Perspectives on the Current and Imagined Role of Artificial Intelligence and Technology in Corporate Governance Practice and Regulation

Abstract

This article investigates how AI and related technology augments corporate governance practices and the potential for further augmentation as AI continues to expand its capacity in corporate board rooms. Adopting Davenport and Ronanki’s framework for AI systems, the investigation shows that most of the current AI applications that aid governance falls in the process automation classification (board portals, risk and auditing systems, legal compliance), with some inroads having been made in cognitive insight (risk management, internal audit, legal compliance). Systems that exercise cognitive engagement are still immature but show real promise. The central conclusion is that technology may lend real benefit to governance practice. The consequential gaps in the current statutory formulation of the business judgment rule could be easily remedied by legislative amendment or even by means of expansive judicial interpretation. However, consistent nurturing of a culture of compliance and ethical behaviour remains a human endeavour.

Keywords: Corporate Governance, Artificial Intelligence, Technology, Disruption, Compliance, Risk Governance