Research Papers

The financial industry faces a significant challenge modeling and risk portfolios: balancing the predictability of advanced machine learning models, neural network models, and explainability required by regulatory entities (such as Office of the Comptroller of the Currency, Consumer Financial Protection Bureau). This paper intends to fill the gap in the application between these "black box" models and explainability frameworks, such as LIME and SHAP. Authors elaborate on the application of these frameworks on different models and demonstrates the more complex models with better prediction powers could be applied and reach the same level of the explainability, using SHAP and LIME. Beyond the comparison and discussion of performances, this paper proposes a novel five dimensional framework evaluating Inherent Interpretability, Global Explanations, Local Explanations, Consistency, and Complexity to offer a nuanced method for assessing and comparing model explainability beyond simple accuracy metrics. This research demonstrates the feasibility of employing sophisticated, high performing ML models in regulated financial environments by utilizing modern explainability techniques and provides a structured approach to evaluate the crucial trade offs between model performance and interpretability.

"I Like That You Have to Poke Around": Instructors on How Experiential Approaches to AI Literacy Spark Inquiry and Critical Thinking

Aparna Maya Warrier, Arav Agarwal, Jaromir Savelka +2

As artificial intelligence (AI) increasingly shapes decision-making across domains, there is a growing need to support AI literacy among learners beyond computer science. However, many current approaches rely on programming-heavy tools or abstract lecture-based content, limiting accessibility for non-STEM audiences. This paper presents findings from a study of AI User, a modular, web-based curriculum that teaches core AI concepts through interactive, no-code projects grounded in real-world scenarios. The curriculum includes eight projects; this study focuses on instructor feedback on Projects 5-8, which address applied topics such as natural language processing, computer vision, decision support, and responsible AI. Fifteen community college instructors participated in structured focus groups, completing the projects as learners and providing feedback through individual reflection and group discussion. Using thematic analysis, we examined how instructors evaluated the design, instructional value, and classroom applicability of these experiential activities. Findings highlight instructors' appreciation for exploratory tasks, role-based simulations, and real-world relevance, while also surfacing design trade-offs around cognitive load, guidance, and adaptability for diverse learners. This work extends prior research on AI literacy by centering instructor perspectives on teaching complex AI topics without code. It offers actionable insights for designing inclusive, experiential AI learning resources that scale across disciplines and learner backgrounds.

In explainable AI, Concept Activation Vectors (CAVs) are typically obtained by training linear classifier probes to detect human-understandable concepts as directions in the activation space of deep neural networks. It is widely assumed that a high probe accuracy indicates a CAV faithfully representing its target concept. However, we show that the probe's classification accuracy alone is an unreliable measure of concept alignment, i.e., the degree to which a CAV captures the intended concept. In fact, we argue that probes are more likely to capture spurious correlations than they are to represent only the intended concept. As part of our analysis, we demonstrate that deliberately misaligned probes constructed to exploit spurious correlations, achieve an accuracy close to that of standard probes. To address this severe problem, we introduce a novel concept localization method based on spatial linear attribution, and provide a comprehensive comparison of it to existing feature visualization techniques for detecting and mitigating concept misalignment. We further propose three classes of metrics for quantitatively assessing concept alignment: hard accuracy, segmentation scores, and augmentation robustness. Our analysis shows that probes with translation invariance and spatial alignment consistently increase concept alignment. These findings highlight the need for alignment-based evaluation metrics rather than probe accuracy, and the importance of tailoring probes to both the model architecture and the nature of the target concept.

Convolutional neural networks (CNNs) underpin many modern computer vision systems. With applications ranging from common to critical areas, a need to explain and understand the model and its decisions (XAI) emerged. Prior works suggest that in the top layers of CNNs, the individual channels can be attributed to classifying human-understandable concepts. Concept relevance propagation (CRP) methods can backtrack predictions to these channels and find images that most activate these channels. However, current CRP workflows are largely manual: experts must inspect activation images to name the discovered concepts and must synthesize verbose explanations from relevance maps, limiting the accessibility of the explanations and their scalability. To address these issues, we introduce Large Language model EXplaIns COncept Relevance Propagation (LLEXICORP), a modular pipeline that couples CRP with a multimodal large language model. Our approach automatically assigns descriptive names to concept prototypes and generates natural-language explanations that translate quantitative relevance distributions into intuitive narratives. To ensure faithfulness, we craft prompts that teach the language model the semantics of CRP through examples and enforce a separation between naming and explanation tasks. The resulting text can be tailored to different audiences, offering low-level technical descriptions for experts and high-level summaries for non-technical stakeholders. We qualitatively evaluate our method on various images from ImageNet on a VGG16 model. Our findings suggest that integrating concept-based attribution methods with large language models can significantly lower the barrier to interpreting deep neural networks, paving the way for more transparent AI systems.

Despite their enormous predictive power, machine learning models are often unsuitable for applications in regulated industries such as finance, due to their limited capacity to provide explanations. While model-agnostic frameworks such as Shapley values have proved to be convenient and popular, they rarely align with the kinds of causal explanations that are typically sought after. Counterfactual case-based explanations, where an individual is informed of which circumstances would need to be different to cause a change in outcome, may be more intuitive and actionable. However, finding appropriate counterfactual cases is an open challenge, as is interpreting which features are most critical for the change in outcome. Here, we pose the question of counterfactual search and interpretation in terms of similarity learning, exploiting the representation learned by the random forest predictive model itself. Once a counterfactual is found, the feature importance of the explanation is computed as a function of which random forest partitions are crossed in order to reach it from the original instance. We demonstrate this method on both the MNIST hand-drawn digit dataset and the German credit dataset, finding that it generates explanations that are sparser and more useful than Shapley values.

Feature-attribution methods (e.g., SHAP, LIME) explain individual predictions but often miss higher-order structure: sets of features that act in concert. We propose Modules of Influence (MoI), a framework that (i) constructs a model explanation graph from per-instance attributions, (ii) applies community detection to find feature modules that jointly affect predictions, and (iii) quantifies how these modules relate to bias, redundancy, and causality patterns. Across synthetic and real datasets, MoI uncovers correlated feature groups, improves model debugging via module-level ablations, and localizes bias exposure to specific modules. We release stability and synergy metrics, a reference implementation, and evaluation protocols to benchmark module discovery in XAI.

Melanoma is one of the most aggressive and deadliest skin cancers, leading to mortality if not detected and treated in the early stages. Artificial intelligence techniques have recently been developed to help dermatologists in the early detection of melanoma, and systems based on deep learning (DL) have been able to detect these lesions with high accuracy. However, the entire community must overcome the explainability limit to get the maximum benefit from DL for diagnostics in the healthcare domain. Because of the black box operation's shortcomings in DL models' decisions, there is a lack of reliability and trust in the outcomes. However, Explainable Artificial Intelligence (XAI) can solve this problem by interpreting the predictions of AI systems. This paper proposes a machine learning model using ensemble learning of three state-of-the-art deep transfer Learning networks, along with an approach to ensure the reliability of the predictions by utilizing XAI techniques to explain the basis of the predictions.

The development of Artificial Intelligence (AI), including AI in Science (AIS), should be done following the principles of responsible AI. Progress in responsible AI is often quantified through evaluation metrics, yet there has been less work on assessing the robustness and reliability of the metrics themselves. We reflect on prior work that examines the robustness of fairness metrics for recommender systems as a type of AI application and summarise their key takeaways into a set of non-exhaustive guidelines for developing reliable metrics of responsible AI. Our guidelines apply to a broad spectrum of AI applications, including AIS.

Evaluating how Large Language Models (LLMs) handle complex, specialized knowledge remains a critical challenge. We address this through the lens of climate change by introducing CLINB, a benchmark that assesses models on open-ended, grounded, multimodal question answering tasks with clear requirements for knowledge quality and evidential support. CLINB relies on a dataset of real users' questions and evaluation rubrics curated by leading climate scientists. We implement and validate a model-based evaluation process and evaluate several frontier models. Our findings reveal a critical dichotomy. Frontier models demonstrate remarkable knowledge synthesis capabilities, often exhibiting PhD-level understanding and presentation quality. They outperform "hybrid" answers curated by domain experts assisted by weaker models. However, this performance is countered by failures in grounding. The quality of evidence varies, with substantial hallucination rates for references and images. We argue that bridging this gap between knowledge synthesis and verifiable attribution is essential for the deployment of AI in scientific workflows and that reliable, interpretable benchmarks like CLINB are needed to progress towards building trustworthy AI systems.

Current quantum machine learning approaches often face challenges balancing predictive accuracy, robustness, and interpretability. To address this, we propose a novel quantum adversarial framework that integrates a hybrid quantum neural network (QNN) with classical deep learning layers, guided by an evaluator model with LIME-based interpretability, and extended through quantum GAN and self-supervised variants. In the proposed model, an adversarial evaluator concurrently guides the QNN by computing feedback loss, thereby optimizing both prediction accuracy and model explainability. Empirical evaluations show that the Vanilla model achieves RMSE = 0.27, MSE = 0.071, MAE = 0.21, and R^2 = 0.59, delivering the most consistent performance across regression metrics compared to adversarial counterparts. These results demonstrate the potential of combining quantum-inspired methods with classical architectures to develop lightweight, high-performance, and interpretable predictive models, advancing the applicability of QML beyond current limitations.

Do Chatbots Walk the Talk of Responsible AI?

Susan Ariel Aaronson, Michael Moreno

This study examines whether leading AI chatbot companies implement the responsible AI principles they publicly advocate. The authors used a mixed-methods approach analyzing four major chatbots (ChatGPT, Gemini, DeepSeek, and Grok) across company websites, technical documentation, and direct chatbot evaluations. We found significant gaps between corporate rhetoric and practice.

Recent advances in finance-specific language models such as FinBERT have enabled the quantification of public sentiment into index-based measures, yet compressing diverse linguistic signals into single metrics overlooks contextual nuances and limits interpretability. To address this limitation, explainable AI techniques, particularly SHAP (SHapley Additive Explanations), have been employed to identify influential features. However, SHAP's computational cost grows exponentially with input features, making it impractical for large-scale text-based financial data. This study introduces a GRU-based forecasting framework enhanced with GroupSHAP, which quantifies contributions of semantically related keyword groups rather than individual tokens, substantially reducing computational burden while preserving interpretability. We employed FinBERT to embed news articles from 2015 to 2024, clustered them into coherent semantic groups, and applied GroupSHAP to measure each group's contribution to stock price movements. The resulting group-level SHAP variables across multiple topics were used as input features for the prediction model. Empirical results from one-day-ahead forecasting of the S&P 500 index throughout 2024 demonstrate that our approach achieves a 32.2% reduction in MAE and a 40.5% reduction in RMSE compared with benchmark models without the GroupSHAP mechanism. This research presents the first application of GroupSHAP in news-driven financial forecasting, showing that grouped sentiment representations simultaneously enhance interpretability and predictive performance.