Author name: CIO

As Klarna Flips From AI-first to Hiring People Again, a New Landmark Survey Reveals Most AI Projects Fail to Deliver

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Klarna, after relying heavily on AI for customer service, is shifting back to hiring humans due to AI's “lower quality” results. CEO Siemiatkowski stated they need human agents for better customer support. An IBM survey found that only 25% of AI projects succeed as expected. Klarna aims to improve service quality while still maintaining an AI-first strategy, planning to offer flexible freelance roles for customer support.

https://fortune.com/2025/05/09/klarna-ai-humans-return-on-investment/

78% of CISOs See AI Attacks Already

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78% of CISOs report encountering AI-driven attacks, as cybersecurity evolves with AI tools. Darktrace's survey reveals 74% view AI as a current threat, with rising sophistication in phishing and malware. While there’s a personnel shortage in cybersecurity, 95% believe AI can enhance defense efficiency. However, only 42% fully understand their AI cybersecurity tools, highlighting a need for clarity and effective integration in defenses against emerging threats.

https://www.theregister.com/2025/05/16/cisos-report-ai-attacks/

Prohibited AI

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TLDR: EU AI Act, effective August 2024, prohibits harmful AI practices: subliminal manipulation, social scoring, and biometric tracking in public. Compliance requires assessing current AI uses, screening future applications, and maintaining an efficient governance framework. Focus on high-risk, prohibited cases and leverage existing compliance processes to ensure adherence.

https://www.tlt.com/insights-and-events/insight/prohibited-ai—taking-a-practical-approach-to-compliance/

Compliance Now Biggest Cyber Challenge for UK Financial Services

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Compliance is the top cyber challenge for UK financial services, as cited by 44% of surveyed firms. Key issues include data protection, remote work support, and cloud security. The EU's DORA regulation, effective January 2025, highlights the need for robust cyber resilience. Supply chain attacks take the longest to respond to (16 hours), with significant concerns about threats from nation-states. A third of firms are using AI in cybersecurity, viewing AI-powered phishing as a major threat (89%).

https://www.infosecurity-magazine.com/news/compliance-cyber-challenge-uk/

CIOs Turn to ESG Tech as Part of Sustainability Leadership

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CIOs play a key role in corporate sustainability by selecting technologies that support ESG (Environmental, Social, Governance) initiatives. Over 70% of investors advocate integrating sustainability into corporate strategy, driving demand for ESG software to improve compliance, data reporting, and operational efficiency. CIOs need to understand their organization's sustainability needs, collaborate with cross-functional teams, and evaluate software costs and ROI. Various software options exist for carbon accounting and broader ESG management, with many organizations opting to develop in-house solutions. The global market for ESG software is projected to grow significantly by 2030.

https://www.techtarget.com/sustainability/feature/CIOs-turn-to-ESG-tech-as-part-of-sustainability-leadership

Why Cybersecurity Shouldn’t Be a Checkbox Exercise

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Cybersecurity must go beyond mere compliance with regulations like PCI DSS as it does not equate to true security. Many small and medium-sized businesses mistakenly believe compliance provides safety, yet attackers specifically target them. Compliance often leads to a false sense of security, deprioritizing essential threat detection and response. Businesses need a risk-based strategy that identifies and addresses actual vulnerabilities, aligns with operational priorities, and uses dynamic, real-time threat detection. Ultimately, resilience against cyber threats should be the primary focus, moving beyond basic compliance to ensure ongoing business protection.

https://www.fastcompany.com/91331498/why-cybersecurity-shouldnt-be-a-checkbox-exercise

The Fine Print of AI Hype: The Legal Risks of AI Washing : Clyde & Co

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AI washing poses legal risks as companies exaggerate AI capabilities amid vague definitions in the EU's AI Act. Legal clarity is essential but increases scrutiny, with potential penalties for false claims. Companies face liability for misleading assertions to investors and customers. Developing accurate communications and verifying AI claims are crucial to mitigate legal repercussions.

https://www.clydeco.com/en/insights/2025/05/the-fine-print-of-ai-hype-the-legal-risks-of-ai-wa

Developers Prepare for Uncertainty, Look to Prior Regulations With AI Act Coming Online

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Developers are braced for uncertainty as the EU AI Act is enacted, acknowledging that evolving compliance strategies will be necessary due to ambiguities in the regulatory landscape. Experts emphasize adapting governance frameworks while recognizing the gradual implementation of regulations. Companies with prior regulatory experience, particularly in data compliance, are better positioned to navigate the Act's requirements, while the finalization of a general-purpose AI Code of Practice remains delayed. The European Commission is exploring simplifications to the Act to ease compliance for businesses.

https://iapp.org/news/a/developers-prepare-for-uncertainty-look-to-prior-regulations-with-ai-act-coming-online

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