Decoding AI Disclosure
How Europe’s largest companies report on Artificial Intelligence
FTI Consulting & Trinity Corporate Governance Lab
Executive Summary
With growing public attention on artificial intelligence (AI), the implementation of the EU AI Act and heightened investor scrutiny, companies face increasing pressure to disclose their AI activities. This research explores how leading European companies are reporting on AI, with a particular focus on their governance practices. Strong AI governance is essential due to the potential risks associated with the technology and the critical decisions leadership must make regarding its use. How AI is governed will have a lasting impact on a company’s future direction and success.
We analysed the Annual and Sustainability reports of the 50 European companies from the STOXX Europe 50 Index, classifying their AI disclosures based on 10 categories, ranging from the existence and content of an AI policy, to concrete use cases and mentions of the topic in Chair and CEO statements. Some of the categories are broken down into sub-categories to provide further information on the kind of disclosure.
Many companies report on AI strategy and use cases, whereas critical areas such as AI policy, oversight mechanisms, risk management, audits and key performance indicators (KPIs)showed lower disclosure rates. We also noted some variation in disclosures per sector, with those exposed to the greatest amount of risk providing the most comprehensive disclosures.
Our analysis revealed varying levels of disclosure , with eight leading companies reporting on at least eight out of the 10 identified categories.
2024 Top 'Disclosers'
Allianz, AstraZeneca, Deutsche Telekom, GSK, Mercedes-Benz, Prosus, RELX, Zurich Insurance
For each category, the report highlights the various disclosure practices observed, provides examples of best practice and key takeaways. Priority areas, based on public disclosure, include strengthening Board and management oversight, establishing key performance metrics, expanding audit practices and providing detailed context on AI’s implementation.
This analysis provides valuable insights and guidance for companies seeking to enhance their AI disclosure and to demonstrate the effectiveness of their governance frameworks. It also illuminates Europe’s largest companies’ approach towards AI corporate governance. Companies that can effectively communicate their strategic approach to AI innovation and how they manage risks will be better positioned to maintain stakeholder confidence.
At the end of the report, we provide 10 recommendations and advice for disclosure.
About Trinity Business School
The triple-accredited Trinity Business School strives to embed environmental, social, and governance (ESG) solutions into all of its activities to tackle urgent societal issues. The School is committed to a strategy of “Transforming Business for Good” and works with students and various stakeholders in building an inclusive and sustainable economy for all.The School’s Corporate Governance Lab delivers innovative and collaborative projects in the areas of corporate governance and business ethics. With a focus on the ‘G’ of ESG, the Lab undertakes cutting-edge interdisciplinary and practitioner-oriented research, engagement, and innovation projects in collaboration with industry, policy-makers, and researchers.
Lead Author: Niamh O’Brien (FTI Consulting)
Contributing Authors: Arnaud Cavé (FTI Consulting), Daniel Malan (Trinity Corporate Governance Lab)
Researchers: Danielle Farrelly (FTI Consulting), Johana Sierra (Post-Doctoral Researcher, Universidad de Barcelona; Visiting Research Assistant, Trinity Corporate Governance Lab)
