AI Risk Management in the UK & France: Overviews and Trends for AI in 2024

Introduction

As AI adoption and research continues to accelerate, Europe’s emerging AI hubs are often regarded to lie in the United Kingdom and France; with fierce, AI-pioneering firms such as Mistral AI, Deepmind, and countless others, the two countries are positioned at a blend of full government support and a commercial environment ready to implement with speed. In this blogpost, our aim is to identify the trends of these regions’ model adoptions, analyzing the implications for the Banking and Insurance sectors as strongly corresponding, AI-enabled industries.

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The current state of AI adoption in the UK & France

Both France and the UK have sprung forth some of the most notable AI firms from Europe. Likewise, the commercial adoption of AI across industries has followed in its robustness. With reference to the 2023 Global AI Index published by Tortoise Media (co-founded by James Harding, former Director of News and Current Affairs at the BBC and Editor of The Times), rankings on both overall and sub-sectioned metrics were identified for both the UK and France. For reference, the overarching rankings consist of Scale and Intensity, while the following sub-pillars of Talent, Infrastructure, Operating Environment, Research, Development, Government Strategy, and Commercial are normalized between 100 and the minimum original score.

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The UK towers as 4th in the world and 1st in Europe in terms of AI capacity. Notably, its rankings of Talent, Research, and Commercial - at 5th place each - allows the environment to flourish in enterprise use through leveraged resources. Thus, the UK’s Scale ranks 4th in the world, reflecting its overarching expansionary score as it holds consistently strong, stable grading in some of the most heavily-weighted categories.

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France follows in 13th place worldwide and 6th in Europe. Within Europe, its AI Scale lies in 3rd place, trailing the UK and Germany. Similar to the UK, its strengths lie in Talent, Research, and Commercial aspects, also having a relatively stronger Infrastructure (which includes energy access, supercomputing, and deep databases to sustain AI solutions).

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These metrics are supported by the actualities of AI in businesses’ daily uses. In fact, Forbes notes that the UK’s AI market is worth more than £16.8 billion, with 68% of large-size companies incorporating at least one AI technology. Moreover, Statista reports France’s AI market size to reach $5.32bn in 2024, with a CAGR (2024-2030) of 28%; for the country, finance remains the top sector of implementation at 44%.

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With AI models and benefits proliferating with such high capabilities, so do their concerns; as adoption widens throughout the region, what are some of the driving forces guiding these powerhouse countries towards AI Risk Management?

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Current issues with AI adoption

As mentioned in our previous DACH Deepdive, IBM’s Global AI Adoption Index released in January 2024 found that surveyed companies faced a number of adoption risks, including the top barriers of:

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- Limited AI skills and expertise (33%);

- Too much data complexity (25%);

- And ethical concerns (23%).

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In a 2024 Enterprise AI in UK report, digital consulting and analytics company EXL conducted surveys with 64 senior figures in the UK’s insurance and banking industries. With respect to generative AI, nearly three-quarters of the surveyed finance professionals stated that “they were already using this technology, higher than the 50% figure recorded amongst US counterparts”. However, these technological accelerations come with apprehensions, as 70% of UK senior executives in insurance and banking affirmed deep concern for the use of generative AI in their organizations, citing fears such as “risk to brand reputation and the possibility of inaccurate data impacting outcomes”. On the other hand, France faces the additional pillar of regulatory concerns; as the EU AI Act approaches, many firms are searching for methods to index, assess, and implement AI risk management best practices throughout their AI portfolios. In the study conducted by Pôle emploi, a French government agency, it was found that while 45% of large enterprises (over 200 employees) implement AI, a top obstacle remains that 38% lack expertise and have compatibility problems with existing tools.

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Rate of adoption of AI Risk Management mitigation

In the UK, a shift is now being made towards AI governance and risk mitigation; despite not having a defined legislation as in the EU AI Act (rather, a context-based framework), the inherent benefits for companies, especially those operating in the financial and insurance industries, remains vital. 45% of UK companies cite challenges with siloed systems and lack of resources - factors from which Calvin aims to tackle with its AI Inventory module. Cost and budget concerns, AI explainability, and legacy systems were also noted as key issues, from which AI governance solutions - especially as in the case of Calvin’s modularized solutions.

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The EXL report notes that around 8 in 10 companies said they have quality (78%), accessible (78%), and transparent (80%) data - a key requirement to effectively implement AI solutions with real business value. As France prepares for the initial requirements of the EU AI Act, firms are left searching for a solution to optimize their AI portfolios, ensure that the aforementioned, limiting risks are addressed, and confirm that operations in the EU area are compliant with the upcoming EU AI Act.

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At Calvin, we are proud to offer our modularized solution to tackle firms’ individual needs. Our expertise lies in guiding firms towards technical, ethical, and regulatory AI excellence through aiding in compliance, guaranteeing unbiased algorithms, enhancing the efficiency of company AI portfolios, and developing new solutions to tackle the market’s needs. Effectively, we adopt a quantitative approach to AI risk management to ensure your models remain compliant and optimized throughout their life cycles.

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Let’s make trustworthy AI a tangible reality for the UK, France, and beyond - schedule a demo with us today!