Toward Digital Corporate Law: Revisiting Corporate Law's Responses to Technology

Abstract

This article examines the dynamic relationship between emerging technologies and corporate law, raising fundamental questions about whether these technological advancements require reshaping traditional legal doctrines. It investigates key aspects of corporate law—including corporate formation, governance, and finance—through a comparative analysis of Chinese and U.S. legal frameworks. The article critically assesses the ability of contemporary corporate law to respond effectively to technological challenges posed by artificial intelligence (AI), particularly in relation to evolving fiduciary duties of corporate agents and shifts in the balance of power between shareholders and management. Furthermore, the article proposes innovative strategies for future corporate law development, advocating enhanced compatibility and flexibility to accommodate rapid technological progress. Notably, it considers treating data as a corporate asset and supports enabling corporations to issue and store stocks digitally. The analysis also explores how technological advancements may facilitate the balancing of interests among shareholders, stakeholders, and broader societal concerns. In this context, it discusses the use of AI to improve corporations' Environmental, Social, and Governance (ESG) practices and examines the potential of AI-assisted decision-making for fund managers in proxy voting processes. By presenting thought-provoking questions designed to inspire further research, the article aims to foster a nuanced discussion on the critical intersection of corporate law and technology. It specifically highlights the increasing digitization of corporate law and explores the possibilities offered by software engineering techniques for enhancing legislative clarity and efficiency in rulemaking processes.

Keywords: board of directors, corporate governance, corporate law, data assets, token offerings, ESG, index funds, stakeholders, digital assets, shareholder primacy, corporate purpose, Caremark, Artificial Intelligence (AI)

JEL Classification: G32, G34, K20, K22, M14