UNIT V

AI AND ETHICS- CHALLENGES AND OPPORTUNITIES

Challenges – Opportunities- ethical issues in artificial intelligence- Societal

Issues Concerning the Application of Artificial Intelligence in Medicine-
decision-making role in industries-National and International Strategies on
AI.

CHALLENGES

Ethical challenges facing AI has identified six types of concerns that can be traced to the
operational parameters of decision-making algorithms and AI systems.

The map reproduced and adapted in Figure 1 takes into account decision-making algorithms

1) turn data into evidence for a given outcome (henceforth conclusion), and that this
outcome is then used to

(2) trigger and motivate an action that (on its own, or when combined with other actions)
may not be ethically neutral. This work is performed in ways that are complex and (semi-
)-autonomous, which

(3) complicates apportionment of responsibility for effects of actions driven by

algorithms.”
 ➢ The proposed types of concerns can cause failures involving multiple human,
organisational, and technological agents.
➢ This mix of human and technological actors leads to difficult questions concerning
how to assign responsibility and liability for the impact of AI behaviours.
➢ These difficulties are captured in traceability as a final, overarching, type of concern.

Unjustified actions
➢ Much algorithmic decision-making and data mining relies on inductive knowledge and
correlations identified within a dataset.

➢ Correlations based on a „sufficient‟ volume of data are often seen as sufficiently

credible to direct action without first establishing causality and gain knowledge.

➢ Even if strong correlations or causal knowledge are found, this knowledge may only
concern populations while actions with significant personal impact are directed towards
individuals

Opacity
Opacity in machine learning algorithms is a product of the high dimensionality of data,
complex code and changeable decision-making logic.[

1] Transparency and comprehensibility are generally desired because algorithms that

are poorly predictable or interpretable are difficult to control, monitor and correct

[2] Transparency is often naively treated as a panacea for ethical issues arising from
new technologies.

Bias
The automation of human decision-making is often justified by an alleged lack of bias in AI
and algorithms. This belief is unsustainable; AI systems unavoidably make biased decisions.
Development is not a neutral, linear path. Inclusiveness and equity in both the design and usage
of AI is thus key to combat implicit biases.

(1) pre-existing social values found in the “social institutions, practices and attitudes”
from which the technology emerges,

(2) technical constraints and

(3) emergent aspects of a context of use.

Discrimination
➢ Discrimination against individuals and groups can arise from biases in AI systems.

➢ Discriminatory analytics can contribute to self-fulfilling prophecies and stigmatisation

in targeted groups, undermining their autonomy and participation in society.
 ➢ The goals of equality law (e.g., formal and substantive equality), and appropriate
thresholds for distribution of outcomes across groups. In this context, embedding
considerations of non-discrimination and fairness into AI systems is particularly
difficult.

Autonomy
➢ Value-laden decisions made by algorithms can also pose a threat to autonomy.
Personalisation of content by AI systems, such as recommender systems, is particularly
challenging in this regard.

➢ Personalisation can be understood as the construction of choice architectures which are

not the same across a sample.

➢ Different information, prices, and other content can be offered to profiling groups or
audiences within a population defined by one or more attributes,

➢ for example the ability to pay, which can itself lead to discrimination. Personalisation
reduces the diversity of information users encounter by excluding content deemed
irrelevant or contradictory to the user's beliefs or desires.

Informational privacy and group privacy

➢ Algorithms also transform notions of privacy.

➢ Responses to discrimination, personalisation, and the inhibition of autonomy due to

opacity often appeal to informational privacy, or the right of data subjects to “shield
personal data from third parties.”

➢ Informational privacy concerns the capacity of an individual to control information

about herself, and the effort required by third parties to obtain this information.

➢ In a healthcare setting this could include insurers, remote care providers (e.g., chatbot
and triage service providers), consumer technology companies, and others. Opaque
decision-making inhibits oversight and informed decision-making concerning data
sharing.

➢ Data subjects cannot define privacy norms to govern all types of data generically
because the value or insightfulness of data is only established through processing.

Moral responsibility and distributed responsibility

➢ When a technology fails, blame and sanctions must be apportioned.

➢ Blame can only be justifiably attributed when the actor has some degree of control and
intentionality in carrying out the action.
 ➢ Traditionally, developers and software engineers have had “control of the behaviour of
the machine in every detail” insofar as they can explain its overall design and function
to a third party.

➢ This traditional conception of responsibility in software design assumes the developer

can reflect on the technology‟s likely effects and potential for malfunctioning, and
make design choices to choose the most desirable outcomes according to the functional
specification.

Automation bias
➢ A related problem concerns the diffusion of feelings of responsibility and accountability
for users of AI systems, and the related tendency to trust the outputs of systems on
the basis of their perceived objectivity, accuracy, or complexity. Delegating
decision-making to AI can shift responsibility away from human decision-makers.

➢ Similar effects can be observed in mixed networks of human and information systems
as already studied in bureaucracies, characterised by reduced feelings of personal
responsibility and the execution of otherwise unjustifiable actions.

➢ Algorithms involving stakeholders from multiple disciplines can, for instance, lead to
each party assuming others will shoulder ethical responsibility for the algorithm‟s
actions. Machine learning adds an additional layer of complexity between designers
and actions driven by the algorithm, which may justifiably weaken blame placed upon
the former.

Safety and resilience

➢ The need to apportion responsibility is acutely felt when algorithms malfunction.
Unethical algorithms can be thought of as malfunctioning software artefacts that do not
operate as intended.

➢ Useful distinctions exist between errors of design (types) and errors of operation
(tokens), and between the failure to operate as intended (dysfunction) and the presence
of unintended side-effects (misfunction). Misfunctioning is distinguished from mere
negative side effects by „avoidability‟, or the extent to which comparable types of
systems or artefacts accomplish the intended function without the effects in question.

➢ Machine learning in particular raises unique challenges, because achieving the intended
or “correct” behaviour does not imply the absence of errors or harmful actions and
feedback loops.

Ethical auditing
 ➢ How best to operationalise and set standards for testing of these ethical challenges
remains an open question, particularly for machine learning.

➢ Merely rendering the code of an algorithm transparent is insufficient to ensure ethical

behaviour. One possible path to achieve interpretability, fairness, and other ethical goals
in AI systems is via auditing carried out by data processors, external regulators, or
empirical researchers, using ex post audit studies, reflexive ethnographic studies in
development and testing, or reporting mechanisms designed into the algorithm itself.

➢ For all types of AI, auditing is a necessary precondition to verify correct functioning.
For systems with foreseeable human impact, auditing can create an ex post procedural
record of complex automated decision-making to unpack problematic or inaccurate
decisions, or to detect discrimination or similar harms.

OPPORTUNITIES IN AI ETHICS
Ethical Design and Development:
Integrating ethical considerations into the design and development of AI systems presents a
significant opportunity for promoting responsible AI. By embedding ethical principles from
the outset, developers can create AI technologies that align with human values and respect
users' rights. A notable example is Google's "Ethical AI Principles", which guide the
development and deployment of AI technologies to ensure they are designed with ethical
considerations in mind, including transparency, privacy, and fairness.

Leveraging AI for Social Good:

Leveraging AI for positive social impact offers great potential. AI applications in healthcare,
powered by technologies like natural language processing and machine learning, education,

environmental protection, and disaster response can improve people's lives and address societal
challenges. For instance, IBM's "Watson for Oncology" uses AI to assist doctors in cancer
treatment decisions, enhancing accuracy and efficiency in diagnoses.
Robust Ethical Frameworks:
Developing comprehensive ethical frameworks for AI can guide policymakers, developers, and
users in making responsible choices. These frameworks provide a set of guiding principles and
standards to ensure the ethical use of AI. An example of this is the "Asilomar AI Principles",
a set of 23 principles proposed by AI researchers to ensure the safe and beneficial development
of AI technologies.

Public Engagement and Awareness:

Raising public awareness about AI ethics fosters informed discussions and ensures that ethical
considerations are at the forefront of AI adoption. Organizations like the AI Now Institute -
Symposium hold symposiums to bring together experts and the public to discuss AI's social
impact and ethical implications, promoting an inclusive and transparent conversation about AI
ethics.

Interdisciplinary Collaboration:
Engaging experts from various fields, including ethics, law, sociology, psychology, and
philosophy, can lead to more holistic and nuanced approaches to AI ethics. Collaborative
efforts among diverse stakeholders can help identify and address
omplex ethical challenges effectively. The Partnership on AI is an example of a multi-
stakeholder organization that fosters collaboration among industry, academia, and civil society
to address AI challenges responsibly.
ETHICAL ISSUES IN ARTIFICIAL INTELLIGENCE

Artificial intelligence (AI) provides many new and exciting capabilities. We see AI in our daily
lives in the form of virtual assistants, instructional programs and autonomous operations:

• Self-driving cars? Check.

• Instantaneous translation of phrases into another language. Check.
• Write code. Check.

Legal Considerations for AI

In the United States, AI regulation is decentralized which can cause uncertainty surrounding
what legal implications can result from the usage of artificial intelligence. While we do have
some rules that regulate the outcomes, there is often confusion around the actual operational
usage of AI tools.

Here are some legal considerations:

• Violations to intellectual property rights

• Data privacy issues that violate General Data Protection Regulation (GDPR)
• Data privacy issues that violate the California Consumer Privacy Act (CCPA)
• Violations of employment regulations
• Inappropriate usage of copyright data
• Disputes concerning contract law when generative AI is used
• Consumer confidentiality and issues with personally identifiable information (PII)
• Inaccurate usage of generative AI output

11 AI Ethical Issues

Artificial intelligence has the potential to make your business more efficient. That‟s a win. But
increasing your output could come at a cost regardless of any savings. Making the ethics of AI
a focal point will help ensure your business remains in good standing from an operational,
regulatory and reputational standpoint. Here are 11 ethical issues you should know about when
it comes to AI.

Issue 1: Job Displacement

Job displacement is a concern that is frequently cited in discussions surrounding AI. There is
fear that automation will replace certain aspects or entire job roles, causing unemployment rates
to spike industries. According to CompTIA‟s Business Technology Adoption and Skills Trends
report, 81% of U.S. workers have recently seen articles which focus on the replacement of
workers with AI. The same report found that 3 out of 4 workers are very or somewhat
concerned about how automated technologies will impact the workforce.
Issue 2: Privacy

Training of AI models requires massive amounts of data, some of which includes PII. There is
currently little insight into how the data is being collected, processed and stored which raises
concerns about who can access your data and how they can use it. There are other privacy
concerns surrounding the use of AI in surveillance. Law enforcement agencies use AI to
monitor and track the movements of suspects. While highly valuable, many are worried
about the misuse of those capabilities in public spaces, infringing upon individual rights to
privacy.

Issue 3: Bias

There is another ethical concern surrounding AI bias. Although AI does not inherently come
with bias, systems are trained using data from human sources and deep learning which can lead
to the propagation of biases through technology. For instance, an AI hiring tool could omit
certain demographics if the data sets used to train the algorithm contained a bias against a
particular group. This could also have legal implications if it leads to discriminatory practices.

Issue 4: Security

Security remains a top priority when it comes to AI (and really any branch of computer
science). Lax security can have a wide-ranging impact. For example, AI is susceptible to
malicious attacks which can compromise outcomes. The Cybersecurity Infrastructure and
Security Agency (CISA) references documented instances of attacks leadings to misbehaviors
in autonomous vehicles and the hiding of objects in security camera footage. Experts and
governmental entities are urging for more security measures to limit potentially negative
effects.

Issue 5: Explainability

It‟s not enough to simply put AI tools out into the world and watch them work. It can be
particularly important to understand the decision-making process with certain AI applications.
In some cases, it can be difficult to understand why certain AI tools came to conclusions. This
can have sizeable implications, especially in industries such as healthcare or law enforcement
where influencing factors must be considered, and real human lives are at stake.

Issue 6: Accountability

The increasing prevalence of AI in all industries means that we use AI tools to make decisions
daily. In cases where those decisions lead to negative outcomes, it can be difficult to identify
who is responsible for the results. Are companies on the hook for validating the algorithms of
a tool they buy? Or do you look to the creator of an AI tool? The quest for accountability can
be a deep rabbit hole which can make it difficult to keep people and companies accountable.
Issue 7: Deepfakes

The usage of deepfakes creates ethical concerns. Deepfakes are now able to circumvent voice
and facial recognition which can be used to override security measures. One study even showed
that a Microsoft API was tricked more than 75% of the time using easily generated deepfakes.
Other ethical challenges arise when it comes to impersonation. The usage of deepfakes to sway
public opinion in political races can have far-reaching implications. There is also concern over
whether deepfakes could be used to influence the stock market if a CEO were believed to be
making decisions or taking actions that were considered questionable. With no oversight and
easy access to the software, the abuse of deepfakes presents a significant security gap.

Issue 8: Misinformation

Misinformation has a way of creating social divides and perpetuating untrue opinions to the
detriment of organizations and others. A topic that gained scrutiny in the context of the political
upheaval seen in recent years, misinformation can affect public opinion and cause severe
reputational damage. Once misinformation becomes widely shared on social media, it can be
difficult to determine where it originated and challenging to combat. AI tools have been used
to spread misinformation, making it appear as though the information is legitimate, when it is
in fact not.

Issue 9: Exploitation of Intellectual Property

A recent lawsuit against ChatGPT involving several popular writers who claim the platform
made illegal use of their copyrighted work has brought attention to the issue of AI exploitation
of intellectual property. Several authors, including favorites as Jodi Picoult and John Grisham,
recently sued OpenAI for infringing on copyright by using their content to train their
algorithms. The lawsuit further claims that this type of exploitation will endanger the ability of
authors to make a living from writing. This kind of exploitation has owners of intellectual
property concerned about how AI will continue to impact their livelihoods.

Issue 10: Loss of Social Connection

While AI has the potential to provide hyper-personalized experiences by customizing search

engine content based on your preferences and enhancing customer service through the use of
chatbots, there is concern that this could lead to a lack of social connection, empathy for others
and general well-being. If all you see on social media are opinions that reinforce your own,
you‟re unlikely to develop a mindset that allows you to empathize with others and engage in
actions for social good.
 Issue 11: Balancing Ethics With Competition

New technologies present companies, tech giants and startups alike, with a particular challenge
because there is a constant race to innovate. Often, success is determined by a company‟s
ability to be the first to release a particular technology or application. When it comes to AI
systems, companies often aren‟t taking the time to ensure their technology is ethically designed
or that it contains stringent security measures.
Tech giants such as Alphabet, Amazon, Facebook, IBM and Microsoft – as well as individuals
like Stephen Hawking and Elon Musk – believe that now is the right time to talk about the nearly
boundless landscape of artificial intelligence. In many ways, this is just as much a new frontier for
ethics and risk assessment as it is for emerging technology. So which issues and conversations keep
AI experts up at night?

1. Unemployment. What happens after the end of jobs?

The hierarchy of labour is concerned primarily with automation. As we’ve invented ways to
automate jobs, we could create room for people to assume more complex roles, moving from the
physical work that dominated the pre-industrial globe to the cognitive labour that characterizes
strategic and administrative work in our globalized society.

Look at trucking: it currently employs millions of individuals in the United States alone. What
will happen to them if the self-driving trucks promised by Tesla’s Elon Musk become widely available
in the next decade? But on the other hand, if we consider the lower risk of accidents, self- driving
trucks seem like an ethical choice. The same scenario could happen to office workers, as well as to the
majority of the workforce in developed countries.

This is where we come to the question of how we are going to spend our time. Most people still
rely on selling their time to have enough income to sustain themselves and their families. We can only
hope that this opportunity will enable people to find meaning in non-labour activities, such as caring
for their families, engaging with their communities and learning new ways to contribute to human
society.

If we succeed with the transition, one day we might look back and think that it was barbaric
that human beings were required to sell the majority of their waking time just to be able to live.
2. Inequality. How do we distribute the wealth created by machines?

Our economic system is based on compensation for contribution to the economy, often assessed
using an hourly wage. The majority of companies are still dependent on hourly work when it comes to
products and services. But by using artificial intelligence, a company can drastically cut down on
relying on the human workforce, and this means that revenues will go to fewer people.
Consequently, individuals who have ownership in AI-driven companies will make all the money.

We are already seeing a widening wealth gap, where start-up founders take home a large
portion of the economic surplus they create. In 2014, roughly the same revenues were generated by
the three biggest companies in Detroit and the three biggest companies in Silicon Valley ... only in
Silicon Valley there were 10 times fewer employees. If we’re truly imagining a post-work society,
how do we structure a fair post-labour economy?

3. Humanity. How do machines affect our behaviour and interaction?

Artificially intelligent bots are becoming better and better at modelling human conversation and
relationships. In 2015, a bot named Eugene Goostman won the Turning challenge for the first time. In
this challenge, human raters used text input to chat with an unknown entity, then guessed
whether they had been chatting with a human or a machine. Eugene Goostman fooled more than half of
the human raters into thinking they had been talking to a human being.

This milestone is only the start of an age where we will frequently interact with machines as if
they are humans; whether in customer service or sales. While humans are limited in the attention and
kindness that they can expend on another person, artificial bots can channel virtually unlimited
resources into building relationships.

Even though not many of us are aware of this, we are already witnesses to how machines can
trigger the reward centres in the human brain. Just look at click-bait headlines and video games.
These headlines are often optimized with A/B testing, a rudimentary form of algorithmic optimization
for content to capture our attention. This and other methods are used to make numerous video and
mobile games become addictive.
 On the other hand, maybe we can think of a different use for software, which has already
become effective at directing human attention and triggering certain actions. When used right, this could
evolve into an opportunity to nudge society towards more beneficial behavior. However, in the wrong
hands it could prove detrimental.

4. Artificial stupidity. How can we guard against mistakes?

Intelligence comes from learning, whether you’re human or machine. Systems usually have a
training phase in which they "learn" to detect the right patterns and act according to their input. Once a
system is fully trained, it can then go into test phase, where it is hit with more examples and we see how
it performs.

Obviously, the training phase cannot cover all possible examples that a system may deal with in
the real world. These systems can be fooled in ways that humans wouldn't be. For example, random
dot patterns can lead a machine to “see” things that aren’t there. If we rely on AI to bring us into a new
world of labour, security and efficiency, we need to ensure that the machine performs as planned, and
that people can’t overpower it to use it for their own ends.

5. Rocist Robots. How do we eliminate AI Bias?

Though artificial intelligence is capable of a speed and capacity of processing that’s far
beyond that of humans, it cannot always be trusted to be fair and neutral. Google and its parent
company Alphabet are one of the leaders when it comes to artificial intelligence, as seen in Google’s
Photos service, where AI is used to identify people, objects and scenes. But it can go wrong, such as
when a camera missed the marks on racial sensitivity, or when a software used to predict future
criminals showed bias against black people.

We shouldn’t forget that AI systems are created by humans, who can be biased and judgemental.
Once again, if used right, or if used by those who strive for social progress, artificial intelligence can
become a catalyst for positive change.

6. Security. How do we keep AI safe from adversaries?

 The more powerful a technology becomes, the more can it be used for nefarious reasons as well
as good. This applies not only to robots produced to replace human soldiers, or autonomous weapons,
but to AI systems that can cause damage if used maliciously. Because these fights won't be fought on
the battleground only, cybersecurity will become even more important. After all, we’re dealing with a
system that is faster and more capable than us by orders of magnitude.

Societal Issues Concerning the Application of Artificial Intelligence in Medicine

Medicine is becoming an increasingly data-centred discipline and, beyond classical statistical

approach-es, artificial intelligence (AI) and, in particular, machine learning (ML) are attracting
much interest for the analysis of medical data.

The application of artificial intelligence (AI) in medicine holds great promise for improving
healthcare outcomes, but it also raises several societal issues that need careful consideration.
Here are some key societal issues concerning the application of AI in medicine:

1. Equity and Access

Healthcare Disparities: There is a risk that AI applications may inadvertently exacerbate

existing healthcare disparities if not implemented carefully. For example, if AI algorithms are
trained primarily on data from certain demographics, they may not perform as well for others.
Access to Technology: Not all healthcare facilities or regions have equal access to AI
technologies. This could lead to unequal access to the benefits of AI-driven healthcare, creating
a "digital divide."

2. Data Privacy and Security

Patient Data Protection: AI systems rely heavily on patient data, raising concerns about privacy.
How this data is collected, stored, and used must align with strict regulations like GDPR and
HIPAA.

Data Bias: Biases in healthcare data, such as historical disparities in treatment, can be
inadvertently perpetuated by AI systems, leading to unequal treatment.

3. Transparency and Accountability

Black Box Problem: Many AI algorithms are complex "black boxes" where it's challenging to
understand how they arrive at decisions. This lack of transparency raises questions about
accountability and the ability to challenge or appeal decisions made by AI.

Responsibility for Errors: When errors occur in AI-driven diagnosis or treatment

recommendations, it's crucial to define who is responsible—whether it's the developer,
healthcare provider, or the AI system itself.

4. Job Displacement and Training

Impact on Healthcare Jobs: As AI automates certain tasks, there's concern about the potential
displacement of healthcare workers. This includes administrative roles as well as some clinical
tasks.

Training and Education: Healthcare professionals need training to effectively use AI tools.
There's a need to ensure that healthcare workers are equipped with the skills to work alongside
AI systems.

5. Medical Liability and Malpractice

Legal Frameworks: Existing medical liability frameworks may not be well-suited for cases
involving AI errors. New legal frameworks may be needed to determine liability when AI is
involved.

Ensuring Safe Use: Ensuring that AI systems are rigorously tested and validated is essential to
minimize the risk of errors leading to malpractice claims.

6. Bias and Discrimination

Algorithmic Bias: AI algorithms can inherit biases present in the data used to train them, which
can lead to discriminatory outcomes. This is particularly concerning in healthcare, where
biased algorithms could perpetuate disparities in diagnosis and treatment.
7. Regulation and Standardization

Regulatory Oversight: Governments and regulatory bodies need to develop frameworks to

ensure the safe and ethical use of AI in healthcare. This includes standards for data quality,
algorithm transparency, and patient consent.

Interoperability: As AI systems are integrated into healthcare systems, ensuring they can work
together and share data seamlessly is crucial for maximizing their potential benefits.

8. Overreliance on Technology

Human Oversight: There's a risk of overreliance on AI systems, leading to a decrease in critical

thinking or decision-making by healthcare professionals. AI should be seen as a tool to
enhance, not replace, human expertise.

9. Cost and Resource Allocation

Financial Barriers: Implementing AI in healthcare can be costly, which could create disparities
in access based on the financial resources of healthcare organizations.

Resource Allocation: Determining where to allocate resources for AI implementation—

whether in research, development, or patient care—raises complex ethical questions.

10. Changing Doctor-Patient Relationships

Impact on Communication: The introduction of AI into healthcare settings may change the
dynamics of doctor-patient relationships. Patients may feel alienated if they perceive AI as
replacing human care and empathy.

Trust: Building and maintaining patient trust in AI systems is crucial for their acceptance and
effective use in healthcare.

Addressing these societal issues requires collaboration among policymakers, healthcare

providers, AI developers, ethicists, patients, and other stakeholders. Ethical guidelines,
transparency in AI systems, ongoing education, and robust regulatory frameworks are essential
to ensure that AI in medicine benefits society as a whole while minimizing potential harms.

DECISION-MAKING ROLE IN INDUSTRIES

Advancements in artificial intelligence (AI) can help with the decision-making process by
evaluating data and variables in complex situations. This enables companies and organizations
to make faster, more well-informed decisions than when humans tackle the problems
without assistance.

The purpose of AI in decision making is not complete automation. Rather, the goal is to
help humans make quicker and better decisions through streamlined processes and effective
use of data.
some of the most common challenges individuals and companies face when they
incorporate AI into their business decision making and problem-solving.

Importance of AI in decision making

AI can play a significant role in data-driven decision making, providing benefits such
as:

• Enhanced accuracy. AI can use advanced algorithms and data science and analysis
to provide accurate and objective insights repeatably, reducing the likelihood of
human error and bias.
• Faster decision making. AI can process vast amounts of data at incredible
speeds, enabling quick analysis and generating insights in real time. This ultimately
leads to faster and more efficient decision-making processes, especially when
you‟re able to incorporate automation in many components of the process.
• Improved efficiency. AI automates time-consuming and repetitive tasks in decision-
making processes, freeing up valuable human resources to focus on more complex
and strategic aspects.
• Better risk assessment and mitigation. AI can assess and analyze various risk factors,
helping decision makers identify potential risks and devise effective mitigation
strategies.
• Data-driven insights. AI leverages large volumes of data to uncover patterns, trends,
and correlations that may go unnoticed by humans. Understanding data can be a
complicated endeavor, but incorporating the computer science of AI into your
analysis can simplify the process.

AI Is Used in Decision-Making Processes in Industries

➢ Predictive analytics
AI uses predictive analytics to analyze historical data, identify patterns, and make accurate
predictions

As big data systems continue to grow, companies will have larger sets of data to work
from, which should increase the accuracy of predictive analytics.

Predictive analytics enables decision makers to anticipate future outcomes and make proactive
decisions in various domains, such as sales forecasting and demand planning.

Several types of predictive analytics exist. In addition to using predictive analytics to imagine
what the future could look like, the same technology can be helpful when trying to
understand what happened in the past and what events led to a certain result.

Example: predictive analytics is applied in the management of equipment maintenance.

Historical breakdown analysis is combined with real-time process metrics and operational
schedules to determine the most cost-effective times to shut equipment down for
necessary maintenance.

➢ Risk assessment and mitigation

Risk assessment takes time and careful planning to ensure a company is aware of and protected
against potential threats. Effective risk management relies on the proper analysis of data;
situations can become problematic if the data that‟s used is incomplete or inaccurate.

AI algorithms can assess and analyze complex risk factors, such as credit risk or cybersecurity
threats. Since an AI-powered tool can quickly analyze large sets of data and detect
anomalies,

This data can support decision makers in evaluating risks, identifying vulnerabilities, and
devising effective mitigation strategies, minimizing potential negative impacts. Risk
managers and auditors can use AI tools to ensure they are using a larger range of available
data, and not just the evidence they have detected on their own.

Example:

➢ Banks can use risk AI assessment and mitigation for fraud prevention.
➢ Health care systems may apply this approach for patient-specific disease prevention
or community epidemic prevention.

➢ Natural language processing (NLP)

Natural language processing (NLP) refers to a computer‟s ability to automatically analyze

and process language in a conversational manner. Conversational chatbots such as ChatGPT
use NLP to analyze human prompts and questions to produce a coherent response. NLP
techniques enable AI systems to analyze human language in ways that facilitate decision-
making processes that involve text data, such as sentiment analysis, contract review, or
customer feedback analysis.

Here are a few of the main ways NLP can help with decision making:

• Sentiment analysis. NLP can provide insight into the sentiment (or emotional tone)
of textual documents and data in addition to analyzing the actual information
presented.
• Text classification. NLP can sort text into predefined labels or classes. This can
help you organize large amounts of data into preset categories, making the information
easier to understand and utilize.
• Information extraction. By extracting relevant information, you can better identify
trends and patterns during the decision-making process.

Summarization. NLP can help you condense long documents into summaries so
that you can have the relevant information without going through all the material
yourself.
• Question answering. You can use NLP systems to ask questions about various
documents and datasets to find answers quickly.

Example:

Marketing organizations are already using this approach for managing programs across
channels to optimize revenue. Individuals can use these generative AI tools for wide-
ranging decision-making in activities such as planning trips, determining who to vote for,
or simply creating menus from available ingredients.

➢ Decision support systems

AI-powered decision support systems assist decision makers by providing relevant

information, data analysis, and insights in real time, empowering them to make well- informed
decisions across various domains, including healthcare, logistics, or supply chain
management.

These systems use machine learning models and operational data to develop insights
and access real-time information. Since this involves nonstop data processing, systems
must be equipped to quickly analyze and process the data consistently.

However, as mentioned above, critical thinking is necessary to ensure that the data being
used is accurate and trustworthy. Make sure you feel confident about where the system is
pulling the data from and how it is using all available information for the validation of
conclusions.
 ➢ Recommender systems

AI-based recommender systems analyze user preferences, historical behavior, and

contextual data to provide personalized recommendations. These systems use big data to
analyze relevant information such as past purchases, demographic information, and
other factors that help companies learn about customers‟ preferences.

This approach is helpful because it reveals insights companies may not have been able to
identify on their own. The findings can equip decision makers in areas such as product
recommendations, content suggestions, or personalized marketing campaigns to deliver
effective campaigns and advertisements tailored to the user‟s specific taste.

Exmaple:

Netflix currently includes a recommender system as a part of its algorithm. The platform
uses your past viewing history to predict what might interest in the future based on the
history of similar consumers. The purpose of this system is to eliminate the time and
frustration that may happen when you‟re deciding what to watch next.

➢ Optimization and resource allocation

AI optimization algorithms enable decision makers to allocate resources efficiently,

optimize processes, and solve complex optimization problems. This can help in areas such
as workforce scheduling, supply chain optimization, or route planning.

Using AI, teams can better allocate their resources by quickly analyzing availability, utilization,
and performance. This data will enable you to identify potential bottlenecks and ensure
that all team members are working on the most important tasks.

Many supply chain managers are using AI to improve their route optimization. They can
automatically create the most efficient routes for their drivers by inputting a list of stops.
The system will consider factors such as traffic and consumer demand to determine what
routes will be the most efficient and cost-effective.

➢ Fraud detection and prevention

AI algorithms can analyze large volumes of data and detect anomalies and patterns associated
with fraudulent activities. The findings can assist decision makers in fraud detection and
prevention efforts, mitigating financial losses and protecting businesses and consumers.

A current example is American Express, which has developed an AI-based system that
 can analyze billions of transactions in real time to identify patterns of fraudulent activity.
This platform employs machine learning algorithms and big data analytics to effectively detect
potential fraudulent transactions.

➢ Cognitive decision making

AI technologies, such as cognitive computing and machine learning, can facilitate decision-
making processing by analyzing vast amounts of data, recognizing patterns, and
recommending optimal solutions. This can help decision makers in complex scenarios,
such as medical diagnosis or strategic planning.

Remember, this information should be used to inform the human decision-making process
rather than replace it entirely. While the data produced by AI technologies can be helpful,
it may sometimes have fallacies or errors. Human discernment should be used to
evaluate the findings produced by AI and check for any potential errors or mistakes.

Applications of AI in decision making

Let‟s introduce a few prominent companies already using AI to help with their decision
making.

• Google. Google uses a deep learning system to better understand search prompts
and provide personalized results.
• IBM. IBM has optimized its decision making to solve complex problems in a
fraction of the time it once required. This innovation has saved customers significant
time and money.
• Microsoft. Microsoft believes AI can help individuals tackle life‟s biggest
challenges with ease. Their philosophy is that AI can provide people with
a wider range of information, but humans ultimately must make the decisions.
• Deloitte. Deloitte‟s team is working on creating automated processes that improve
human decision making by predicting and simulating future outcomes.
• Salesforce. Salesforce incorporates AI to gain further insight into customer behavior
and buying patterns. The company has improved its decision making by
forecasting sales trends, which enables them to quickly respond to an ever- changing
market.

NATIONAL AND INTERNATIONAL STRATEGIES ON AI.

As the technology behind AI continues to progress beyond expectations, policy initiatives are
springing up across the globe to keep pace with these developments.

The first national strategy on AI was launched by Canada in March 2017, followed soon after
by technology leaders Japan and China. In Europe, the European Commission put forward a
communication on AI, initiating the development of independent strategies by Member States.

An American AI initiative is expected soon, alongside intense efforts in Russia to formalise

their 10-point plan for AI.

These initiatives differ widely in terms of their goals, the extent of their investment, and their
commitment to developing ethical frameworks, reviewed here as of May 2019.

An overview of national AI strategies and policies

As artificial intelligence (AI) advances across economies and societies, policy makers and AI
actors around the world seek to move from principles to practice.

To harness the benefits of AI while mitigating the risks, governments are investing in AI R&D;
leveraging AI in specific industries such as transportation and healthcare; building human
capacity on AI; ensuring a fair labour market transformation; reviewing and adapting relevant
policy and regulatory frameworks and developing standards; and co-operating internationally.

This Going Digital Toolkit note provides an overview of the various AI policy initiatives
undertaken by governments and analyses these initiatives throughout the AI policy cycle:

1) Policy design;

2) policy implementation;

3) Policy intelligence;
 4) approaches for international and multi-stakeholder cooperation on AI policy

The development of national policies and strategies focusing specifically on AI is a relatively

new phenomenon. To track these initiatives, the OECD (The Organization for Economic
Cooperation and Development) AI Policy Observatory (OECD.AI) comprises over 620
national AI policies from over 60 countries and the European Union (EU).

These resources provide a baseline to map countries‟ AI policy initiatives according to the
recommendations to governments contained in the OECD AI Principles (Box 1).

AI policy design
 Countries are at different stages of the development and implementation of national
AI strategies and policies.

Some countries, such as Canada and Finland, developed their national AI strategies as
early as 2017, closely followed by Japan, France, Germany and the United Kingdom in 2018.

Other countries, such as Brazil, Egypt, Hungary, Poland and Spain, launched a
national AI strategy more recently. Several countries are currently in AI policy consultation
and development processes.

Effective implementation of national AI initiatives hinges on coordination

Countries pursue different national governance models to co-ordinate the

implementation of their national AI policies across government, offering regulatory and ethical
oversight (Figure 1). Models include:

• Assigning oversight of the development and implementation strategies to an existing

ministry, department or body. Among existing ministries or agencies tasked with developing
or implementing an AI strategy, the following tend to drive the creation of AI strategies most
often:

1) information technology and communications ministries;

2) economics or finance ministries; or

3) education, science (and technology) and innovation ministries.

• Creating a new governmental or independent AI co-ordination entity.

• Establishing AI expert advisory groups. These are generally multistakeholder groups

comprising AI experts tasked with identifying and reporting on current and future
opportunities, risks and challenges arising from the use of AI in society. These AI councils also
provide recommendations to the government.

• Setting up oversight and advisory bodies for AI and data ethics.

 World Economic Forum
The World Economic Forum (WEF) formed a Global AI Council in May 2019, co-chaired by
speech recognition developer Kai-Fu Lee, previously of Apple, Microsoft and Google, and
current President of Microsoft Bradford Smith. One of six 'Fourth Industrial Revolution'
councils, the Global AI Council will develop policy guidance and address governance gaps, in
order to develop a common understanding among countries of best practice in AI policy (World
Economic Forum, 2019a).
In October 2019, they released a framework for developing a national AI strategy to guide
governments that are yet to develop or are currently developing a national strategy for AI. The
WEF describe it as a way to create a 'minimum viable' AI strategy and includes four main
stages:
1) Assess long-term strategic priorities
2) Set national goals and targets
3) Create plans for essential strategic elements
4) Develop the implementation plan
 The WEF has also announced plans to develop an 'AI toolkit' to help businesses to best
implement AI and to create their own ethics councils, which will be released at 2020's Davos
conference (Vanian, 2019).

Government Readiness for AI

A report commissioned by Canada's International Development Research Centre (Oxford

Insights, 2019) evaluated the 'AI readiness' of governments around the globe in 2019, using a
range of data including not only the presence of a national AI strategy, but also data
protection laws, statistics on AI startups and technology skills.
Singapore was ranked number 1 in their estimation, with Japan as the only other Asian
nation in the top 10 (Table 3). Sixty percent of countries in the top 10 were European, with the
remainder from North America.

National Strategy In AI

The first national strategy on AI was launched by Canada in March 2017, followed soon after
by technology leaders Japan and China. In Europe, the European Commission put forward a
communication on AI, initiating the development of independent strategies by Member
States. An American AI initiative is expected soon, alongside intense efforts in Russia to
formalise their 10-point plan for AI.
These initiatives differ widely in terms of their goals, the extent of their investment,
and their commitment to developing ethical frameworks, reviewed here as of May 2019.

Europe
The European Commission's Communication on Artificial Intelligence (European
Commission, 2018a), released in April 2018, paved the way to the first international strategy
on AI. The document outlines a coordinated approach to maximise the benefits, and address
the challenges, brought about by AI.

The EU's High-Level Expert Group on AI shortly after released a further set of policy
and investment guidelines for trustworthy AI (European Commission High-Level Expert
Group on AI, 2019b), which includes a number of important recommendations around
protecting people, boosting uptake of AI in the private sector, expanding European research
capacity in AI and developing ethical data management practices

Finland was the first Member State to develop a national programme on AI (Ministry
of Economic Affairs and Employment of Finland, 2018a). The programme is based on two
reports, Finland's Age of Artificial Intelligence and Work in the Age of Artificial Intelligence
(Ministry of Economic Affairs and Employment of Finland, 2017, 2018b). Policy objectives
focus on investment for business competitiveness and public services. Although
recommendations have already been incorporated into policy, Finland's AI steering group will
run until the end of the present Government's term, with a final report expected imminently.
 Denmark's National Strategy for Artificial Intelligence (The Danish Government,
2019) was released in March 2019 and follows its 'Strategy for Digital Growth' (The Danish
Government, 2018). This comprehensive framework lists objectives including establishing a
responsible foundation for AI, providing high quality data and overall increasing investment in
AI (particularly in the agriculture, energy, healthcare and transport sectors)

Germany's AI Strategy was adopted soon after in November 2018 (Die

Bundesregierung, 2018) and makes three major pledges: to make Germany a global leader in
the development and use of AI, to safeguard the responsible development and use of AI, and
to integrate AI in society in ethical, legal, cultural and institutional terms. Individual objectives
include developing Centres of Excellence for research, the creation of 100 extra professorships
for AI, establishing a German AI observatory, funding 50 flagship applications of AI to benefit
the environment, developing guidelines for AI that are compatible with data protection laws,
and establishing a 'Digital Work and Society Future Fund' (De.digital, 2018).

Sweden's approach to AI (Government Offices of Sweden, 2018) has less specific

terms, but provides general guidance on education, research, innovation and infrastructure for
AI. Recommendations include building a strong research base, collaboration between sectors
and with other countries, developing efforts to prevent and manage risk and developing
standards to guide the ethical use of AI. A Swedish AI Council, made up of experts from
industry and academia, has also been established to develop a 'Swedish model' for AI, which
they say will be sustainable, beneficial to society and promote long-term economic growth
(Swedish AI Council, 2019).
 Singapore. 'AI.SG'

AI Singapore is a five-year, S$150 million national program launched in May 2017 to

enhance Singapore‟s capabilities in AI. Its goals are to invest in the next wave of AI research, address
major societal and economic challenges, and broaden adoption and use of AI within industry.

In June 2018, the government announced three new initiatives on AI governance and
ethics. The new Advisory Council on the Ethical Use of AI and Data will help the Government
develop standards and governance frameworks for the ethics of AI.

Saudi Arabia

King Salman issued a royal decree to establish an artificial intelligence (AI) center to
enhance the drive toward innovation and digital transformation in Saudi Arabia in Sep 2019.
The establishment of the center aligns with the Kingdom‟s Vision 2030 program. The
Government of Saudi Arabia is now drafting a national AI strategy that aims to build an
innovative and ethical AI ecosystem in the country by 2030.
 Australia does not yet have a national strategy on AI. It does however have a' Digital
Economy Strategy' (Australian Government, 2017) which discusses empowering Australians
through 'digital skills and inclusion', listing AI as a key emerging technology. A report on
'Australia's Tech Future' further details plans for AI, including using AI to improve public
services, increase administrative efficiency and improve policy development (Australian
Government, 2018).

UAE

The UAE Strategy for Artificial Intelligence, was announced in October 2017. The
UAE became the first country in the world to create a Ministry of Artificial Intelligence and
first in the Middle East to launch an AI strategy. The strategy is the first initiative of the UAE
Centennial 2071 Plan and its main objective is to enhance government performance and
efficiency. The government will invest in AI technologies in nine sectors: transport, health,
space, renewable energy, water, technology, education, environment, and traffic. In doing so,
the government aims to diversify the economy, cut costs across the government and position
the UAE as a global leader in the application of AI.
 United States.

In February 2019, the United States launched the American AI Initiative, in the form of
an executive order. This “whole-of-government strategy” aims at focusing federal government
resources for investing in AI research, unleashing AI resources, setting AI governance
standards, building the AI workforce and protecting the US AI advantage.

Following the American AI Initiative, the US issued the National Artificial Intelligence
Research and Development Strategic Plan: 2019 Update calling for developing shared public
datasets and environments for AI training and testing. The Initiative was also considered in the
development of the US‟s new Federal Data Strategy and associated Action Plan, which
includes an action item to “improve data resources for AI research and development”.

India. 'Social Inclusion and AI Garage'

India‟s National Strategy for Artificial Intelligence focuses on using technologies to

ensure social growth, inclusion and positioning the country as a leader in AI on the global
platform. Strategically, the government also seeks to establish India as an “AI Garage,”
incubating AI that can be applicable to the rest of the developing world.

NITI Aayog, the government think tank that wrote the report, calls this approach
#AIforAll. The strategy, as a result, aims to (1) enhance and empower Indians with the skills
to find quality jobs; (2) invest in research and sectors that can maximize economic growth and
social impact; and (3) scale Indian-made AI solutions to the rest of the developing world.
G7 Common Vision for the Future of AI
At the 2018 meeting of the G7 in Charlevoix, Canada, the leaders of the G7 (Canada, France,
Germany, Italy, Japan, the United Kingdom and the United States) committed to 12 principles
for AI, summarised below:
1. Promote human-centric AI and the commercial adoption of AI, and continue
to advance appropriate technical, ethical and technologically neutral
approaches.
2. Promote investment in R&D in AI that generates public test in new
technologies and supports economic growth.
3. Support education, training and re-skilling for the workforce.
4. Support and involve underrepresented groups, including women
5. Facilitate multi-stakeholder dialogue on how to advance AI innovation to
increase trust and adoption.
6. Support efforts to promote trust in AI, with particular attention to countering
harmful stereotypes and fostering gender equality. Foster initiatives that
promote safety and transparency.
7. Promote the use of AI by small and medium-sized enterprises.
8. Promote active labour market policies, workforce development and training
programmes to develop the skills needed for new jobs.
9. Encourage investment in AI.
10. Encourage initiatives to improve digital security and develop codes of
conduct.
11. Ensure the development of frameworks for privacy and data protection.
12. Support an open market environment for the free flow of data, while
respecting privacy and data protection.
(G7 Canadian Presidency, 2018).
International AI Initiative

In addition to the EU In addition to the EU, there are a growing number of international strategies on
AI, aiming to provide a unifying framework for governments worldwide on stewardship of this new and
powerful technology. G7 Common Vision for the Future of AI At the 2018 meeting of the G7 in
Charlevoix, Canada, the leaders of the G7 committed to 12 principles for AI, summarised below:

1. Promote human-centric AI and the commercial adoption of AI, and continue to advance
appropriate technical, ethical and technologically neutral approaches.
2. Promote investment in R&D in AI that generates public test in new technologies and supports
economic growth.
3. Support education, training and re-skilling for the workforce.

4. Support and involve underrepresented groups, including women and marginalised individuals, in
the development and implementation of AI.

5. Facilitate multi-stakeholder dialogue on how to advance AI innovation to increase trust and

adoption.
6. Support efforts to promote trust in AI, with particular attention to countering harmful stereotypes
and fostering gender equality. Foster initiatives that promote safety and transparency.
7. Promote the use of AI by small and medium-sized enterprises.

8. Promote active labour market policies, workforce development and training programmes to
develop the skills needed for new jobs.
9. Encourage investment in AI.

10. Encourage initiatives to improve digital security and develop codes of conduct.

11. Ensure the development of frameworks for privacy and data protection.

12. Support an open market environment for the free flow of data, while respecting privacy and data
protection.
Nordic-Baltic Region Declaration on AI The declaration signed by the Nordic-Baltic Region
aims to promote the use of AI in the region, including improving the opportunities for skills
development, increasing access to data and a specific policy objective to develop 'ethical and transparent
guidelines, standards, principles and values' for when and how AI should be used. OECD Principles on
AI On 22 May 2019, the Organisation for Economic Co-operation and Development issued its principles
for AI, the first international standards agreed by governments for the responsible development of AI.
They include practical policy recommendations as well as value-based principles for the 'responsible
stewardship of trustworthy AI', summarised below: • AI should benefit people and the planet by driving
inclusive growth, sustainable development and well-being. • AI systems should respect the rule of law,
human rights, democratic values and diversity, and there should include appropriate safeguards to ensure
a fair society. • There should be transparency around AI to ensure that people understand outcomes and
can challenge them. • AI systems must function in a robust, secure and safe way throughout their life
cycles and risks should be continually assessed. • Organisations and individuals developing, deploying
or operating AI systems should be held accountable. These principles have been agreed by the
governments of the 36 OECD Member States as well as Argentina, Brazil, Colombia, Costa Rica, Peru
and Romania (OECD, 2019a). The G20 human-centred AI Principles were released in June 2019 and
are drawn from the OECD Principles (G20, 2019). United Nations The UN has several initiatives relating
to AI, including: • AI for Good Global Summit- Summits held since 2017 have focused on strategies to
ensure the safe and inclusive development of AI. The events are organised by the International
Telecommunication Union, which aims to 'provide a neutral platform for government, industry and
academia to build a common understanding of the capabilities of emerging AI technologies and
consequent needs for technical standardisation and policy guidance.'
UNICRI Centre for AI and Robotics

The UN Interregional Crime and Justice Research Institute (UNICRI) launched a programme on
AI and Robotics in 2015 and will be opening a centre dedicated to these topics in The Hague (UNICRI,
2019). • UNESCO Report on Robotics Ethics - The UNESCO World Commission on the Ethics of
Scientific Knowledge and Technology (COMEST) has authored a report on 'Robotics Ethics', which
deals with the ethical challenges of robots in society and provides ethical principles and values, and a
technology-based ethical framework (COMEST, 2017). World Economic Forum The World Economic
Forum (WEF) formed a Global AI Council in May 2019, co-chaired by speech recognition developer
Kai-Fu Lee, previously of Apple, Microsoft and Google, and current President
of Microsoft Bradford Smith. One of six 'Fourth Industrial Revolution' councils, the Global AI Council
will develop policy guidance and address governance gaps, in order to develop a common understanding
among countries of best practice in AI policy (World Economic Forum, 2019a). In October 2019, they
released a framework for developing a national AI strategy to guide governments that are yet to develop
or are currently developing a national strategy for AI.

The WEF describe it as a way to create a 'minimum viable' AI strategy and includes four main
stages:

1) Assess long-term strategic priorities

2) Set national goals and targets

3) Create plans for essential strategic elements

4) Develop the implementation plan.

The strong European representation in this analysis is reflective of the value of the unifying
EU framework, as well as Europe's economic power. The analysis also praises the policy strategies of
individual European nations, which, importantly, have been developed in a culture of collaboration.
Examples of this collaborative approach include the EU Declaration of Cooperation on AI, in which
Member States agreed to cooperate on boosting Europe's capacity in AI, and individual partnerships
between Member States, such as that of Finland, Estonia and Sweden, working together to trial new
applications of AI.
Singapore ranked highest of all nations while Japan, the second country in the world to release
a national strategy on AI, ranked 10th. China's position as 21st in the global rankings is expected to
improve next year as its investments in AI begin to pay off. Progress in Asia overall has been unbalanced,
with two countries in the region also ranking in the bottom ten worldwide, reflecting the income
inequality in the region. Despite the comparatively slow development of their national strategy, the USA
ranked 4th, with Canada not far behind. Both nations are supported by their strong economies, highly
skilled workforces, private sector innovation and abundance of data, to a level at which regions missing
from the top 10 – Africa, South America and Australasia – are unable to compete. This framework
provides a highly useful metric by which to assess the ability of governments to capitalise on AI's
potential in the coming years.