The Toronto-Dominion Bank | Regulating Artificial Intelligence in order to Safeguard the Human Aspect at The Toronto-Dominion Bank

Status
Filed
AGM date
Previous AGM date
Proposal number
7
Resolution details
Lead filer
Mouvement d'éducation et de défense des actionnaires (MÉDAC)
Resolution ask
Report on or disclose
ESG theme
  • Social
ESG sub-theme
  • Digital rights
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
Canada
Resolved clause
It is proposed that the Bank produce a report on the use of artificial intelligence in relation to decision making at senior levels, risk assessment, and credit underwriting.
Supporting statement
Artificial intelligence is rapidly transforming the financial sector, particularly in terms of risk analysis, credit automation, fraud detection and product recommendation. However, this shift comes with new risks, which are well identified in international research and policy. In a report published in August 2023 (Generative AI in Financial Services: Risks and Policy Considerations)(7), the International Monetary Fund (IMF) warns against: “algorithmic biases, privacy violations, threats to financial stability and governance risks arising from the unregulated use of AI”. At the same time, several renowned experts, including Yoshua Bengio, winner of the Turing Award and a leading figure in AI research, have publicly expressed their growing concern about the lack of effective safeguards. In an interview in Les Affaires (May 2023), Mr. Bengio stated: [translation] “The urgency to act is real. Powerful AI systems are already able to manipulate or mislead.” These warning signs have led to the adoption or study of regulatory frameworks in several countries. At the federal level, Bill C-276(8) — Digital Charter Implementation Act — currently before the Senate, proposes the creation of a specific legal framework for high-impact artificial intelligence. This framework will impose new responsibilities on businesses using AI, including banks. In this changing regulatory and technological context, it is in the Bank’s interest to: • demonstrate its responsibility and transparency; • prevent legal, reputational and systemic risks; • position itself as a prudent and ethical leader in the adoption of AI. The proactive publication of a structured report on the use of AI would enable shareholders to exercise informed oversight and allow the organization to build a corporatecoll governance worthy of the trust of the public and the authorities. This report should address the measures taken by the Bank to: • promote transparency on how, why and when artificial intelligence is used; • evaluate the results of AI systems, including generative tools, in order to minimize bias and inaccuracies, and enable users to distinguish between AI results and those generated by humans; • train employees or contractors who develop or use AI so that they understand the legal, ethical and operational issues, including privacy protection, security and bias, and are able to adopt AI systems responsibly. This proposal has received the support of 17.36% of votes cast at the last annual meeting. (7) (8) https://www.imf.org/en/Publications/fintech-notes/Issues/2023/08/18/Generative-Artificial-Intelligence-in-Finance-Risk-Considerations-537570 https://www.parl.ca/LegisInfo/en/bill/44-1/c-27

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