•  
  •  
 
Canadian Journal of Law and Technology

Assistant or Authority? Artificial Intelligence in Business Decision-Making and the Director’s Duty of Care

Keywords

Canada Business Corporations Act, CBCA, AI in decision-making, AI directors

Abstract

The appointment of an AI – an amorphous concept in itself – to a directorial position, as in the Vital example, is not permissible under Canadian corporate law. Under the federal Canada Business Corporations Act (CBCA), the focus of this paper, a director in Canada must be “an individual,” precluding the appointment of non-human directors. Similar provisions also exist in many provincial business corporation statutes.

The CBCA does not specifically restrict the use of AI by directors. However, the duties of directors, as articulated under the CBCA, could affect the degree to which directors may utilize AI in their business decision-making. The use of AI by directors raises provocative questions around the directors’ duty of care and the delegation of decision-making tasks within that duty. This paper will discuss three AI-use scenarios to examine the degree of restraint that the directorial duty of care imposes on directors’ use of AI in decision-making in CBCA corporations.

Part I will summarize the director’s duty of care under the CBCA. Part II will engage in a technical and theoretical discussion of AI, using Large Language Models (LLMs), like ChatGPT, as an illustrative example. Part III will analyse three AI-use scenarios and discuss the implications of each for the directorial duty of care in the use of AI in business decision-making.

This document is currently not available here.

Share

COinS