IIM Lucknow Faculty Research Proposes Ethical Framework

For Responsible Use of AI in Marketing

LUCKNOW :
A multi-institutional research team including a faculty member from the Indian Institute of Management (IIM) Lucknow has proposed a comprehensive ethical framework for the responsible use of Artificial Intelligence (AI) in marketing. The study highlights that ethical AI adoption is essential to ensure equity, fairness, accountability, and sustainable business performance in increasingly data-driven marketing ecosystems.

The research critically examines how AI-driven marketing practices affect key stakeholders, including consumers, firms, and society at large. Drawing on established ethical theories, the study emphasises that AI should not be treated as an abstract or purely technical tool, but as a socio-technical system embedded with human values, data, and decision-making structures.

Lessons from Failed AI Implementations

The researchers analysed several high-profile cases of unsuccessful or controversial AI implementations to demonstrate the risks of unregulated and unethical AI use.

Notable examples include:

• Microsoft’s Tay chatbot, which exposed how machine learning systems can absorb and amplify toxic social biases
• The Facebook–Cambridge Analytica scandal, which revealed large-scale privacy violations enabled by AI-driven data analytics
• Amazon’s AI-based recruitment tool, which was discontinued after being found biased against women due to skewed historical data

These cases illustrate that without proper governance, AI systems can reproduce inequality, compromise privacy, and undermine public trust. The study underscores the need for transparency, ethical AI design, and human oversight as indispensable components of AI-driven marketing.

Ethical Foundations and Key Issues in AI Marketing

Published in the American Business Review, an ABDC A-rated journal, the paper is co-authored by Prof. Priyanka Sharma (IIM Lucknow), Prof. V. Kumar (Brock University, Canada), Prof. Ashutosh Dixit (Cleveland State University, USA), and Prof. Sudipendra Nath Roy (St. Cloud State University, USA).

The framework is grounded in well-established ethical theories, including:

• Utilitarianism
• Deontology
• Virtue ethics
• Ethics of care
• Contractarianism

Using these perspectives, the researchers identify five major ethical challenges associated with AI use in marketing:

• Monopolisation of data and market power
• Consumer privacy concerns
• Corporate social responsibility
• Human rights protection
• Accountability and governance

Real-world scenarios are used throughout the study to demonstrate how these issues arise and how they affect consumers, organisations, and society.

Theory-Based Solutions for Responsible AI Adoption

To address these ethical challenges, the study proposes several actionable, theory-driven solutions:

• Data democratisation to reduce excessive market concentration and monopolistic control by enabling broader and fairer access to data resources
• Contextual and purpose-driven data usage, ensuring consumer data is collected and applied strictly within ethically justified and transparently communicated boundaries
• Adherence to international human rights frameworks, particularly to prevent discrimination, protect autonomy, and uphold dignity in algorithmic decision-making
• Robust AI governance mechanisms, including clear accountability structures, ethical review processes, and institutional safeguards such as independent AI ombudspersons, to strengthen transparency and trust

Expert Perspective

Speaking about the study, Prof. Priyanka Sharma, Professor at IIM Lucknow, said:

“AI has become both indispensable and deeply challenging for firms. AI practices grounded in ethical theories such as Utilitarianism and Deontology can help businesses address issues of privacy, accountability, and corporate social responsibility in their marketing applications. Frameworks like data democratisation and governance through AI ombudspersons are key to the responsible and equitable use of AI-driven marketing.”

Contribution to Policy, Practice, and Research

The study makes a significant contribution to the global discourse on responsible AI in marketing by offering structured guidance for academics, practitioners, and policymakers. It provides a roadmap to balance technological innovation with ethical responsibility and outlines future research directions to strengthen ethical AI adoption across marketing systems.