The road to humane AI

By Amy Browne, Director of Stewardship, CCLA Investment Management

Artificial intelligence (AI) is developing at extraordinary speed. Its benefits can be significant, from improving productivity to accelerating scientific research. Yet, as AI becomes embedded in daily life, important questions have emerged about how this technology affects people and communities.

Discussions about responsible AI often focus on how algorithms interact with people. But that question is only part of the picture. Behind every AI system sits a complex human ecosystem. If AI is to be truly humane, we must not only consider how to use the technology, but also what its environmental and human impacts will be.

Workers’ health

Employers increasingly use AI to support recruitment, monitor performance and allocate work. AI can improve efficiency, but it also raises important questions about employee wellbeing.

Research from the Institute for the Future of Work suggests that workers who interact more with AI report lower quality of life. Concerns are particularly acute where algorithms influence workloads, assess performance or run disciplinary processes without human oversight.

For charities and voluntary sector organisations, the challenge is clear: how can new technologies support them without undermining trust, autonomy and wellbeing in the workplace?

Consumer rights

AI is transforming the way organisations interact with consumers. That change will impact everything from customer service and advertising to pricing and access to financial services.

But the risks of that transformation are becoming visible as well. Consumer groups have highlighted instances where AI systems produce misleading advice, while generative AI has created new opportunities for fraud. Concerns remain about the transparency of automated decision-making, particularly when algorithms affect credit, insurance or other key services.

For charities, these issues are especially relevant because the people they support are often among the most vulnerable to financial exclusion and unfair treatment. Public confidence in AI will not only depend on whether it is accurate, but also on whether it is fair, transparent and accountable.

A role for the third sector

The third sector’s role is not only to ask what AI can do. We should also ask how it is built, whose interests it serves and whether its environmental and social costs are managed responsibly. Charities bring valuable perspectives on vulnerability, inequality and public trust. Those can help ensure that discussions not only on the technology behind AI but also on its social outcomes.

Many charities already contribute to debates on workplace surveillance, data protection, consumer rights and digital exclusion. Others are exploring how AI can be used responsibly to improve service delivery without compromising ethical standards.

The environmental consequences of AI are another area where civil society engagement is increasingly important. Training and deploying AI models require computing power, which drives demand for energy-intensive data centres. Data centres themselves demand an extraordinary volume of electricity and water, while also raising carbon emissions.

At the same time, the global supply chain that underpins AI technologies may create human rights challenges, including responsible sourcing and modern slavery risks. These issues are less visible than concerns about algorithmic bias or misinformation, but they are no less important.

CCLA’s approach

AI technologies rely on energy-intensive data centres, significant water consumption and complex global supply chains. As demand for AI grows, so does the importance of managing its climate, environmental and human rights risks.

In our view, a humane approach to AI requires companies to manage the environmental and social impacts associated with it.

At CCLA, we engage with investee companies to encourage them to reduce their carbon emissions and manage their climate impacts. In addition, we regularly assess major companies in the AI and semiconductor supply chain through our CCLA Modern Slavery Benchmark. Those include, for example, Microsoft, TSMC, ASML and Texas Instruments. We engage with companies on how they identify, address and prevent modern slavery and forced labour risks, not only in their operations but also in their supply chains.

One such example is micro-chip capital equipment firm ASML. Here, our engagement since 2023 has coincided with improvements in climate reporting and target-setting. The Science Based Targets initiative (SBTi) has now validated ASML’s 2030 and 2040 emissions reduction targets, and the company has expanded its emissions reduction roadmap to cover its value chain.

Elsewhere, we’ve engaged with Microsoft on human rights and responsible sourcing and have begun to see progress. Microsoft now provides greater detail on how it incorporates site-level analysis into its modern slavery risk assessments. That is indicative of a stronger approach to identifying forced labour risks in its supply chain.

We believe that engagement can be a powerful tool for positive change. By working with companies, we aim to help reduce the environmental and social impacts associated with AI-related technologies while improving corporate practice over time.

Looking ahead

AI is an inevitable technological revolution. But what kind of revolution will it become?

Decisions made today by companies, regulators, investors and civil society, will shape whether AI strengthens or weakens public trust, supports or undermines workers’ wellbeing, and broadens or restricts access to opportunity.

Ensuring that AI serves humanity is about more than making algorithms fair and transparent. It means asking whether the infrastructure, supply chains and resources that underpin this technology are managed in ways that respect people and the planet.

AI will undoubtedly shape the future. The real question is whether it will do so in a way that supports thriving communities, protects people and the planet, and creates lasting economic value. For long-term investors, helping to shape a fair, accountable and sustainable AI economy is therefore not only the right thing to do, but a critical component of protecting prosperity, portfolio resilience and long-term value creation.

CCLA, part of the Jupiter Group, is authorised and regulated by the Financial Conduct Authority.