Microsoft plans ethical principles for its facial recognition technology: Report

The company has planned to draft policies and build governance systems that make sure the technology usage is in line with its principles and goals. This would include setting controls for the company's global sales to ensure the AI technology is not sold to parties where there is a risk of wrongful usage.

There have been growing concerns about the use of facial recognition software by law enforcement, border security and the military due to possible risks of mass surveillance. Well-known researches have shown that products perform poorly and make mistakes with people who have darker skin. Many research and advocacy groups have protested against tech giants including Google, Amazon and Microsoft regarding the same.

Smith made it clear that this doesn't mean Microsoft will stop providing governments and militaries with the technology altogether. They just want to ensure that it is not used for surveillance without preferred safeguards.

Microsoft is rejecting some contracts for the same reason. In one case, Smith said providing the technology would have led to public surveillance "in a country where we were not comfortable that human rights would be protected".

With respect to China's new rule where citizens will be judged on their social behaviour, he said Beijing is anyway more interested to get the recognition technology from Chinese firms, rather than American ones.

"You never want to create a market that forces companies to choose between being successful and being responsible and unless we have a regulatory floor, there is danger of that happening," he added.