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How risk technology transforms trust

Posted on 01-14-2019 by Lisa Thompson

 From AI to blockchain, companies are rapidly adopting new technologies which use data to drive business insights and manage risks more effectively. Our third volume of The Trust Issue explores how technology can also improve a company’s transparency and increase the trust it receives from customers, investors, third parties and regulators. But it also warns that if companies fail to use technology in a transparent and ethical way, they risk losing trust altogether.

Emerging tech enables proactive risk management

Take a closer look at innovations giving companies new tools for managing risk, improving customers’ experiences, and demonstrating transparent, ethical business practices.

  • Blockchain technology increases transparency and accountability in supply chains, helping consumers to trust in companies and their products.
  • Biometric technology helps banks ensure customers are who they say they are, which combats money laundering, unearths hidden beneficial ownership, and deters data theft, hacking and fraud.
  • Machine learning algorithms in risk monitoring tools accelerate visibility into potential risk events.
  • Data analysis and visualization helps companies spot risks of bribery and corruption and identify strategic opportunities.

The list goes on.

Regulators trust in tech

Many regulators now expect companies to use technology to boost their approach to compliance. For example, the EU’s Fourth Anti-Money Laundering Directive requires corporate identity-related documentation to be collected, verified, safely stored and updated. When a regulator requests this information, companies need to use technology to provide this information with speed and accuracy.

Technology also helps companies address regulatory compliance with more confidence. Over the last five years, utility solutions have been developed to help banks meet regulatory requirements, in many cases as a joint effort between banks and third parties.

Tech requires good governance

Financial services companies invest more in big data and AI technologies every year. Last year, HSBC recruited 1,000 digital experts to embed big data across its operations. The bank is using insights from big data to create new products and services and to manage the risk of financial crime by monitoring customer transaction data to spot unusual patterns.

But HSBC recognizes that it must maintain its customers’ trust as it implements technology solutions. “Clearly the biggest risk of data is around trust,” said Josh Bottomley, HSBC’s Global Head of Digital. “As a bank we are obsessed about our customers’ security of their money and increasingly of their data as well. Trust is the critical issue—we need to make sure we build trust in our use of big data as opposed to undermining trust.”

Are you considering technology to accelerate visibility into reputational, regulatory, financial and strategic risk?

Next steps:

  1. Read more in "The Trust Issue: How technology transforms trust.” Download your copy now.
  2. Read more about the value of technology for mitigating supply chain risk.
  3. Share this blog with your colleagues and connections to keep the conversation going

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