Lawyer Monthly - January 2022 Edition

20 WWW.LAWYER-MONTHLY.COM | JAN 2022 HOW CAN DIGITAL STRATEGY HELP COMPANIES BE COMPLIANT? Artificial intelligence (AI), big data and blockchain are changing everyone’s world – and that is not even the half of it. Virtual reality, digital biotechnology, nanotechnology, digital manufacturing, the internet of things (IoT) and ‘connected everything’, limitless computing power in the cloud, and robotics are all standing in line. The short answer to the titular question is ‘because it must’. Compliance professionals cannot refuse the hurricane of technological change sweeping across business, finance and wider society any more than we can hide from the regulatory blizzard itself. Compliance on the front line Legal and regulatory compliance should be on the front line of digital transformation because there is a compelling reason for regulator and regulated alike to embrace this new world. In a word, that is complexity. The idea that human experts can always provide definitive answers is little more than a comforting illusion. In our hearts – and from our experience – we know this. Even they have human limits to their knowledge, experience and information processing. As Edgar Fiedler famously said of economists: ‘Ask five and you’ll get five different answers – six if one went to Harvard’. For regulators, the sheer volume and pace of modern human activity has made the scale of their task almost impossible. The French tax authorities now use AI to scan online platforms like social media, Airbnb and classified adverts for signs of fraudulent under-reporting. They combine AI with aerial photography to find tax cheats by locating their undeclared swimming pools. In 2019, AI-driven data mining helped France collect an extra €640 million in personal taxes. In South Africa, data-driven, self-learning AI now holds the key to modernising the tax system, cutting fraud and rebuilding public trust. Meanwhile, for the regulated and their advisors, the growing weight and complexity of law and regulation (especially for cross- How Can Digital Strategy Help Companies Be Compliant? Russell Sheldon Chief Operations and Technology Officer TMF Group Tel: +44 (0) 20 7832 4900 E: comms@tmf-group.com www.tmf-group.com The rapid acceleration of modern technological advancement portends exciting things for the world of compliance, even as it outpaces existing regulations. Russell Sheldon, chief operations and technology officer at TMF Group, shares his predictions for the future of digital technology and its implications for the legal sector. Russell Sheldon boasts over 20 years’ worth of experience leading operational and technological change in global professional services firms, including AON Hewitt, Axiom Law, NGA Human Resources Nd PricewaterhouseCoopers. Prior to joining TMF Group, he was chief client officer at technology solutions firm Sabio. TMF Group is an international provider of administrative services. Its 9,100 experts provide legal, financial and employee administration through the Group’s 120 offices worldwide.