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We understand that the Joe Biden administration is considering regulating AI tools like ChatGPT over concerns of potential harm and discrimination.

The Wall Street Journal reported on Tuesday (11 April 23), the Commerce Department has asked the public for comments on what it described as accountability measures, including whether the new AI models should go through a certification process before they are released.

There are a few A.I. stocks which are being watched and traded previously constantly, it make me wonder what are the current practice in terms of :

• Accountability

• Ethical regulation of A.I. software

• Does commercial available model need to be certified?

Existing Call for Protocols and Regulation

I believe we have seen the news by Twitter and Tesla CEO, with other signatories who has called for a pause on any A.I. training systems which are more powerful than OpenAI’s GPT-4 in March.

In March, Twitter and Tesla CEO Elon Musk, Apple Co-founder Steve Wozniak, and 1000+ signatories called for a pause on training systems exceeding OpenAI's GPT-4.

Last month, Italy became the first Western nation to ban ChatGPT due to concerns surrounding privacy issues.

Current Accountability, Protocols and Regulations

Governance of artificial intelligence (A.I.) will involve accountability as one of the cornerstones. This is one of the main reasons because of the delegation of tasks (e.g., prediction or decision-making) is left to A.I. systems (henceforth A.I.s).

When it comes to managing artificial intelligence, there is no shortage of principles and concepts aiming to support fair and responsible use. But organizations and their leaders are often left scratching their heads when facing hard questions about how to responsibly manage and deploy AI systems today.

So there is framework which developed by the U.S. Government Accountability Office to help assure accountability and responsible use of AI systems.

https://www.gao.gov/products/gao-21-519sp

The framework defines the basic conditions for accountability throughout the entire AI life cycle

• Design

• Development

• Monitoring

It also define the 4 dimensions to lay out specific questions to ask, which audit procedures to use. This help to assess an A.I. systems along the 4 dimensions defined.

• Governance

• Data

• Performance

• Monitoring

This could help organizations and leaders to transit theories and principles to practices that can actually be used to manage and evaluate A.I. in real world implementation.

What is a Full A.I. Life Cycle

Very often oversight are detected and question about the A.I. systems are only asked after it is being build and deployed in full scale.

This is not good enough, because there might be inherent problems that would arise and cause issues.

Assessments of an A.I. or machine-learning (ML) system should be done at every stage of its life cycle.

This could help to detect and help define ways to mitigate system-wide issues that can be missed during narrowly defined “Point-In-Time” assessments.

Important stages of an A.I. system’s life cycle

Design: clearly spelled out the system’s objectives and goals, including any underlying assumptions and general performance requirements.

Development: defining technical requirements, collecting and processing data, building the model, and validating the system.

Deployment: piloting, checking compatibility with other systems, ensuring regulatory compliance, and evaluating user experience.

Monitoring: continuously assessing the system’s outputs and impacts (both intended and unintended), refining the model, and making decisions to expand or retire the system.

Which A.I. stocks would have met these requirement?

I have done my research for a few A.I. stocks and found these 2 stocks which would be able to go through the A.I. tools regulation (enhanced).

$Palantir Technologies Inc.(PLTR)$

Palantir (PLTR) has been building their A.I. software platform adhering to this framework, with their AI-ethics. https://www.palantir.com/pcl/palantir-ai-ethics/

Hence, I do not think they need to worry much about new regulation or spending more monies to adhere to any changes or updates to the regulation.

$Adobe(ADBE)$

Adobe (ADBE) has unveiled on March 21 generative artificial intelligence services for creative professionals and marketers.

This include Adobe Firefly, a new family of creative generative AI models focused initially on image generation and text effects.

Adobe has been using A.I. in their product and have been practicing the current framework in their product and services.

https://www.adobe.com/sg/about-adobe/aiethics.html

https://blog.adobe.com/en/publish/2022/03/24/putting-principles-into-practice-adobes-approach-to-ai-ethics

I believe this regulation would be an enhancement to the current framework to further improve on the regulation and accountability set up for A.I. systems before it is released for commercial use.

What might be lacking is making the report or process transparent (mean show the public PROS and CONS).

Appreciate if you could share your thoughts in the comment section on what are your thoughts on the impact regulations on A.I. stocks? Will it affect all A.I. stocks? Or even hit those companies who have started to ride the A.I. wave?

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Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.