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Understanding the legal risks of deploying AI in businesses

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Carole Piovesan, Litigator and Team Lead on AI, Privacy, Cybersecurity and Data Management group at McCarthy Tétrault
Carole Piovesan, Litigator and Team Lead on AI, Privacy, Cybersecurity and Data Management group at McCarthy Tétrault
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Artificial intelligence (AI) is bringing an array of opportunities and challenges to businesses. Not least of these new changes is legal risk.

DX Journal spoke with Carole Piovesan, Litigator and Team Lead on AI, Privacy, Cybersecurity and Data Management group at McCarthy Tetrault, to find out how AI will affect businesses, who should be addressing the legal risks AI poses to society and how the legal practice itself is being affected by AI.

DX Journal: To what extent does AI pose a legal risk to enterprises looking to incorporate this technology?

Carole Piovesan: Since there’s a lot of talk about AI, let me start with a very short definition. AI is an umbrella term that encompasses different processes such as natural language processing (like Siri), image recognition, machine learning and deep learning. The “AI” that draws a lot of attention these days – both negative and positive – is usually machine learning and deep learning, both of which involve self-teaching and self-executing systems.

AI offers a lot of opportunity for businesses looking to improve efficiencies and cut costs. Depending on the purpose of the system, however, it can present certain legal risks.

For instance, AI systems require lots of data to train systems on how to accurately perform a certain task. Access to data is largely governed by the Personal Information Protection and Electronic Documents Act which sets parameters for how to legally access, store and use data, among other things. Companies need to understand how to comply with privacy legislation to avoid reprimand or sanction. In addition, amassing huge quantities of data could lead to competition issues around data monopolies, among other things.

Then there is the issue of liability where a system does something it shouldn’t have done or doesn’t do something it should have done. In self-teaching and self-executing systems, questions arise as to who should bear liability for harm caused by the system. This leads to the corollary issue of proof. The pathway to a particular output for these systems is notoriously difficult to understand.

There is a whole movement around increasing the interpretability of AI systems, particularly where systems are used in matters that directly affect human life such as medical diagnosis and criminal law.  

DX Journal: Which industries are likely to be most affected by the legal risks that AI brings to businesses?

Piovesan: I wouldn’t think of it as industries that will be most affected by AI, but tasks. Every industry has the potential to be affected by advanced technologies including deep learning systems. The idea is that AI systems can perform routine, repetitive tasks better, faster and cheaper than humans. Every industry has processes that are repetitive in nature and that can be improved by AI.

That said, in the near-term, industries that are expected to be deeply affected by AI include transportation, medicine, law, insurance, accounting, manufacturing, retail, financial services, among others. Sectors that are less obvious but that are benefitting from AI include oil and gas, and mineral extraction, in which AI is being used to more safely and efficiently extract natural resources.

DX Journal: What should businesses focus on as they begin to onboard AI tools?

Piovesan: Depending on the purpose and complexity of the technology, business will want to develop a better understanding of AI technologies, as well as risk management strategies for incorporating more sophisticated technologies into their operations. Increasingly we’re seeing an interest in creating legal assessment tools specific to AI technologies. 

DX Journal: Who is addressing the legal risks created by AI in society?

Piovesan: Many different actors have a role to play in ensuring safe, beneficial and productive innovation. I would say that provincial and federal governments need to kick-start a dialogue with the academic and private sectors around issues specific to AI technology. One critical area for greater discussion is with respect to the interpretability of AI systems, and requirements for explainability for systems used with direct impact on human rights and well-being.

The EU and UK are examples of jurisdictions that are undergoing regular consultations to inform a possible regulatory framework on AI. Canada has also done such consultations but I think more is needed.

The academic and private sectors are tasked with advancing innovation but, as we have seen with the 2017 Asilomar principles, for example, they can also lead in defining appropriate standards and codes of conduct to promote responsible and productive research and innovation.

Canada is well-situated in the AI field. Some of the foundational thought-leaders of deep learning are based in Canada. We have tremendous academic talent here.

Plus, the federal government announced $125 million in research and development focused AI and nearly $1 billion over 5 years to promote innovation superclusters.

These announcements made international headlines which is important to show the world that Canada is the place to be for research and innovation (not to mention we are known for having the second largest tech sector outside Silicon Valley).

Finally, Canada is a well-respected international player and AI is technology will require a coordinated international approach, especially with respect to data sharing and in the military and defence contexts. Canada is very well placed to add-value to any international dialogue on AI.

DX Journal: How is AI changing the legal practice itself?

Piovesan: AI presents tremendous opportunity in the legal profession. As lawyer become more exposed to and comfortable with the technology, we will increasingly incorporate AI into all aspects of our practice.

The law firm can use AI to streamline internal processes such as mandate scoping. By understanding how much a typical piece of legal work costs, law firms can more quickly and accurately estimate new work that is similar in scope.

At my firm, McCarthy Tétrault, we’re using AI in M&A due diligence work. In so doing, we’re able to complete due diligence for an M&A transaction in a fraction of time and for a fraction of traditional costs.

AI is also being introduced on the litigation side through systems that can complete legal research of concepts. It is also being used in e-discovery to increasingly categorize documents and predict relevance.

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Media

DJG partners with GetStarted to create voice-activated content experiences for brands

DJG’s new partnership breaks ground for voice-activated branded content experiences.

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Voice-activated content experiences
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Content marketing firm Digital Journal Group (DJG) and voice technology platform GetStarted today announced a partnership to build voice-enabled experiences for brands wanting to reach audiences via smart home devices such as Amazon Alexa and Google Home.

This partnership will leverage DJG’s cross-industry content marketing and storytelling experience for leading B2B and B2C brands, and GetStarted’s technology platform that allows organizations to create dialogue and conversation via smart home devices.

“Voice is a really exciting space for us because it allows for totally new kinds of content experiences, as well as unique data insights that are possible as a result of the way people interface with content,” says Chris Hogg, President and Partner at DJG. “Up until now, a person’s interaction with their smart speaker has been largely query-based, where an individual asks for information such as weather, recipes or events in their calendar. Our partnership with GetStarted allows us to shape the experience on behalf of a brand, allowing an organization to have a conversation with a person around their interests.”

In Canada, 77% of the population is aware of smart speakers, and 26% own a device according to research from Edison Research and Triton Digital. In the United States, 80% of the population is familiar with smart speakers and nearly one quarter (24%) own a device.

The DJG-GetStarted partnership allows companies to connect their audience via the voice-activated speakers they already have in their home, so no additional hardware is required.

As part of its partnership, DJG will design and deliver voice-enabled content marketing experiences for brands via a managed service, and GetStarted will provide the voice technology platform. 

DJG will focus first on creating brand-audience experiences that deliver surprise and delight via voice, as well as deepen engagement and conversion opportunities for organizations exploring new ways to connect with an audience. 

“We are very excited to count DJG as a key member of our pioneering launch partner group to explore the rapidly growing voice activation arenas,” says Norbert Horvath, CEO and Co-Founder at GetStarted. “Using our innovative GetStarted dialogue management platform, brands are now able to design, launch, iterate quickly, and perfect their conversation-based content experiences with their respective audiences.  We are looking forward to pursuing this opportunity together with DJG by engaging and actually listening to what the stakeholders have to say.”

DJG offers consultation, design and build services for voice-enabled experiences for multiple stakeholders within an organization:

  • For marketers: Give your audience access to news and information, exclusive content, thought leadership and insight, as well as offers and contests.
  • For internal communications and HR teams: Deliver company updates, news and executive messaging on a one-on-one basis with distributed teams and remote workforces.
  • For virtual event organizers: Provide attendees with “backstage access” to speaker interviews, sponsor information and exclusive content. Attendees can engage with their smart speaker live during an event, deepening engagement and creating a new kind of virtual attendee experience.

“While the use of voice in content marketing, HR and events is still in its infancy, we anticipate audiences will move in this direction and be open to new kinds of content experiences via conversation with a smart home device, so we’re building for it now,” says Hogg. 

For more information or to discuss how voice-activated content experiences could be produced for your business, contact DJG.

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Professional Services

How Nancy McKinstry successfully led digital transformation at Wolters Kluwer

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Nancy McKinstry, CEO of Wolters Kluwer, talks with CFO Kevin Entricken. - Image courtesy Wolters Kluwer
Nancy McKinstry, CEO of Wolters Kluwer, talks with CFO Kevin Entricken. - Image courtesy Wolters Kluwer
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Dutch global information services company Wolters Kluwer was founded in the 1830s as a publishing house.

Now, the company earns more than 90 percent of its revenue from digital, thanks to a successful digital transformation (DX) by CEO Nancy McKinstry, who stepped into her role in 2003 — when they earned just 31 percent of revenue from digital.

McKinstry persistently kept her firm investing in product innovation, remaining patient while consumers adapted to these new products and services.

In a recent episode of HBR IdeaCast, McKinstry — who recently landed as the highest-ranked woman on Harvard Business Review’s annual list of the world’s top CEOs —  sat down with host Curt Nickisch to talk about leading her company through its DX journey.

Here are some select moments from the episode, which you can listen to here:

  • “I got to do a lot of really interesting work, you work on really complex problems, right? And so what that taught me was first of all, to be very data-driven because often it was the data, whether it was going out and talking to customers, or talking to competitors, or actually doing analysis with numbers, but it was the data that ultimately would largely drive you towards the solution.”

  • “What’s so exciting for me as the CEO and certainly the excitement among our employees is that this next wave of transformation is really rewarding because we’re adding so much more value to our customers and at the same time we can see that the profit pools will increase, therefore we’ll have more investment to drive even further growth.”
  • “Really engage with your customers. Because I think sometimes you can go down these transformations and you might expect your customers to be doing certain things, or adopting things in a way that is not going to be the case. So you have to stay really close to your customer during the journey to make sure that you’re not way too far out in front, or you’re not investing in things that maybe aren’t going to pay off. So that close proximity to customers is very critical.”
  • “Some of these things take some time. [Have] the strength and the courage to keep the investment going. There’s pressure on OK, show us the results. You made all these investments. When are they going to pay off? And you really have to have kind of the strength of your own conviction and your belief in the strategy to keep investing. And versus it’s easy to say OK, let’s just go for cost cutting. That’s much easier than to go for innovation and growth.”

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Culture

Which innovations will shape Canadian industry in 2019?

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Canada
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Canada is in the midst of an economic shift. New and traditional industries are increasingly being driven by innovation and these advances in technology are shifting the economic landscape at an unprecedented pace.

This is the assessment by Borden Ladner Gervais, which is Canada’s largest law firm. The company has issued a new thought leadership report, titled “Top Innovative Industries Shaping the Canadian Economy”.

The report weighs in on the opportunities and risks Canada faces in order to maintain its status as an international leader in innovation across eight key industries: cybersecurity, the Internet of Things, smart cities, cryptocurrency and blockchain, autonomous vehicles, fintech, renewable energy and cannabis.

To find out more about the report and its implications for Canadian businesses, Digital Journal spoke with Andrew Harrison, a partner at BLG.

Digital Journal: Where does Canada stand as a global tech innovator?

Andrew Harrison: Canada has always been at the forefront of innovation. Products developed by Canadians or Canadian companies encompass a variety of industries and include medicinal insulin, the snowmobile, the telephone, the pager, BlackBerry Messaging, IMAX, the Canadarm and the goalie mask, to name a few. Canadians are also fast adopters of new technologies; email money transfer between individuals, which was inconceivable only a few years ago, has been used by 63 per cent of Canadians.

This is why Canada is recognized worldwide for its research and technological know-how, but we have to be mindful of the challenges in a global competitive market.

DJ: What potential does Canada have to grow faster? Is this sector specific?

Harrison: Canada is well positioned to succeed and take the lead in all innovative industries, but there are definitely sector-specific challenges that could limit this growth. For example, the lack of regulation as to whether cryptocurrencies are considered securities or not is creating uncertainty, which may restrain investment in this sector.

DJ: What are the risks that could hamper innovation and development?

Harrison: For any new product, financing is always an issue; with innovation, money becomes an even more crucial element. Companies must have access to capital – including from individual and institutional investors – if they want to bring their innovative product/process to life. Evolving politics and policies can also have a significant impact.

DJ: What framework will Canada need in the future to secure its innovation potential?

Harrison: The key element is finding a proper balance between regulating the issues that might be created by the innovation itself or its use and providing a space where innovations can thrive without too many restrictions.

DJ: What does the Canadian government need to do?

Harrison: In many cases, laws and regulations were enacted long before we saw these innovative technologies and products brought to life, so they need to be updated. In certain sectors, such as cryptocurrencies and autonomous vehicles, the Canadian government has yet to provide a framework that would define the playing rules for all participants.

The government will also need to take a look at its current regulations on privacy: the coming into force in May 2018 of the European General Data Protection Regulation (“GDPR”) and recent high-profile data breaches have created the need for stronger privacy guidelines. Failure to do so could prevent Canadian businesses from accessing the European market.

DJ: What can academia contribute?

Harrison: Universities play a big role in fostering innovation – they could be the home of research and innovation and incubators of ventures, entrepreneurs, and tech talent. Universities can partner with industry players and have their researchers work closely to solve key industry issues. This is already happening in Canada. The Smith School of Business and Scotiabank, for instance, have partnered to set up the Scotiabank Centre of Customer Analytics at Smith School of Business to bring together professors, graduate students and analytics practitioners to collaborate on applied research projects in customer analytics. The academia plays a big role in creating an innovation ecosystem.

DJ: What is Canada’s most pressing technological need?

Harrison: There is still much work to be done to connect with Canada’s rural and remote communities. In 2016, the Canadian Radio-television and Telecommunications Commission (CRTC) declared that broadband Internet amounted to an essential service and adopted minimal performance standards across Canada: 50 megabit per second download and 10 megabit per second upload. However, the evidence presented to the Committee by a variety of stakeholders shows that the digital divide remains prominent in Canada – it is estimated that it will take roughly 10 to 15 years for the remaining 18% of Canadians to reach those minimums. Canada needs to develop a comprehensive rural broadband strategy in partnership with key stakeholders and make funding more accessible for small providers.

DJ: What type of investment is needed with skills and training?

Harrison: Canada has a serious shortage of tech talent, which makes it imperative for both the government, the education, and the business sector to invest in raising and fostering STEM talents. To help businesses attract the talent they require, the federal government is offering hiring grants and wage subsidies to offset payroll costs for recent post-secondary STEM students and graduates.

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