Artificial Intelligence: A Friend Or Foe In Good Corporate Governance

Arshit Srivastava, ICFAI Law School, Hyderabad

Harsh Sinha, ICFAI Law School, Hyderabad

Introduction

In today's complex business environment, boards of directors struggle with fragmented policies, unstable economic conditions, and growing shareholders' demands. These aspects necessitate a wider variety of information and experiences for well-informed decision-making, but dealing with these difficulties has made the process more dynamic and demanding. Boards believe that implementation of advanced technologies can be a way around. Hence, in order to synthesize complex information and find the best answers, boards adapt and accept cutting- edge technologies that address the complex elements at hand and make well-informed decisions that are in line with the desires of all concerned parties.1

The former Chief Justice of India, Dipak Mishra, said, “The future of any new-age technology lies in the regulations that govern them. Artificial Intelligence (AI) promises a high growth potential in a number of sectors,” at the first International Conference on Law and Regulation of Artificial Intelligence.2

Artificial intelligence has transformed human dialogue and decision-making, infiltrating our daily lives in numerous ways, from weather forecasts to genomic mapping. However, the integration of AI in the corporate world remains uncertain, particularly at a time when the importance of good corporate governance is emphasized. AI and algorithms are transforming how firms operate and reshaping many elements of corporate operations. The consequences of AI implementation, such as its impact on decision-making processes and interactions, raise ethical and privacy concerns. Corporate governance becomes paramount in ensuring responsible AI utilization, striking a balance between its benefits and potential risks.