Anglicare Sydney CEO on AI, housing and critical issues facing governments

Joe Kornik: Welcome to the VISION by Protiviti interview. I'm Joe Kornik, Editor-in-Chief of VISION by Protiviti, a global content resource examining big themes that will impact the C-suite and executive boardrooms worldwide. Today, we’re exploring the future of government, and I'm thrilled to welcome Simon Miller, CEO of Anglicare Sydney, a nonprofit organization that offers services for seniors, families, and individuals in need from food and housing to mental health and family care. I'm happy to turnover the interviewing today to my Protiviti colleague, Leslie Howatt, managing director and the firm’s Technology Consulting solution Australia lead. Leslie, thanks so much for joining me today.

Leslie Howatt: Thanks, Joe. Great to be here and I'm delighted to have Simon, you here with me today. Thank you so much for joining us.

Simon Miller: My pleasure to be here, Leslie. Thank you.

Howatt: You have such a unique background as a CEO of an NGO, former management consultant for 15 years and more than a decade in the New South Wales government. How do you think those experiences come together to help shape the work you currently do as a CEO of a not-for-profit providing age care, retirement living, social housing, and community services to over a hundred thousand people across Greater Sydney and the Illawarra?

Miller: It’s interesting because I’ve had the privilege of working across really all three different sectors. I’ve worked across the public sector. I’ve worked across the private sector and now, in the for-purpose sector. And I think what that does is it gives me the capacity to view problems from different perspectives, to understand how different stakeholders think about things. One of the things with being a CEO of a not-for-profit is there is so much that we have to do in working with other sectors and so, actually, being able to speak their language, understand the challenges that they are working on to be able to bring a whole range of different skill sets around public policy and advocacy, around commercial analysis, around technology and be able to meet those together I think is a really useful perspective that I'm able to bring and contribute to the sector, hopefully, to the development of the sector and some of the things that we’re trying to do as an organization and indeed as a society here in Australia.

Howatt: So, given that, what do you see are the biggest challenges facing governments both in Australia or beyond right now?

Miller: Yes. Look, I think there are five really big themes that governments are grappling with. I think the first one is clearly cost of living, the sticky inflation. Governments and central banks are trying to deal with managing economic growth along with the price pressures and they’re struggling with that. They haven’t really had to do since the 1970s. Well, this is different from the 1970s as well so this is almost a unique challenge around cost of living. What’s that leading to, it’s leading to what I call the rise of disillusionment. There’s disillusionment amongst the population. You see this showing up in populism and extremism. You see it coming up with the challenges from social media. I think the third thing is energy transition. There’s never been a global crisis quite like that of climate change and the energy transition is feeding into all of these. It sorts of feeding into a hopelessness which leads to populism, it’s feeding into the cost-of-living pressures through the rise of renewables, but it’s a really, really serious issue that government is trying to grapple with. They know they have to do it but there’s a lot of pushback from the populists because it’s expensive. And then I think housing, the availability of housing, the cost of housing. You’re seeing rents at unaffordable levels across at the least most of the Western world. You’re seeing dislocations in the housing market in places like China and so there’s a really significant challenge around the housing right at the moment and that’s not just in Western democracies. It’s right across the globe. I think the last one is AI and technology and governments working out, “What do we do with artificial intelligence? How do we manage them? How do we use it?”

Howatt: So, let’s pick up on that last point. In your consulting days, you built and led an artificial intelligence and advanced analytics business across Asia-Pacific, growing it from scratch to hundreds of data scientists and engineers. How do you think government can use AI to deal with living policy challenges?

Miller: Look, I'm genuinely quite excited about AI and what it can be used for in public policy. So, I think there’s just an enormous number of use cases and so let me give you an example. I heard recently about people starting to use large language models to do real time coaching in call centers. So, you can have the AI model listening essentially to the call and provide prompts. So, it’s not just, “We’re going to record this call for later. We can actually give you real-time feedback on how you’re doing and real-time access to information.” So, it’s going to improve experience. I think there’s opportunities for automated approvals, automated regulatory approvals. For instance, planning approvals, interpretations of laws and policies, I think is a really interesting area. I was talking to a large Asia-Pacific bank just a week ago and they were saying they’re now running an AI across all of their policies and all of their terms and conditions and it means that customer queries to bankers, 90% of them can now be answered live without people needing to go back and try to ask experts. AI can actually do that and, again, speed things up, makes it more efficient. Governments can do that same thing with laws and policies.

Airlines and logistics companies have been using AI to help with optimization and scheduling disruption management, and governments are now starting to think about how do we use that in say public transport networks or road networks and so that creates improvements and experience of lives of citizens. We are using at my organization AI to actually automate recruitment in terms of resume screenings, in terms of asynchronous video interviews. Well, government hires thousands of people and so the capacity to be able to find the right people, find them fast, takes a lot of the pressure and friction out of the recruitment process, again, it’s going to improve public policy.

I think the used cases are absolutely endless. The only thing that’s going to limit it, really, is the imagination, government can be quite risk-averse and needs to be risk-averse because it’s actually dealing with balancing quite difficult public conversations and trying to manage the interaction with the population. So, risk aversion and imagination, and on the other hand, their willingness to invest. I think the public investment we require will be substantial but the payoffs, particularly as government revenues fall and we have a demographic pressure of an aging population, I think the payoffs for the government will be enormous from the application of AI, right across almost any area you can imagine in public policy.

Howatt: Let’s talk a little bit about your current role as the CEO of Anglicare. What are some of the big issues that you’re dealing with in that sector and how can government more effectively work with the social sector to deliver better outcomes?

Miller: There’s really four things that I’m particularly concerned about that we are working on. I think there’s the question of aging and ageism. Our population is significantly aging across most of the Western world, indeed across most of the world, we have an aging population and there’s a need for government to help foster more healthy approach to aging. There is some research out of Yale that suggest that the way you think about aging actually impacts really significantly how healthy you are as you get older. You can have more years of being well as a result of thinking more positively about aging. And so I think there’s a role for not-for-profits and governments to really think about, how do we age well as a society? So, let’s not just make aging a clinical thing, something that is about a loss of capacity but how do we celebrate, how do we embrace aging, how do we actually help well-being to be a feature of how we all grow older and that’s one of the things that we’re trying to grapple with in terms of building communities for older people that are healthy and thriving and flourishing that are not just about medical care but are about community, that are about hospitality, that are about social connection.

The second thing that we really focus on is the housing crisis. Anglicare is a significant housing provider and it’s an area that we focus our growth in because we see this as really being the great kind of social challenge of our time. Because without good housing, you lose social cohesion and I think that that’s an enormous challenge to our society. So, that’s an area that requires government investment, government regulation, government support. It’s something that simply doesn’t happen because if it was something the private would just do on its own, we wouldn’t need to worry about it but it’s clearly a huge problem.

The third case is food and security. This is a big challenge, cost of living and food insecurity, huge challenge across the Western world. Certainly in Australia, where I am, food insecurity is an enormous challenge for us and how do we work on distribution, how do we work on subsidizing that, how do we work on building capacity requirement.

I think the last one that we’re significantly working on is around mental health, just the increase in the number of mental health challenges in community, particularly for both young people and for older people. The group in society that has the highest rate of suicide is men over 85. It’s not the largest number but it’s the highest rate and so mental health challenges for both teenagers and for seniors are an area that we are partnering with government to really invest in counselling, in psychology, in support. They are big challenges that we need to face into as an organization, having partnership with government.

Howatt: That’s quite amazing. That’s a stat that I had never heard before but having an aged father, I can kind of understand how that might come about. So, for my last couple of questions, I want you to look out five years or so, maybe to 2030, what do you envision for the future of housing, specifically social housing and community services to support Australia’s aging population?

Miller: One of the biggest challenges with housing is around supply. We just need more housing. But of course, it’s not just a case of building more because land is expensive. Regulatory approvals are expensive. Construction is expensive, and so people, developers, even Anglicare, we need to make a return on the money that we invest in building housing. So, one of the things that I see in the next decade, five to 10 years, is government stripping away some of those regulatory costs, make it really easy for people to build if they build following a certain design standard. I see technology playing a significant role into the things like prefabrication, things like automation, offsite manufacturing, the reduction of the cost of [Unintelligible] architecture, of project management, of engineering. I think AI, in particular, can play a role in those spaces. Then, of course, the lifecycle cost of housing around energy, heating, cooling management and there’s an estimation that actually, at least in high-rise buildings, those lifecycle costs can be half the net person cost of the building. So, they’re really, really significant particularly for people on low incomes.

So, I see really a quite exciting world where government regulation, where technology, and where really smart design in the next five years can dramatically lower some of those costs and enable developers to make good returns but at significantly lower costs and so you get a win-win. You get developers still making the money that they need to be able to put their money at risk but you see people on lower incomes, on minimum wages, on income support actually able to afford it because we’ve changed the way that we deliver housing. So, that’s something I see us being quite exciting over the next five years and I’m hopeful that organizations like mine can actually play a role in saying, “You know, we’re going to take a risk. We’re going to do some things a little bit differently than we’ve traditionally done because we can and because we can,” sort of show the way and so I’d like us to be the innovative organization. But these things are going to really transform the way we do the housing, I think.

Howatt: Amazing. Finally, then, the same question but about the future of government in the delivery of services. Based on everything we’ve talked about today, how optimistic are you that we’ll get this right and what do you see for 2030?

Miller: Look, I think I’m ultimately an optimist and I think the reason I’m an optimist in terms of public policy and getting this right is, what I see when I look at millennials and Gen Z and then the generations coming after them is that they are much more publicly minded and I think these things like climate change that have led them to taking a different, more positive, more community-minded approach. So, I think that by 2030, the millennials and Gen Z are going to be a really significant part of the voting population. So, they’re going to demand it from government and governments tend to respond to voters, one way or another, and so I’m actually really optimistic that their attitude will actually translate into government action.

Howatt: Thanks, Simon. We really appreciate you taking the time to spend with us today and for your amazing insights. That was so helpful and I learned a lot and, hopefully, others do too.

Miller: Fantastic. Thank you.

Howatt: Now, back to you, Joe.

Kornik: Thanks, Leslie. Thank you for joining the VISION by Protiviti interview today. On behalf of Leslie and Simon, I’m Joe Kornik. I’ll see you next time.

AIR's Jo Ann Barefoot on AI, automation and the future of financial regulation

Joe Kornik: Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti, a global content resource examining big themes that will impact the C-Suite and executive boardrooms worldwide. Today, we’re exploring the future of government and I’m thrilled to be joined by Jo Ann Barefoot, CEO and co-founder of the Alliance for Innovative Regulation, or AIR, a nonprofit organization working globally to promote a more fair, inclusive, and resilient financial system by helping adapt financial regulation for the digital age. She hosts the global podcast, Barefoot Innovation, and is a Senior Fellow at the Harvard Kennedy School Center for Business and Government. She serves on multiple global boards and advisory bodies and is a renowned public speaker and author, having published more than 200 articles on innovation and regulation. Jo Ann, thank you so much for joining me today.

Jo Ann Barefoot: I’m delighted to be here. Thank you.

Kornik: So, Jo Ann, it’s been about five years since you launched AIR, the Alliance for Innovative Regulation, as I mentioned in the intro. Could you tell us a little bit about AIR and then how you would assess the first five years and maybe what do you see are some of the biggest challenges and opportunities of the next five?

Barefoot: Yes, I’m happy to do so. Yes, we have just passed our fifth anniversary at AIR. We are a nonprofit. We are based in the United States but active around the world and really, the idea for it came out of the bat. I’m a former bank regulator myself, begin immersing in how technology is changing the world, including finance, and reached sort of an epiphany that it’s going to be hard to regulate change at this speed and this wall breaking nature unless we really step up the focus on the regulatory process itself. We work to help regulators, financial regulators, both use technology themselves and understand the technology they’re overseeing in the marketplace. The challenges going forward are that everything is speeding up and becoming even more wall breaking and we think it’s like race against time to keep pace with the change.

Kornik: Right. I love the name because innovation and regulation are just two words that you don’t often hear together. They are often sort of opposites.

Barefoot: Yes.

Kornik: I’ll start up by asking you about your views on the future of regulation, just particularly in the financial sector.

Barefoot: If we look at the financial sector, it is changing as much as anything else around us in terms of technology, digitization, tokenization, all the trends that we’re living with, and it really matters. It’s an area where if it doesn’t work well, people get hurt and therefore it’s pervasively regulated maybe more than any other sector. The big changes, I think, and you won’t be surprised to hear me say this, are going to be dominated by artificial intelligence. The advent of generative AI, a year and a half ago, is like nothing we’ve ever seen before in terms of hitting everyone’s desk at the same time in just a few months and making everyone rethink what they are doing. So, the big trends are going to be really keeping up with that change, deploying it, and also properly regulating it so that we get the benefits of new ways of doing things but we deal with the risks, which are very, very real.

Kornik: Right. Since you brought up generative AI, let’s stay on that topic for a few more minutes. I’m curious about it’s ultimate impact. I know there was a recent AIR white paper that asked if AI is transforming the future or triggering fear or perhaps a little bit of both. How concerned are you about that generative AI future and how do we make sure it’s actually a force for good and not the other way around?

Barefoot: Yes. We definitely think it’s a double-edged sword, very dangerous for sure. There’s risks that AI and generative AI specifically is going to introduce bias into the system. We have the challenges of so called explainability, why is the AI does doing what it’s doing or recommending what it’s suggesting. We’ve got problems with data quality. We’ve got problems with model risk management. We’ve got problems with privacy. We’ve got problems with AI’s hallucinating. I mean, we don’t minimize the risks of it all, but having said that, we think the upside opportunity is huge and we have to harness it. If we put that in the framework of thinking about financial regulation, when you have a problem that at its heart is about the difficulty of not getting enough information and analyzing it or keeping up with the dynamic environment, those are the situations that AI is perfect for solving. Particularly generative AI, the ability to search large language models. If we have the time, I could give you so many examples where the way we do things today is hampered because we don’t have enough information in hand; it’s in analog form. People are doing manual data entry, I mean, regulators are doing it, risk managers and compliance people are doing it. Everyone is dealing with fragments of information in a system that’s huge and changing at a breathtaking rate and we need to harness these tools to understand what’s going on in them and get hold of that.

Kornik: Right. Are the tools in place? Do the regulators have the tools right now to protect the system and ultimately make it more resilient, inclusive, and fair? How do you balance the need for those guardrails without stifling innovation?

Barefoot: Yes. The regulators, with a few exceptions, do not have the tools now. One of the things we really advocate for, and it might sound nerdy and not interesting but it’s essential, is that the regulators have to overhaul their own technology. Not just adopt some different tools but go back and redesign their information architecture and their talent lineup. They’ve got great people who understand risks in the system but those people, the colleagues who understand technology, they need software engineers and designers. So, attracting and retaining talent, working on culture change. We are putting out a white paper on this shortly by my colleague Nick Cook, who used to head Innovation at the Financial Conduct Authority in the UK which we’re calling Regulators’ Odyssey. They need completely different tools they need to invest, and they all need to, for one thing, migrate to the cloud, which will take a little while but really has to be done.

Kornik: Right. That’s interesting also and I keep an eye out for that. So, I was listening to your Barefoot Innovation podcast, which is excellent by the way. Recently you had Elizabeth Kelly, Special Assistant to the President for Economic Policy at the White House National Economic Council, and I know she was key in drafting the Executive Order on AI by President Biden. So, I’ll ask you, do you think that the U.S. is doing enough? Do we have the right resources and focus pointed at the problem?

Barefoot: The U.S. is doing a great deal and the Executive Order led to learning and innovation really throughout the government. We are not as far along as some other places in thinking through policy toward AI and some would say that was a bad thing, some would say it’s a good thing. We’re going to need to learn to create more dynamic policy change mechanisms because whatever is adopted today on AI is going to be out of date before long because the tech itself is changing so rapidly and so are the use cases. But I would like to see the U.S. really think through a consistent set of principles for regulation of AI and be ready to put that out. I’ll mention another thing that we think is really important. At AIR, we look a lot at consumer finance, consumer protection, and financial inclusion. We think that one of the things that deserves a thought from policymakers and from the private sector is the potential for consumers, financial consumers, to have their own agents for helping them manage their financial lives. Call it a robot, call it an agent. Gartner has called this phenomenon “Custobots,” the AI devices that are going to be able to make decisions. Financial consumers don’t have enough information either and they don’t have, on average, the knowledge to fully understand the financial products that they’re looking at. If we can encourage development of AI assistants for the financial consumer who can help her pay her bills, do her budget, evaluate financial products, see through offers that may have hidden fees or terms that would be adverse to her, manage to meet her own preferences and priorities as she’s saving and trying to build wealth. If we had these and they were affordable for everyone and that was a business model that could support them, and if they were regulated to have to have a duty of care to the individual or a fiduciary duty with no secondary agenda, we could transform consumer financial markets and really reward the good actors who were trying to provide the best products and services and prices and wring out the bad actors who are not. So, we think policymakers should be thinking about that.

Kornik: Right. Very interesting and a lot of this emerging tech AI movement is being led by the private sector of course, and it seems like perhaps an area that’s right for public-private partnership. Do you see opportunities for collaboration between government entities and the private sector?

Barefoot: I couldn’t agree more, Joe. We are going to have to have private and public collaborative efforts here. I think we may need some new models for those but all these area standards, the best practices, interoperability of different kinds of systems. One example is, digital identity is emerging as the key issue in fraud, which is skyrocketing, partly thanks to AI and financial inclusion and privacy. You can’t design a systemic approach to something like that unless you have the public and private sectors working closely together, which people are trying to do but we have a long way to go to do better.

Kornik: Right. Well, Jo Ann, you’ve been very generous with your time. I just have one more question for you and that’s to take me out a few years, maybe to the end of the decade, and talk to me a little bit about what you see as the future of financial regulation in, let’s say, 2030?

Barefoot: I think the future of financial regulation is like the future of everything else. Frankly, it’s data and AI and I think by 2030, we’re going to have a lot of situations where, say, a bank examiner or a securities regulator is sitting at their desk and that he too have an AI agent that enables them to get all the information that they could possibly want just by querying, just by talking to an AI that will then bring you the answers that you have, cut data in different ways, pick up the trends, the early warning systems. I think these systems are going to remove the need to do so much regulatory work with lagging indicators at risk, which is what we have mostly today, and the whole industry is going to be able to get ahead of problems. It’s not going to be perfect, I’m not naïve, and it will be so much better today if when you speak in to see risk emerging or non-compliance emerging, you can flag it immediately and fix it immediately instead of letting it accumulate over the years. It's going to be much more beneficial to the customer and the public and also to the regulated firms. They’re going to have an easier time running their businesses in a fortuitous way.

Kornik: Jo Ann, thank you so much for your time today. I really appreciate it and I really enjoyed our conversation.

Barefoot: I do too.

Kornik: And thank you for watching the VISION by Protiviti interview. For Jo Ann Barefoot, I’m Joe Kornik. We’ll see you next time.

Protiviti's Scott Laliberte: Regulation of AI and emerging tech should not stifle innovation

Joe Kornik: Welcome to the VISION by Protiviti interview. I’m Joe Kornik, Editor-in-Chief of VISION by Protiviti, a global content resource examining big themes that will impact the C-suite and executive boardrooms worldwide. Today, we’re exploring the future of government, and I’m happy to be joined by my Protiviti colleague, Scott Laliberte, managing director and global leader of Protiviti’s Emerging Technology Group. Scott and his team enable clients to innovate by leveraging emerging technologies such as AI, machine learning and IoT, among others. Scott, thanks so much for joining me today.

Scott Laliberte: Thanks for having me.

Kornik: Scott, as you know, we’ve recently published our Future of Government survey that we do with the University of Oxford, and we found out some interesting things regarding AI and emerging technologies. For starters, more than three-quarters of global business leaders expect emerging technologies such as IoT and AI to substantially transform the delivery of public sector services. Does that finding surprise you at all?

Laliberte: No, that doesn’t surprise me, Joe. I think so many people are encouraged and really looking forward to the advances and the efficiencies that they’ll gain with AI and IoT. AI is enabling businesses and people to do so many things right now, like more efficient predictive analytics, and when you combine that with the power of IoT and some of the data we can get from IoT censors, we’re going to be able to do some really amazing things with improving services and preventative maintenance, predictive analytics, all those things that will make services in our lives a lot easier.   

Kornik: Right. Scott, in the survey, when we asked executives what role, if lany, government should play in regulating emerging technologies such as AI and deepfakes, technologies that, as we put in our survey, can disrupt democracies, 82% of business leaders believe government has a role and 53% said that role should be substantial. What do you make of those numbers?  

Laliberte: Well, I think not only are folks encouraged by this technology and the breakthroughs that it is creating for us, they’re also scared of the consequences because those consequences and bad outcomes can be pretty significant. The things like deepfakes, the ability of AI to speed up and make attacks more effective and quicker all are things that they’re worried about. You combine that with the fact that it’s so new and there’s a lack of standards and regulations and all those types of things, people are pretty nervous and they’re looking for guidance. On the flipside of that, I think they don’t want to be overregulated as well. They need that guidance, they want the protection, but they want the ability to be able to continue to innovate and innovate quickly, and that’s going to require a real balancing act there to make sure that the government’s providing oversight, they’re providing guidance, they’re providing regulations, but they’re not stifling innovation by putting so much on there that companies aren’t going to be able to take advantage of the enhancements and gains that they can get with this technology.   

Kornik: Right. Scott, we’ve already seen some government involvement in regulating emerging technologies with two recent SEC enforcements for AI washing, the deceptive marketing tactic which exaggerates the use of AI. Do you think we’ll see more in the future, and if so, what will that look like?

Laliberte: Yes, I think we’re going to see a lot more in the future. It’s really interesting, history tends to repeat itself. When I saw the White House executive order on AI issued back in December — fourth quarter of 2023, it was — it reminded me of the early 2000s when a similar White House executive order came out on privacy. If you remember, in the early 2000s, states were just starting to come up with some of their privacy regulations. California had come out with one. Massachusetts had come out with one. Europe had put out some of their legislation and regulations but the U.S., federally, didn’t have any guidance or regulations in this area. The White House put out a similar executive order, and then right after that, we saw enforcement actions by the FTC, DOJ, SEC for privacy-related issues but they related back to regulations and laws that already existed, Consumer Fraud and Abuse Act, Computer Protection Act, and things of that nature.

You’re seeing that now as well, these enforcement actions for AI washing. They weren’t for AI. Right. They were existing laws that existed for consumer fraud and abuse and those types of things. I think we’re going to see the same thing happen here. That executive order basically laid out a bunch of aspirational things but it set some very common-sense things as well. It said you have to be transparent with what you’re doing with AI. You have to protect customer data. You have to make sure you don’t have bias worked into any of the decisions that you’re making. It had a whole bunch of other things in there, but those were really your core tenets. I think what we’re going to see is if you violate those core tenets, the government’s going to come down on you pretty hard to make an example out of you. That’s what we saw in the early 2000s. I think we’re going to see that again. So, that’s the warning shot and a notice that people need to be taking and really embracing that they’ve got to start putting AI governance initiatives in place, make sure they don’t violate any of those core tenets, and that they’re putting their companies in a good position to leverage AI but in a responsible and ethical manner.  

Kornik: Scott, from where you sit, what does effective AI governance and compliance look like? How much regulation is appropriate? How much is too much? What should companies be doing right now to prepare for when all this rolls into shape?

Laliberte: Yes. Well, I think what companies need to be doing is really laying down the foundation for AI governance. They need a steering committee. They need a group with — a multidisciplinary group of people that can really be tackling this from multiple directions. It’s not just going to be compliance. It’s not just going to be information security. It’s not just going to be legal. It’s going to be all of those groups working together with the business to really set the foundation of how do they responsibly use AI to enhance the business.

That’s going to be things like making sure you got the right policies and procedures in place, and that may sound like a daunting task but when we’ve helped companies map their policies and procedures to some of the AI standards, like the NIST AI risk management framework, you’ll find that 85%, 90% of the standards are already in place with existing policy statements or controls that they have today. They might just need to be reminded that they have those types of things in place and they apply to AI as well as other technology they already have, but majority of that is going to be in place. And then making sure that you’re educating your people on how to use it, how to develop with it in a responsible way. If you’re going to be doing risky transactions, making sure that you’ve got ways of ensuring transparency, ensuring no biases there or that you have a human in the loop to make sure that it’s not making decisions based upon incorrect information.

So, laying that foundation is going to be very important and it’s also going to be important that it continues to evolve because this area is evolving so quickly. So, that’s really on the company side. On the regulatory side of this, the balance is that, how do you regulate this given that it’s evolving so quickly and not stifle the innovation? Right. So, when you look at Europe, who took a bit of a heavier hand in putting out some very specific guidance, some consequences that will happen if you violate those things, the risk there is that it’s going to slow AI innovation in Europe. I think the United States doesn’t necessarily want to do that because we’re not just competing in the United States, we’re not just competing with Europe, we’re competing with the rest of the globe and many jurisdictions that are not going to put any type of regulations on this whatsoever. So, I think that the government is really going to be — the federal government — is going to be looking to say, “We’ve set out the tenets that we want you to abide by. Frankly, if you’re going to violate those tenets, we’re going to hammer you with existing laws that are on the books,” and that will be the way that they regulate. They’ll regulate through enforcement actions rather than necessarily legislation. What’s going to complicate that also is that the states are going to continue to put forth their legislations as well. So, it’s going to be like it was with privacy where you have a ton of different state laws that you’re trying to navigate, no real federal legislation, and you’re going to be looking at precedented enforcement actions to try and sense what’s the right direction to go in.

Kornik: Right. You touched on this a bit earlier but let’s talk about the private sector for a minute if we could. They are obviously way out in front on this. Do you see an opportunity for them to sort of lead on regulation or perhaps be integral in working with governments to align strategically to sort of make sure that we get all this right?  

Laliberte: Yes. That’s a tough question. [Laughter] We’ve seen some of the big players that are already trying to set standards and put out frameworks and things like that, it’s like you got Microsoft Responsible AI and Google and AWS — all the big players are putting forth their frameworks and their guidance, and there’s many common elements. As you look across those, they align with a lot of the NIST standards and the ISO standards and things like that. I believe we will continue to see large leading organizations like that putting forth guidance, templates, all those things that we can take advantage of because they want consumers to use the technology, right, because it’s in their best interest for those things to be used aggressively and responsibly. They’ve always been in collaboration with the government, and I think we’ll continue to see that.

I think when you look at the bad things that could happen with AI, I look at it and compare it to, say, ransomware. Right. Ransomware still is a devasting attack vector that we deal with today. When it first came out, people didn’t know what to do. The government worked in collaboration with private sector and put forth guidance, and it wasn’t necessarily regulation. They didn’t regulate ransomware, but they worked trying to harden critical infrastructure and applying lessons learned and guidance from the commercial sector with government to put forth a really good defensive strategy that could be employed not only by the government but by the private sector as well. I think we’ll see a parallel here and that’s how we’ll be attacking now with AI and other emerging technologies as they start to emerge.

Kornik: Thanks, Scott. Finally, if I were to ask you to sort of look out three to five years or even to the end of the decade, how optimistic are you about all this emerging tech and its role to be a force for good in the world rather than the alternative?

Laliberte: This is a double-edged sword. I am really optimistic about the gains that we will see in society, in business, and in government services with AI and IoT, but especially AI and generative AI. We’re already seeing those gains. You look out three to five years, I mean your imagination is probably the only thing that will limit you in what we’re going to be able to provide and see as services and enhancements.

The other side here, right, the naysayer side of me or the critical thinker that I have, I also see the extreme negatives that could happen, and we have to be prepared for that. We’ve seen that over the years. I’ve been doing this for 30 years and it’s always, a new technology comes out that has great promise and it also could be used for really bad things. Security professionals, technology professionals such as myself and others, we need to be thinking about how are the bad guys going to try and use this against us? It’s that cat-and-mouse game, a game of chess where move and countermove and you’re trying to predict three moves ahead so that you can stay ahead of the bad guys and the cybercriminals out there. It is going to be a challenge. We already see accelerated attacks. The things like deepfakes are really scary in that you think about how do we defend against that? Humans have always been the weakest link in the security chain and now AI is going to allow for really sophisticated attacks that you can’t expect any human to be able to decipher or pick out that it’s a fake. So, we got to get really creative and think outside of the box and collaborate because the group mind working together and collaborating on how to defend this stuff is going to be much stronger than any one individual or any one company is going to be able to do. We’ve seen that collaboration in the past. We’ve seen the ISACs and we’ve seen the government and private sector collaboration, and that is going to be more important than ever as we move into these new waters and new territories that we have to work to combat against.   

Kornik: Well, Scott, let’s hope we get this right, huh?

Laliberte: Let’s hope. We will. We have. We always have figured it out. There’ll be some pain along the way. There’ll be some very difficult lessons learned, but with each one of those we take those lessons learned and we apply it to the future to get better and stronger and we’ll continue to succeed.

Kornik: Thanks, Scott. Appreciate your time today. I really enjoyed our conversation.

Laliberte: Me, too. Thank you very much.

Kornik: Thank you for watching the VISION by Protiviti interview. On behalf of Scott Laliberte, I’m Joe Kornik. We’ll see you next time.