Ethical dimensions of digital transformation: aligning AI strategies with corporate values and responsibilities

<p dir="ltr">As the landscape of business evolves amidst the pervasive integration of artificial intelligence (AI), organisations face an imperative to recalibrate their digital strategies to remain competitive. Yet, this paradigm shift towards AI-driven operations has brought forth profound ethical dilemmas, compelling managers to develop strategies that reconcile technological advancement with societal responsibility. In response, scholarly attention has increasingly scrutinized the ethical challenges inherent in AI implementation and their implications for strategic decision-making. This paper presents a systematic literature review aimed at dissecting the nexus between digital strategy, AI ethics, and corporate responsibility. Through an examination of key literature, including seminal works and contemporary discourse, the review identifies pressing challenges such as AI bias, privacy concerns, stakeholder apprehensions regarding unemployment, and regulatory gaps. Left unaddressed, these challenges can have far-reaching strategic consequences for businesses, undermining sustainability. Central to this research is the exploration of how strategic frameworks can serve as navigational tools for managers to effectively mitigate ethical risks associated with AI adoption while leveraging digital strategies for competitive advantage. By elucidating the intersectionality of digital strategy, AI ethics, and corporate responsibility, this paper underscores the imperative for businesses to integrate ethical considerations into their strategic decision-making processes. Moreover, the study identifies opportunities to align digital strategies with principles of sustainability and social responsibility, fostering synergies with the circular economy (CE) paradigm. Through a nuanced analysis of existing literature, this research aims to provide actionable insights for managers seeking to develop responsible AI strategies that uphold ethical standards while driving digital innovation. Finally, this paper contributes to the burgeoning discourse on AI ethics and digital strategy by elucidating the strategic imperatives for businesses in navigating the ethical complexities of AI adoption. By fostering dialogue and offering practical guidance, it seeks to catalyse a paradigm shift towards digital sustainability, where technological progress is harmonized with societal values and ethical principles.</p>