On Predicting ESG Ratings Using Dynamic Company Networks

2023 | ACM Transactions on Management Information Systems | Citations: 0

Authors: Ang, Gary; Guo, Zhiling; Lim, Ee-Peng

Abstract: Environmental, social and governance (ESG) considerations play an increasingly i ... Expand

Abstract: Environmental, social and governance (ESG) considerations play an increasingly important role due to the growing focus on sustainability globally. Entities, such as banks and investors, utilize ESG ratings of companies issued by specialized rating agencies to evaluate ESG risks of companies. The process of assigning ESG ratings by human analysts is however laborious and time intensive. Developing methods to predict ESG ratings could alleviate such challenges, allow ESG ratings to be generated in a more timely manner, cover more companies, and be more accessible. Most works study the effects of ESG ratings on target variables such as stock prices or financial fundamentals of companies, but few works study how different types of company information can be utilized to predict ESG ratings. Previous works also largely focus on using only the financial information of individual companies to predict ESG ratings, leaving out the different types of inter-company relationship networks. Such inter-company relationship networks are typically dynamic, i.e., they evolve across time. In this paper, we focus on utilizing dynamic inter-company relationships for ESG ratings prediction, and examine the relative importance of different financial and dynamic network information in this prediction task. Our analysis shows that utilizing dynamic inter-company network information, based on common director, common investor and news event-based knowledge graph relationships, can significantly improve ESG rating prediction performance. Robustness checks over different time-periods and different number of time-steps in the future further validate these insights. Collapse

Topics: shapley additive explanation knowledge graph database system missing data network effect

Methods: machine learning econometric modeling longitudinal research Granger causality robustness check

Single-Sourcing vs. Multisourcing: An Empirical Analysis of Large Information Technology Outsourcing Arrangements

2023 | Information Systems Research | Citations: 0

Authors: Bapna, Ravi; Gupta, Alok; Ray, Gautam; Singh, Shweta

Abstract: As the information technology (IT) services landscape matures, clients are incre ... Expand

Abstract: As the information technology (IT) services landscape matures, clients are increasingly adopting multisourcing arrangements that involve multiple vendors. Although a large body of information systems (IS) literature addresses issues of whether to outsource (to a single vendor), what types of contracts to use, and how to achieve optimal relational governance, little is known about the antecedents and consequents of the single versus multisourcing decision. Moreover, while conceptual and analytical models of single-sourcing versus multisourcing have been developed, there is no empirical IS research using a large-scale data set with rigorous econometric analysis that examines the antecedents and consequents of multisourcing in the IT context. This paper fills this void, using the transaction cost economic lens and a data set of 49,057 large IT outsourcing arrangements that spans multiple industries and dates back 25 years. We find that there is a curvilinear relationship between number of IT services in an IT outsourcing arrangement and the likelihood of multisourcing. This relationship increases as the number of IT services increases to up to five services and then decreases. For managers who plan to multisource IT outsourcing arrangements, this research provides guidance to minimize exchange hazards through a better understanding of the relationship between sourcing choice, client IT outsourcing capabilities, the competitiveness of the vendor landscape, and the number of IT services in an IT outsourcing arrangement. We provide empirical evidence that the choice between single-sourcing and multisourcing is material to the performance of outsourcing contracts as an incorrect sourcing choice is likely to result in negative contract outcomes. History: Paul A. Pavlou, Senior Editor; Ning Su, Associate Editor. Collapse

Topics: outsourcing system integration IS management service desk data center

Methods: XGBoost robustness check machine learning k-nearest neighbor statistical hypothesis test

Theories: transaction cost economics game theory

Human-machine collaboration for feature selection and integration to improve congestive Heart failure risk prediction

2023 | Decision Support Systems | Citations: 0

Authors: Ben-Assuli, Ofir; Heart, Tsipi; Klempfner, Robert; Padman, Rema

Abstract: The issue of harnessing machine learning (ML) algorithms for the prediction of a ... Expand

Abstract: The issue of harnessing machine learning (ML) algorithms for the prediction of adverse medical events is important considering the prevalence of vast repositories of patient-level medical data, and the quest to reduce healthcare costs while elevating the quality of care. Of particular interest is identifying a set of features that can better predict the risk of unplanned readmissions of chronically ill patients within 30 days post discharge, among them patients with Congestive Heart Failure (CHF). While numerous studies have employed ML algorithms to identify sets of significant features, only a handful have compared features extracted by various methods, and even fewer have compared the predictive power of feature sets selected by human experts to those selected by ML. Hence, this research aimed to elicit a comprehensive feature set selected by four ML algorithms and compare its predictive performance to that of a feature set selected by experts. We then evaluated a merged list of the two feature sets, constructing a human-machine collaborative set to predict the likelihood of 30-day unplanned readmission of CHF patients using data on 10,763 CHF patients hospitalized during the years 2010–2017. Our models achieved Area under the ROC Curve (AUC) above 0.8 and an Accuracy of ~0.89, comparable to the best models in the extant literature. Moreover, the Human-Machine Collaborative model significantly outperformed (best AUC 0.836) other human-only selected models as well as the machine-selected set. This study contributes to a better understanding of the power of using ML for patient risk stratification with special attention to the benefits of human-machine collaboration, even when these two entities work separately or in parallel, for improved clinical decision making. Collapse

Topics: healthcare data decision making big data missing data data warehouse

Methods: machine learning computational algorithm XGBoost descriptive statistic random forest classification

AI-Enhanced Hybrid Decision Management

2023 | Business & Information Systems Engineering | Citations: 0

Authors: Bork, Dominik; Ali, Syed Juned; Dinev, Georgi Milenov

Abstract: The Decision Model and Notation (DMN) modeling language allows the precise speci ... Expand

Abstract: The Decision Model and Notation (DMN) modeling language allows the precise specification of business decisions and business rules. DMN is readily understandable by business users involved in decision management. However, as the models get complex, the cognitive abilities of humans threaten manual maintainability and comprehensibility. Proper design of the decision logic thus requires comprehensive automated analysis of e.g., all possible cases the decision shall cover; correlations between inputs and outputs; and the importance of inputs for deriving the output. In the paper, the authors explore the mutual benefits of combining human-driven DMN decision modeling with the computational power of Artificial Intelligence for DMN model analysis and improved comprehension. The authors propose a model-driven approach that uses DMN models to generate Machine Learning (ML) training data and show, how the trained ML models can inform human decision modelers by means of superimposing the feature importance within the original DMN models. An evaluation with multiple real DMN models from an insurance company evaluates the feasibility and the utility of the approach. Collapse

Topics: artificial intelligence explainable artificial intelligence perceived usefulness price management extensible markup language

Methods: computational algorithm decision tree classification experiment conceptual modelling simulation

Analyzing Patients’ EHR: Predicting and Explaining Admission Consequences for COPD and Liver Disease Patients

2023 | International Conference on Information Systems | Citations: 0

Authors: Ben-Assuli, Ofir; Geva, Gaya

Abstract: This study analyzed the admission outcomes in chronic patients (with COPD, and ... Expand

Abstract: This study analyzed the admission outcomes in chronic patients (with COPD, and Liver disease) to demonstrate the feasibility of applying prediction methods on EHR records while incorporating an explainable AI technique. We predicted three target variables: 30-day readmission, Medium&Long Length of Stay and Single-day admission and analyzed the features using an explainable AI technique, the SHapley Additive exPlanations (SHAP). The results show that Readmission had higher prediction scores than all other dependent variables. Some features affected all target variables with either positive or negative influence including: Age, Charlson comorbidity index, Day-Shift, Gender, using EHR screens and Insurance cover level. These findings thus point to the value of using Machine-Learning combined with an explainable AI method to understand and assess the risks factors. The assessment of the potential factors leading to multiple complications can bolster prevention-oriented medical decisions to groups of patients but can also be tailored to the patient level. Collapse

Topics: shapley additive explanation explainable artificial intelligence Python IT work artificial intelligence

Methods: machine learning XGBoost logistic regression artificial neural network classification method

A Theory-Driven Deep Learning Method for Voice Chat–Based Customer Response Prediction

2023 | Information Systems Research | Citations: 0

Authors: Chen, Gang; Xiao, Shuaiyong; Zhang, Chenghong; Zhao, Huimin

Abstract: As artificial intelligence and digitalization technologies are flourishing real- ... Expand

Abstract: As artificial intelligence and digitalization technologies are flourishing real-time, online interaction–based commercial modes, exploiting customers’ purchase intention implied in online interaction processes may foster huge business opportunities. In this study, we target the task of voice chat–based customer response prediction in an emerging online interaction–based commercial mode, the invite-online-and-experience-in-store mode. Prior research shows that satisfaction, which can be revealed by the discrepancy between prior expectation and actual experience, is a key factor to disentangle customers’ purchase intention, whereas black-box deep learning methods empirically promise us advantageous capabilities in dealing with complex voice data, for example, text and audio information incorporated in voice chat. To this end, we propose a theory-driven deep learning method that enables us to (1) learn customers’ personalized product preferences and dynamic satisfaction in the absence of their profile information, (2) model customers’ actual experiences based on multiview voice chat information in an interlaced way, and (3) enhance the customer response prediction performance of a black-box deep learning model with theory-driven dynamic satisfaction. Empirical evaluation results demonstrate the advantageous prediction performance of our proposed method over state-of-the-art deep learning alternatives. Investigation of cumulative satisfaction reveals the collaborative predictive roles of theory-driven dynamic satisfaction and deep representation features for customer response prediction. Explanatory analysis further renders insights into customers’ personalized preferences and dynamic satisfaction for key product attributes. History: Yong Tan, Senior Editor; Jingjing Zhang, Associate Editor. Funding: This work was supported in part by the National Natural Science Foundation of China [Grants 71971067 and 72271059] and the China Postdoctoral Science Foundation [Grant 2022M722394]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1196. Collapse

Topics: customer satisfaction willingness to pay decision making marketing information system customer service

Methods: deep learning experiment machine learning BERT theory development

Trust and deception with high stakes: Evidence from the friend or foe dataset

2023 | Decision Support Systems | Citations: 0

Authors: Chen, Xunyu; Wang, Xinran; Spitzley, Lee; Nunamaker, Jay

Abstract: Many social interactions rely on the premise of mutual trust, but deception viol ... Expand

Abstract: Many social interactions rely on the premise of mutual trust, but deception violates trust and poses risk. Empirically examining trust and deception, particularly in high-stakes situations, is challenging but essential for improving the research realism and generalizability. To address this difficulty, we study trusting and deceptive behaviors in a high-stakes situation by using a novel dataset created from an American game show, Friend or Foe (FoF). In the show, a contestant's reward was determined through a trust game modified from the prisoner's dilemma. We explore how numerous human behaviors including facial expressions, gaze, head pose, body motion, language, and socio-demographic attributes, were related to a contestant's trusting or deceptive decision. Using a data-driven approach, we find that the deceivers' (contestants who chose Foe) behavior featured a neutralized face, negative facial emotions, enhanced upper body motion, and language with a lower sense of immediacy and agreeableness. The contestants who chose to trust (chose Friend) exhibited opposite behavioral patterns. Socio-demographic factors such as age, height, and facial attractiveness were also associated with a contestant's choice. Combining multimodal information, machine learning classifiers could predict the contes­ tant's choice with an accuracy about 25% greater than earlier reported human accuracy. We contribute to both trust and deception literature by examining the generalizability of trusting and deceptive behaviors to a new high-stakes scenario. We also add to the decision support literature by showing the superior predictive perfor­ mances of combining behavioral and socio-demographic features. Furthermore, we contribute to the academic community by introducing the FoF dataset. Collapse

Topics: decision support website YouTube Python decision making

Methods: meta analysis support vector machine correlation analysis descriptive statistic random forest classification

Algorithm-Human-Algorithm: A New Classification Approach to Integrating Judgemental Adjustments

2023 | International Conference on Information Systems | Citations: 0

Authors: Chen, Christopher; Jain, Nitish; Karamshetty, Varun

Abstract: Modern-day firms face the predicament of blending the comparative advantages of ... Expand

Abstract: Modern-day firms face the predicament of blending the comparative advantages of their two core resources: machines and humans. When forecasting demand (e.g. for a product), extant literature documents that always permitting (or prohibiting) human revision of a machine forecast is beneficial if the humans' private information role is larger (or smaller) than that of machine-accessible public information. We propose and test a complementary framework that shifts the focus to the regulation of each human revision; and in doing so, adjusts for human vulnerability to systematic biases. We collaborate with a European retailer to compile a large dataset (∼ 1.1 mn transactions) on machine-led demand forecasts. Humans revise nearly 38% of these forecasts, but revisions do not always yield an improved final forecast. Compared to the always permit or prohibit strategies, the ideal regulation of each of these revisions could reduce the absolute deviation of the final forecast from realized sales in close to 50% of instances. Any regulation to obtain the best of the machine and human-revised forecasts requires an ability to predict revision quality. In addition to private information indicators, we show that indicators of systematic bias in human judgement (e.g., indicators of cognitive load) can improve the prediction of revision quality. In an out-of-sample analysis, our revision-level regulation approach picks the best of available forecasts in 14% more instances, compared to an always-permit or prohibit strategy at the product-store level. Our paper provides practitioners with a novel approach to combining the machine-human output to improve demand forecasting performance. Collapse

Topics: privacy logistics management supply chain management analytical information system

Methods: computational algorithm machine learning descriptive statistic XGBoost gradient boosting

Appreciating the Performance of Neuroscience Mining in NeuroIS Research: A Case Study on Consumer's Product Perceptions in the Two UI Modes-Dark UI vs. Light UI

2023 | HICSS | Citations: 0

Authors: Costello, F.; Kim, M.; Lee, K.

Abstract: The goal of the current study was to explore the potential of neuroscience mini ... Expand

Abstract: The goal of the current study was to explore the potential of neuroscience mining (NSM) for comprehending NeuroIS paradigms. NSM is an interdisciplinary field that combines neuroscience and business mining, which is the application of big data analytics, computational social science, and other areas to business problems. NSM makes it possible to apply predictive models to NeuroIS datasets, such as machine learning and deep learning, to find intricate patterns hidden by conventional regression-based analysis. First, we predicted 28 individual EEG power spectra separated brainwave data using a Random Forest (RF) model. Next, we used NSM to precisely predict how consumers would perceive a product online, depending on whether a light or dark user interface (UI) mode was used. The model was then used to extract more precise results that could not be obtained using more conventional linear-based analytical models using sensitivity analysis. The benefits of using NSM in NeuroIS research are as follows: (1) it can relieve the burden of the threehorned dilemma described by Runkel and McGrath; (2) it can enable more temporal data to be directly analyzed on the target variables; and (3) sensitivity analysis can be performed on a condition/individual basis, strengthening the rigor of findings by reducing sample bias that can be lost in grand averaging of data when analyzed with methods like GLM. Collapse

Topics: user interface big data usability tablet artificial intelligence

Methods: electroencephalography NeuroIS computational algorithm sensitivity analysis machine learning

Economic Impacts of Platform-Endorsed Quality Certification: Evidence from Airbnb

2023 | Management Information Systems Quarterly | Citations: 0

Authors: Dewan, Sanjeev; Kim, Jooho; Nian, Tingting

Abstract: We contribute to the emerging literature on quality certification by digital pl ... Expand

Abstract: We contribute to the emerging literature on quality certification by digital platforms by studying the launch of the Airbnb Plus service, wherein the platform inspects properties and provides a badge that presumably signals the quality of the property and the reliability of the host. Our identification strategy relies on the fact that the Airbnb Plus service was launched in different cities at different times, and listings within the cities received the certification at different times. Using a staggered difference-in-differences estimation strategy in conjunction with suitable matching methods, we found that the Airbnb Plus certification increased the weekly booking rate of Plus listings by about 6.8% on average (direct effect). We also found some evidence that non-Plus listings saw a temporary decline in booking rate when one or more nearby properties received a Plus certification (externality effect). The net impact of the Airbnb Plus service on the platform itself was an annual increase in revenue of about $37,500 for the average 2-kilometer zone in a U.S. city that included one or more Plus listings, as compared to matched zones without any Plus listings (local platform effect). We performed additional analyses, including a randomized experiment, to demonstrate the robustness of our findings. Overall, our results suggest that platform-endorsed quality certification has significant economic impacts-not just on the listings that receive the certification but on other listings on the platform as well as on the platform itself. Collapse

Topics: Airbnb website sharing platform peer-to-peer model Google+

Methods: experimental group experiment propensity score method product review robustness check