Moody's’ Post

I found 2 massive opportunities in my last 12 months of working in the AI safety space: AI safety lacks funding, but offers many opportunities. It is possible to do well for humanity AND earn money for investors and entrepreneurs because: Every company is turning into an AI enabled company, regardless of size. How to manage that safely is critical. 95% of 1b+ revenue companies surveyed by KPMG in the US don’t have a mature AI governance process. This means they need help with figuring out how to use AI safely, responsibly and reliably. I estimate that currently less than 0.5% of AI capability development is spent on safety based on last years figures. The below report (which I had a very small part in) maps out the opportunities and current landscape. Useful read for investors and for people who are interested to build in this space. Huge thanks to Kristian Rönn, Joshua Williams and the broader team for recognising the need for this report and making this happen. If you are interested in details dm me. #ai #aisafety #responsibleai

𝑇𝑟𝑎𝑑𝑖𝑡𝑖𝑜𝑛𝑎𝑙 𝑟𝑖𝑠𝑘 𝑚𝑎𝑛𝑎𝑔𝑒𝑚𝑒𝑛𝑡 𝑎𝑝𝑝𝑟𝑜𝑎𝑐ℎ𝑒𝑠 𝑠𝑡𝑟𝑢𝑔𝑔𝑙𝑒 𝑡𝑜 𝑘𝑒𝑒𝑝 𝑢𝑝 𝑤𝑖𝑡ℎ 𝑡ℎ𝑒 𝑓𝑎𝑠𝑡-𝑝𝑎𝑐𝑒𝑑 𝑎𝑛𝑑 𝑐𝑜𝑚𝑝𝑙𝑒𝑥 𝑛𝑎𝑡𝑢𝑟𝑒 𝑜𝑓 𝑐𝑎𝑝𝑖𝑡𝑎𝑙 𝑚𝑎𝑟𝑘𝑒𝑡𝑠. Manual processes and outdated models lead to missed risks and inefficiencies, costing firms both time & money. Here is how I think Generative AI offers a transformative approach to risk management 𝟏. 𝐄𝐧𝐡𝐚𝐧𝐜𝐞𝐝 𝐑𝐢𝐬𝐤 𝐀𝐬𝐬𝐞𝐬𝐬𝐦𝐞𝐧𝐭 𝐚𝐧𝐝 𝐌𝐨𝐝𝐞𝐥𝐢𝐧𝐠 𝑫𝒂𝒕𝒂 𝑨𝒏𝒂𝒍𝒚𝒔𝒊𝒔: AI analyzes vast amounts of market data, news, & regulatory filings to detect early warning signs of emerging risks. 𝑺𝒊𝒎𝒖𝒍𝒂𝒕𝒊𝒐𝒏𝒔: Runs simulations to forecast potential impacts under different scenarios, optimizing risk management strategies. 𝑨𝒄𝒄𝒖𝒓𝒂𝒄𝒚: Achieves 30-50% improvement in predicting risk factors by continuously refining models. 𝑨𝒖𝒕𝒐𝒎𝒂𝒕𝒊𝒐𝒏: Automates data collection for counterparty risk assessments, generating early-warning signals based on trigger events. 𝟐. 𝐅𝐫𝐚𝐮𝐝 𝐃𝐞𝐭𝐞𝐜𝐭𝐢𝐨𝐧 𝐚𝐧𝐝 𝐏𝐫𝐞𝐯𝐞𝐧𝐭𝐢𝐨𝐧 𝑷𝒂𝒕𝒕𝒆𝒓𝒏 𝑹𝒆𝒄𝒐𝒈𝒏𝒊𝒕𝒊𝒐𝒏: Analyzes transaction data to identify irregularities and patterns indicating fraud. 𝑨𝒈𝒊𝒍𝒊𝒕𝒚: Detects nuanced risk indicators, becoming increasingly agile at recognizing fraudulent tactics. 𝑬𝒇𝒇𝒊𝒄𝒊𝒆𝒏𝒄𝒚: Reduces false positives by up to 30% compared to rules-based systems, saving significant costs. 𝟑. 𝐑𝐞𝐠𝐮𝐥𝐚𝐭𝐨𝐫𝐲 𝐂𝐨𝐦𝐩𝐥𝐢𝐚𝐧𝐜𝐞 𝐚𝐧𝐝 𝐑𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠 𝑨𝒖𝒕𝒐𝒎𝒂𝒕𝒊𝒐𝒏: Tracks regulatory changes and modifies controls or develops new ones automatically. 𝑷𝒐𝒍𝒊𝒄𝒚 𝑴𝒂𝒏𝒂𝒈𝒆𝒎𝒆𝒏𝒕: Automates drafting and updating policies to reflect changing requirements. 𝑹𝒆𝒑𝒐𝒓𝒕𝒊𝒏𝒈: Generates automated reports on risk and compliance, including ESG sections of annual reports. 𝟒. 𝐂𝐥𝐢𝐦𝐚𝐭𝐞 𝐑𝐢𝐬𝐤 𝐌𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭 𝑰𝒏𝒔𝒊𝒈𝒉𝒕 𝑮𝒆𝒏𝒆𝒓𝒂𝒕𝒊𝒐𝒏: Draws insights from multiple lengthy reports and distills answers from source materials. 𝑬𝒗𝒂𝒍𝒖𝒂𝒕𝒊𝒐𝒏: Generates syntheses of counterparty transition plans, comparing them against actual emissions to evaluate progress. 𝑻𝒓𝒆𝒏𝒅 𝑨𝒏𝒂𝒍𝒚𝒔𝒊𝒔: Identifies market trends and environmental impact to uncover green investment opportunities. 𝐂𝐡𝐚𝐥𝐥𝐞𝐧𝐠𝐞𝐬 𝐚𝐧𝐝 𝐂𝐨𝐧𝐬𝐢𝐝𝐞𝐫𝐚𝐭𝐢𝐨𝐧𝐬 𝑹𝒆𝒈𝒖𝒍𝒂𝒕𝒊𝒐𝒏𝒔: Need for clear regulations and governance standards for AI in finance. 𝑬𝒕𝒉𝒊𝒄𝒔: Concerns around fairness, accountability, transparency, and potential biases in AI models. 𝑺𝒆𝒄𝒖𝒓𝒊𝒕𝒚: Robust data governance, security measures, and human oversight are essential. 𝑻𝒂𝒍𝒆𝒏𝒕: Requirement for specialized AI talent and addressing potential workforce disruptions as routine tasks get automated. By leveraging GenAI responsibly with human expertise, firms can significantly improve efficiency and effectiveness. How is your firm integrating AI into its risk management? #ai #genai #riskmanagement #financialmanagement #investment

📣 Announcement: Just last month we released the widely-anticipated, first-of-its-kind market sizing report on the burgeoning Global AI Assurance Technology (AIAT) market❗ An indispensable new approach to risk management is rapidly emerging. In response to accelerating AI adoption, both legislative and business imperatives demand modernised GRC approaches for a world embedded with AI. To address this demand, a new industry is emerging: AIAT is the software, hardware, and services that enable organisations to more effectively, more efficiently, or more precisely mitigate the risks of AI. Risk & Reward: The 2024 AI Assurance Technology Market Report aims to unpack the intricacies of this nascent market, exploring the evolving landscape of risk management in the age of AI, the pressing need for innovative compliance-enabling solutions, and the market opportunities that await proactive stakeholders. Organised into five sections, preceded by an executive summary, the report navigates through [Ch.1] The Age of AI, [Ch.2] Risk Management in the Age of AI, [Ch.3] The AI Assurance Technology Landscape, [Ch.4] AI Assurance Technology Market Forecasts, and culminates with concluding messages in [Ch.5] Navigating the Risks & Rewards. Visit 💻 https://aiat.report for: • Report highlights on our website landing page, • A view-on-web online reading interface, and • A downloadable 9-slide summary, or the full 110-page report! Questions and comments can be directed to: 📧 [email protected] Joshua Williams, Kristian Rönn, Jakob Graabak, Bahadir Sirin, Sarah Weiler, Emma Gonzales-Puell, Edson Reistad, Kuil Schoneveld, Cyprien Duhamel, Cameron Tan, Berke Celik, Marie-Alix Depuydt, Samuel Härgestam, Nick Fitz, Mike McCormick, Dom Vinyard, Erik Engellau-Nilsson, Vishal Maini, Sara Rywe, Magnus Hambleton, David Marriage, David Langer, Brandon Goldman, JueYan Zhang, Jacob Wulff Wold, Torran Evans, Daan Juijn, Oliver Guest, Oscar Delaney, Nicolas Miailhe, Conrad Helminger, Vilhelm Skoglund, Lowe Lundin, Ben Bucknall, Gábor Szórád, Deric Cheng, Michael Aird, Lennart Heim, Tim Shavers, Connor Dunlop, Jonathan Happel and thank you to the many-many others that contributed to this process!

A must-read for anyone wanting to understand the potential and dynamics of the AI Safety market in the years to come. Very happy to see PRISM Eval featured. It is going to be crucial to see steady investment in AI Safety if we are to realize the promise of GenAI at 1.5 trillion USD at least by 2030. Currently the AI Safety market hovers around 1.3B USD but is projected to double year after year between now and 2030 to reach 276B USD at that point. From a ratio perspective, a 20% investment on safety seems reasonable given the promise of the technology... and its well documented risks stemming predominantly from the "black box problem". What I am seeing since the beginning of the year leading PRISM Eval is a large number of industrial players testing and experimenting on a small set of use cases (primarily knowledge management)... and remaining cautious in their industrialization pathways mostly because of lack of safety and robustness of GenAI set up integrating foundation models. This seems to confirm the need for frictionless red teaming and blue teaming solutions to enable more deployment at scale and across a much larger set of use cases.

🚀 Exciting Insights Ahead! 🚀 Read my latest blog article, "Integrated Risk Management in the Digital Era: Employing IRM Technology for AI Challenges." Dive deep into the recent comprehensive survey by AI Impacts and discover the critical role of Integrated Risk Management (IRM) in navigating the digital risks associated with AI's rapid evolution. 🔍 Key Highlights: 1. Understand the urgency of adopting IRM technology. 2. Explore strategies for proactive risk identification and rapid response to AI risks. 3. Learn how IRM provides a comprehensive approach for AI integration and regulatory compliance. 4. Gain insights into managing third-party AI risks and aligning IRM disciplines with AI advancements. This article is a must-read for anyone looking to stay ahead in the digital era and effectively manage the complex landscape of AI risks. 📅 And don't forget, join me on January 18th for the Risk@Work session where I'll delve further into these topics and discuss the five stages of the Digital Risk Cycle. It's an opportunity you won't want to miss! Reserve your spot for the webinar here: https://bit.ly/3TTrmut #DigitalRisk #IRM #AIChallenges #RiskManagement #Riskonnect #RiskAtWork #WheelhouseAdvisors

AI and Risk Management: Strengthening Financial Resilience In the realm of finance, risk management is crucial for safeguarding assets and ensuring long-term sustainability. Traditional risk assessment methods often struggle to keep pace with the complexity and interconnectedness of modern markets. Enter AI-powered risk management, revolutionizing how businesses identify, assess, and mitigate risks. AI algorithms analyze vast amounts of data from diverse sources, including market trends, customer behavior, and economic indicators, with unparalleled speed and accuracy. By detecting patterns and correlations that human analysts might miss, AI enhances risk prediction and scenario analysis, empowering businesses to proactively manage potential threats. Moreover, AI facilitates dynamic risk modeling and simulation, enabling real-time adjustments to risk strategies based on evolving market conditions. This agility not only enhances responsiveness but also strengthens financial resilience in the face of uncertainty. Embracing AI in risk management isn't just about managing risks; it's about transforming risk into opportunity. By harnessing AI's predictive capabilities, businesses can navigate volatile markets with greater confidence, seize strategic advantages, and drive sustainable growth. Let's embrace the power of AI in risk management, knowing that innovation isn't just about technology—it's about empowering businesses to thrive amidst uncertainty and complexity. Together, let's harness AI to unlock new possibilities and shape a future where resilience and agility define financial success. f-ai.in/get-started . . . . . #AIAccountant #SmartAccounting #AccountingAI #FintechAI #AutomatedAccounting #AIInFinance #SmartFinance #AccountingTechTrends #DigitalAccounting

--- **AI: Transforming Third-Party Risk Management in Business** The integration of Artificial Intelligence (AI) is revolutionizing third-party risk management, turning challenges into opportunities for enhanced security and efficiency. 1. **Automated Risk Assessment**: AI streamlines the evaluation of third-party risks by analyzing vast datasets rapidly, identifying potential red flags that might be missed manually. 2. **Continuous Monitoring**: Unlike traditional methods, AI offers real-time monitoring of third-party activities. This constant vigilance helps in quickly detecting and responding to any changes in risk profiles. 3. **Predictive Insights**: AI doesn't just assess current risks; it predicts future vulnerabilities. By leveraging predictive analytics, businesses can anticipate and mitigate risks before they manifest. 4. **Enhanced Due Diligence**: AI-powered tools delve deeper into third-party backgrounds, financial stability, and compliance history, providing a more comprehensive due diligence process. 5. **Cost Efficiency**: By automating complex processes, AI reduces the labor and time costs associated with third-party risk management, allowing teams to focus on strategic decision-making. The power of AI in revolutionizing third-party risk management is undeniable. It's not just changing how we manage risks; it's redefining the standards of security and efficiency in our interconnected business world. #AI #RiskManagement #Innovation #ThirdPartyRisk #BusinessEfficiency

In today's rapidly changing business landscape, having a robust risk management framework is crucial for any organization striving to achieve its goals. A well-structured risk framework helps identify, assess, and mitigate potential threats, ensuring the company's resilience and stability. By proactively managing risks, organizations can safeguard their assets, enhance decision-making, and build stakeholder trust, ultimately paving the way for sustained growth and success. Moreover, the integration of AI into risk management processes is revolutionizing the way we approach these challenges. AI-driven insights provide predictive analytics, enabling companies to anticipate risks before they materialize. This technological advancement allows for real-time monitoring and response, ensuring that organizations remain agile and adaptive in the face of uncertainty. As we continue to navigate complexities, leveraging AI within risk frameworks not only enhances efficiency but also empowers organizations to innovate and achieve strategic objectives with confidence. #RiskManagement #AI #BusinessGrowth #Innovation

You are invited to attend this CPE webinar: Unleashing the Potential of AI and Technology in Risk Management on Thursday July 25th at 1pm Eastern. Artificial intelligence (AI) is emerging as a powerful tool that enables a more efficient approach to risk management and compliance. By unleashing the potential of AI, your organization can transform challenges into opportunities, driving growth, resilience, and and strategic decision-making. Save your spot to learn more! https://lnkd.in/eBSyscF2