“The proliferation of technology over the past several years has been a huge boon to companies fighting corruption,” says business advisory firm BDO.
Mining companies are using cloud data analytics to turn the tide against corruption.
Like every other industry, the mining sector is undergoing rapid digital transformation as companies race to streamline their operations. Mining businesses are also approaching digital tech as a way to curb corruption and reduce their external dependencies.
To learn more about how anti-corruption initiatives are benefitting from digital transformation, DX Journal caught up with three leaders of BDO’s mining business:
- Nina Gross, leader of BDO’s Global Forensics practice at BDO USA
- Sean Bredin, national mining leader for BDO Canada
- Jeff Harfenist, the co-leader of BDO’s Anti-Corruption practice
DX Journal: What are the top corruption-related challenges facing mining today, and how are companies approaching the risks?
BDO: Unfortunately, corruption continues to persist in mining today for many reasons.
The first has to do with location: Mining companies typically operate in very difficult regions and countries that are often more prone to corruption than others.
Then, there is the fact that the mining industry is not as heavily regulated as other natural resources sectors. In fact, mining regulations are quite decentralized.
Another main driver of corruption is the industry’s dependency on the government for mining licenses and approvals. Mining companies face exposure to many government touchpoints, which increases the risk of bribery and corruption.
To address these risks, mining companies are finding ways to improve transparency with their key stakeholders, and ensure compliance with global human rights and environmental standards. Many are also strengthening their anti-corruption compliance programs by hiring and training more people, improving processes and procedures, and enlisting the help of technology.
DX Journal: How has digital transformation helped to mitigate these challenges?
BDO: While new technologies have transformed every aspect of mining, major advancements in data analytics has revolutionized companies’ ability to detect and mitigate fraud and corruption risk.
By incorporating advanced analytics, artificial intelligence (AI), and the internet of things (IoT) into existing systems, mining companies have been able to build powerful business intelligence and enterprise resource planning platforms to help them improve their overall corporate governance and make smarter predictions.
The cloud has also made these technologies much more accessible. Whereas many organizations were unable or unwilling to use predicative analytics before — because it required too much computing power and was expensive — cloud solutions now let miners run tests for one or two months and pay just for the time used.
DX Journal: What are some examples of successful digital transformation efforts you have witnessed in mining?
BDO: One of our clients, Barrick Gold, recently underwent a companywide digital transformation initiative that touched on every aspect of its business — from its mining sites to its Toronto headquarters. To aid its efforts, the company partnered with technology and consulting companies, including Cisco and our team at BDO.
One of our main tasks was to help Barrick Gold improve the transparency of its investment data to maximize the value of its investment portfolio. To do this, we worked with the company’s Investment Management team to implement several reporting dashboards using tools like SQL and Microsoft PowerBI.
These dashboards are intended to be part of an investment-wide analytics hub designed to help employees benchmark the company’s internal and external investment projects, and to achieve greater efficiency, speed, and transparency in their overall tracking, reporting, analysis, and investment decision-making.
DX Journal: What should mining companies consider when implementing new technologies? Are there additional challenges to be aware of?
BDO: Mining companies looking to implement new technologies must be prepared to face many challenges and risks. Most notably, companies must be cautious not to over-rely on technology to solve every problem.
A major reason why many IT projects fail is not due to a lack of technological tools, but a lack of subject matter experts who can work alongside IT vendors to design platforms that will get the desired results.
Technology can only take an organization so far. Companies must continually invest in hiring and training smart professionals so that they can optimize the systems in place.
Finally, companies must ensure they have the proper cybersecurity and information governance frameworks in place to guard against potential cyberattacks and data breaches.
DX Journal: How can companies prepare themselves for emerging technologies, such as Industry 4.0, cloud and IoT?
BDO: Mining companies that want to take advantage of Industry 4.0 and the associated emerging technologies and applications (i.e. sensors, data analytics, the IoT, and AI) need to have a tailored action plan that clearly outlines the organization’s goals, stakeholders, and potential areas for failure.
As mentioned earlier, companies must also be extremely aware of cybersecurity, and the new security challenges that new technological systems, such as the IoT, bring.
As mining companies shift to connected operations, security must be embedded into products from design to distribution. An ideal cybersecurity program is one that focuses on proactive threat intelligence, detection, and rapid response.
DX Journal: What top corruption risks can mining companies expect to face in the next year, and how will technology help them respond?
BDO: Mining companies can expect to continue to face many of the same corruption risks they are facing today in the year ahead.
Political and administrative risks will continue to persist, as mining companies rely on government officials for mining license applications and approvals.
Nevertheless, the advancement and proliferation of technology over the past several years has been a huge boon to companies fighting corruption.
Advanced forensic data analytics can help organizations spot suspicious transactions, arising from anomalous data, as soon as they occur. It is expected that as the technology evolves, companies can use analytics not only to spot current anomalies, but envision potential problematic scenarios and act on predictive trends.
Engineers need to use tech to make humans more powerful
James Heppelmann, CEO of PTC, gave the convocation speech to Boston University’s College of Engineering and talks about how engineers can create better machines and tools for humans, rather than just focusing on robots that put humans out of work.
In his convocation speech, Heppelmann focused on the importance of better connecting humans with digital tools and creating tools and machines that don’t just aim to replace humans, but creating machines that will aid humans in their understanding of the digital world.
One of the ways to do this, Heppelmann said, is using AR. In his view, AR will help to alleviate some of the problems caused by the great divide created by automation — where people have been split into two camps: the “haves” and the “have-nots.” The “haves” are the ones who are benefitting from, understanding and creating automation, the “have-nots” are those who are being replaced. Heppelmann said that this imbalance creates an image problem for the tech industry.
— Greg Jones (@GregoryAJones) February 5, 2015
He said that there needs to be a stronger focus on connecting physical, digital and human capabilities because “humans have innovation and creativity” and future engineers and tech industry professionals need to create “new ways to pass digital information onto humans.”
He describes AR as “augmenting god-given human capabilities with a technology overlay,” like one might see in a hearing aid or smart glasses. By giving humans this overlay of digital information, AR becomes “a great equalizer [that] allows people to become smart and connected.”
An example of this would be giving employees in a factory a pair of smart glasses to help the human employee with their productivity.
The Future Of The Factory: How #Technology Is Transforming Manufacturing https://t.co/c0H2QNxOnr @cbinsights#Industry40 #IoT #IIoT #BigData #AI #Robotics #Automation #AR #VR #Blockchain #3Dprinting #Tech@alvinfoo @KaiGrunwitz @robvank @IIoT_World @TopCyberNews @HeinzVHoenen pic.twitter.com/vDyxEfdzk2
— Franco Ronconi (@FrRonconi) May 31, 2018
Heppelmann said that engineers have a responsibility to “elevate [their] focus higher than productivity and cost savings” and spoke about the concept of “the societal engineer,” which is an engineer “who uses digital technology to make humans more powerful.”
“The societal engineer combines quantitative and creative problem solving skills with the ability to communicate effectively with systems-level thinking and global awareness with a passion for innovation and awareness of public policy and a social consciousness and an appreciation for the need to improve the quality of life while creating jobs and economic opportunities.”
Heppelmann ends his convocation speech by asking engineers to take this responsibility seriously and “help create a safer, more sustainable, healthier more productive world with enough food and water and opportunity for all.”
Samsung set to open AI research lab in Cambridge
Tech giant Samsung is opening an AI research lab in Cambridge. The move to do this has been welcomed by British Prime Minister Theresa May, but there’s concern over a mass funneling of graduates out of academic AI research.
This centre joins Samsung’s other AI centres in Moscow and Toronto. The move to build a research lab in Britain, specifically for AI, comes as no surprise following a recent announcement by Prime Minister May’s government.
U.K. spurs AI research
The U.K. government recently announced a USD$400 million investment in AI from corporations and investment firms based in and out of the U.K. In addition, a report from the House of Lords Artificial Intelligence Committee states that while the U.K. can’t outspend leaders like China, they can still become leaders in AI.
BBC reported that the new centre will be lead by professor Andrew Blake, formerly of Microsoft’s research lab in Cambridge and the new Samsung AI lab “could recruit as many as 150 scientists.”
The brain drain
According to the BBC, there’s concern over a funneling of graduates in AI research out of academics and into private sector work:
“A recent study by recruitment specialists Odgers Berndtson found just 225 students in the country were doing post-graduate technology research in specialist areas including AI and machine learning. “In the US, PhD qualified experts can command packages of $300,000 [£223,000]. And in the UK, whilst not yet at that level, salaries are spiralling,” said Mike Drew, head of technology at the headhunting company. A large part of the problem is that industry is picking university departments clean of their talent. A distinguished academic in the AI field confirmed this to me – he said anyone who had done post-graduate research in machine learning could ‘name their price.'”
This isn’t an isolated situation, the same concern was raised when Facebook decided to open new AI labs in Seattle and Pittsburgh, with professors, scholars and researchers from local universities worrying about the future of academic AI research when so many graduates leave for corporate — and greener — pastures.
The future of AI depends on who’s at the table
A new report from Canada’s Brookfield Institute for Innovation and Entrepreneurship about AI’s implications for policy makers found that, to be successful in implementing AI in government, a diversity in conversation must happen.
Conversations about AI aren’t just limited to government, or to Canada. Countries all over the world are tossing their hats in the ring to figure out how to best, and most seamlessly integrate AI into the public realm.
— Sean Mullin (@MullinSean) May 2, 2018
The report, “The AI Shift: Implications for policymakers”, outlines that there’s a need for what Brookfield calls ”deliberate conversation” and that it needs to happen “amongst policymakers, technologists, social scientists and broader communities that will be impacted by a shift toward a prediction-centred society.”
The institute also observed that a further exploration of what will happen when AI is used in government, and a closer look at the decision-making process behind such AI, is needed.
Imogen Parker, the head of justice, rights and digital society for the Nuffield Foundation, a charitable trust that funds research and student programming in the UK, outlined in her piece for TechUK what is meant by “deliberate conversation.”
Parker writers that, as the UK has announced that they want to be a leading force in ethics for technology and data use, they need to have a “diversity of voices” looking into risks and potential outcomes of the use and employment of AI in the public sphere.
Brookfield has released a briefer on AI and the basic terminology associated, it includes a helpful section that explains the ethical implications.
“Due to the increasing reliance on and trust in automated systems in contexts that may require them to make moral decisions,” reads the document. “Users should consider whether the values embedded in the code reflect their own.”
An overview of our Evidence Meeting 3 on #AI and Accountability — looking at the ethical implications of AI; specifically, issues around accountability, transparency, and explainability.https://t.co/VIOuGpoaMD pic.twitter.com/K8FbTNCTEi
— APPG AI (@APPG_AI) May 2, 2018
The idea of a value set in a machine not reflecting a person’s values — or reflecting, depending on who the person is — is a topic of ongoing discussion. At UC Berkeley, professor Anca Dragan is working on developing algorithms for human-robot interaction to ensure that conflicts between humans and robots are avoided by teaching robots to express their intentions and capabilities. Research like hers is crucial to the ongoing and ever-evolving field of AI because there have already been conflicts between humans and AI, like the self-driving car that killed a woman in Arizona.
The conversation around AI will determine the future we build with it. And if the report from Brookfield is correct, more deliberate discussion needs to happen — and soon.
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