World’s largest banks fail to report on responsible AI
A third of the world’s largest banks across the US and Europe are failing to publicly report on their approaches to responsible AI, according to research from intelligence platform Evident.
The organisation analysed millions of data points to assess how banks report against four primary areas of responsible AI: creation of AI leadership roles, publication of ethical principles, collaborations with other organisations and publication of original research.
While AI is already used by banks for many critical processes – from authenticating customers to risk modelling – eight of the 23 largest banks in the US, Canada and Europe currently provide no public responsible AI principles.
Evident said that SVB’s collapse [the UK arm of which was bought by HSBC earlier this month], First Republic’s bailout and Credit Suisse’s rescue by the Swiss Government all highlight the issue of banking sector transparency and the need for many banks to overhaul and improve their approach to risk management.
“AI could be the key driver of better risk management and decision-making across the global banking sector,” said Alexandra Mousavizadeh, Evident co-founder and CEO.
“However, it is vital that banks develop AI in a way that meets high ethical standards and minimises unforeseen consequences.
“Our research found a worrying lack of transparency around how AI is already used – and how it may be used in the future – which could damage stakeholder trust and stifle progress,” Mousavizadeh warned.
The Index found that Canadian banks were the most transparent on responsible AI reporting, with European banks the least.
Only three banks – JPMorgan Chase & Co, Royal Bank of Canada and Toronto-Dominion Bank – provided a demonstrable strategic focus on transparency around responsible AI.
Each of these showed evidence of creating specific responsible AI leadership roles, publishing ethical principles and reports on AI, and partnering with relevant universities and organisations.
“In this highly regulated sector, the reality is that many institutions are taking proactive steps to address AI concerns and developing internal programmes to address responsible AI,” Mousavizadeh continued.
“The problem is that there is no standard for responsible AI reporting, and many banks withhold the details of their efforts. At this critical time for the sector, the banks need to show leadership and start reporting publicly on their AI progress,” he added.
Evident also suggested that approaches to hiring AI talent differ regionally. North American banks are more likely to hire specific responsible AI roles, usually from Big Tech firms, and European banks tend to lead responsible AI within their data ethics teams.
Evident co-founder Annabel Ayles said: “It’s perhaps unsurprising that two Canadian banks, RBC and TD, perform well as the country itself facilitates a lively AI ethics conversation. The top-ranking banks also tend to have strong research hubs, which we believe helps address the technical challenges of implementing ethical standards into AI.
“It’s similarly clear that banks are trying to work out the links between responsible AI and data ethics. European banks which view responsible AI through a lens of data ethics, potentially due to the dominance of GDPR legislation, are perhaps missing a trick by not creating AI-specific roles and thinking holistically about the broader risks posed by AI,” she added.
Earlier this month TechInformed talked to Ivana Bartoletti, data privacy officer at WiPro and author of An Artificial Revolution – On Power, Politics and AI: about the ethics and gender bias in generative AI chatbots such as ChatGPT.
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