Three Quarters of M&A Specialists Want AI Regulation

While business executives generally support AI implementations at their companies (45% of senior decision-makers told Gartner their firms are boosting AI investment) risks and uncertainties abound with the groundbreaking technology.

Data security and compliance risks routinely land on the list of “top worries” cited by senior executives – and they’re not the only concerns.

In fact, “making factually wrong decisions”, “compromised private data”, “regulation non-compliance”, and “increased risk of data breaches”, are all among the top concerns senior executives have with AI, Boston Consulting Group reports in a new study.

M&A Concerns

Now, a new and separate study from Datasite reveals that 73% of business executive deal makers say they support AI regulation, with most wanting oversight before they invest in the technology.

In its survey of 500 global dealmakers, Datasite, a leading SaaS-based technology provider for global mergers and acquisitions (M&A) professionals, also notes the following responses from surveyed executives:

• More than 60% said adoption of GenAI at their own organizations was low or that they were using it experimentally, suggesting personal familiarity has yet to translate into their work.

• Data privacy and security concerns, which most dealmakers (34%) identified as the greatest risk to using GenAI in their business, followed by job displacement (25%), quality control (20%), and intellectual property rights, bias, and fairness (9%).

• (42%) of global dealmakers said productivity was the biggest benefit of using GenAI in their business, and 36% identified data security and privacy concerns as the biggest obstacle to incorporating GenAI in their business, ahead of other barriers, such as a lack of competence and expertise (26%), GenAI’s immaturity or need for more validation (20%), and unclear application use case (12%).

• 43% of dealmakers expect GenAI to be the most disruptive to the technology, media, and telecommunications sector, followed by financial services (24%) and healthcare and life sciences (12%).

• 33% of dealmakers expect software engineering to drive the most GenAI-related M&A opportunities in the next five years, followed by research and development (25%) and marketing and sales (24%).

• Three in ten dealmakers (30%) said security, privacy, and compliance was the biggest factor to sink a GenAI deal, followed by data and data quality, competence and expertise, transparency and explainability, and technology validation. Meanwhile, 14% of dealmakers said they have seen a deal derailed because of concerns about GenAI.

Aside from compliance and regulatory concerns, 52% of M&A executives are also concerned AI “will increase their daily workload” and approximately the same percent are worried AI will take their jobs.

Even so, M&A leaders will have to take the field and play ball with AI if they want to move their companies and their careers forward.

“M&A is ultimately a relationships business, and people are essential to driving deals forward,” Wiley continued. “As an industry on the precipice of a massive shift in technological adoption, it will be important for dealmakers to ensure their business models are primed to leverage AI to increase efficiency, apply sharper insights, and ultimately improve deal outcomes

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