Tech-tonic Shift: PreView Examines Seismic Risks Wrought by Technology

Jason Daily, Managing Director Risk and Compliance

In October 2017, Saudi Arabia granted citizenship to a robot with facial features designed to look like the late British actress and humanitarian, Audrey Hepburn. The largely ceremonial gesture made the humanoid, named Sophia, the world’s first robot to be granted legal rights. Advances in artificial intelligence (AI), and technology in general, are coming at an increasing rate, creating far-reaching opportunities and risks with implications for education, regulation and even investments. The January 2018 edition of Protiviti’s PreView newsletter examines these opportunities and risks as part of an ongoing series that focuses on the defining issues of our time from a business perspective.

PreView is a “big picture” publication that focuses on macro-level emerging risks, classified according to the World Economic Forum’s five global risk categories – economic, technological, environmental, societal and geopolitical. Protiviti’s Risk and Compliance Solutions team scans the risk landscape and provides informed insights on matters they believe have the potential to fundamentally change the profile portrayed in one or more of those risk categories. Below is a synopsis of topics in the latest issue of PreView.

Artificial Intelligence

The February 2017 edition of PreView focused on AI and machine learning as a key aspect of the new industrial revolution. This month’s edition provides a progress report on the march of AI and how the picture has continued to evolve since then. For businesses, the efficiencies of using AI have been made increasingly apparent by its successful application across an expanding range of industries. For consumers, AI has moved beyond being a luxury for the tech-savvy to become a driving force in enabling an increasingly fast and convenient lifestyle, albeit at the price of some personal privacy. Business leaders and individuals alike must now ask themselves: What risks does the recent acceleration in AI development and applications pose to our business models, our privacy, and our lives as a whole?

Gender Imbalance in Tech

In a technology-driven world, it makes sense that the job opportunities of the future will skew toward science, technology, engineering and math (STEM). The U.S. Chamber of Commerce estimates there will be 6.6 million STEM jobs created over the next 10 years. Women make up half of the total U.S. college-educated labor force, yet they account for less than one-third of employees in the science and engineering workforce. The gender imbalance in STEM is a growing concern. Women’s participation in computer-related occupations has declined steadily from a high of 36 percent in 1991 to approximately 25 percent in 2015. Projected labor shortages underscore the importance of attracting and retaining both students and career-aged women. Educational institutions are stepping up in an attempt to bridge this gap – a spotlight in this month’s issue.

Technology-Driven Investments

Technology is also fundamentally changing the investment spectrum, leading to the rising popularity of alternative investments. “Esoteric” investments, such as cryptocurrency, infrastructure, green technology, precious metals, and real estate have become increasingly popular and more accessible as big data and analytic technology have made it easier to value and structure these typically complex deals. An article in this issue dedicated to these increasingly popular types of deals delves deeper into this trend with historic and current data.

Regulating Tech?

Regulating Big Tech has been until recently a taboo, not to mention a real challenge. To date, large technology firms have been given free rein on the assumption that the companies themselves are best suited to understand and manage the risks to their customers. That attitude could be shifting, particularly around data protection and privacy. Our article examines measures taken and proposed in both the U.S. and Europe, with marked differences in approach and effectiveness.

As you peruse PreView, we encourage you to think about how the above issues affect your organization and ask probing questions: How will these risks affect us? What should we do now to prepare? Is there an opportunity we should pursue?

Risks are changing even as the digital ink is drying. Staying focused on the present is not going to prepare organizations for what’s around the curve. At Protiviti, we have the advantage of learning of those around-the-corner risks continuously through our work and conversations with our clients, colleagues and peers, C-suite executives and board members. We are happy to share those insights and we hope you find them helpful.

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