Investment Firms’ AI Adoption Hindered by Lack of Standards, CFA Institute Finds
A recent survey found that investment professionals agree AI standards are needed before they utilize the technology.
There is “widespread agreement” among investment professionals that standards for using artificial intelligence in the investment industry are needed and that the current lack of standard is hindering the adoption of AI technologies in investing, according to a survey conducted by the CFA Institute, which awards the Chartered Financial Analyst designation.
The survey, which took place in February, polled 200 representatives of investment firms with assets under management ranging from about $5 billion to about $500 billion.
“Increasing accessibility to large language models is rapidly adding to the pace of the AI-led revolution of the investment industry,” said CFA President and CEO Margaret Franklin in a statement. However, she continued, “the absence of standards and concerns around data privacy may be slowing down AI adoption.”
According to the survey results, 85% of investment industry representatives polled said there is a need for industry-wide standards and ethical guidelines for AI and generative AI—AI that can create content such as video, images, audio or text. Close to the same share, 82%, said that until such standards are established, they are holding back from using the technologies. In contrast, only 16% of those polled said data privacy and security were the biggest roadblock to their adoption of AI technologies, while 13% said a lack of knowledge and tools were the main reason they are hesitant to use AI.
A large majority of surveyed employers, 70%, said they need workforce training and upskilling regarding regulatory compliance and risk-related skills concerning AI. Nearly half, 47%, said they believe their firms are not well prepared for potential regulatory changes due to AI.
The survey also polled employers about their perception of their workers’ attitude toward the use of AI and found that more than twice as many felt their employees were anxious about AI than excited about it. The CFA Institute reported only 26% of those polled, when asked to name three emotions to describe their employees’ attitudes toward AI, said they felt their employees were excited about the use of AI in investing, while 27% said they believed their workers are confident. Meanwhile, 60% said they believe their employees are anxious about AI, while 48% felt they are resistant and 41% perceived them as skeptical.
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