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Acting for You, July 2019

AI: Australia’s Ethical Framework

Governance Institute recently lodged a submission to the Department of Industry, Innovation and Science on its discussion paper — Artificial Intelligence: Australia’s Ethical Framework. In our submission we expressed our support for the ongoing discussion about the need for AI opportunities to be balanced with risks. Our members consider that a set of ethical AI principles would greatly aid public trust as these technologies continue to penetrate communities and would also ensure the right mix of innovation and the avoidance of potential harms.

In our submission we observed that there is a considerable volume of documents already published on principles, guidelines and frameworks for AI ethics, including many identified within the discussion paper, as well as several attempts to consolidate the growing amount of material being developed globally. There is significant variation however, in the principles identified. This variation is seen in the number of principles, the level of detail and the language used. We noted that one area of commonality is that almost all of this material provides for the ability to voluntarily commit to the relevant principles, guidelines or framework, rather than providing recommendations for operationalising, overseeing or enforcing them.

We suggested that before looking at the individual principles proposed in the Discussion Paper, there should be consideration about how the principles are structured. Our members consider that it would aid in understanding the principles, if they were grouped into categories or themes. This would not only allow a smaller number of categories which may make understanding the overall intention of the principles easier, but also provide an opportunity for including a larger number of more detailed principles within those groupings. We suggested that a tiered framework of Core Principle, Supporting Principle and Ethical AI issues could be a useful way of structuring any principles. We also suggested two different approaches for developing the core principles. The first is based on the medical ethical principles of respect for ‘autonomy’, ‘non-maleficence’, ‘beneficence’ and ‘justice’. Many of the existing AI ethics documents are based on these four principles, often with a fifth of ‘explicability’. An alternative approach to categorising the proposed principles into a collection of core principles could be to consider the key components of governance: ‘stewardship’, ‘transparency’, ‘accountability’, ‘integrity’ and ‘risk management’, or STAIR.

In response to a question as to whether there are already best-practice models in related fields that could serve as a template to follow in the practical application of ethical AI we referred the Department to the to the UK Institute for Ethical AI & Machine Learning that proposes that the regulation of responsible AI be approached through four phases:

  1. By Principle — empowering individual through best practices and applied principles
  2. By Process — empowering leaders through practical industry frameworks and applied guides
  3. By Standards — Empowering entire industries through contributions to industry standards
  4. By Regulation — Empowering entire nations through case studies and breakthroughs

We suggested a similar phased approach as a practical model for applying the principles through to enforcing regulation is a sensible way forward.

The Australian Human Rights Commission (AHRC) in partnership with the World Economic Forum has also been considering the issue of AI in the February 2019 White Paper Artificial Intelligence: governance and leadershipThe AHRC will be consulting further later in 2019.

Governance Institute will continue to keep members updated on this issue.

Modernising business registers and Director Identification Number

Governance Institute is continuing our discussions with the MBR project team as part of its extensive stakeholder engagement program. We continue to advocate for company secretaries to be included in the DIN regime and for company secretary identification details to be removed from the public part of the register. There will be a number of challenges in transitioning ASIC’s 31 business registers and the Australian Business Register to a new system hosted at the ATO as well as issuing DIN’s to over 2.7 million company directors and linking those DIN’s with company records.

This project is critical Australian business infrastructure for all Australian companies in all sectors. Governance Institute’s members have a crucial role to play in the implementation of this project. We will strongly advocate to Government that it consider funding decisions for this important project as part of the preparation for the Mid-Year Economic and Fiscal Outlook.

Governance Institute will continue to keep members updated on this issue.

ASX Listing Rule changes effective dates

Removal of entities from the ASX Official List

ASX has released a revised version of ASX Listing Rules Guidance Note 33 Removal of Entities from the ASX Official List (GN 33). Changes to GN 33 were foreshadowed in ASX’s consultation paper Simplifying, clarifying and enhancing the integrity and efficiency of the ASX Listing Rules issued in November 2018. The revised version of GN 33 has been released earlier than intended to:

  • incorporate immediately some of the feedback received in the consultation including, in particular, a change to section 2.7 of GN 33 to require a special resolution rather than an ordinary resolution to approve a voluntary de-listing, and
  • give the market advance notice of the deferral of the effective date for the changes to ASX’s long term suspended entity policy in section 3.4 of GN 33.

The changes to ASX’s long-term suspended entity policy will now take effect on Monday 3 February 2020, rather than the date originally proposed, 1 July 2019. This is to allow currently suspended entities more time to pursue a transaction that could lead to them being reinstated to trading. ASX has advised that all of the other changes in GN 33 take effect immediately.

ASX Listing Rules consultation

ASX has advised that ASIC will not be able to process the rule changes proposed in ASX’s consultation paper Simplifying, clarifying and enhancing the integrity and efficiency of the ASX Listing Rules in time for them to come into effect on the originally proposed implementation date of 1 July 2019. ASX has therefore decided to defer the implementation date for those changes to 1 December 2019, to give listed entities the opportunity to complete their AGMs for 2019 before having to absorb the rule and guidance changes in the package.

Provided the necessary regulatory approvals are available, ASX expects to release a consultation response and the final version of the listing rule changes and associated guidance note changes in late September/early October 2019. ASX has advised it will conduct a national roadshow about the rule and guidance changes in late October/early November 2019.

Governance Institute will continue to keep members updated on this issue.

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Queen’s Birthday Honours 2019

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