The technology that is often blamed for this is AI. It is said to consume too much energy, cost jobs and lack transparency. Yet that picture is not accurate. AI may well be the strongest ally that the environment, people and government will have in the coming years.

AI and the environment

Let’s start with the environment, as that is where the most well-known objection lies. Data centres currently use around 500 terawatt-hours of electricity per year worldwide. By around 2030, that figure is likely to double: accounting for around 35 per cent of all electricity on Earth.

That is a lot. But you need to see this as an investment, not as the end result. The same technology actually helps us make better use of solar and wind power. AI ensures that less green electricity is wasted and routes energy more intelligently through the grid. AI also designs new materials for batteries, and much faster than a laboratory could. A single model mapped out more than 200 million protein structures.

If you add it all up (energy, food and transport), AI could save billions of tonnes of CO₂ by 2035. That is far more than data centres emit. And it is precisely this demand for electricity that is now the biggest driver ever of private investment in nuclear and renewable energy. Anyone who looks only at the costs and not at the benefits is making a mistake in their thinking that often costs investors a great deal of money.

AI and humanity: knowledge for almost everyone

Then there is the human aspect. The scare story is well known: many jobs will disappear and the gap between rich and poor will widen. Yet history tells a different story. Technology that makes people more productive has always created more work and prosperity than it has taken away. And higher productivity remains the only sustainable path to a better standard of living.

But the benefit to society extends beyond employment alone. AI makes knowledge that was once scarce accessible to almost everyone. Think of medical advice, a patient tutor, or help with a legal or financial query. For a long time, this was only possible for those who could afford it. Now it is within reach of almost anyone with a mobile phone. Language barriers are disappearing. People with disabilities are gaining access to aids that were unthinkable ten years ago. And tedious or dangerous work can be carried out by a machine. The question of exactly who benefits is a valid one and calls for sound policy. But the technology itself primarily reduces inequalities, not increases them.

AI and good governance

Finally, governance. This is where the benefits are most underestimated. Good governance revolves around one thing: narrowing the gap between what decision-makers ought to know and how they actually act. And that is precisely where human nature often gets in the way. In boardrooms and investment committees, overconfidence, herd behaviour and the search for validation are the order of the day. These are exactly the behavioural pitfalls I wrote a book about.

AI has a memory without an ego. It recognises patterns without emotion. It provides a second opinion without seeking to please anyone. And in very concrete terms: AI detects fraud and money laundering, enhances the auditor’s checks, monitors compliance at all times, and reduces the information advantage that management holds over shareholders. The objection that algorithms might have their own biases is valid. But a bias in an algorithm can be measured, checked and adjusted. With a director’s gut feeling, that is almost never possible.

Our children will be better off than expected

We are used to being pessimistic about the world we are leaving to our children. But progress is happening faster than we think, and AI is accelerating it even further. Better health, greater knowledge and higher productivity accumulate over the course of a generation. There is a good chance that our children will actually be much better off than we currently imagine.

ESG has always been about long-term value, not a moral seal of approval. AI enhances the prospects on all three fronts. That doesn’t mean you should buy into AI at any price. Valuation remains important, and a compelling narrative does not necessarily equate to a sound investment. But it is certainly a reason to look beyond the simplistic, negative narrative. The greatest risk is not that AI is bad for the environment, people or governance. The greatest risk is that our own cognitive biases make the costs appear starkly clear whilst the benefits remain vague, and that, as a result, we invest in the wrong direction.

More columns by Han Dieperink