amount of data that is used to take a pro-active
approach to managing risk.
Gail Danvers - Director of PSD's Banking & Financial Services sector,
along with Charlotte Hackett - Senior Consultant, attended the Institute
of Risk Management(IRM) Artificial Intelligence
(AI) in Risk Management forum. This was hosted by Imperial
College Business School this October and gathered experts in the
field of AI technology from Imperial College, Google, Microsoft, IBM and
4th IR. The event was chaired by Raza Sadiq, Chair of the IRM's ERM
in Banking and Financial Services Sector Interest Group (SIG).
discussion focussed on how Artificial Intelligence can and will transform risk
management in the financial services industry. It touched on the benefits of a
symbiotic approach of using artificial and human intelligence to create greater
human outcomes, not just across financial services but in a broad range of
sectors. The ethical implications of the democratisation of AI and its
potential wider impact to society were not forgotten either.
90% of the world's data has been created in just the
last two years
Grace Brasington, Vice President of IBM and a former Chief Compliance
Officer, spoke about how 90% of the world's data has been created in just the
last two years, and explained how we can intelligently use that data. The
concept around using AI to inform Risk Management involves using machine
learning and cognitive learning to make better informed decisions, primarily
in Anti Money Laundering, Conduct Risk, KYC and Surveillance. The consensus
view was that by using artificial and human intelligence symbiotically the
benefits for all were far greater as you eliminate human cognitive bias.
So why is AI a game changer in Risk Management? AI can teach
computers to identify potential risks. Traditional methods could not handle
the amount of data that is used to take a pro-active approach to managing
risk. If 'cognitive computing' wrongly identifies something as a potential
fraud, and a human determines it is not for certain reasons, the computer
then learns from that decision, becoming more and more intelligent, and
therefore becomes increasingly capable of detecting irregularities and complex
This was a thought-provoking and informative event, and a
fantastic opportunity to meet experts in this field and senior executives
within the Risk Management and Financial Services network.