To govern gen AI effectively, financial institutions must revamp traditional risk frameworks. Gen AI's complexity—multimodal data, content creation, and IP risks—requires new oversight models. A gen AI risk scorecard can guide prioritization, supported by four control types: business (flexible oversight structures), procedural (updated MRM standards), manual (human reviews and testing), and automated (real-time tools for data sanitization and quality checks). Robust governance ensures safe innovation, regulatory compliance, and operational gains while minimizing reputational, ethical, and legal risks.

Join for free to read