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A hypothesis-driven responsible AI framework for interpretable ESG forecasting with RuleFit

  • Tufail Muhammad
  • , Rubab Hafeez
  • , Waqas Bin Khidmat
  • , Mehtab Afzal
  • , Fazeel Abid
  • , Harun Elkiran
  • , Ahmet Gurhanli
  • , Jawad Rasheed*
  • *Corresponding author for this work
  • Department of Computer Science
  • Air University Aerospace and Aviation Campus
  • Stockholm University
  • Department of Computer Science and IT
  • The University of Lahore
  • Istanbul Medipol University
  • Department of Computer Engineering
  • Istanbul Ayvansaray University
  • Department of Software Engineering
  • Istanbul Sabahattin Zaim University
  • Nisantasi Universitesi

Research output: Contribution to journal › Article › peer-review

Abstract

The systematic integration of artificial intelligence (AI) within business practices and corporate governance has made Responsible AI (RAI) an absolute subset of corporate social responsibility. This research formulates a framework that integrates Responsible AI principles with hypothesis-driven rule extraction to predict Environmental, Social, and Governance (ESG) scores. Employing the ensemble-based RuleFit algorithm, we construct decision rules that algorithmically associate non-linearly with firm-level attributes such as size, leverage, digitization intensity, and managerial ownership. These rules are then transformed into domain-specific hypotheses and subsequently subjected to statistical validation using nonparametric tests to ensure robust results under non-normal outcome distributions. Performance predictive models are augmented to preserve equity by simultaneously assessing subgroup fairness through the distribution of residuals and biased proportions of firm characteristics. In summary, the proposed methodology illustrates how rule-based learning can yield interpretable, statistically sound, and ethically aligned forecasts of ESG outcomes, thereby facilitating reliable decision-making in sustainable finance and corporate governance.

Original languageEnglish
Article number19742
JournalScientific Reports
Volume16
Issue number1
DOIs
Publication statusPublished - Dec 2026
Externally publishedYes

Bibliographical note

Publisher Copyright:
© The Author(s) 2026.

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

  1. SDG 4 - Quality Education
    SDG 4 Quality Education
  2. SDG 12 - Responsible Consumption and Production
    SDG 12 Responsible Consumption and Production
  3. SDG 17 - Partnerships for the Goals
    SDG 17 Partnerships for the Goals

Keywords

  • Corporate governance
  • Ensemble learning
  • Responsible AI
  • RuleFit

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