Skip to content
All posts

How responsible AI drives sustainable ESG initiatives

Artificial intelligence (AI) is one of the most disruptive and transformative technologies of our time. This jaw-dropping technology has the potential to improve business efficiency, innovation and competitiveness, as well as generate social and environmental benefits for society. However, AI also poses challenges and risks related to ethics, privacy, security, governance and inclusion. Do you want to learn how the use of responsible AI can help companies improve their ESG philosophy? This is the article for you - here we go!

Black and white robotic hand holds a tree with its palm. Bigle Legal CLM article on responsible AI and ESG.

It is important for companies to take a holistic view and achieve a responsible use of AI so that environmental, social and governance (ESG) criteria are taken into account. The ESG philosophy follows a set of factors that assess the impact and performance of a company based on these criteria, both internally and externally. They are so important that they have become a key element in measuring the value and reputation of companies, as well as in attracting investors, customers and talent.

Join us in this article and explore with us how AI can contribute to ESG and sustainability initiatives, as well as the challenges and opportunities this technology presents for companies.

In this article you will find out:

  1. What does responsible AI refer to and why is it so important?
  2. What are ESG criteria and what are they for? 
  3. How can responsible AI drive ESG and sustainability initiatives?
  4. What challenges and opportunities does the responsible use of AI present for companies?

What does responsible AI refer to and why is it so important?

Responsible AI refers to artificial intelligence (AI) that seeks to ensure ethics, transparency and social benefit in its use. It involves the creation of AI systems that are environmentally sound, fair, non-discriminatory, safe and respectful of the privacy of individuals. This is achieved by implementing policies and practices that consider the environmental, ethical and social impacts of AI throughout its lifecycle, from design and data collection to decision-making and ongoing monitoring.

Pursuing responsible use of AI is essential for our society and companies must pursue it to align with the ESG (Environmental, Social and Governance) philosophy of sustainable business governance. Companies that make responsible use of AI demonstrate their commitment to ethical and socially responsible values, which not only strengthens consumer and investor confidence but also ensures that AI technology is used for the good of society rather than harming it.

It is worth noting that unregulated and unmonitored AI has a high environmental cost. The unoptimised AI systems of the big tech companies consume a disproportionate amount of energy, contributing to environmental degradation. But is it possible that responsible use of AI not only does not harm the environment but also helps society? Let's see if this is achievable.

What are ESG criteria and what are they for? 

ESG criteria are a set of factors that assess a company's sustainability impact and performance. The ESG criteria are divided into three dimensions:

  • Environmental: refers to a company's impact on the environment, such as energy and natural resource consumption, greenhouse gas emissions, waste management or biodiversity.
  • Social: refers to a company's impact on society, such as respect for human rights, working conditions, health and safety, diversity and inclusion, and community engagement.
  • Corporate governance: refers to a company's impact on its own organisation, such as transparency, ethics, internal control, corporate governance or risk management.

These criteria serve to measure the value and reputation of companies from a holistic and long-term perspective. ESG criteria also serve to attract investors, customers and talent looking for responsible and sustainable companies. In addition, ESG criteria can help companies anticipate and adapt to regulatory, social and environmental changes affecting their industry.

How can responsible AI drive ESG and sustainability initiatives?

AI can drive ESG and sustainability initiatives in a number of ways:

  • Improving energy efficiency and reducing emissions: Responsible AI can optimise the use of energy and natural resources in production, logistics or administrative processes. For example, it can predict demand, adjust supply, monitor consumption or detect anomalies. AI can also reduce greenhouse gas emissions by facilitating the transition to renewable energy sources, improving sustainable mobility or capturing and storing carbon.
  • Promoting the circular economy and waste management: Responsible AI can promote the circular economy, which is based on the principle of reducing, reusing and recycling materials and products. For example, AI can help design more durable and efficient products, facilitate tracking and traceability of materials, improve waste sorting and recycling, or generate new business models based on sharing or renting.
  • Empowering social and environmental innovation: AI can drive social and environmental innovation by solving complex problems or generating new solutions. Such AI can improve people's health and well-being by diagnosing diseases, personalising treatments, preventing epidemics or creating smart prostheses. AI can also improve education and learning by adapting to the pace and style of individual learners, delivering personalised content, facilitating access to information or fostering collaboration.
  • Strengthening governance and transparency: AI can strengthen corporate governance and transparency by improving internal control, corporate governance and risk management. For example, AI can automate processes, detect fraud, assess performance, generate reports or facilitate auditing. AI can also improve communication and dialogue with stakeholders by analysing the opinions, expectations and needs of investors, customers, employees or society.

Green leaf on an electronic circuit, Bigle Legals blog post on AI and ESG

Our artificial intelligence project is designed from the ground up to create responsible AI: it is validated by the DNSH Principle (no significant harm to the environment), and certified by the EQA (Certification, Inspection and Verification Body) in Spain.

What challenges and opportunities does the responsible use of AI present for companies?

Just as AI has boomed and offers a universe of options, like any technology it is still developing and presents challenges and opportunities for companies that want to boost their ESG and sustainability initiatives. Some of these challenges and opportunities are:

  • Ensure responsible and ethical AI: Companies should ensure that AI is developed and used in an ethical and responsible manner, respecting the principles of legality, fairness, transparency, explainability, security, privacy and accountability. Companies should establish mechanisms for governance, oversight and control of AI, and involve stakeholders in the design and implementation of AI.
  • Ensure inclusive and diverse AI: Companies should ensure that AI is inclusive and diverse, reflecting and respecting plurality of gender, age, culture, background or disability. Companies should prevent AI from reproducing or amplifying bias or discrimination in data, algorithms or applications. Companies should also promote equitable access to the benefits of AI for all sectors and regions.
  • Leverage innovative and competitive AI: AI can generate added value for products, services or processes. Companies should invest in AI research and development, as well as in training and capacity building of human talent. Companies should also collaborate with other players in the AI ecosystem, such as universities, research centres, startups or public entities.

If you want to know more about how Bigle Legal contributes to improving the ESG philosophy of companies thanks to Contract Lifecycle Management (CLM) software, check out our website. Find out how technology can help you improve your document management and your social and environmental impact!