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Wealthy tech entrepreneurs including Elon Musk launched OpenAI in 2015 as a nonprofit research lab that they said would involve society and the public in the development of powerful AI, unlike Google and other giant tech companies working behind closed doors. In line with that spirit, OpenAI’s reports to US tax authorities have from its founding said that any member of the public can review copies of its governing documents, financial statements, and conflict of interest rules.
But when WIRED requested those records last month, OpenAI said its policy had changed, and the company provided only a narrow financial statement that omitted the majority of its operations.
“We provide financial statements when requested,” company spokesperson Niko Felix says. “OpenAI aligns our practices with industry standards, and since 2022 that includes not publicly distributing additional internal documents.”
OpenAI’s abandonment of the long-standing transparency pledge obscures information that could shed light on the recent near-implosion of a company with crucial influence over the future of AI and could help outsiders understand its vulnerabilities. In November, OpenAI’s board fired CEO Sam Altman, implying in a statement that he was untrustworthy and had endangered its mission to ensure AI “benefits all humanity.” An employee and investor revolt soon forced the board to reinstate Altman and eject most of its own members, with an overhauled slate of directors vowing to review the crisis and enact structural changes to win back the trust of stakeholders.
Access to OpenAI’s conflict-of-interest policy could show what power the new board really has over Altman and his outside pursuits, which include personal investments in numerous startups pursuing AI projects and a nuclear reactor maker. His day job and personal projects intermingling played some role in board members’ distrust, according to people involved in the situation but not authorized to discuss it. In 2019, while Altman was at the helm, OpenAI signed a nonbinding letter of intent to buy $51 million of AI chips from Rain, a startup in which he has invested more than $1 million, WIRED reported last month. OpenAI hasn’t moved forward with a purchase. Felix says Altman is transparent with the board about his investments and follows a process for managing potential conflicts.
Some sunlight on OpenAI’s governing documents could reveal whether it has made revisions to stabilize an unusual corporate structure and potentially pacify backers such as Microsoft. The company’s founding bylaws, publicly available via its 2016 application to the Internal Revenue Service for tax-exempt status, indicate how a fraction of the board could take control and push out Altman. OpenAI’s filings to the IRS through 2022 reported that no “significant changes” had ever been made to its governing documents. But the company almost certainly made updates after Altman’s return to allow it to give a nonvoting seat on the nonprofit board to Microsoft, whose CEO, Satya Nadella, complained publicly that he had been blindsided by Altman’s firing. Any additional changes made at that time remain a secret.
WIRED’s request for the documents promised in OpenAI’s IRS filings fell to the counsel for its nonprofit to decide on. Their denial and new policy of withholding those documents extends an existing trend of dwindling openness at a project founded on transparency. OpenAI once published extensive detail about its AI inventions but has more recently guarded the technical details and data behind its most famous tool, ChatGPT. Felix, the company spokesperson, says San Francisco-based OpenAI discloses all the material required by the IRS and California’s attorney general and that it regularly publishes information about its research and safety work, while also making its research freely available in the form of tools such as ChatGPT.
OpenAI’s declining openness has been most notable since 2019, when the nonprofit created a for-profit subsidiary to house most of its AI development and draw outside investment. That opened the way for OpenAI to hitch its future to the largesse of Microsoft, one of the tech giants it was founded to challenge, and also to shroud its finances. OpenAI cofounder turned competitor Elon Musk said at a New York Times event in November that his former company should be called Super-Closed-Source-for-Maximum-Profit-AI.
