Uncover Hidden Risks with AI-Enabled GRC Platform

By | 3 minute read | August 11, 2020

Even before the added pressures caused by COVID-19, we had observed a considerable rise in regulatory fines and regulatory pressures across geographies and industries, and we expect this trend to continue. In financial services in 2019 alone, according to Fenergo research, $8.4 billion in fines were issued globally for non-compliance with AML, KYC and sanctions regulations.

In reaction to these regulatory and market pressures, we have noted a trend with clients across industries towards moving workloads to cloud, to reduce infrastructure IT overhead and achieve operational resiliency and time-to-value.

What’s happening inside organizations today?

From a risk and compliance perspective, organizations are trying to get their heads around the various silos and pockets of related data from financial controls and IT controls information, controls testing, risk evaluation, policy adherence attestation, and more. We have seen clients build simple matrices to highlight lines of business on the x axis and risk/compliance repository (which could live on Excel, SharePoint, or any number of GRC platforms) on the y axis. It’s a patchwork in most cases.

More and more, clients are looking to AI and other innovative technologies to move beyond this inventory check process. Organizations want to see how AI can be applied to risk and compliance use cases to help reduce costs, increase data accuracy, drive transparency, and also be secure, scalable, and cloud ready.

As organizations look to bring to market their products and innovate, grow, and compete, they’re faced with balancing these performance components with trustworthy and appropriate governance. On a daily basis they are attempting to meet their obligations to external regulators and their own governance processes, as well as manage the operational risks they face — with the ultimate goal to achieve business continuity and cost efficiency.

Advances in AI for risk

There is rising interest, both from IT and from risk and compliance professionals, in how AI could be applied in day-to-day risk and compliance functions. In particular, there’s been a growing interest in applying virtual assistants, natural language processing technology, language translation and AI-powered search engines inside risk and compliance use cases.

We’ve heard the following questions from executives, risk and compliance professionals, line of business managers, regulators and throughout our customer base:

  • What if your average employee could be guided by a virtual assistant to uncover a risk or compliance incident inside their organization?
  • What if your GRC platform could automatically suggest the correct causal or risk categorization simply based on the text description of the incident?
  • What if your GRC platform could then suggest the specific controls that are failing based on the incidents coming into the system?
  • How can you minimize compliance fines? Furthermore, how would risk awareness inside your organization increase?

What is really exciting is that we at IBM started a journey of embedding Watson, advanced analytics and more in the IBM OpenPages platform, and we currently deliver an offering that answers all of the questions above.

Advances in business intelligence for risk

Reporting, dashboards and data visualizations have been slow to keep pace in risk and compliance initiatives compared to other areas such as business performance. However, this doesn’t need to be the case.

  • What if your GRC platform would automatically generate multi-panel dashboards to include predictive insights simply by selection of a data element — with no report authoring needed?
  • What if your GRC platform could also present data relationships and interdependencies on the fly based on its interpretation of your data and data types?
  • What if instead of starting your analysis from a blank sheet you could ask your GRC platform “where do I start?” — and the system would suggest your starting points and visualizations?

The aha moment

IBM OpenPages with Watson platform delivers answers to all of these questions. Not only are multiple AI and analytics capabilities already embedded today inside the platform, including Watson Assistant, Watson OpenScale, and Cognos Analytics, but we continue to add even more. Because of our agile approach to innovate in the open, we are taking away complexity and cost from GRC initiatives.

As an example, for one client, we were able to drive a 99% cost savings of development time by reducing the wait time for risk analysis reports from 30 days to 3 hours.

Those are the kind of exponential results possible when you infuse AI and analytics into your risk and compliance framework.

To learn more about IBM OpenPages with Watson, check out our product page.

Learn more at ibm.com/RegTech