The rapid growth of artificial intelligence (AI) technology is raising concerns about its social, ethical, and sustainability implications. Recent events, such as the temporary removal of OpenAI’s CEO Sam Altman, have intensified these concerns. A report titled ‘Unmasking Sustainability in AI,’ published by London-based rating agency Standard Ethics, sheds light on the lack of governance and ethical guidelines surrounding AI in many large companies.
Companies lag in addressing AI’s ethical and sustainability impact
Standard Ethics’ report assessed 240 of the largest listed companies, both within and outside the EU, on four key criteria related to AI governance:
Acknowledgment of AI’s ethical and ESG (Environmental, Social, and Governance) impact in their codes of ethics.
Publication of AI policies for accountability to stakeholders.
Disclosure of secondary documents on AI.
Alignment of AI policies with international guidelines.
Shockingly, none of the surveyed EU or non-EU companies referenced AI within their codes of ethics or conduct. Only 9% of EU-based companies had published AI policies, primarily within the banking sector. Non-EU companies had no AI policies. However, 64% of EU companies had generic documents on AI, compared to 55% of non-EU companies. The finance sector led the way, with 89% of EU financial companies having such documents.
Financial institutions pioneering sustainable AI usage
Despite these concerning findings, companies are making strides in the right direction, particularly in the finance sector. According to Beatrice Gornati, vice-president of the research office at Standard Ethics, the finance sector is more attuned to the sustainable implications of AI. They recognize that AI can introduce risks and affect client relationships, emphasizing the importance of human control in AI processes.
Lack of transparency in investment decisions and increased market volatility are some of the potential issues if AI is not carefully managed within the banking sector. This sector’s proactive approach in adopting AI with sustainability in mind highlights its commitment to responsible AI usage.
Aligning AI policies with international standards
To ensure that AI policies align with international strategic objectives, Standard Ethics recommends that companies follow guidelines issued by reputable sources such as the United Nations and the Organisation for Economic Co-operation and Development (OECD). By adhering to these established guidelines, companies can gain a better understanding of the complexities and potential risks associated with AI.
A guide published by the Corporate Governance Institute offers practical steps for firms to improve their AI policies, including the formation of working groups to oversee policy creation and educating board members about AI concepts. However, it’s crucial to note that some companies still underestimate the magnitude of AI’s impact, emphasizing the need for adherence to international standards to enhance their understanding of this transformative technology.
As AI technology continues its unprecedented growth, concerns about its ethical and sustainability implications are becoming increasingly urgent. The ‘Unmasking Sustainability in AI’ report by Standard Ethics highlights the lack of governance and ethical guidelines within many large companies, both within and outside the EU. These findings underscore the need for companies to acknowledge AI’s ethical and ESG impact, publish AI policies, and align these policies with international standards.
While the finance sector leads the way in adopting sustainable AI practices, it is essential for all industries to recognize the broader implications of AI and take proactive steps to ensure responsible and ethical AI usage. By following established international guidelines and enhancing their understanding of AI’s complexities, companies can navigate the AI landscape more effectively while mitigating potential risks and negative impacts on society.
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