What about investors? ESG analyses as tools for ethics-based AI auditing

Abstract

Artificial intelligence (AI) governance and auditing promise to bridge the gap between AI ethics principles and the responsible use of AI systems, but they require assessment mechanisms and metrics. Effective AI governance is not only about legal compliance; organizations can strive to go beyond legal requirements by proactively considering the risks inherent in their AI systems. In the past decade, investors have become increasingly active in advancing corporate social responsibility and sustainability practices. Including nonfinancial information related to environmental, social, and governance (ESG) issues in investment analyses has become mainstream practice among investors. However, the AI auditing literature is mostly silent on the role of investors. The current study addresses two research questions: (1) how companies’ responsible use of AI is included in ESG investment analyses and (2) what connections can be found between principles of responsible AI and ESG ranking criteria. We conducted a series of expert interviews and analyzed the data using thematic analysis. Awareness of AI issues, measuring AI impacts, and governing AI processes emerged as the three main themes in the analysis. The findings indicate that AI is still a relatively unknown topic for investors, and taking the responsible use of AI into account in ESG analyses is not an established practice. However, AI is recognized as a potentially material issue for various industries and companies, indicating that its incorporation into ESG evaluations may be justified. There is a need for standardized metrics for AI responsibility, while critical bottlenecks and asymmetrical knowledge relations must be tackled.

How to explain AI systems to end users: a systematic literature review and research agenda

“…Hence, the developers must create tools and systems that enable end users to understand the system they are using and feel control of it. Moreover, this connects to the discussion on the role of XAI as an element of AI governance (Minkkinen et al, 2020b(Minkkinen et al, , 2022aM€ antym€ aki et al, 2022;Sepp€ al€ a et al, 2021). According to Sepp€ al€ a et al (2021), AI design and development play a significant role in translating ethical principles into governed AI, while explainability in turn, is one of the key design issues related to AI governance.…”

“…Hence, the developers must create tools and systems that enable end users to understand the system they are using and feel control of it. Moreover, this connects to the discussion on the role of XAI as an element of AI governance (Minkkinen et al ., 2020b, 2022a; Mäntymäki et al. , 2022; Seppälä et al.…”

Sustainable AI in environmental economics and management: Current trends and post-COVID perspective

“…The article contributes to the development of the concept of environmental economics and management by substantiating the new role that AI should play in its framework. Unlike Astobiza et al (2021), Bolton et al (2021), Choi et al (2021), Minkkinen et al (2022), Osipov et al (2022), Popkova et al (2020), Saetra (2021), Visvizi (2022), and Wilson and van der Velden (2022), it has been proved that the existing interpretation of sustainable AI does not allow to unlock the potential of AI to fight new global challenges and therefore needs to be revised. Distinctive features of the proposed new authors' interpretation are: → The transition from the practice of flexible redirection of AI from one industry to another (for example, in healthcare, in the context of the COVID-19 pandemic) to a fixed, stable, and long-term application of sustainable AI in environmental economics and management; → Sustainable AI should be given a new role related to preventive environmental crisis management (as opposed to dealing with current threats, which is a characteristic of the existing interpretation).…”

“…The existing interpretation of sustainable AI defines it as smart technology for maintaining stable and balanced development of economic systems (Popkova et al, 2020;Saetra, 2021;Minkkinen et al, 2022;Osipov et al, 2022). Threats to healthcare have become more acute in the context of a pandemic; therefore, based on the existing interpretation, medicine has become the main area of application of sustainable AI (Astobiza et al, 2021;Bolton et al, 2021;Choi et al, 2021;Visvizi, 2022;Wilson and van der Velden, 2022).…”

ESG investing in the AI era: Features of developed and developing countries

“…ESG investment in the age of AI acquires two specific features (Selim, 2020;Saetra, 2021). The first one is that ESG investments imply the financing of smart technologies which systemically improve the environmental, social, and financial characteristics of business activities (Minkkinen et al, 2022a). The second one is that ESG investment is performed based on smart technologies, for example, blockchain (Alkaraan et al, 2022).…”