As artificial intelligence gains popularity, critics argue that some companies are resorting to “AI washing,” or misleadingly claiming to utilize sophisticated AI technologies.
The term has emerged in recent months as an increasing number of companies tout their supposed use of AI in products and services, while often failing to demonstrate the genuine application of these technologies.
Researchers suggest that AI washing has stemmed from the competitive drive for funding, along with a desire to appear cutting-edge. As it stands, only a mere 10% of tech start-ups referenced using AI in their pitches in 2022; this number skyrocketed to over 25% by 2023 and is predicted to continue escalating. However, according to OpenOcean, only around 30% of these companies actually manage to deliver tangible AI-driven results.
Despite growing concerns, a consensus has not been reached on a definitive description of AI. This ambiguity, according to KPMG’s Douglas Dick, Head of Emerging Technology Risk (UK), is the primary reason “AI washing” has become a reality: “If I were to gather a room full of individuals and solicit a single definition of AI, each and every one would provide a unique definition… it is this lack of a consistent framework that is enabling ‘AI washing.'”
Regulatory bodies are progressively cracking down on AI washing, starting in the United States. The Securities and Exchange Commission has recently filed charges against two investment firms for making false and deceptive statements about their AI usage. Meanwhile in the United Kingdom, the Advertising Standards Authority already has rules and guidelines governing AI washing, as its Code of Practice explicitly states that marketing efforts cannot be misleading or likely to deceive, ultimately serving as a vital instrument against this growing issue.
