Norway's sovereign wealth fund, holding a staggering $1.4 trillion and recognized as the largest stock market investor globally, is issuing a resounding call to the companies it invests in, advocating for their active engagement with artificial intelligence (AI) to enhance profitability, according to a report by Reuters.
The Norwegian flag is flying half-mast after Queen Elizabeth II's death at the Royal Palace in oslo on September 9, 2022.
Norway Wealth Fund: AI Is 'Massive Driver for Productivity and Efficiency'
According to Reuters, the fund's CEO Nicolai Tangen emphasized the intrinsic importance of AI integration across the entire spectrum of the fund's portfolio.
He told the outlet that AI possesses the potential to become a "massive driver for productivity and efficiency," similar to fundamental business tools such as electricity, computers, or the internet. Tangen underscored the necessity of harnessing AI's potential while ensuring its judicious application.
In the interview with Reuters, Tangen expressed the expectation for companies to leverage AI optimally, recognizing it as an invaluable asset for both businesses and society. This optimism, however, is balanced by a conscientious approach to AI's implementation to avoid any undue risks.
Tangen suggested that companies unwilling to embrace AI could be undermining their own growth prospects. His assertion echoed the broader sentiment that AI is evolving into an everyday tool integral to modern business operations.
The fund's expansive reach encompasses investments in around 9,200 companies worldwide. Its extensive influence spans numerous domains, addressing issues ranging from climate change to children's rights.
The forthcoming document, slated for publication, reflects the fund's focus on consumers' interests, predominantly centering around the burgeoning field of AI.
When engaging with companies about AI integration, the fund strategically directs its attention to sectors with pronounced consumer impact, particularly healthcare, finance, and the substantial-tech industry. Given the considerable ramifications of their AI use, these sectors warrant meticulous scrutiny.
The fund's expectations outlined in the document underscore the imperative for companies to elucidate the rationale behind specific AI systems' development. Detailed insights into design, training, and testing are deemed essential, accompanied by robust human oversight and control mechanisms.
Transparency in AI Processes
Carine Smith Ihenacho, the fund's chief governance and compliance officer, stressed companies need to offer transparency in their AI processes, allowing affected individuals to seek explanations for outcomes, such as loan approvals. That reinforces the principle of accountability in AI deployment.
Smith Ihenacho welcomed recent self-regulation measures initiated by US tech leaders, deeming them a positive step. However, she underscored the absence of comprehensive AI regulations and emphasized the role of investors in contributing to AI's ethical evolution.
The fund's equity investments are heavily skewed towards the technology sector, constituting 11.9% of its total value as of 2022's close. Its approach centers on active engagement with companies through dialogue and participation in annual general meetings, aligning with its commitment to environmental, social, and governance (ESG) principles.
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