Activist investor Richard Bernstein has secured Nat Rothschild’s backing for an artificial intelligence (AI) company that will put corporate “hypocrisy” in the spotlight.
Bernstein, founder of Crystal Amber, recently became CEO of Insig AI, which uses machine learning to interrogate company disclosures. Prominent financier Rothschild has bought a 5% stake in the company for almost £1m.
The firm helps investors and regulators sift through reams of publicly available disclosures, detecting those guilty of “greenwashing” or other cases of not being truthful with the public.
Heavyweights: Richard Bernstein, right, founder of Crystal Amber, has recently become chief executive of Insig AI, in which financier Nat Rothschild, left, bought a 5% stake for almost £1m.
“There seems to be a lot of hypocrisy around people who say we want to be good corporate investors and yet on the other hand, they don’t bother to do the work to see what is revealed,” Bernstein said.
Greenwashing is the term used when companies make promises about the environment that are not matched by their actions.
He added that Insig has already identified a FTSE 100 company worth more than £10bn that is “crying out for a greenwashing investigation” and estimates that if this happens it will wipe out between £700m and £800m. of its value “in a minute.”
“They are not disclosing what they should be disclosing and what they have said is inconsistent,” Bernstein said. “He is making false claims.”
Bernstein, who owns just under 20 percent of Insig AI, said: “It’s similar in that Crystal Amber is about activism and change.
‘Here I have gone one step further: I have decided to be the boss. “It’s really about using machine learning for corporate reporting and governance-related standards in particular.”
The goal is to detect companies whose disclosures reveal that they are not the “big and good” that some in fact claim to be.
Bernstein added: “The idea is to increase the level of information disclosure by companies so that there are no scandals in the future.”