The Ethical Challenges of AI in Business: Issues and Solutions

Abstract

Artificial intelligence (AI) has brought about a revolution in business, yet it has simultaneously introduced complex ethical challenges. This paper focuses on three key issues. First, algorithmic bias, which exacerbates social inequalities. Second, data privacy violations,
resulting from extensive data aggregation. Third, the absence of clear accountability in automated decision - making. By closely examining
real - world examples, such as discriminatory hiring algorithms and the Cambridge Analytica incident, the study reveals flaws in existing regulatory mechanisms. To address these concerns, the paper puts forward a comprehensive approach. This includes implementing strict regulatory
frameworks like the EUs AI Act, promoting technological advancements in explainable AI (XAI) and bias reduction tools, and encouraging
corporate initiatives to integrate ethical principles into business operations. By integrating insights from law, technology, and business ethics,
this research offers practical strategies for reconciling AI innovation with ethical responsibility. It also advocates for a multi - stakeholder governance model.