Published on the 02/08/2024 | Written by Heather Wright
While IoD urges board action…
The New Zealand government is encouraging Kiwi businesses to embrace artificial intelligence, with ‘reassurance’ that it will be taking a ‘light-touch, proportionate and risk-based approach’ to regulation – and avoids an ‘AI Act’ in favour of existing legislation.
A paper, Approach to Work on Artificial Intelligence, from the Office of the Minister of Science, Innovation and Technology says New Zealand is ‘behind its peers’ in AI adoption, pointing to several local reports on the topic, but no international benchmarking. Included in those reports is a 2023 Datacom survey of 200 senior business leaders which found 49 percent had yet to take up AI in their organisation or didn’t plan to do so at all.
“Further regulatory intervention should only be considered to unlock innovation or address acute risks.”
The Cabinet paper says the low adoption is ‘due in part to uncertainty about the future regulatory environment’. The light-touch approach to regulation will ‘provide reassurance and spur development and use of AI in New Zealand’, the paper, from the office of Judith Collins, says.
“We already have laws that provide some guardrails; further regulatory intervention should only be considered to unlock innovation or address acute risks and use existing mechanisms in preference to developing a standalone AI Act.”
The EU’s AI Act has been held up as the watermark for AI regulation, akin to its GDPR (General Data Protection Regulation) for privacy laws.
It’s an approach Australia also appears to be avoiding, focusing instead on safeguards for ‘high-risk’ use. Earlier this year the Australian Federal government published an interim response to its responsible AI consultation, noting mandatory safeguards for high-risk use, but avoiding any outright bans. It’s also progressing work on its Privacy Act, which could have further impacts.
“Regulating AI based on ‘predicted uses’ or ‘speculated harms’ may be overly broad in many contexts and harm productivity, the Kiwi cabinet paper says.
“If needed, a range of more agile options can address risks and build trust, for instance voluntary guidance, industry codes, technical standards and audit requirements.”
The OECD AI Principles should be promoted, serving as a visible signal of the national approach and a high-level direction for work across government on AI issues, including in the public service’.
Calls for a cross-portfolio AI work program to realise opportunities for the country, led by the Ministry of Business Innovation and Employment (MBIE) in collaboration with the Department of Internal Affairs are also included.
The paper sets out five ‘domains’ to be addressed, including setting a strategic approach – which essentially covers the light-touch regulation and mirroring of the OECD principles – enabling safe AI innovation in public services, and harnessing AI in the economy.
While the specifics are noticeably lacking, the domain of harnessing AI in the economy includes the most near-term deliverables, with Collins saying she has asked MBIE to provide risk management-based guidance for companies, and an AI Roadmap to support AI uptake in the private sector and align government behind focus areas, such as health.
It notes that in the public sector, ACC recently trialled generative AI to support back-office efficiency and productivity, and that the health sector is exploring precision health technologies, including AI, to support healthcare.
Collins has previously been bullish about artificial intelligence, noting its value in health diagnostics and education in particular. She’s also suggested that New Zealand could create its own bespoke ‘internal’ large language model.
Prioritising engagement on international rules and norms, guided by the Ministry of Foreign Affairs and Trade, and coordinating with work on national security, round out the five domains.
The Cabinet paper comes as the Institute of Directors calls on directors to ‘proactively equip themselves with the knowledge and skills to navigate the complexities of AI integration’ launching a forum and two new guides to help boards ‘make the most of AI’.
A Director’s Guide to AI Board Governance serves up nine principles to guide boards oversight of AI in their organisations:
- – Take action from a strategic perspective
- – Seize the opportunities
- – Categorise and address the risks
- – Build board capability
- – Select the right board structure
- – Oversee AI use and data governance
- – Look after your people
- – Proactively build trust
- – Embrace AI as part of your governance practice
- Kirsten Patterson, NZ Institute of Directors chief executive, says boards should make time to learn about and understand the potential of AI, and support management to learn about AI.
“The immediate challenge is to figure out how to harness this powerful tool in a way that is both productive and safe, and truly value adding.”
