Open Access Research Article

NON-FEASANCE IN THE ALGORITHMIC BOARDROOM: DIRECTORS' OVERSIGHT DUTIES OVER AI SYSTEMS UNDER THE COMPANIES ACT, 2013 BY: OISHIKA SARKAR & SRIJANI SAHA

Author(s):
OISHIKA SARKAR SRIJANI SAHA
Journal IJLRA
ISSN 2582-6433
Access Open Access
Volume 3
Issue 8
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Abstract

With the advent of Artificial Intelligence in the present era, the systems and structures of corporate decision-making are now being increasingly mechanized. It is now the algorithms that determines how to marks borrowers, examine suitable candidates, appropriate pricing of goods, detect any misconduct or breach as well as format the main reports which the Board can lean on and in many firms today, AI is gradually replacing man to take the central place. The Companies Act, 2013 is the primary statute that provisions for the duties of Board of Directors in India so as to ensure that the corporate processes that involve human subordinates can be made accountable and the systems can be made transparent. This paper throws light on how, in firms where AI is becoming the business, the habitual governance failure due to an inactive Board is not misfeasance but non-feaseance as only self-learning AI systems are made to gradually modify or even mutilate its risk exposure and profiling. The paper proceeds to highlight how the statute already encompasses an indispensible obligation to monitor such systems, ranging from Section 166(3)’s standard of care, skill and due diligence as well as the risk profiling provisions of Sections 177, 134 and 149, Schedule IV and the SEBI listing obligations. But the ambiguity of depending on non-human AI agents, inequity of data and information and the automated drift makes obligations dormant where they must have been non- negotiable. This research relies on the Delaware duty to monitor and eventually concludes that it is an issue of interpretation and not of legislative breach and finally provides one comprehensive pack of reform recommendations that in no way needs amendment of the Act.

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Authors: OISHIKA SARKAR & SRIJANI SAHARegistration ID: 1013570 | Published Paper ID: IJLRA13570 & IJLRA13571Approved ISSN: 2582-6433 | Country: Delhi, India

Article Information

NON-FEASANCE IN THE ALGORITHMIC BOARDROOM: DIRECTORS' OVERSIGHT DUTIES OVER AI SYSTEMS UNDER THE COMPANIES ACT, 2013 BY: OISHIKA SARKAR & SRIJANI SAHA

Authors: OISHIKA SARKAR, SRIJANI SAHA

  • Journal IJLRA
  • ISSN 2582-6433
  • Volume 3
  • Issue 8
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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