According to research carried out by Evident, one third of North America’s and Europe’s largest banks lack transparency when reporting progress on artificial intelligence (AI) development. 

The independent intelligence platform believes that the banking sector is on the verge of overhauling its operations due to the recent high-profile collapses of Silicon Valley Bank and Credit Suisse, with AI adoption seemingly at the forefront of this transition. 

One of the main concerns of Evident’s and the banking sector as a whole, is the focus on risk management and how AI can help alleviate some of these pressures. 

However, Evident found that while AI adoption has been widely adopted by many banks across both continents, only eight out of 23 of the largest banks provide no public responsible AI principles. 

The company’s AI Index analysed millions of publicly available data points to assess how banks report against four key areas of responsibility: collaborations with other organisations, publication of ethical principles, creation of AI leadership roles, and publication of original research. 

The Index found that Canadian banks are most transparent on responsible AI reporting, with European banks the least. 

“AI could be the key driver of better risk management and decision-making across the global banking sector,” said Alexandra Mousavizadeh, Evident Co-Founder and CEO. 

“However, it is vital that banks develop AI in a way that meets high ethical standards and minimises unforeseen consequences. Our research found a worrying lack of transparency around how AI is already used – and how it may be used in the future – which could damage stakeholder trust and stifle progress.

“In this highly regulated sector, the reality is that many institutions are taking proactive steps to address AI concerns and developing internal programmes to address responsible AI. The problem is that there is no standard for responsible AI reporting, and many banks withhold the details of their efforts.  

“At this critical time for the sector, the banks need to show leadership and start reporting publicly on their AI progress.”

Three banks – JPMorgan Chase & Co, Royal Bank of Canada, and Toronto-Dominion Bank – are shown to have demonstrated ‘strategic focus on transparency around responsible AI’, according to the report. 

Approaches to hiring AI talent also differ regionally. North American banks are more likely to hire specific responsible AI roles, usually from big tech firms, and European banks tend to lead responsible AI within their data ethics teams.

Evident Co-Founder Annabel Ayles, added: “It’s perhaps unsurprising that two Canadian banks, RBC and TD Bank, perform well as the country itself facilitates a lively AI ethics conversation. 

“The top-ranking banks also tend to have strong research hubs, which we believe helps them address the technical challenges of implementing ethical standards into AI.”