Kate MacDonald, New Zealand Government Fellow at the World Economic Forum, and Lofred Madzou, Project Lead, AI and Machine Learning at the World Economic Forum have published a report that explains how AI can benefit everyone.

According to MacDonald and Madzou, artificial intelligence can improve the daily lives of just about everyone, however, we still need to address issues such as accuracy of AI applications, the degree of human control, transparency, bias and various privacy issues. The use of AI also needs to be carefully and ethically managed, MacDonald and Madzou recommend.

As mentioned in a blog post by MacDonald and Madzou:

One way to [ensure ethical practice in AI] is to set up a national Centre for Excellence to champion the ethical use of AI and help roll out training and awareness raising. A number of countries already have centres of excellence those which dont, should.

The blog further notes:

AI can be used to enhance the accuracy and efficiency of decision-making and to improve lives through new apps and services. It can be used to solve some of the thorny policy problems of climate change, infrastructure and healthcare. It is no surprise that governments are therefore looking at ways to build AI expertise and understanding, both within the public sector but also within the wider community.

As noted by MacDonald and Madzou, the UK has established many Office for AI centers, which aim to support the responsible adoption of AI technologies for the benefit of everyone. These UK based centers ensure that AI is safe through proper governance, strong ethical foundations and understanding of key issues such as the future of work.

The work environment is changing rapidly, especially since the COVID-19 outbreak. Many people are now working remotely and Fintech companies have managed to raise a lot of capital to launch special services for professionals who may reside in a different jurisdiction than their employer. This can make it challenging for HR departments to take care of taxes, compliance, and other routine work procedures. Thats why companies have developed remote working solutions to support companies during these challenging times.

Many firms might now require advanced cybersecurity solutions that also depend on various AI and machine learning algorithms.

The blog post notes:

AI Singapore is bringing together all Singapore-based research institutions and the AI ecosystem start-ups and companies to catalyze, synergize and boost Singapores capability to power its digital economy. Its objective is to use AI to address major challenges currently affecting society and industry.

As covered recently, AI and machine learning (ML) algorithms are increasingly being used to identify fraudulent transactions.

As reported in August 2020, the Hong Kong Institute for Monetary and Financial Research (HKIMR), the research segment of the Hong Kong Academy of Finance (AoF), had published a report on AI and banking. Entitled Artificial Intelligence in Banking: The Changing Landscape in Compliance and Supervision, the report seeks to provide insights on the long-term development strategy and direction of Hong Kongs financial industry.

In Hong Kong, the use of AI in the banking industry is said to be expanding including front-line businesses, risk management, and back-office operations. The tech is poised to tackle tasks like credit assessments and fraud detection. As well, banks are using AI to better serve their customers.

Policymakers are also exploring the use of AI in improving compliance (Regtech) and supervisory operations (Suptech), something that is anticipated to be mutually beneficial to banks and regulators as it can lower the burden on the financial institution while streamlining the regulator process.

The blog by MacDonald and Madzou also mentions that India has established a Centre of Excellence in AI to enhance the delivery of AI government e-services. The blog noted that the Centre will serve as a platform for innovation and act as a gateway to test and develop solutions and build capacity across government departments.

The blog post added that Canada is notably the worlds first country to introduce a National AI Strategy, and to also establish various centers of excellence in AI research and innovation at local universities. The blog further states that this investment in academics and researchers has built on Canadas reputation as a leading AI research hub.

MacDonald and Madzou also mentioned that Malta has launched the Malta Digital Innovation Authority, which serves as a regulatory body that handles governmental policies that focus on positioning Malta as a centre of excellence and innovation in digital technologies. The island countrys Innovation Authority is responsible for establishing and enforcing relevant standards while taking appropriate measures to ensure consumer protection.

Link:
AI and Machine Learning Technologies Are On the Rise Globally, with Governments Launching Initiatives to Support Adoption: Report - Crowdfund Insider

On Tuesday this week, Mark Lewis, senior consultant in IT, fintech and outsourcing at Macfarlanes, took part in an event hosted by The Investment Association covering some of the use cases, successes and challenges faced when implementing AI and machine learning (AIML) in the investment management industry.

Mark led the conversation on the current regulatory landscape for AIML and on the future direction of travel for the regulation of AIML in the investment management sector. He identified several challenges posed by the current regulatory framework, including those caused by the lack of a standard definition of AI generally and for regulatory purposes. This creates the risk of a fragmented regulatory landscape (an expression used recently by the World Federation of Exchanges in the context of lack of a standard taxonomy for fintech globally) as different regulators tend to use different definitions of AIML. This results in the risk of over- or under-regulating AIML and is thought to be inhibiting firms adopting new AI systems. While the UK Financial Conduct Authority (FCA) and the Bank of England seem to have settled, at least for now, on a working definition of AI as the use of a machine to perform tasks normally requiring human intelligence, and of ML as a subset of AI where a machine teaches itself to perform tasks without being explicitly programmed these working definitions are too generic to be of serious practical use in approaching regulation.

The current raft of legislation and other regulation that can apply to AI systems is uncertain, vast and complex, particularly within the scope of regulated financial services. Part of the challenge is that, for now, there is very little specific regulation directly applicable to AIML (exceptions include GDPR and, for algorithmic high-frequency trading, MiFID II). The lack of understanding of new AIML systems, combined with an uncertain and complex regulatory environment, also has an impact internally within businesses as they attempt to implement these systems. Those responsible for compliance are reluctant to engage where sufficient evidence is not available on how the systems will operate and how great the compliance burden will be. Improvements in explanations from technologists may go some way to assisting in this area. Overall, this means that regulated firms are concerned that their current systems and governance processes for technology, digitisation and related services deployments remain fit-for-purpose when extended to AIML. They are seeking reassurance from their regulators that this is the case. Firms are also looking for informal, discretionary regulatory advice on specific AIML concerns, such as required disclosures to customers about the use of chatbots.

Aside from the sheer volume of regulation that could apply to AIML development and deployment, there is complexity in the sources of regulation. For example, firms must also have regard to AIML ethics and ethical standards and policies. In this context, Mark noted that, this year, the FCA and The Alan Turing Institute launched a collaboration on transparency and explainability of AI in the UK financial services sector, which will lead to the publication of ethical standards and expectations for firms deploying AIML. He also referred to the role of the UK governments Centre for Data Ethics and Innovation (CDEI) in the UKs regulatory framework for AI and, in particular to the CDEIs AI Barometer Report (June 2020), which has clearly identified several key areas that will most likely require regulatory attention, and some with significant urgency. These include:

In the absence of significant guidance, Mark provided a practical, 10-point, governance plan to assist firms in developing and deploying AI in the current regulatory environment, which is set out below. He highlighted the importance of firms keeping watch on regulatory developments, including what regulators and their representatives say about AI, as this may provide an indication of direction in the absence of formal advice. He also advised that firms ignore ethics considerations at their peril, as these will be central to any regulation going forward. In particular, for the reasons given above, he advised keeping up to date with reports from the CDEI. Other topics discussed in the session included lessons learnt for best practice in the fintech industry and how AI has been used to solve business challenges in financial markets.

See the original post:
Current and future regulatory landscape for AI and machine learning in the investment management sector - Lexology

According to a new report by PMMI Business Intelligence, artificial intelligence (AI) and machine learning is the area of automation technology with the greatest capacity for expansion. This technology can optimize individual processes and functions of the operation; manage production and maintenance schedules; and, expand and improve the functionality of existing technology such as vision inspection.

While AI is typically aimed at improving operation-wide efficiency, machine learning is directed more toward the actions of individual machines; learning during operation, identifying inefficiencies in areas such as rotation and movement, and then adjusting processes to correct for inefficiencies.

The advantages to be gained through the use of AI and machine learning are significant. One study released by Accenture and Frontier Economics found that by 2035, AI-empowered technology could increase labor productivity by up to 40%, creating an additional $3.8 trillion in direct value added (DVA) to the manufacturing sector.

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However, only 1% of all manufacturers, both large and small, are currently utilizing some form of AI or machine learning in their operations. Most manufacturers interviewed said that they are trying to gain a better understanding of how to utilize this technology in their operations, and 45% of leading CPGs interviewed predict they will incorporate AI and/or machine learning within ten years.

A plant manager at a private label SME reiterates AI technology is still being explored, stating: We are only now talking about how to use AI and predict it will impact nearly half of our lines in the next 10 years.

While CPGs forecast that machine learning will gain momentum in the next decade, the near-future applications are likely to come in vision and inspection systems. Manufacturers can utilize both AI and machine learning in tandem, such as deploying sensors to key areas of the operation to gather continuous, real-time data on efficiency, which can then be analyzed by an AI program to identify potential tweaks and adjustments to improve the overall process.

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And, the report states, that while these may appear to be expensive investments best left for the future, these technologies are increasingly affordable and offer solutions that can bring measurable efficiencies to smart manufacturing. In the days of COVID-19, gains to labor productivity and operational efficiency may be even more timely.

To access this FREE report and learn more about automation in operations, download below.

Source: PMMI Business Intelligence, Automation Timeline: The Drive Toward 4.0 Connectivity in Packaging and Processing

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Link:
Is Wide-Spread Use of AI & Machine Intelligence in Manufacturing Still Years Away? - Automation World

Mischief can happen when AI is let loose in the world, just like any technology. The examples of AI gone wrong are numerous, the most vivid in recent memory being the disastrously bad performance of Amazon's facial recognition technology, Rekognition, which had a propensity to erroneously match members of some ethnic groups with criminal mugshots to a disproportionate extent.

Given the risk, how can society know if a technology has been adequately refined to a level where it is safe to deploy?

"This is a really good question, and one we are actively working on, "Sergey Levine, assistant professor with the University of California at Berkeley's department of electrical engineering and computer science, told ZDNet by email this week.

Levine and colleagues have been working on an approach to machine learning where the decisions of a software program are subjected to a critique by another algorithm within the same program that acts adversarially. The approach is known as conservative Q-Learning, and it was described in a paper posted on the arXiv preprint server last month.

ZDNet reached out to Levine this week after he posted an essay on Medium describing the problem of how to safely train AI systems to make real-world decisions.

Levine has spent years at Berkeley's robotic artificial intelligence and learning lab developing AI software that to direct how a robotic arm moves within carefully designed experiments-- carefully designed because you don't want something to get out of control when a robotic arm can do actual, physical damage.

Robotics often relies on a form of machine learning called reinforcement learning. Reinforcement learning algorithms are trained by testing the effect of decisions and continually revising a policy of action depending on how well the action affects the state of affairs.

But there's the danger: Do you want a self-driving car to be learning on the road, in real traffic?

In his Medium post, Levine proposes developing "offline" versions of RL. In the offline world, RL could be trained using vast amounts of data, like any conventional supervised learning AI system, to refine the system before it is ever sent out into the world to make decisions.

Also: A Berkeley mash-up of AI approaches promises continuous learning

"An autonomous vehicle could be trained on millions of videos depicting real-world driving," he writes. "An HVAC controller could be trained using logged data from every single building in which that HVAC system was ever deployed."

To boost the value of reinforcement learning, Levine proposes moving from the strictly "online" scenario, exemplified by the diagram on the right, to an "offline" period of training, whereby algorithms are input with masses of labeled data more like traditional supervised machine learning.

Levine uses the analogy of childhood development. Children receive many more signals from the environment than just the immediate results of actions.

"In the first few years of your life, your brain processed a broad array of sights, sounds, smells, and motor commands that rival the size and diversity of the largest datasets used in machine learning," Levine writes.

Which comes back to the original question, to wit, after all that offline development, how does one know when an RL program is sufficiently refined to go "online," to be used in the real world?

That's where conservative Q-learning comes in. Conservative Q-learning builds on the widely studied Q-learning, which is itself a form of reinforcement learning. The idea is to "provide theoretical guarantees on the performance of policies learned via offline RL," Levine explained to ZDNet. Those guarantees will block the RL system from carrying out bad decisions.

Imagine you had a long, long history kept in persistent memory of what actions are good actions that prevent chaos. And imagine your AI algorithm had to develop decisions that didn't violate that long collective memory.

"This seems like a promising path for us toward methods with safety and reliability guarantees in offline RL," says UC Berkeley assistant professor Sergey Levine, of the work he and colleagues are doing with "conservative Q-learning."

In a typical RL system, a value function is computed based on how much a certain choice of action will contribute to reaching a goal. That informs a policy of actions.

In the conservative version, the value function places a higher value on that past data in persistent memory about what should be done. In technical terms, everything a policy wants to do is discounted, so that there's an extra burden of proof to say that the policy has achieved its optimal state.

A struggle ensues, Levine told ZDNet, making an analogy to generative adversarial networks, or GANs, a type of machine learning.

"The value function (critic) 'fights' the policy (actor), trying to assign the actor low values, but assign the data high values." The interplay of the two functions makes the critic better and better at vetoing bad choices. "The actor tries to maximize the critic," is how Levine puts it.

Through the struggle, a consensus emerges within the program. "The result is that the actor only does those things for which the critic 'can't deny' that they are good (because there is too much data that supports the goodness of those actions)."

Also: MIT finally gives a name to the sum of all AI fears

There are still some major areas that need refinement, Levine told ZDNet. The program at the moment has some hyperparameters that have to be designed by hand rather than being arrived at from the data, he noted.

"But so far this seems like a promising path for us toward methods with safety and reliability guarantees in offline RL," said Levine.

In fact, conservative Q-learning suggests there are ways to incorporate practical considerations into the design of AI from the start, rather than waiting till after such systems are built and deployed.

Also: To Catch a Fake: Machine learning sniffs out its own machine-written propaganda

The fact that it is Levine carrying out this inquiry should give the approach of conservative Q-learning added significance. With a firm grounding in real-world applications of robotics, Levine and his team are in a position to validate the actor-critic in direct experiments.

Indeed, the conservative Q-Learning paper, which is lead-authored by Aviral Kumar of Berkeley, and was done with the collaboration of Google Brain, contains numerous examples of robotics tests in which the approach showed improvements over other kinds of offline RL.

There is also a blog post authored by Google if you want to learn more about the effort.

Of course, any system that relies on amassed data offline for its development will be relying on the integrity of that data. A successful critique of the kind Levine envisions will necessarily involve broader questions about where that data comes from, and what parts of it represent good decisions.

Some aspects of what is good and bad may be a discussion society has to have that cannot be automated.

More:
How do we know AI is ready to be in the wild? Maybe a critic is needed - ZDNet

Fort Collins, Colorado The report on the Machine Learning Market provides an in-depth assessment of the Machine Learning market including technological advancements, market drivers, challenges, current and emerging trends, opportunities, threats, risks, strategic developments, product advancements, and other key features. The report covers market size estimation, share, growth rate, global position, and regional analysis of the market. The report also covers forecast estimations for investments in the Machine Learning industry from 2020 to 2027.

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Machine Learning Market to Witness Exponential Growth by 2020-2027 | Leading Players SAP SE , Sas Institute Inc. , Amazon Web Services, Inc. , Bigml,...