The AI governance questions financial services must come together to answer
Throughout my career, I have worked in legal and compliance in financial institutions during periods of significant technological change. Each wave of innovation created new opportunities, but also forced organisations to rethink governance - how they exercised oversight, managed risk, and maintained accountability.
AI represents the next - and arguably most profound - of these shifts. Many of the governance frameworks we rely on today were designed for static systems: deterministic technologies whose behaviour could be tested and approved at a single point in time, and then relied upon to behave consistently.
Yet modern AI systems are adaptive, probabilistic, and increasingly agentic. They are continuously learning from new data, and therefore evolve over time. An AI system approved one day may behave very differently the next.
This makes core governance questions harder to answer. Accountability is less clear, while oversight cannot rely on one-off approval and control needs to operate continuously.
Alongside frameworks and processes, there is a growing skills and capability gap. Effective AI governance depends on people being able to understand, challenge and explain such systems. And this isn't just a question of compliance - it goes to the heart of operational and conduct risk: as financial institutions increasingly embed AI into operational workflows the probabilistic outcomes can have real impacts on customers and markets.
As a sector, we need to anticipate the governance and accountability questions that lie ahead - not wait for failures or enforcement actions to define the agenda for us. That requires collaboration: between financial institutions, regulators, government, academia, and civil society.
Regulation will play a central role, but with the pace of development of AI so rapid, industry must be on the front foot with the internal capabilities that allow them to deploy AI responsibly and maintain trust both with customers and regulators.
That is why I am pleased to be joining Zango as an adviser and to support the research initiative on The Future of AI Governance & Compliance in Financial Services.
Drawing on Zango’s experience working with regulated financial institutions on compliance and governance challenges, and in collaboration with independent researchers, the research initiative focuses on the practical realities facing firms as AI adoption begins to scale. Its aim is to generate future-focused insights grounded in the lived experience of senior practitioners across the industry.
AI has enormous potential to improve financial services and deliver better products and services for everyone. But that potential will only be realised if our governance frameworks are fit for purpose, and if we invest in the capabilities required to operate these systems responsibly.
Getting this right is vital. Central to every major shift in technological innovation we have seen in financial services has been the maintenance of trust. AI is no different and the time to embed that trust is now.
