The regulatory landscape around AI risk management

With the fast advancement of AI technologies and adoption in critical business decision-making, and the negative impacts that AI systems can potentially have on individuals, organizations, and societies, many countries and jurisdictions have established policies, guidance, and regulations to help manage the risks of AI adoption. It is also expected that more and more legislation will be proposed and passed by different countries and jurisdictions at a fast rate.

In the United States (US), the Federal Reserve and the Office of the Comptroller of the Currency (OCC) published the Supervisory Guidance on Model Risk Management (OCC 2011-2012/SR 11-7) as early as 2011. SR 11-7 has become the key regulatory guidance for model risk management in the US. This guidance establishes the main principles for model risk management covering governance, policies and controls, model development, implementation and use, and model validation processes...