Chief Risk Officers’ current challenges in Financial Services and managing Artificial Intelligence Q&A

Listen back to our webinar, where our prudential risk and data specialists discussed how firms can navigate current risk management challenges, including how firms can integrate AI effectively into their existing risk management framework and navigate potential regulatory requirements.

Key summary

The evolving risk universe, particularly in relation to technological advancements presents real challenges for Risk Functions, requiring agile, pro-active approaches to help firms navigate change and uncertainty. This also requires adoption of new ways of considering risks, and new skill sets and expertise to help identify and manage these risks.

The adoption of AI, including increasingly more sophisticated and complex forms of the technology, requires firms to develop a clear strategy, supported by risk appetite and risk management principles to ensure the opportunities and risks are appropriately considered.

Risk functions should therefore ensure their firms are focused on the following key areas as part of their AI plans:

• AI strategy and governance: Establishing a clear strategy for AI adoption supported by robust AI governance framework
• AI culture: recognise the need for changes in culture, ways of working and thinking about risk given the nature of AI
• AI readiness: Ensure data quality, infrastructure scalability, and compliance integration is core to any plans.
• AI monitoring and oversight: Conduct ongoing AI governance reviews to monitor AI performance, identify emerging risks, and ensure compliance with evolving regulatory obligations.