Fears about AI are many and in many ways justified. The pace of innovation this technology has undertaken over the past few years has been rapid. Concerns about data security, intellectual property theft, and the overall negative impact of technology on the environment.
For many advisors, such as Charmaine Hall, founder of Unbound Financial, the biggest concern about using AI in their work is privacy regarding customer data.
“One of the biggest hurdles for me early on was understanding where the data was going, whether it was being used to train models, whether it was being processed offshore, which is a very important ethical consideration when dealing with customer information,” she said on the latest episode of the ifa Show podcast.
“We’re talking about very personal financial information, so you need to know that it’s redacted and protected before it’s processed. Otherwise, it’s a serious risk.”
However, as Hall highlighted, data security is often not the main concern.
“Only one customer actually had any doubts. Their main concern was whether their information was being used to train the system. Once they understood that was not the case, they were relieved,” she said.
For most clients, the biggest concern is the impact of AI on the environment.
“As we go down that path, we start to look at the amount of water used in data centers and the broader climate impact. It raises questions about how that aligns with ethical investment,” Hall said.
The use of AI in practice can be problematic for clients considering ethical investing.
“Ninety-five percent of my clients come to me because they want to make ethical investments, so there’s a huge conflict in using AI when you consider the environmental impact.”
“As you go down that path, you start looking at the amount of water used in data centers and the broader climate impact. It raises questions about how that aligns with ethical investing.”
For Hall, AI is a benefit it brings to her clients and has revolutionized her practice, creating efficiencies across the board.
“I certainly can’t live without AI in my business right now, so it’s important to find a balance between using AI responsibly and being aware of the wider impact.”
For all the concerns and ethical questions surrounding AI, Hall ultimately has a positive outlook. “AI is probably at its worst right now and it’s only going to get better. So I think we need to focus on how we use AI responsibly as it evolves.”
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