Explainable AI (XAI) for Due Diligence

The reality is, however, as all modern AI is based on ‘Machine Learning’, it is in fact a black box. Machine learning is not based on pre-programmed rules. No model is implemented that captures a human decision-making process, like decision trees.

Instead, with Machine Learning a purely stochastic and empirical approach is taken. Therefore, it is not possible to explain how the machine learning reaches a conclusion or prediction. We can, however, analyse and understand its ‘behaviour’. In this paper we explain how that can be done in relation to AI being used to enhance legal due diligence during M&A. We analyse our recently released AI tools, by asking the following questions:

• How does the ‘machine’ learn?
• Can you trust the results?