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In the rapidly evolving world of AI FinTech, transparency and trust have emerged as critical pillars for long-term success. As more financial institutions adopt AI-powered solutions, they must navigate complex issues around data privacy, ownership, and the risks of opaque "black box" systems.
In this first article of our new “AI FinTech in Wealth and Asset Management” series, we explore the deep-seated issues around transparency and trust in AI FinTech and the dynamics at play to address them. We reached out to Nathan Stevenson, CEO of ForwardLane - a leading AI WealthTech firm whose AI-powered Insights and Next Best Action platform empowers intermediaries by synthesizing and organizing insights from billions of data points in unstructured and structured enterprise data. Transparency and trust are core to the firm's values and ethos and they have earned recognition as a Certified Transparent™ organization. Nathan will be sharing his in-depth knowledge and experiences on his continuing journey of applying AI in financial services for sustained growth and ROI.
Hortz: Why is building trust and transparency so important for the future of AI FinTech?
Stevenson: Trust and transparency are important in AI FinTech because clients want to maintain their own IP (intellectual property) and competitive advantage in the market. If you do not know how your data is being processed, this leaves you exposed to compliance and audit risk.
There is also this growing trend in the AI industry, much like “greenwashing” in the ESG space, of "AI washing" where companies use buzzwords like "glass box" solutions without truly embracing transparency. I am concerned that if you cannot trust the validity of a company's messaging, then you have to question the quality of the data, the insights, and most importantly, the protection of your IP.
Hortz: How are you and your firm addressing these concerns?
Stevenson: To meet the highest standards of transparency, we have aligned ourselves with the principles developed by Nobel Prize-winning scientists and leaders from Stanford, as well as Dr. Rainford Knight, CEO and Co-Founder of Transparency Global which has analyzed over 55,000 companies and found that only 2% meet the standards for environmental, social, corporate governance, privacy, and trust.
To address these concerns, we provide our clients with direct access to their own data, full auditing, and API-level transparency into our Insights engine. It is only with this level of transparency and openness that you can be sure we will not steal your knowledge, that you will not be exposed to “bad actor” risks, nor reputational risks associated with unethical AI.
Collaboration and partnerships also play a vital role in establishing trust. ForwardLane has long-standing partnerships with industry leaders like Invesco and Salesforce, working together to develop AI solutions that automate insights and deliver them into user workflows. The company has also partnered with data providers like BentoEngine and Intergen Data to create new insights and is transactable on Microsoft Azure and AWS.
Hortz: What is a Certified Transparent™ organization and why did you actively pursue this particular certification?
Stevenson: We are working with Transparency Global, a company with a mission to accelerate the world’s adoption of transparency and, through a decade of research and analysis of 55,000 companies, have determined six factors that define transparency. Achieving their Certified Transparent™ organization designation showcases our commitment to innovation, customer success, responsibility, and trust.
Hortz: What else have you learned about building transparency and trust?
Stevenson: Throughout our journey, ForwardLane has learned valuable lessons about building transparent and trustworthy AI. Most importantly, that AI, compliance, and technology are perhaps 50% of the story. This grand endeavor is truly a human story, of working together on how to apply the technology to provide better insights so that advisors get relevant value out of engagement, that investors get the right high-quality products, that they are informed, and their interests are protected.
Hortz: What do you see as the potential future of our working with AI?
Stevenson: Looking ahead, I envision a future where transparency and trust enable a symbiotic relationship between humans and AI. It means bypassing dashboards, spreadsheets, database work, data loading, and even data processing, and just focusing on the points of interaction with intelligence. The question becomes: How can you collaborate and work most effectively with superintelligence as your new best friend?
As the AI FinTech landscape continues to evolve, companies like ForwardLane are leading the way in prioritizing transparency and trust. By aligning with ethical principles, providing visibility into their systems, and fostering collaborative partnerships, they are setting the standard for responsible AI adoption in financial services. The future of FinTech belongs to those who can navigate this path with integrity and build lasting bonds of trust with their clients and partners.
Related: Using AI To Weave the Fabric of Data and Intelligence for Fund Product Distribution