Corporations play a foundational role in the global economy, yet persistent gaps remain between corporate governance ideals, legal frameworks and organizational practice. The rapid integration of artificial intelligence (AI), particularly generative AI and large language models, intensifies these challenges by reshaping corporate decision-making, compliance and accountability. This paper examines how AI both promises to alleviate long-standing governance problems, such as information asymmetries and managerial opportunism, and generates new risks arising from opacity, automation bias and diminished human oversight. It analyzes five interrelated areas of tension: the emerging AI governance gap, models of AI integration within corporate structures, the adaptation of directors’ duties to algorithmic decision-making, the transparency paradox created by AI-mediated disclosure and the problem of anthropomorphism, whereby attributing agency to AI risks obscuring human responsibility. Rather than offering definitive solutions, the paper identifies critical questions that corporate law must confront as automated and semi-automated corporations become an established reality. It argues that sustaining legitimacy in the AI era requires renewed emphasis on human judgment, board-level oversight and adaptive governance frameworks capable of reconciling technological power with legal accountability and societal expectations.

The rapid rise of artificial intelligence (AI), especially generative AI, is transforming industries and redefining corporate governance. AI now influences key business functions such as finance, compliance and risk management, presenting boards of directors with new oversight challenges. While AI offers strategic opportunities, it also introduces complex risks – algorithmic bias, privacy breaches, cybersecurity threats and ethical concerns. Despite its growing relevance, AI governance remains underdeveloped in Canada. From an empirical legal standpoint, the role of boards in managing AI-related risks is still emerging and largely unexplored. This gap is increasingly critical amid rising expectations from regulators, investors and the spread of soft law instruments like voluntary codes and proxy advisor guidelines. This article examines how Canadian TSX 60 companies are responding to AI governance challenges. It situates the issue within Canada’s corporate governance framework and presents an empirical study revealing a disconnect between recognizing AI as a strategic risk and formally integrating it into governance structures. Drawing on academic research and international best practices, the article assesses the responsiveness of Canadian governance standards and offers recommendations for regulators seeking to modernize oversight in an era of technological disruption and ethical complexity.

Data privacy and protection are inextricably intertwined, whereas the former often slides into a national security concern. Amid geopolitical tensions, the U.S. aims to preserve TikTok’s independence and prevent its use in cognitive warfare. The landmark case presents potentially groundbreaking trade-offs for the Committee on Foreign Investment in the United States and the balance between data privacy and national security. The TikTok ban can be seen as a Catch-22 situation, presenting a Hobson’s choice for both the U.S. and China in the ongoing data war. The U.S. faces national security concerns regarding Chinese influence over the app’s data and its potential use for surveillance and propaganda. Conversely, banning TikTok risks setting a precedent for censorship and digital platform manipulation, undermining the U.S.’s long-standing commitment to free speech and open markets. The dilemma lies in whether to prioritize national security over the principles of free expression and open trade or to accept the risks posed by adversary-owned platforms operating in the U.S. This decision underscores rising tensions as the two powers grapple with data governance, digital sovereignty and geopolitical rivalry – an outcome that will shape global data governance and the technological landscape for years to come. A paradox emerges as China’s ideological aims and the U.S.’s technical concerns converge on a cutting-edge global challenge, that is, cognitive warfare in shaping global discourse and public opinion. This study examines how these conflicting forces shape TikTok’s quest to become a global platform, delving into the root causes of these tensions and exploring strategies to address the associated challenges.

In an increasingly data- and AI-driven economy, integrating ethical values into algorithmic decision-making is becoming ever more pressing. Benevolence is a fundamental value in human and organizational interactions, fostering trust, fairness and long-term relationships. Companies, particularly in the financial sector, must balance economic efficiency with social responsibility. As business decisions become increasingly automated, the question arises whether and how benevolence can be programmed. Research on artificial benevolence explores how AI systems can maximize not only efficiency but also trust, mitigate discrimination and align with broader corporate purposes. This requires an interdisciplinary perspective integrating technical, ethical and legal dimensions. While existing regulations increasingly shape AI-driven decisions, the question remains how artificial benevolence can be implemented and legally anchored.

A brief examination reveals the multifaceted legal challenges involved in implementing artificial benevolence in consumer banking. In addition to the omnipresent questions of data privacy and liability, risks of discrimination shape the legal debate on a practice of benevolent AI-driven decision-making. Further issues stem from governmental participation in consumer banks based on the model of a public savings bank. The social impact of decisions made by banks in their interactions with private customers on tenancies, real estate projects and the provision of daily necessities is exceedingly important to fundamental rights. Another relevant question is whether administrative bodies could commit themselves to derivative participation claims. This article outlines these issues in the context of the growing regulatory framework provided by European Union law.

The governance of Artificial Intelligence (AI) fundamentally depends on the implementation of risk management standards. Article 9 of the EU AI Act exemplifies this challenge, as it relies on indeterminate terms, such as “reasonably foreseeable risks” and “acceptability of risk”, to define the scope of the provision. This paper argues that such open risk management provisions require an economic framework in order to establish a coherent and innovation-friendly standard of care.

Drawing on the theoretical parallels between risk management and tort law, the analysis demonstrates the importance of cost-benefit and risk-utility models in transforming ambiguous legal standards into actionable ones. However, a purely quantitative approach proves insufficient for several reasons, including the risk of “metrics shopping” and the protection of fundamental rights. Consequently, the paper proposes a hybrid approach to risk management that integrates quantitative metrics with qualitative safeguards. Furthermore, in addressing the challenge of hindsight and outcome biases in ex-post enforcement, the analysis recommends applying the Business Judgment Rule (BJR) logic from corporate law. By limiting the standard of review to the quality of ex ante decision-making, this framework can be applied more widely to the management of AI risks.

The rapid proliferation of artificial intelligence (AI) technologies across corporate value chains has exposed fundamental gaps in traditional approaches to ensuring respect for human rights. This article analyzes the transition from fragmented compliance mechanisms to unified governance models that seek to embed human rights standards within AI deployment, focusing in particular on the European Union’s regulatory framework and its global implications. A central focus is placed on the EU’s AI Act, which introduces the Fundamental Rights Impact Assessment (FRIA) as the first mandatory evaluation mechanism for selected high-risk AI systems. We demonstrate that FRIA marks a significant regulatory innovation. Alongside FRIA, we examine the Council of Europe’s voluntary HUDERIA methodology, which while conceptually aligned with FRIA, enables organizations to undertake comprehensive rights assessment across their entire AI portfolio. We argue that the convergence of mandatory (FRIA) and voluntary (HUDERIA) frameworks strengthens corporate responsibility for human rights in AI, extending ethical obligations where legal norms may not reach. However, we also highlight the real-world challenges to universalizing these standards – growing regulatory divergence between the EU’s rights-driven approach and the US innovation-focused “America’s AI Action Plan.” The resulting tension threatens the global harmonization of human rights protections in AI.

The boundary problem (BP) asks who ought to be included by democratic procedure. Initially articulated as a challenge for democratic citizenship, the BP is later reframed as a difficulty faced by the ‘democratiing AI' (DAI) agenda. By mapping different senses of DAI, this article aims to provide a resolution to the BP in the context of DAI. In particular, it notes that DAI shifts our attention away from a crucial factor to make ethical decisions around AI: the power disparities within organizations that put employees advancing ethical AI in a vulnerable position. In this context, I show that workplace democracy provides a more promising normative aspiration than the DAI agenda, although some elements of the latter, such as its emphasis on subjecting tech firms to greater democratic control, serve to mitigate certain problems that workplace democracy is unable to address, for example, when members of tech firms unanimously prioritise ethically concerning AI practices.

This article examines how artificial intelligence (AI) systems displace the foundational structures that uphold legal legitimacy. Traditionally anchored in legal certainty, accountability and enforceability, which this study conceptualizes as the “Tripod of Legal Legitimacy,” law’s normative authority is increasingly undermined by opaque, adaptive and privately governed algorithmic infrastructures. AI systems embed regulatory functions such as adjudication, classification and enforcement directly into technical design, often operating beyond the reach of public oversight or judicial review. Through comparative analysis of public frameworks like the EU’s Digital Services Act and AI Act, alongside private governance regimes such as Meta’s Oversight Board and OpenAI’s safety protocols, the article demonstrates how law is displaced both functionally and structurally. A process-based model contrasts traditional legal governance cycles with AI-induced governance cycles, revealing a recursive erosion of legal authority. The paper advances a theoretical framework called legal displacement to diagnose this shift and proposes policy strategies for reconstructing legal legitimacy through traceability, binding enforcement, and jurisdictional coordination. Ultimately, the study argues that reclaiming legal authority in the age of algorithmic governance requires institutional transformation grounded in procedural transparency and democratic accountability, rather than relying solely on ethical frameworks or voluntary compliance regimes.

This article discusses the rise in the use of Gen artificial intelligence (Gen AI) for the production of mandatory corporate reporting, particularly narrative and ESG (Environmental, Social or Governance) reports. The capabilities of Gen AI can potentially deliver many benefits, but firms are exposed to legal and regulatory risks in connection with Gen AI adoption. This article discusses how firms may address these risks, but more importantly, these risks should not be appreciated only at the firm-level but at a broader industry, market and systemic level. When viewed through the lens of the reporting chain, which is the universe of recipient entities that use such corporate reporting, including numerous financial intermediary entities, regulators and finfluencers, these risks take on new implications that require regulatory and supervisory efforts for their oversight and mitigation. The article makes specific proposals for securities and financial regulators in particular, against a broader context of the more general, cross-cutting nature of AI systems regulation and governance.

As boards engage with the adoption of artificial intelligence (AI), including agentic AI to drive operational efficiencies, this presents new opportunities for profit maximization. AI adoption is increasingly identified with employee role displacement in companies, and the interests of employees as stakeholders require exploration. A novel question posed is whether, in an age of AI ascendancy, AI may warrant being given stakeholder status as its role in the company approximates or eclipses that of human employees. The article probes four distinct models of corporate purpose within the directors’ duty to act in the best interests of the company – the shareholder primacy model, the Enlightened Shareholder Value model, the stakeholder friendly model and the stakeholder value model, highlighting the available scope for directors to accommodate the interests of employees around AI adoption in decision-making by boards around AI. It is concluded that, given the degree to which directors are insulated from legal scrutiny in relation to their best interests duty, adopting a wider law in context approach to promote employee welfare would serve the interests of employees, directors and companies alike. This would see directors engaging meaningfully with employees and providing opportunities for reskilling to adapt to the age of AI.