UBS firmly places AI at the core of its strategy.

UBS Embeds AI into Non-Financial Risk Pieces: A Look Into the Bank’s Risk Framework

Risk management has always been a dark art in the financial industry. But with the rise of conversational AI chatbots in general conversation, it’s hard not to feel a sense of uncertainty. While key tech experts are voicing concern that AI could lead to human extinction, UBS is taking a different approach by embedding it into the bank’s risk framework. In its most recent quarterly report, UBS indicated that the use of AI and machine learning have found their place in the non-financial risk piece of the risk management and control section, which opens up new questions related to AI algorithms, data life-cycle management, data ethics, data privacy, and security, and records management.

While there are no specifics on how to mitigate the AI risk, UBS seems to be enhancing and implementing the required frameworks designed to ensure proper controls are in place to meet regulatory expectations. The decision to look more closely at the AI algorithms was identified during the regular risk assessment process, but it remains unknown what the bank believes constitutes a fair or unfair algorithm.

Considering AI poses a significant threat to organisations across the globe, UBS’s move to integrate AI into its non-financial risk pieces of the risk management and control section comes as no surprise when the use of data-driven advisory processes and machine learning is continually gaining attention. The move indicates that the bank is proactive, preparing for AI’s risks and opportunities.

Editor Notes:
There are lots of uncertainties when it comes to AI’s impact on businesses. It’s always better to be safe than sorry, and integrating AI into the risk management framework is one way to mitigate the dangers. To stay ahead of the game in AI risk management, businesses must continually update their risk assessment methodologies and frameworks. GPT News Room is a great platform to stay updated on the latest AI tech news.

Keywords: AI, UBS, risk management, non-financial risk, machine learning, risk assessment.

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