| dc.description.abstract | The UK financial services industry is undergoing significant transformative digitalisation through the development of information technology, increased internet communications, computer speed and programming capacity, and application of big data to traditional financial services. In particular, the use of Artificial Intelligence (AI), i.e. intelligence simulated by technological means, and ‘machine learning’, i.e. automatic learning by machines and software based on a computational and statistical process, is becoming increasingly and rapidly prevalent in financial services. The purpose of this thesis is to examine whether, in the light of the potential risks that AI and machine learning will pose upon society, our current ethical, legal and regulatory standards are satisfactory. Primarily, this thesis observes that the separation of ethics as an academic discipline from economic theory and modern finance theory has undermined the efficacy of the ethical, legal and regulatory standards to regulate the financial system. Therefore, it proposes an integrated ethical approach to UK financial regulation, which seeks to regulate the relationship between action, character of the actor, and the consequences of action. The proposed integrated ethical approach is anchored in the ‘social licence for financial markets’, which helps us to focus on the purpose of financial activity to serve the human good, and, ultimately, to improve the well-being of society. This thesis argues that, further to adopting an integrated ethical approach, we should refine our current ethical standards, and introduce new ethical standards. This thesis demonstrates that while an integrated ethical approach may be applied to programme AI and machine learning technology to behave ethically using, overall responsibility for AI and machine learning should remain with humans. In addition, in light of potential responsibility gaps, specially designed liability rules are required. Finally, this thesis will recommend a series of legal and regulatory reforms with the ultimate goal of cultivating a flourishing digitalised financial system. | en_US |
