Big Tech investors worry that artificial intelligence will go rogue

Exposure to AI now represents a short-term risk to investors' according to one London-based portfolio manager

Sam Altman: OpenAI fired and then rapidly rehired its chief executive this month. 

Fund managers who turned to big tech as a low-carbon, high-return bet are growing increasingly anxious over the sector’s experimentation with artificial intelligence.

Exposure to AI now represents a “short-term risk to investors,” said Marcel Stotzel, a London-based portfolio manager at Fidelity International. Mr Stotzel said he’s “worried we’ll get an AI blowback”, which he describes as a situation in which something unexpected triggers a meaningful market decline.

“It takes just one incident for something to go wrong and the material impact could be significant.”

Examples that Mr Stotzel says warrant concern are fighter jets with self-learning AI systems. Fidelity is now among fund managers talking to the companies developing such technologies to discuss safety features such as a “kill switch” that can be activated if the world one day wakes up to “AI systems going rogue in a dramatic way”, he said.

The investing industry based on environmental, social, and governance considerations may be more exposed to such risks than most, after taking to tech in a big way. Funds registered as having an outright environmental, social and good governance objective hold more tech assets than any other sector, according to Bloomberg Intelligence.

And the world’s biggest ESG exchange-traded fund is dominated by tech, led by Apple, Microsoft, Amazon, and Nvidia.

Those companies are now at the forefront of developing AI. Tensions over the direction the industry should take — and the speed at which it should move — recently erupted into full public view.

This month, OpenAI, the company that rocked the world a year ago with its launch of ChatGPT, fired and then rapidly rehired its chief executive, Sam Altman, setting off a frenzy of speculation.

Internal disagreements had ostensibly flared up over how ambitious OpenAI should be, in light of the potential societal risks.

Mr Altman’s reinstatement puts the company on track to pursue his growth plans, including faster commercialisation of AI.

Apple said it plans to tread cautiously in the field of AI.

• Bloomberg