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Business, Corporate Strategies

How Businesses Can Practice Ethical AI

General Assembly
October 30, 2023
Ethical AI Best Practices for Business Leaders

AI presents vast opportunities for innovation. But companies must also address the ethical concerns this rapidly emerging tech poses. This article examines how responsible innovators can implement ethical AI practices.

During what most historians consider the most significant event of the first half of the 19th century, prospectors flocked to the hills of Sacramento, California, in search of gold. 

Today’s businesses are on a similar journey, frantically digging through the AI mines for nuggets of efficiency and innovation. 

According to a State of AI 2022 report by McKinsey, only 20% of respondents had adopted AI in at least one business process as of 2017. By the end of 2022, that number jumped to 50%. 

From powering tailored product recommendations in retail to determining creditworthiness in finance and informing hiring decisions in HR, AI continues to gain momentum across industries and disciplines.  And for good reason. 

AI provides insights for data-driven decision-making, improves customer experience through personalization, unlocks seamless automation, frees up resources for more crucial business operations, and much more. 

AI is like the key to the treasure trove of Emperor Montezuma of the Aztec Empire. 

Yet, with every turn of this digital key, business leaders and innovators must also confront the ethical implications AI use brings. Concerns such as AI singularity and AI takeover may seem far-fetched. But AI bias, discrimination, and potential job losses represent clear and present ethical considerations — considerations that need to be proactively addressed. 

How organizations address these AI ethics concerns can either position them as trustworthy and transparent solution providers or derail their efforts to get ahead. 

Read on to discover how you can responsibly integrate AI into your business operations and provide answers to the ethical questions AI adoption poses.

What is Ethical and Responsible AI?

Ethics has remained a central concern throughout history when adopting various forms of technology. For instance, the printing press raised concerns about the spread of misinformation and propaganda. The internet spawned ethical dilemmas related to privacy, cyberbullying, and digital surveillance.

The rise of artificial intelligence is no different. With AI, there are also complex considerations regarding its ethical usage and responsible innovation.

While innovators continue to grapple with the complexities of AI, there’s a growing understanding of the ethical challenges it poses and what makes for responsible implementation. Ethical and responsible AI refers to the use of AI in ways that uphold human dignity, avoid unjust discrimination, and foster a more equitable and just society.

Cases like Nashville-based visual artist McKernan, who’s suing Stability AI, the London-based maker of text-to-image generator Stable Diffusion, exemplify why it’s critical to practice ethical and responsible AI.

At its core, the ethical use of AI involves upholding these values in its application:

a. Transparency and accountability

Transparency implies that the decision-making processes of AI systems are clear and understandable. This helps identify and rectify any AI biases or errors that may arise. 

The principle of accountability demands that those who design and deploy AI systems are responsible for their actions. And that there are mechanisms in place to rectify any harm caused by AI decisions.

b. Privacy and security

Privacy and security emphasize the protection of individual personal data by preventing unauthorized access and fostering AI safety in general.

Ethical AI respects individuals’ privacy rights and ensures companies handle sensitive information securely. It also guards against potential cyber threats, ensuring the confidentiality and integrity of data.

c. Inclusiveness and fairness

These values ensure that AI tech benefits all individuals, regardless of race, gender, or other differentiating characteristics. Inclusiveness implies that AI systems should cater to people of varying traits and backgrounds. 

Fairness requires AI to avoid discriminating against any particular group and to treat all individuals equitably in its decisions and outcomes. These principles help address biases and promote diversity and equity in AI applications.

The Big Guns Agree

Interestingly, global tech giants who also double as the leading AI innovators believe in AI governance. They accept they have a responsibility to deploy AI in ways that respect fundamental human values, fairness, and transparency.

“My job is to put into practice across the company, the six AI principles that we’ve adopted at Microsoft. Our six principles that form our north star are fairness, privacy and security, reliability and safety, inclusiveness, accountability, and transparency,” says Microsoft’s Chief Responsible AI Officer, Natasha Crampton.

“Microsoft has long taken the view that we need both responsible organizations like ourselves to exercise self-restraint and put in place the best practices that we can to make sure that AI systems are safe, trustworthy, and reliable,” she adds.

Why Should Ethical AI Practices Matter to You?

While testifying before the U.S. Congress, Christina Montgomery, IBM’s Vice President and Chief Privacy and Trust Officer, said, “The era of AI cannot be another era of ‘move fast and break things,’ still, we don’t have to slam the brakes on innovation either.” 

Montgomery’s words capture the posture that innovators must take with AI implementation. 

They need to make moves and leverage the power of AI. Yet they can’t afford to innovate now and worry about ethics later. This isn’t just because of the far-reaching consequences it may have on society — it’s also because of the dire impact it can have on their businesses.

If you’re wondering what potential direct repercussions innovators have to worry about when it comes to unethical AI use, here are a few: 

1. Reputational risks

In the era of viral tweets and trending hashtags, a company’s reputation can transform from pristine to precarious with the speed of a repost. As such, much like a trapeze artist, businesses must tread carefully in the realm of AI. 

Any ethical missteps can lead to a hot reputational mess.

For instance, when news of biased algorithms or data misuse emerges, such as when Amazon’s internal AI recruiting tool penalized applications containing the word “women’s,” the repercussions can be swift and severe. 

Social media outrage, consumer boycotts, and a torrent of negative media coverage flow in. Followed by the inevitable decrease in customer loyalty and a compromised brand standing.

AI regulation is evolving rapidly. Governments and regulatory bodies worldwide are enacting stringent legislation to ensure the ethical use of AI. 

Non-compliance with these AI regulations carries substantial legal risks. Businesses that engage in unethical AI practices can face significant fines and legal actions that can cripple operations and severely damage their reputation.

Unsurprisingly, the public is also keeping companies on their toes regarding compliance with AI-related ethics. If businesses don’t want to waste resources battling avoidable lawsuits, they’ll take AI ethics seriously.

3. Financial risks

AI might be where the money is at. But unethical AI use can stifle growth or even blow a hole in your war chest. 

For instance, unethical AI practices can lead to customer attrition — and a decline in a company’s market share. All of which can have major financial consequences. 

Not to mention the possibility of paying huge fines or compensation for violating AI ethics.

Plus, biased AI-driven hiring processes do more than just hinder diversity and inclusion. They also affect a company’s ability to innovate and remain competitive.

Steps to Start Practicing Ethical AI in Your Company Today

With great opportunity comes great responsibility. As a forward-thinking business leader, here are ways you can help your company responsibly and ethically integrate AI into its operations.

1. Foster diverse teams

Putting together teams of individuals of varying backgrounds and perspectives can help you ethically adopt AI.

Such diverse teams bring together people from different cultures, genders, ages, and experiences. It makes it easier for them to anticipate, prevent, spot, and rectify AI biases.

Also, assembling diverse teams ensures your AI models work with inclusive data that accounts for multiple groups and variables. Algorithms trained on such representative data will likely make unbiased and fair decisions and avoid discriminatory outcomes.

The cherry on top is that diverse teams excel at user-centered design. They can better empathize with the needs and preferences of a broad user base, ensuring that AI interfaces and interactions are inclusive and respectful of individual differences. This enhances the user experience and fosters trust.  

Even big tech recognizes the importance of diverse teams in creating well-rounded AI models. Facebook CTO Mike Schroepfer, for instance, admits that hiring is an integral part of fostering diversity in AI, even though there’s a general shortage of diverse AI employees.

2. Prioritize transparency

AI transparency in this context means making AI processes and decisions understandable and explainable to internal stakeholders and end-users. This can enhance accountability, fairness, and trust in AI systems.

So, how do you achieve AI transparency? 

One way is by choosing interpretable AI models. These systems enable humans to understand the reasoning behind their decisions and outcomes. They include decision trees, linear regression, or rule-based systems.

To extend the impact of interpretable models, you can pair them with explainability tools. These tools aren’t AI models themselves. 

But you use these tools to further break down the reasons for a decision provided by interpretable AI models in layperson’s language. They can also come in handy when dealing with stakeholders who don’t have a deep understanding of AI.

3. Educate your team

Educating employees, ranging from developers and data scientists to decision-makers and executives, about ethical AI principles and potential biases is critical to fostering ethical AI practices.

By providing clear lessons on ethical AI principles, you ensure your employees align with your company’s values related to AI. That way, workers across various roles are better equipped to make ethical decisions at every stage of the AI lifecycle.

The added benefit of having employees who understand the ethical principles of AI applications is that they can openly communicate with stakeholders. 

With customers, for instance, such employees can quickly reassure them and provide insights into decisions. This fosters transparency, trust, and, by extension, customer loyalty. 

You must focus on delivering ongoing education and regular refresher courses on ethical AI principles. This keeps your workforce updated on the latest ethical concerns and how to address them. 

Clear and up-to-date documentation on ethical AI development and deployment guidelines can also be helpful.

4. Practice routine audits and assessments 

You’ll need routine audits and assessments to detect bias and fairness issues in your AI systems. These audits involve scrutinizing data, algorithms, and outcomes to identify any disparities related to race, gender, age, or other attributes. 

These checks are critical to making timely corrections to biases in your AI models and ensuring that your company adapts to evolving AI ethical standards. 

For instance, X (formerly Twitter) phased out its AI-powered photo-cropping algorithm after discovering that it favored white faces over black ones. But it was the public that first pointed out that glitch. You can avoid the fallout X had to deal with by expanding biases to test for in your AI systems and conducting regular checks.

Sometimes, those routine checks will reveal glitches you can fix — other times, they might unveil features you need to nix. 

Speaking about X’s decision to phase out the photo-cropping algorithm, Rumman Chowdhury, director of Twitter’s META team (Machine Learning Ethics, Transparency, and Accountability), noted: “One of our conclusions is that not everything on Twitter is a good candidate for an algorithm, and in this case, how to crop an image is a decision best made by people.” 

Making an effort to get informed consent from your users fosters trust. But you can’t get informed consent if users aren’t well informed. This means you must communicate transparently about how you use AI and what users sign up for. 

By providing clear information on AI’s role in your operations and its potential impact, you empower stakeholders to give meaningful consent to how you use their data.

Protecting user privacy is another critical aspect of practicing ethical AI and engendering stakeholder trust. But this isn’t limited to internal privacy protection measures. It also involves transparent communication with stakeholders.

For instance, when you share details about AI data handling practices and how you ensure data privacy and security, such transparency reassures stakeholders that you’ll treat their sensitive information with care and respect.

Practicing Ethical AI is the Key to Responsible Innovation

Harnessing the advantages of AI requires organizations to navigate a precarious path paved with severe ethical risks. It’s their duty to ensure they deploy AI in ways that respect fundamental human values, fairness, transparency, and accountability. 

The good news is data suggests more business leaders are understanding AI and the importance of upholding its ethical demands. 

In a recent Adobe survey, 25% of leaders say their companies aren’t ready to take advantage of generative AI, with 35% citing a lack of the proper security, privacy, and trust guardrails.

The future of AI in the world of work will require industry partners and trusted experts to help practice responsible and ethical AI together. If you’ve answered the question, “What is artificial intelligence, and how can it help my company?” We can show you how to answer an equally important question — “How do we ensure ethical AI practices?”

Contact us today to learn more.

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