New Technologies in Managing Corruption and Compliance Risks: a Practitioner’s Perspective.

Some say that data is the new oil. With the digital trace we all leave on a daily basis its volume is growing exponentially. The more data is generated, the harder it gets for the human workforce to handle it. Intelligent machine systems like AI, machine learning, natural language processing, and big data analytics will assume this burdensome task transforming our lives for the better. At least, that’s what the promise is. Compliance profession is no exception – new technologies are expected to bring massive operational efficiencies to Compliance & Ethics programs. Digitalization leads to less manual interactions reducing the red tape and corruption risk. The use of biometrics helps to detect fraudulent identities used by criminals to launder money or commit other kinds of bank frauds. Other immediate benefits of AI-based solutions include automating ordinary compliance tasks, identifying patterns and correlations too complex to be picked up by traditional anomaly detection, and filtering out false positives. That would result in a surge in operational effectiveness and more informed decision-making based on data-driven insights. While the opportunities are considerable, they come at a price. Managing risk associated with technology is an increasingly important strategic issue facing the private sector. Poor data quality, lack of explainability, inadequate controls, validation or governance, and biases in data and algorithms leading to poor decisions are among the major areas of concern. Besides, it may become harder and take longer to attribute accountability to individuals in a workplace dominated by big data and AI. The boards must assume the responsibility to manage the technology carefully to avoid unintended consequences, and it is likely a prerequisite for entering the next stages of technology deployment.