Governments worldwide are busy proposing, refining and passing laws to govern artificial intelligence (AI). Standards organizations are likewise developing guidelines for the technology’s development and use. AI governance is a hot topic.
So, I was particularly struck by the remarks of a panelist at a recent conference on AI, for which I was a moderator. I’d asked, “What worries you most about AI?” His answer was surprising: “The greatest risk is that companies will be too cautious, not take chances with it.”
The idea that we are perhaps being too cautious with AI is interesting. It’s counterintuitive, running against the prevailing rhetoric that views AI primarily through the prism of dystopic science fiction in which rogue computers run amok. The reality is that AI is already driving economic growth — and stands to do so to an even greater degree in the years ahead. But first we need to see, and seize, the opportunity.
In 2017, a PwC study highlighted the potential size of the AI prize, projecting that AI would contribute US$15.7 trillion to the global economy by 2030. The sheer scale of this opportunity is staggering, and the links to future economic growth more broadly underscore the imperative of Canada securing a piece of this pie. We should be able to do this. Contrary to many reports, Canadians are not risk-averse.
As a case in point, the Global Entrepreneurship Monitor’s survey of 100 countries (2021/22) showed that Canada ranks at the top for early-stage entrepreneurship. We were number one among 19 countries in the Level A group, those countries with higher per capita GDP. At least some Canadians manage risk quite well! This should be a good-news moment for Canada.
And yet, it isn’t. A policy paper from the Organisation for Economic Cooperation and Development An OECD policy paper (2021) predicts Canada will be the worst-performing advanced economy in the next decade, and for three decades after that.
This dire conclusion should stop all Canadians in their tracks. It should be discussed in government corridors and policy think tanks, in schools, homes, businesses and everywhere Canadians gather.
The fact is that AI, along with the digital economy more broadly, is critical to Canadians’ future prosperity. And while this country has so many of the components in place for a good-news story — a stable government and an open economy, a strong banking system, excellent universities with top researchers, a vibrant start-up economy with no shortage of emerging tech firms, and a recognized leadership position in AI — some profound problems are poised to bite us.
To begin with, we have a dismal track record for scaling our start-ups into big businesses. There are various reasons for this underperformance, and policy makers are turning their attention to them, having formed the Council of Canadian Innovators in 2015 to identify structural barriers and propose solutions, advocating in particular for policy and around access to capital, talent and customers.
Another problem is that Canadian firms have so far been relatively slow to adopt AI, according to a report by Forbes Insights. In fact, Canada ranked last out of 10 countries, and only 31 percent of the Canadian firms adopting AI claimed successful deployment.
These problems have critical policy implications. We need to help our start-ups grow inside Canada by addressing common themes such as the need for more investment, easy access to a pipeline of skilled tech workers and a regulatory system that facilitates high-growth businesses and protects Canadian intellectual property.
We need to help the traditional economy of small and mid-sized and even our largest corporations, across a multitude of sectors, make the transition to and flourish in a digital, AI-laden world. These corporations include not only the digital pioneers, the big banks and the automotive firms but also those in the media, energy, health care and insurance sectors, and beyond. For example, construction is among the least digitized industries in the world — highlighting the opportunity for individual firms and the urgency for the industry more broadly in seeking to remain relevant, enhance value for customers and grow.
AI is a mere toddler today. So even those firms that aren’t yet engaged have time to adapt. The question for many is how to get started.
I would encourage every board and senior leadership team to begin with education. Get started. Get familiar with AI, its opportunities and use cases, the nature of the risk it poses and what’s involved in its governance.
Consider that the economic impact of the technology is expected to come from three main sources: productivity gains from full automation (for example, robots, autonomous vehicles); productivity gains from AI that enhances human work; and increased consumer demand resulting from AI-improved products and services. Within these subsets, there’s a great deal to learn and absorb.
Whether you are in financial services, manufacturing or construction, your board should already be charged up about how to harness this technology to benefit your operation, your employees, your customers and your bottom line. Managers who do not engage with AI now, in other words, may be left behind.
On a practical level, that may pose a greater risk than the admittedly legitimate concerns around AI ethics and impacts that are making headlines today.
