Artificial intelligence has the potential to bring “significant benefits” to sectors like agriculture, education and healthcare but risk professionals say better regulation is needed, according to a new report from World Economic Forum. A survey by market research firm Gartner shows that 52% of companies using AI report that risk factors are a critical consideration when evaluating new AI use cases.
55% of organizations that have previously deployed AI always consider AI for every new use case that they are evaluating, the Gartner survey says.
“An AI-first strategy is a hallmark of AI maturity and a driver of increased return on investment,” says Erick Brethenoux, VP Analyst at Gartner.
“However, AI-first does not mean AI-only. While AI-mature organizations are more likely to consider AI for every possible use case, they are also more likely to weigh risk as a critical factor when determining whether to move forward.”
The Forum’s mid-year Chief Risk Officers Outlook (CRO) warns that risk management is not keeping up with the rapid advances in AI technologies.
Three-quarters of the CROs surveyed said that the use of AI poses a reputational risk to their organization, while nine out of ten said more needed to be done to regulate the development and use of AI.
Almost half were in favour of pausing or slowing down the development of new AI technologies until the risks are better understood.
AI “creates a complex and uncertain environment in which organizations must operate,” the report says.
“Recent months have seen a sharp increase in discussion of technology-related risks, particularly in the context of a surge of interest in the exponential advances being made by generative AI technologies.”
Among the biggest risks identified by the CROs is malicious use of AI. Because they are easy to use, generative AI technologies can be open to abuse by people seeking to spread misinformation, facilitate cyber attacks or access sensitive personal data.
No one, the report says, fully understands how AI content is created. This increases the risks highlighted by the CROs of inadvertent sharing of personal data and bias in decision-making based on AI algorithms.
The lack of clarity about how AI works also makes it hard to anticipate future risks, the report shows, but the CROs say the areas of business most at risk from AI are operations, business models and strategies.
The surveyed agreed that the development of AI was outpacing their ability to manage its potential ethical and societal risks. 43% said the development of new AI technologies should be paused or slowed until its potential impact was better understood.
Over half of the CROs said they understood how regulation might affect their organization and 90% said that efforts to regulate the development of AI needed to be accelerated.
The Global Risks Outlook Survey was conducted among the Forum’s CRO community, which includes risk professionals from a wide range of multinational companies covering fields including technology, financial services, healthcare, professional services and industrial manufacturing.
The Gartner survey comprises organizations in the U.S., France, the U.K. and Germany that have deployed AI.
AI-mature organizations were 3.8 times more likely to involve legal experts at the ideation phase of an AI project’s life cycle.
“There is uncertainty around the ethics and legality of various AI tactics, as well as a fear of violating privacy regulations,” said Brethenoux. “Organizations that are more experienced with AI do not want to be told they’ve crossed a line once they are further along in the process of developing an AI use case.”
When evaluating the return on AI investment, 52% of AI-mature organizations focus on a combination of technical and business metrics to assess ROI. In less mature organizations, technical metrics are most often used to measure the value of AI use cases.
More AI-mature organizations – 41% compared with 24% of all others – use customer success-related business metrics to estimate ROI. Furthermore, 47% of AI-mature organizations cite customer service as one of the top three business functions benefiting from AI, compared with 34% of others, the Gartner survey shows.