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How Your Business Benefits From Creating a Culture of Accountability

For many years now I have lived by what I call the “rule of threes.” In short, if I hear about something three times, I take that as the universe’s way of wanting me to pay attention. This past week three different people –a client, a close friend, and a work colleague –all had a conversation with me with about “a culture of accountability.” 

Not exactly a phrase you hear every day, let alone three times in one week. So, following my own rule, I decided to take a deeper dive into the topic. 

As a former management consultant, and cultural change practitioner, I’ve seen the power of accountability first hand. The presence of it generates trust and forward momentum, while the lack creates resentment and inertia.

In fact, one of the hallmarks of a strong, positive personal brand is being knowing for giving  and keeping one’s word. 

A culture of accountability is one where the employees, from leader to front line, have a high degree of ownership over their actions and the impact they have on achieving the overall organizational results.

One core difference in a culture of accountability is that employees take on the company mission, vision and goals, rather than feeling like it is “put” on them.  But how does a company go about creating a culture of accountability?  Here’s five ways I’ve often advised clients on how to go about it. 

1. Communicate a broad rather than a narrow understanding of how every job contributes to the whole.

Most people work in a vacuum, with a limited perspective of how their job contributes to the whole. One way to increase accountability is to make certain that every job description, no matter how significant (or insignificant), makes that position’s contribution to the whole clear. By knowing how the work they do impacts other people, employees are more likely to feel responsible for getting the job done as needed. 

2. Recognize accountability rather than take it for granted.

I once had a CEO say to me, “I don’t need to show appreciation for the job people do; that’s what I pay them for.” It’s one of the few times in my life I have been stunned into silence. In short, what gets rewarded is what gets done. So going out of your way to acknowledge and appreciate an employee taking accountability –especially for something difficult or challenging –contributes to creating a culture where accountability is seen as an important value.  

3. Call out a lack of accountability when it occurs.

In the same way that acknowledging accountability creates a positive environment, not recognizing the lack of it generates a culture where employees don’t really believe that accountability matters. Don’t pretend that a lack of accountability doesn’t exist, and don’t be afraid to call it out when you see it. 

4. Create a structure for accountability.

It’s one thing to encourage a culture of accountability; it’s another to build in a structure that encourages it on a day-to-day basis. Two easy ways to do this include: 

  • Weekly or monthly meetings to check in on the progress of a project where individuals have specific accountabilities. 
  • Slack, Basecamp or another task management system where commitments can be tracked and followed up on. 

5. Start with simply doing what you say you are going to do, by when you say you are going to do it.

As simple as this sounds, the core of a culture of accountability starts with people keeping their word. Some of the biggest damage I’ve seen done in relationships between co-workers has been caused by a lack of keeping commitments made. You can be an example of accountability by holding yourself to the standard of doing what you said you would, by when you said you would do it.  

The bottom line for creating a culture of accountability is that it starts at the top. As the leader of a business, the more you demonstrate, encourage and create a structure for accountability, the greater your chances of it becoming a reality.  

Greenback's Downside Correction Is Over, Or Nearly So

The US dollar fell against most of the major currencies last week, with the notable exception of the Japanese yen. The greenback has trended higher against the yen, bolstered by the rise in US rates and equity market gains, including last week’s 2.2% rally in the battered MSCI Emerging Markets Index. The pound managed to eke out a minor gain of less than 0.1%. Sterling had been moving higher and reached its best level in two months on September 20. It was up 1.5% for the week before pessimism over Brexit returned with a vengeance.

Broadly speaking, we expect the FOMC meeting on September 26 to re-focus attention back on the continued divergence, which on rates and growth continue to favor the US. At the same time, the optimism that the US and China will work out a trade deal after the November elections and that a bottom in emerging markets, as an asset class, is at hand, seem misplaced.

Dollar Index: After closing below important support near 94.00 on September 20, the recovery before the weekend helped neutralize the negativity. The MACDs and Slow Stochastics have not turned up, but they are poised to do so early next week. A move above 94.60, which houses a retracement objective and the 100-day moving average, would lend credence to the favorable outlook. On the other hand, a break of the 93.65-93.70 area would signal a deeper and more protracted correction is unfolding.

Euro: The euro traded at its best level against the dollar since the June ECB meeting, briefly poking above $1.18. The euro surpassed but did not close above the initial retracement objective (38.2%) of this decline since reaching the high for the year in February near $1.2555. With the help of cross rate demand ahead of the weekend, the euro’s pullback was limited to about $1.1735. A move below $1.17 and ideally $1.1665 would suggest the upside correction is over. The more favorable sentiment toward Italian bonds, which has seen the Italian premium over Germany (10-year yields) narrow 60 bp since the start of the month, will be tested as the government has until September 27 to share it fiscal and economic projections ahead of the formal budget presentation next month.

Yen: The dollar almost touched JPY113 ahead of the weekend, reaching its best level in a couple of months. The technical indicators are constructive. The positive momentum and sentiment were reflected in the price action. The dollar traded on both sides of the previous day’s range last week (September 18 and 20). It illustrates the willingness to buy the greenback on pullbacks. The year’s high was set in the first part in July, a little above JPY113.15, and from above there, the high from last December near JPY113.75 will come into view. The greenback has not been above JPY115 for 18 months.

Sterling: Constructive economic data and signs from the EC that seemed to play up positive developments on Brexit talks helped lift sterling to almost $1.33 late last week, its best level since in a little more than two months. It was also just shy of the 38.2% retracement of its decline since putting in the year’s high near $1.4380 in mid-April. However, the summit in ripped the veneer away to reveal that the UK and the EU remain far apart on a few issues, including importantly the Irish border May’s bind is tightening. The EC had given the UK six weeks to amend its proposals, while in two weeks, May is set to deliver a key speech at the Tory Party Conference. May says it is her Chequers plan or no deal. But there is another moving part: Her. And that means a leadership challenge, probably shortly after her speech. A break of the $1.3050 area would support our idea that sterling’s upside correction since August 15 is over and the resumption of the downtrend means a return to $1.2660. Nearby support is seen near $1.2980 and then $1.2900.

Canadian dollar: Canada reported better-than-expected July retail sales (and an upward revision to the June series) and a modest acceleration of underlying August inflation before the weekend. The data boosts confidence that the Bank of Canada will hike rates next month. Nevertheless, the Canadian dollar was unable to extend its rally for a fourth session. If the inability to respond favorably to constructive economic news signals the potential end of the Canadian dollar’s upside correction, the greenback needs to rise above CAD1.2950 to confirm it, and ideally CAD1.30. The technical indicators have not turned yet, but the MACDs and Slow Stochastics are stretched.

Australian dollar: It felt a bit like deja vu. The Australian dollar rallied in the first four sessions of last week before profit-taking was seen before the weekend, which is the same pattern as the previous week. The Aussie set a new high for the month on September 21, just above $0.7300 before reversing lower. It stopped shy of the 61.8% retracement (~$0.7310) of the retreat from last month’s high (~$0.7450). Alternatively, the Aussie may have formed a head and shoulders bottom pattern this month. The neckline is in the $0.7230-0.7235 area, and the measuring objective is near $0.7385. It is not unusual in this pattern to retest the neckline after a violation.

Oil: US oil inventories have fallen for the past five weeks and in six of the past seven weeks (through the middle of September). It means that US oil inventories have risen in one week since the end of July. The drawdown leaves US oil stocks at the lowest level since early 2015. Initially, it seemed that with the US having irritated many countries, its embargo against Iranian oil might not be that effective. Also, China yuan-denominated oil futures contract would also offer a helpful vehicle. OPEC (Saudi Arabia) agreed to boost output. However, as the thinking evolved, and several countries have taken action well ahead of the effective date, there is speculation the embargo could be effective, especially in the beginning before output can be boosted to offset. Reports suggested that some Saudi officials can envisage crude rising about $80 for a short period of time. The front-month Brent futures contract has been bumping against the $80 for the past five months while holding above $70. At nearly $82 a barrel. Brent would have retraced 61.8% of its decline from those mid-2014 highs over $115. Light sweet crude oil for November delivery made a new high ahead of the weekend near $71.80. The technical indicators caution against picking a top. There is a trendline drawn off the mid-August lows that begins next week near $68.80 and rises to $69.60.

US 10-year rates: Investors appear to require higher US rates to attract global savers. The US deficit is growing spending increases, and revenues are squeezed by the tax cuts. At the same time, US corporates can no longer (September 15) deduct their pension fund contributions at last year’s higher tax rate. This removes one source of demand. Also, starting next month, the Federal Reserve will increase the pace of its balance sheet reduction to $50 bln a month. Consider that since August 22, the US 10-year yield has risen by 30 bp, while the 10-year breakeven increased by a little less than 10 bp, providing evidence that it is a rise in real yields rather than inflation expectations. The December note futures contract fell from 119-16 at the start of the week to 118-16 at the end of it. The technical indicators are stretched but have not turned. The mid-May low near 118-10 on the continuation contract may be sufficient support given the over-extended condition. On the upside, there is a small, one-tick gap from the lower opening on September 20. The gap is found between 118-23 and 118-24. A move through the gap, and ideally 119-00 would indicate a near-term low is in place.

S&P 500: The S&P 500 rose to new record highs ahead of the weekend, but the soft close suggests there may be scope for a pullback at the start of the new week. That said, the futures and options expiry may warn against giving the close much significance. The S&P 500 gapped higher on September 20 and gapped higher on September 21. The latter gap was closed, the former was not. The open gap is found between roughly 2,912.35 and 2,919.75. As it enters the last week of the quarter, the upside momentum remains strong. It has fallen in only two weeks since the end of Q2. Moreover, it has declined in one quarter (Q1 ’18, -1.2%) since Q3 ’15. The 60-day rolling correlation between the S&P 500 and the US 10-year yield is near 0.47, the highest in three months.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

7 Things Introverts Wish Extraverts Knew

As I pointed out a few columns ago, introverts tend to be more creative, more reliable, more trustworthy and to work harder than extraverts. Not surprisingly the great inventors and innovators of history have been markedly introverted: Einstein, Bill Gates, Mark Zuckerberg, Elon Musk, Isaac Newton, Nikola Tesla, Archimedes, and Charles Darwin.

Insanely, though, contemporary business culture values extraversion.  They hire people based upon first impressions (extraverts are good at that), goal them on “collaborating” (which extraverts love) and then spending billions of dollars creating open plan playgrounds perfectly suited for extraverts.

As I said, insane. Or maybe “inane” is the mot juste.  

Anyway, because of the egregious management boneheadedness, most workplaces are dominated by extraverts… to the great detriment of both productivity and innovation. However, since, alas that’s not likely to change any time soon, introverts and extraverts will need to learn how to get along.

Unfortunately, while introverts can see right through extraverts, extraverts simply don’t seem to grok introverts at all. So, since I’m off-the-scale introverted, I’ll take in on myself to speak for my fellow introverts to tell the extraverts what we wish they already knew. Here goes:

1. You’re talking too much.

Introverts are good listeners but the fact that we’re listening to you and not saying anything doesn’t mean that we’re enthralled by everything you’re saying. Quite the contrary. If you’ve been talking for more than a couple of minutes without pause, we’ve mentally proceeded from “What a bore!” to “OMG, will he never stop talking!?” to “For God’s sake, STFU!!” We’re not going to say anything, though, because if we did, we would never hear the end of it.

2. We don’t want to change.

Even though it’s abundantly clear that society (in general) and workplaces (in particular) tend to value outgoing “people-people,” we introverts don’t want to, nor feel the need to, change to fit other people’s ideas of how we ought to act and feel. We’re perfectly fine the way we are, thank you very much. What’s more, we’d greatly appreciate it if you stopped assuming we envy you. We don’t. Believe me. We don’t want to be like you.

3. Give us private offices or let us work-from-home.

Today’s open plan offices are productivity toilets and health hazards for everyone. For introverts, though, they’re particularly hellish because there’s no way to get away from other people. Forcing an introvert to work in an open plan office is like forcing an extravert to spend all day in solitary confinement. We need privacy. Please have the common sense and common decency to give it to us.

4. We resent doing more than our share.

Because extraverts spend so much time collaborating, sharing, and gossiping, the burden of actually getting real work accomplished falls to the introverts. After a while–no, scratch that–from day one, we resent that you waste time and money socializing while we’re working our asses off. And we really resent it when you pipe up to steal the credit.

5. Leave us alone to recharge.

Introverts feel physically, emotionally, mentally and spiritually drained after being forced to interact with other people. The only way that we can recharge is by disconnecting and being by ourselves. Yes, we know that you draw energy from other people. Like a vampire. But we’re the opposite. So when you see us sitting by ourselves, don’t think you’re doing us a favor by pestering us. You’re not.

6. We are not shy loners.

Quite the contrary. Introverts are often talented at public speaking. We often have a small circle of close friends and family with whom we enjoy spending time. We’re not bashful about our accomplishments; we just don’t feel the need to toot our own horns. We don’t talk about ourselves because we’d rather talk about something more interesting than stuff we already know.

7. Go away, please.

American Airlines Just Raised Its Baggage Fee and Offered an Incredible, Maddening Explanation

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

You knew it was going to happen.

I knew it was going to happen.

American Airlines knew it was going to happen too. 

The only question was how many hours the populace would be waiting before American followed Delta and United Airlines (and JetBlue) in raising baggage fees to $30.

When the announcement was made, I sat and pondered the meaning of life for a while.

Then I did the only thing my Yoda could suggest. I contacted American to ask for its logic in making this unpopular move.

An American spokesman told me: 

Like fares, baggage fees are set by the supply and demand for the product in the marketplace, and today’s changes are in line with what other U.S. competitors are charging. 

I stared at this for quite some time, tried to absorb it thoroughly and only then did I consider its fine logic.

I fear some might observe that if baggage fees are set by supply and demand, does that mean that American will raise them for every flight that happens to have a lot of cargo in the hold? 

After all, there might be less space. Ergo, the price should go up.

Please consider arriving at the ticket counter, to be told:

Yeah, sorry, we’ve got a big shipment of golf equipment in the hold today. So your baggage fee will be $175.

And when baggage fees didn’t exist, did this mean there was simply far too much space in the hold, none of it was precious, so it could be just given away?

I fear what American might actually mean by supply and demand is that when four airlines hold more than 80 percent of all available seats, they have most of the supply.

They therefore have the power to set the price of anything to a considerable extent.

The only thing that might even hold them back even a little is the existence of a budget airline on a specific route or, in this case, Southwest’s insistence that its customers’ bags fly free.

There’s a little more logical consistency, I fear, in the second part of American’s statement: United and Delta have done it, so we will too. What did you expect?

Of course, it’ll be fascinating to see whether the more baggage fees go up, the more people try and haul all their belongings onto the plane, hence delaying departure.

That’s something airlines really don’t like.

The baggage fee hike is merely a fare hike by other means. It also comes with a lower tax rate for the airline, as fees are taxed differently from fares.

I wonder if, for even a nanosecond over a third cocktail, an American executive or two might have considered that not raising the baggage fee might have given the airline a little point of difference.

Ach, but what’s the point of difference when your only true distinction is your network and you can just keep on scooping up (what you think is) your fair share?

Cboe exchange turns to machines to police its 'fear gauge'

NEW YORK (Reuters) – Hard pressed to quash allegations that its popular “fear gauge” is being manipulated, Cboe Global Markets (CBOE.Z) is turning to artificial intelligence to help put those concerns to rest.

People walk by the Chicago Board Options Exchange (CBOE) Global Markets headquarters building in Chicago, Illinois, U.S., September 19, 2018. REUTERS/Michael Hirtzer

The exchange, which owns the lucrative volatility index the VIX .VIX, has taken several steps to confront manipulation claims that have helped drive the Cboe’s stock down about 15 percent this year, putting it on pace for its worst year ever.

In its latest effort to police trading tied to the index, the Cboe is working with FINRA, its regulatory services provider, to develop machine learning techniques to tell whether market conditions surrounding the VIX settlement are potentially anomalous, the exchange told Reuters.

“Incorporating the use of machine learning and AI (Artificial Intelligence) is a logical part of the ongoing enhancement of our overall regulatory program,” Greg Hoogasian, Cboe chief regulatory officer, said in an emailed statement.

Cboe declined to elaborate on when it began using machine learning techniques to monitor VIX settlements.

Any steps, however, may take a while to change investors’ minds on the stock.

“Any time you see controversy over manipulating markets and it involves a company, there are people who will walk away from the stock,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

“It ends up tarnishing the company and subjecting them to legal risk that is very hard to quantify,” he said.

Tuz said Chase Investment Counsel, which owned nearly 19,000 Cboe shares in mid-2017, began selling its stake early this year, shedding the last of it on May 21.

Cboe’s stock performance this year has lagged that of other major exchange operators. Shares of Nasdaq Inc (NDAQ.O) are up about 17 percent, Intercontinental Exchange Inc’s (ICE.N) is up about 10 percent and CME Group Inc (CME.O) shares have risen 18 percent.

Concerns the index was being manipulated surfaced last year after John Griffin and Amin Shams of the McCombs School of Business at the University of Texas, Austin wrote an academic paper that noted significant spikes in trading volume in S&P 500 index options right at the time of settlement.

The paper also compared the value of the VIX at settlement with its value as calculated from S&P 500 options right after the settlement, and showed the two tend to diverge.

Instances of big deviations are taken as evidence by some that unscrupulous traders have been deliberately moving the settlement price.

Chicago Board Options Exchange (CBOE) Global Markets sign hangs at its headquarters building in Chicago, Illinois, U.S., September 19, 2018. REUTERS/Michael Hirtzer

A stock market fall on Feb. 5 that caused the VIX to surge the most in its 25-year history brought further scrutiny to the index, and led to dozens of lawsuits and ongoing probes into the matter by the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission.

The regulators have yet to comment on the matter and Cboe has denied the manipulation accusations, citing liquidity problems and legitimate hedging activity as reasons for unusual moves on settlement days.

“Only a forensic analysis of those episodes can confirm or refute such a claim,” said Kambiz Kazemi, partner at Canadian investment management firm La Financière Constance.

Meanwhile, the steps Cboe has taken to address the claims of manipulation are going in the right direction, said Kazemi.

The exchange operator recently overhauled the technology behind the auctions, improved the speed with which it sends alerts about auction imbalances, and sought to increase the number of market makers that provide buy and sell quotes for the auction.


Orderly VIX settlement auctions over the last few months have helped take some of the pressure off the Chicago-based exchange operator.

“I think we all will be observing the effects of the Cboe measures in the next few months,” Kazemi said.

VIX and associated products accounted for roughly a quarter of Cboe’s 2017 earnings, analysts estimate, and the controversy around the product has spooked some stockholders.

While financial firms have been using artificial intelligence software for everything from compliance to stock-picking, a growing number of firms have started to use it for market oversight.

Given the huge amount of data involved in market surveillance, machine learning algorithms can be far more efficient than humans in rooting out potential market manipulation, said Richard Johnson, a market structure and technology consultant at Greenwich Associates.

“It’s going to be a must have,” he said.

FINRA, which already monitors Cboe’s market on the company’s behalf, confirmed it was working on machine learning to enhance surveillance of the VIX settlement auctions, but would not offer specifics.

More generally, the Wall Street watchdog is working to use artificial intelligence to catch nefarious activities more quickly, including schemes that may have previously been unknown to regulators, said Tom Gira, who oversees FINRA’s market regulation department.

He said FINRA has begun using machine learning to scan for illegal activities across stock and options exchanges and is in the process of adding a feedback loop to the software that would regularly incorporate analysts’ data and allow the machines to detect ever-changing manipulation patterns.

Reporting by John McCrank and Saqib Iqbal Ahmed in NEW YORK; Additional reporting by Michelle Price in WASHINGTON; Editing by Megan Davies and Tomasz Janowski

AstraZeneca plots China robot offensive to counter price cuts

WUXI, China/LONDON (Reuters) – With smart cancer diagnostics, one-stop-shop diabetes kits and AI systems to improve ambulance pick-ups for patients with chest pain, AstraZeneca (AZN.L) aims to move from simply supplying drugs to become a broad healthcare provider in China.

A sign is seen at an AstraZeneca site in Macclesfield, central England May 19, 2014. REUTERS/Phil Noble

Tech tie-ups with the likes of Alibaba (BABA.N) and Tencent (0700.HK) will not directly lift the British group’s drug sales, since they are not specific for any one company’s products and in many cases will be low-cost or free.

But it will expand the overall market and represents a soft power play that dovetails neatly with Beijing’s support for Internet-based healthcare systems to alleviate a lack of doctors, overcrowding and poor grassroots healthcare.

“Down the line we benefit, our products benefit, because we have better relationships with doctors and hospital managers and also because we diagnose more patients and they get better treated,” Chief Executive Pascal Soriot told Reuters.

Surrounded by the latest gizmos at the World Internet of Things Exposition in Wuxi, eastern China, Soriot says he wants to use the power of artificial intelligence, robots and apps to help transform diagnosis and disease management.

AstraZeneca has been on a tear in China, more than doubling its sales since 2012, helped by regulatory reforms to fast-track new drugs, and today generates 18 percent of revenue in the country — a far higher proportion than rivals.

Yet Soriot is anxious to do more to keep doctors and government officials on-side in the world’s second-biggest drugs market, as soaring demand strains the state insurance system and squeezes medicine prices.

The company’s underlying conviction is that it has the right medicines across chronic diseases like cancer, diabetes and respiratory disorders to win in China.

Soriot believes that can keep AstraZeneca growing in a pivotal market in the coming years, even though annual growth is likely to slow to nearer 15 percent from the breakneck 33 percent seen in the first half of 2018.

The company has moved quickly to exploit China’s new-found willingness to use innovative Western drugs.

Last year it won a record-fast approval for lung cancer pill Tagrisso, which is designed for patients with a genetic mutation that is particularly common in China.

It hopes to get a green light before the end of 2018 — well before U.S. approval — for a new anemia drug called roxadustat being developed with FibroGen (FGEN.O).

China-first approvals for drugs like roxadustat and Elunate, a colorectal cancer treatment from Eli Lilly (LLY.N) and Hutchison China MediTech (HCM.L), mark a reversal of the historical pattern of Chinese patients getting new drugs years after their launch in the West.

There is, however, a trade-off. Multinationals that relied in the past on selling older drugs at premium prices in China are seeing prices slashed. AstraZeneca took a 50 percent haircut last year on the price of Iressa, its predecessor to Tagrisso.

“The government wants to give access to better medicines to more people,” said Soriot, who admitted that pressure on prices had come sooner than he expected.

“To some extent the economy is growing so there is more money to do that, but there is not enough money … They have to make room in the budget for innovation.”


With 1.4 billion people, around 18 percent of the world’s population, China has more cases of cancer and diabetes than any other nation, fueled by fast food, smoking and pollution, global health data show.

“There are enormous unmet medical needs in China, particularly in oncology, and 30 percent of the world’s cancer patients are in China,” Christian Hogg, Chief Executive of Hutchison China MediTech, told Reuters.

“There is almost an inevitability that the Chinese pharmaceutical industry is going to grow to be the largest in the world in due course.”

The firm, also known as Chi-Med, is working with AstraZeneca on a novel oncology drug targeting kidney, lung and stomach tumors.

AstraZeneca is bolstering its sales force to meet this growing demand. It has around 7,500 sales staff in China and is looking to push into smaller cities — boosting volume and helping offset lower prices.

It aims to get more drugs onto a list of medicines covered by basic insurance schemes — the national drug reimbursement list — and onto fast-track approvals, Soriot said. The list was most recently updated last year after an eight-year hiatus.

A drug joint venture, Dizal Pharmaceutical, backed by the China State Development & Investment Corporation, will promote Chinese-discovered drugs — another priority for Beijing.

“It’s the first time a government fund works with a foreign company in researching new drugs for Chinese patients,” Leon Wang, AstraZeneca’s China head, said in an interview at the firm’s Shanghai headquarters. “So we like that.”

Wang added there were still many patients who went undiagnosed or untreated, and that the firm’s aggressive expansion, even to “village clinics”, was helping make the difference against rivals tapping growing demand.

“Chronic disease, oncology drugs, specialty care, rare disease, these will all explode I think,” he said.

(For a graphic on ‘Booming China sales’ click

Reporting by Adam Jourdan in WUXI and Ben Hirschler in LONDON; Editing by Catherine Evans

IBM Debuts Tools to Help Prevent Bias In Artificial Intelligence

IBM wants to help companies mitigate the chances that their artificial intelligence technologies unintentionally discriminate against certain groups like women and minorities.

The technology giant’s tool, announced on Wednesday, can inspect AI-powered software for unintentional bias when it makes decisions, like when a loan might be denied to a particular person, explained Ruchir Puri, the chief technology officer and chief architect of IBM Watson.

The technology industry is increasingly combating the problem of bias in machine learning systems, used to power software that can automatically recognize images in pictures or translate languages. A number of companies have suffered a public relations black eye when their technologies failed to work as well for minority groups as for white users.

For instance, researchers discovered that Microsoft and IBM’s facial-recognition technology could more accurately identify the faces of lighter-skin males than darker-skin females. Both companies said they have since improved their technologies and have reduced error rates.

Researchers have pointed out that some of the problems may be related to the use of datasets that contain a lack of diverse images. Joy Buolamwini, the MIT researcher who probed Microsoft and IBM’s facial-recognition tech (along with China’s Megvii), recently told Fortune‘s Aaron Pressman that a lack of diversity within development teams could also contribute to bias because more diverse teams could be more aware of bias slipping into the algorithms.

In addition to IBM, a number of companies have introduced or plan to debut tools for vetting AI technologies. Google, for instance, revealed a similar tool last week while Microsoft said in May that it planned to release similar technology in the future.

Data crunching startup Diveplan said at Fortune’s recent Brainstorm Tech conference that it would release an AI-auditing tool later this year while consulting firm Accenture unveiled its own AI “fairness tool” over the summer.

Read More for an In-Depth Look: Unmasking A.I.’s Bias Problem

It’s unclear how each of these AI bias tools compare with one another because no outside organization has done a formal review.

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Puri said IBM’s tool built on the company’s cloud computing service is differentiated partly because it was created for business people and is easier to work with than similar tools from others that are intended only for developers.

Despite the flood of new AI-auditing tools, the problem of AI and bias will likely continue to persist because rooting out bias from AI is still in its infancy.

Data Firms Team up to Prevent the Next Cambridge Analytica Scandal

A bipartisan group of political data firms are drafting a set of industry standards that they hope will prevent voter data from being misused like it was in 2016. The guidelines cover transparency, foreign influence in elections, responsible data sourcing and storage, and other measures meant to root out bad actors in the industry and help fend off security threats.

The conversations, which are being organized by Georgetown University’s Institute of Politics and Public Service, come at a time when data collection more broadly faces increased scrutiny from lawmakers and consumers. Ever since news broke this spring that the political firm Cambridge Analytica used an app to hoover up data on tens of millions of Americans and use it for political purposes, Facebook and other Silicon Valley tech giants have had to answer to Congress and their customers about their mass data collection operations. But the Georgetown group focuses specifically on the responsibilities of the companies that undergird some of the country’s biggest political campaigns. Among the firms participating in these discussions are Republican shops like DeepRoot Analytics, WPA Intelligence, and Targeted Victory, as well as Democratic firms, including Bully Pulpit Interactive, NGP VAN, and DSPolitical.

“These are the firms that power all of the elections in America, and so my hope was if you can get them in a room and get them to understand the importance of the data they’re using and to self-regulate, you could achieve a dramatic improvement on behalf of voters,” says Tim Sparapani, a fellow at the Georgetown Institute who is overseeing the group.

Sparapani served as Facebook’s first director of public policy from 2009 until 2011, after spending several years at the American Civil Liberties Union. A self-proclaimed privacy advocate, he has warned about the need for stricter oversight of data brokers for years. These are companies that collect, store, and analyze data about consumers for a variety of purposes. In the political world, that data can include basic information about how many times a person has voted, their party registration, and their donation record, but it can also include social media and commercial data that can help campaigns better understand who a given person is and target them with political advertising.

The data broker industry remains largely unregulated, both inside and outside politics. The Federal Trade Commission has urged Congress to regulate data brokers since at least 2012, but nothing has come of it so far. In June, Vermont became the first state to pass a data broker law, which goes into effect in January.

The Georgetown group first met last fall, months before Cambridge Analytica began making headlines. At the time, the industry’s primary concern was the risk of a data breach or a hack at the hands of a foreign threat: In the summer of 2017, a cybersecurity firm discovered DeepRoot Analytics’ entire trove of 198 million voter records was exposed in a misconfigured database, constituting the largest known voter data leak in history. Brent McGoldrick, CEO of DeepRoot, says the leak was a shock to the system.

“You just have a different mindset coming out of something like that, where you start to think differently about everything from security to privacy to the data you have and the perceptions of it,” he says.

Coupled with the intelligence community warnings about Russia and other foreign actors’ continued attacks on the American electoral system, McGoldrick says, it seemed well past time for his company and its competitors on both sides of the aisle to talk about protecting themselves and the people whose data they hold.

McGoldrick brought up the idea with Mo Elleithee, a former Democratic National Committee spokesperson who founded Georgetown’s Institute of Politics and Public Service in 2015. Together, they tapped Sparapani to oversee the effort. “We understand that in order to move the ball forward on privacy and security issues, we’re going to have to hear from people who, maybe we don’t like hearing what they have to say,” McGoldrick says. When the Cambridge Analytica story broke months later, he says, it only underscored the need for this kind of work.

The group, which has yet to be named, has begun circulating a set of guiding principles among data privacy advocates and the companies themselves to see what the participants are willing to agree to. While the final list is still being ironed out, Sparapani described a number of commitments for which there is broad-based support. One proposal would require the companies involved to alert one another and the proper government officials of any attempts by a foreign actor to influence the election. Another would have the companies vow to only use their tools to support people’s right to vote, not to suppress it. The group is working on a standard that would guarantee some transparency for consumers and educate them about how their data is being used. They’re also working on security standards around data storage, as well as language that they would commit to include in any contract with a potential client.

“It would make contractually binding not only their practices, but their clients’,” Sparapani says.

The hope is that these guidelines would act as a sort of seal of approval for political campaigns. “If firms have publicly stated they’re following these guidelines, hopefully candidates, committees, and causes will look for this when they’re trying to hire someone,” says Mark Jablonowski, DSPolitical’s chief technology officer, who has been involved in the initiative since its early days.

Of course, getting dozens of political opponents and business competitors who have never been regulated before to agree to any set of standard practices is no easy task. “Everyone’s got to have everything vetted through their lawyers,” McGoldrick says. “The last thing a lawyer likes is you voluntarily saying something you don’t have to say.”

“Sadly over the last few cycles there have been bad actors on both sides working in multiple campaigns,” says Chris Wilson, CEO of WPAIntelligence, which worked briefly with Cambridge Analytica during senator Ted Cruz’s 2016 presidential campaign. “I believe all in our industry, WPAi included, are hopeful that a set of standards will allow us, and the public, to be cognizant of the origins of data and its ultimate use.”

Until the details are finalized, it’s impossible to assess the effectiveness of this collaborative effort. As with any discussion around data privacy, it’s the fine print that matters. In California, where the governor recently signed a landmark privacy bill, lobbying groups have already begun picking apart nearly every sentence to better align with their interests.

Still, it is worth asking how much good this kind of work can ever do. These are well-known, well-regarded players in the industry committing themselves to a certain set of values. But what about everyone else? What about the people who are intending to deceive? Without substantive regulation, there’s nothing stopping anyone from harvesting data for nefarious purposes with impunity.

Then there’s the fact that these proposed guidelines don’t give consumers any real power. While other data privacy laws like the one that passed in California or Europe’s General Data Protection Regulation give people the ability to control what data is collected and see who it’s shared with, these proposed guidelines can’t promise the same.

Elleithee stresses that this is just the first step. Once the companies have all agreed to a set of standards, the Institute plans to convene a larger group from the broader tech and privacy communities. “As the conversation progresses, we want to bring more voices in,” he says.

Whatever the group eventually proposes, Sparapani says he fully expects pushback from privacy advocates. Even he has concerns. “If it were me, and I was critiquing this document, I could point out a dozen things I’d have the companies commit to,” he says. “In the room, they get an earful from me every time we meet, where I find this to be insufficient.”

But he also believes that waiting on the perfect solution that satisfies all parties will take more time than the country can afford. “Is it a fulsome commitment that I have been pushing for as an advocate? No. But does it begin to push companies to raise their standards to meet government and consumer expectations? Yes. And that’s a good thing.”

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