Openai says nonprofits will remain in control after strong opposition

Openai, parents of AI service CHATGPT, announced a new governance plan.

Boss Sam Altman said Openai will continue to be controlled by its for-profit board while becoming a thing called a public welfare company in the United States.

Mr. Ultraman proposed a similar plan in December – but did not clarify controls on nonprofits.

The update follows an extensive scrutiny of the startup that began with nonprofit and faced criticism, including criticism from co-founder Elon Musk, whose pursuit drove it away from its original mission to create technology in order to make human interests.

Last month, a group of former AI workers and outside experts, including Geoffrey Hinton, wrote to regulators in California and Delaware who have power over nonprofits to intervene to prevent conversions.

Openai Chairman Bret Taylor said the startup “decided after hearing the civic leaders and having a constructive conversation with the Delaware Attorney General and the California Attorney General.”

Altman said in his latest news on Monday that the nonprofit will continue to control Openai and acquire a “large” and unspecified Openai commercial stake, which will allow it to gain money to achieve its goals.

He said the new plan will still allow the organization to cease operations under its current complex governance structure, which has limiting its profits.

For investors, including Microsoft, this is seen as a key point that hinders the company's ability to raise funds.

“We are turning to a normal capital structure where everyone has inventory,” he wrote in a letter shared on the OpenAI website. “This is not sales, but a simpler structural change.”

Unlike traditional for-profit companies, these companies will definitely provide services to shareholders, and public welfare companies are also responsible for public tasks.

Altman said in his latest news on Monday that he believes that the opportunity to grow and expand (will make money) for AI is aligned with the company’s mission as it will help people “build incredible things for each other and continue to move society and quality of life forward.”

“Of course, this is not all for, but we believe in humans and believe that welfare will exceed orders of magnitude of the disadvantages,” he wrote.

It is unclear to what extent the new plan meets investors or critics.

After the announcement page, the former policy and ethics adviser for OpenAI, who led last month’s letter, said the update did not address questions such as who will own the company’s technology and how to prioritize its goals.

“We are pleased that Openai is listening to the concerns of civil society leaders … but there are still key issues,” he said.