As organizations analyze increasing amounts of data to understand their exposure to risk, the temptation is there to simply rely on AI to provide coverage. However, according to Gaurav Kapoor, MetricStream’s co-CEO and co-founder, while AI has tremendous potential, it cannot be expected to do everything.
AI became mainstream across various industries in 2023, including governance, risk, and compliance (GRC). Corporate integrity and risk management leaders are now embracing AI because every year, as compliance and risk become more complex, AI technologies continue to improve. As a result, risk management teams are struggling to keep up with the growing scale and intricacy of requirements, particularly when it comes to tracking changes in regulatory compliance and maintaining efficiency of internal audits.
In addition, companies and their leadership teams are prepared to invest in technology to enhance the efficiency of their governance and security practices. According to MetricStream and OCEG’s recent survey, 18% of businesses plan to invest in GRC technologies in 2023, with nearly 30% planning to do so in the next three years.
As leaders explore how to adopt new technologies and search for scalable and adaptable solutions for their business, they must first understand how different types of AI solutions can transform their GRC strategies, protect their businesses from risk, and ensure compliance.
AI-powered technologies are crucial for risk assessment and compliance monitoring as organizations continue to grow and scale. With the risk landscape and the regulatory environment constantly changing, risk management teams need real-time, dynamic solutions for operating more efficiently. AI technologies facilitate data processing, identification, categorization, and analysis, enabling risk managers to respond to potential risks more rapidly and efficiently.
AI solutions can be developed and deployed to assist risk leaders with a range of functions, including identification of interconnected risks, streamlining classification of reported issues, and establishing risk scoring and quantification to make more accurate and reliable recommendations.
Generative AI, a specialized subset of AI technology, has the potential to elevate compliance reporting and testing. Risk leaders should understand the capabilities of generative AI, which allows for the generation of original content, such as reports and recommendations, to transform their risk management strategy from defensive to proactive.
While AI and generative AI offer promising capabilities for the GRC industry, it’s important to acknowledge that AI alone cannot achieve perfection. Human oversight and review remain essential components of GRC, even when AI is performing the heavy lifting. Additionally, the ethical use of AI, safeguarding data privacy, addressing biases, and adhering to regulatory frameworks pose new challenges that must be carefully managed.
In conclusion, the future of AI for GRC is already here and holds great potential for leaders to unlock efficiencies and better manage risk within their organizations. AI for GRC enables a preventive, predictive, and diagnostic approach to ensure stakeholders receive accurate risk insights they can act on with confidence.