In the original publication “Ethical use of data in a digital economy”, we framed the debate on the need for data, technology and industry regulation to come together and put the customer, their data and the outcomes at the core of all activity. Our latest publication with UK Finance, “Ethical principles for Advanced Analytics and AI (AAAI) in Financial services” takes this further, by providing industry principles to support organisations in their drive to innovate in a safe and ethical way.
The rise in data ethics
Over the last few years, there has been a shift in organisations moving towards becoming data and insight-driven - delivering a multitude of benefits including enhanced customer experiences, cost saving and identification of new growth opportunities. The pandemic and subsequent deep recession has accelerated this drive.
According to a report by Forrester Consulting on behalf of KPMG, 94 percent of businesses believe that adopting AI is the key to competitive advantage. However, close to the same percentage (92 percent) question the trustworthiness of the data and analytics they receive.
In realising the opportunities of AAAI, organisations, regulatory authorities and the public are becoming increasingly aware of the risks AAAI could present, as well as the risks it accentuates. The industry must consider broader societal implications and understand and address the limitation of the data and algorithms used. As more advanced techniques are adopted and decisions become increasingly automated, a sharp focus must be applied both to the purpose and context in which AAAI is applied and the outcomes and impact on customers and wider society.
Why is a data ethics framework needed?
We believe that a data ethics framework could support Financial Services in achieving three core objectives:
- Maintain client trust by embedding human autonomy and human rights into all decisions informed by AAAI
- Ensure decisions are fair and enable AAAI subjects to understand decisions informed by it
- Ensure that innovation and advancement in AAAI is undertaken in a safe and trusted manner
However, a breach of data ethics could result in losing the client’s trust, as well as having a negative impact on brand reputation. Thus, a data ethics framework can help satisfy ever-increasing customer demands, whilst still considering ethical standards and public expectations.
What are the benefits of having a data ethics framework?
Embedding a data ethics framework will assist in upholding a trusted reputation and will provide a means to promote to customers and clients that their data and the use of advanced analytical techniques are being used and applied in a safe and ethical manner. By doing so, it can support innovation in market leading AAAI products and services that enhance customer, client and public experience by providing a framework that is relevant to your organisation and enhancing commitment to regulatory responsibilities.
How can KPMG help you?
We can support you end-to-end throughout the AAAI lifecycle to define and embed a data ethics framework into your organisation. There are three core phases we can offer support in:
- Review and assess – We can help you in conducting assessments on your current compliance with both internal and external rules and policies, through to ascertaining the level of risk exposure from the AAAI you are using.
- Design and implement – We can help to support the design and development of an ethical framework, to include principles, governance, an operating model and training and culture. This will support the design, development and testing of ethical and explainable AAAI, as well as the validation of AAAI that has already been developed
- Run and manage – Once data ethics has been embedded into your data culture, it is important that ethical compliance is maintained – from having an established process for testing and monitoring AAAI throughout its lifecycle, through to implementing appropriate escalation processes and exceptions management.
Our UK Finance-KPMG co-authored report on the ethical principles for advanced analytics and artificial intelligence in financial services provides details of five ethical principles, with supporting considerations of each. Whilst these principles are positioned to support financial services, we recognise that these principles could be adapted and adopted for other consumer-facing applications across sectors.
Adoption and application of ethical principles will enable purposeful innovation in AAAI supporting both economic growth and increasing value to consumers whilst maintaining public trust.
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