Ethical AI Governance in Cloud-Based Financial Ecosystems
DOI:
https://doi.org/10.64137/31079385/IJMHSS-V2I2P105Keywords:
Ethical AI Governance, Cloud Computing, Financial Ecosystems, Algorithmic Bias, Model Transparency, Systemic Risk, Regulatory ComplianceAbstract
Artificial intelligence (AI) and distributed cloud computing have quickly converged to revolutionize the global financial services industry, resulting in automated, massively scalable, and highly interconnected transaction ecosystems. These cloud-hosted configurations provide unprecedented computational efficiency, higher predictive accuracy, and lead to real-time management of assets. Structural challenges can shed light on weaknesses such as algorithmic bias, the "black-box" nature of deep-learning models, in addition to questions over data security from multi-tenant public clouds, risks to consumer protections and macroeconomic stability, with unclear liability frameworks under shared-responsibility models. The present work thus lays a foundation for an overarching ethical AI governance framework specifically designed to govern the use of AI in cloud-hosted financial services. The aim of this research is to raise awareness and identify the practical challenges involved in deploying ethical AI, using a mixed-methods approach, interweaving systemic risk modeling with algorithmic auditing across distributed cloud nodes and comparative regulatory analysis. We show from a little empirical evidence that the common cloud architectures are neither log-detailed nor enable custom telemetry to audit deep learning models in real time, further widening the compliance gaps. We further show how considering fairness-based constraints and decentralizing accountability matrices alleviates both discriminatory lending and biases in automated credit-scoring models, while not sacrificing core model performance. Drawing on these insights, we recommend a multi-tiered governance model that combines technical guardrails, continuous monitoring pipelines, and cross-functional oversight committees. The article offers practical recommendations for financial institutions, cloud service providers and government regulators seeking to optimize competitive financial innovation with due ethical diligence.
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