Open Access Research Article

FROM AI- ASSISTED DECISIONS TO AUTONOMOUS CORPORATE ACTION: RECONSIDERING DIRECTORS’ DUTY OF CARE, BOARD ACCOUNTABILITY AND LIABILITY UNDER SECTION 166 OF THE COMPANIES ACT, 2013

Author(s):
P. VAISHNAVI N. SAILESH KUMAR
Journal IJLRA
ISSN 2582-6433
Access Open Access
Volume 3
Issue 7
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Abstract

Artificial Intelligence (AI) is being used more and more in decision- making. This change moves directors from being the decision makers to being supervisors of technology- assisted and more often autonomous decision systems. AI can help directors by looking at amounts of data spotting risks and giving suggestions. There are important questions about human judgment, board accountability and legal liability that arise when AI is selecting and implementing corporate actions. Section 166 of the Companies Act 2013 requires directors to act in faith to use due and reasonable care, skill and diligence and to make independent judgments. The current rules do not say how these duties work when big corporate decisions are largely guided or carried out by AI.             This study investigates whether section 166 can "catch up" with the trend of AI assisting decision making rather than AI making decisions. It considers the impact of the reliance of AI on the director's responsibilities under the duty of care and diligence and independent judgment (IDJ), as well as the possibility that directors might be less likely to fulfil their legal duties if they rely heavily on AI. The research also examines who is responsible if the AI decision makes a loss of money, violates rules, or harms people particularly if the blunder is due to the director, the company, the developer of the AI or the technology provider.             The main issue the research tackles is the gap between technology that acts on its own and the legal duties that still belong to humans. The research is driven by the need to make sure that progress in technology does not leave a hole in accountability in governance. It recommends a way of doing so, one that's based on supervision, thoughtful standards of care that factor in risk, openness, checking, and the continuous supervision of AI systems. The study seeks to determine if section 166 can be read as to accommodate the process of governance by a machine or if it is necessary to develop new laws and rules that will provide a clear system of accountability in an era where artificial intelligence operates increasingly autonomously.

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Authors: P. VAISHNAVI & N. SAILESH KUMARRegistration ID: 1013422 | Published Paper ID: IJLRA13422 & IJLRA13423Approved ISSN: 2582-6433 | Country: Delhi, IndiaPage No.: 1960-1977

Article Information

FROM AI- ASSISTED DECISIONS TO AUTONOMOUS CORPORATE ACTION: RECONSIDERING DIRECTORS’ DUTY OF CARE, BOARD ACCOUNTABILITY AND LIABILITY UNDER SECTION 166 OF THE COMPANIES ACT, 2013

Authors: P. VAISHNAVI, N. SAILESH KUMAR

  • Journal IJLRA
  • ISSN 2582-6433
  • Volume 3
  • Issue 7
Citation Download Paper Full Details Search on Google Search on Google Scholar

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International Journal for Legal Research and Analysis

  • AbbreviationIJLRA
  • ISSN2582-6433
  • AccessOpen Access
  • LicenseCC 4.0

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