A FIELD OF COMPUTER SCIENCE, AI simulates human intelligence by developing technologies and algorithms that allow machines to behave, learn, reason, and self-correct like human beings. The potential magnitude of the change caused by business applications of AI has been compared to that of electricity. As mentioned in prior articles of Strategic Finance (such as "Understanding Smart Machines," bit.ly/36kypkD), AI is expected to radically change how management accountants gather, use, and report information. Therefore, on the one hand, to reap the benefits of a general-purpose technology such as AI, management accountants must adapt their skills to the evolving environment. On the other hand, management accountants must be aware that AI isn't a neutral technology and that it poses challenges to their ethical professional practice based on the principles and standards of management accounting and finance.
AI AND ETHICS
Compared to other technologies and tools, AI has three characteristics that exacerbate its potentially unethical implications: the lack of controllability of the underlying decision criteria; the lack of accountability for unintended consequences; and the lack of significant explicit costs, causing some to underestimate AI's ethical impact.
First, it's hard to assess whether AI is used properly since it's often described as a black box, meaning that it's hard to explain the outcomes that AI produces through techniques of machine learning or artificial neural networks meant to replicate the functioning of the human brain (see "Machine Bias inside the Black Box," bit.ly/ 2PsJD0p). Unlike AI, human beings can provide reasons supporting judgments and actions.
Second, it's impossible to explain the causes of AI's errors, which often aren't easily detectable. Unlike AI, it's always possible for human beings to discover flaws in decision-making processes through social interactions, individual evaluations, or organizational control systems.
Third, AI provides inexpensive solutions to complicated problems, which may lead some to overstate the value of its applications. Unlike AI, spending cognitive resources to formulate decisions leads human beings to pay greater attention to the assessment of their solutions. In contrast, AI's outputs and decisions often go unquestioned.
These three characteristics challenge the ethical principles that management accountants must uphold in the practice of their profession as specified in the IMA...