In this episode of FRT, Julia Sterling, Vice President in Business Development for Big Data & Advanced Analytics at Commerzbank, discusses artificial intelligence, the EU’s AI Act, and the connection to data policies – particularly cross-border policies.
Data enables AI. Without large sets of data representing multitudes of customer activities, AI models have limited information to synthesize and could find their outputs constrained, of relevance to only small groups of consumers, or lacking the accuracy enabled by robust data sets.
Policy considerations for AI are, thus, inextricably linked to data policies. Being able to trust the results generated by AI models of all types is essential to their broad deployment; larger data sets improve accuracy. As a result, training data for AI is an emerging focus of policy development. Policy considerations grow an order of magnitude more complex when dealing with cross-border data flows. As one approach, international definitions of adequate data protections in a destination country may follow those laid out in July 2023’s EU-U.S. Data Privacy Framework. Few jurisdictions have established binding regulations for AI, but many more are in the development process. The EU and China’s interim measures merit attention, while Japan, which has settled on a guardrails approach, presents an alternate vision for regulating this fast-developing technology.
As more industries embrace AI, the effectiveness and dependability of AI models is of increasing importance. The first step in establishing the necessary trust and transparency is to responsibly construct the data universe that AI models can access. The financial services industry has much to share about responsible collection, storage, and use of customer data. The industry will need to consider both tracks of policy development and can make valuable points to regulators in their home jurisdictions about the intersection, as these policies may not be taken up holistically. Julia discusses these aspects of the development of AI policy and more in this episode of FRT, including a piece published by Commerzbank on the European AI Act early in 2023.