Legal Accountability of Directors for Artificial Intelligence-Based Corporate Decision-Making under Indonesian Company Law
DOI:
https://doi.org/10.55927/fjsr.v5i9.65Keywords:
Corporate Law, Board of Directors' Responsibility, Artificial Intelligence, Fiduciary Duty, Corporate GovernanceAbstract
The digital transformation of corporations through artificial intelligence raises the issue of board of directors accountability in technology-based decision-making that has not been fully regulated in Indonesian corporate law. This study aims to analyze the relationship between the use of AI in corporate decisions and the legal responsibility of directors based on the principles of fiduciary duty and corporate governance. The method used is normative juridical with a statutory and conceptual approach; data was obtained through the study of documents on primary and secondary legal materials. The analysis was carried out in a juridical qualitative manner. The results of the study show that the board of directors still bears legal responsibility for AI decisions, even though the process is carried out automatically. The research concludes the need to strengthen AI regulations and governance mechanisms to ensure corporate accountability and make theoretical and practical contributions to the development of corporate law.
References
Bhat, P. I. (2020). Qualitative research: A methodological discourse. Oxford University Press.
Brand, V. (2024). Directors’ duties and AI regulation. Griffith Law Review, 33(4), 324–354. https://doi.org/10.1080/10383441.2024.2422221.
Braun, V., & Clarke, V. (2021). One size fits all? What counts as quality practice in qualitative research? Qualitative Research in Psychology, 18(3), 328–352. https://doi.org/10.1080/14780887.2020.1769238.
Giffen, B. V., & Ludwig, H. (2023). How boards of directors govern artificial intelligence. MIS Quarterly Executive, 22(4), 271–286. https://aisel.aisnet.org/misqe/vol22/iss4/7.
Hagendorff, T. (2022). Blind spots in AI ethics. AI and Ethics, 2, 851–867. https://doi.org/10.1007/s43681-021-00122-8.
Hestia, J. R. (2024). The algorithmic fiduciary: A comparative analysis of board oversight, AI liability, and the business judgment rule in the EU and US. International and Comparative Corporate Law Journal, 16(2), 1–20. https://icclj.com/index.php/j/article/view/6.
Hutchinson, T., & Duncan, N. (2012). Defining and describing what we do: Doctrinal legal research. Deakin Law Review, 17(1), 83–119. https://doi.org/10.21153/dlr2012vol17no1art70.
Mökander, J., Sheth, M., Gersbro-Sundler, M., Blomgren, P., & Floridi, L. (2024). Challenges and best practices in corporate AI governance: Lessons from the biopharmaceutical industry. AI and Ethics. https://arxiv.org/abs/2407.05339.
Möslein, F. (2021). Robots in the boardroom: Artificial intelligence and corporate governance. European Business Organization Law Review, 22, 789–814. https://doi.org/10.1007/s40804-021-00222-5.
Raisch, S., & Krakowski, S. (2021). Artificial intelligence and management: The automation–augmentation paradox. Academy of Management Review, 46(1), 192–210. https://doi.org/10.5465/amr.2018.0072.
Republik Indonesia. (2007). Undang-Undang Nomor 40 Tahun 2007 tentang Perseroan Terbatas.
Republik Indonesia. (2023). Undang-Undang Nomor 6 Tahun 2023 tentang Penetapan Peraturan Pemerintah Pengganti Undang-Undang Nomor 2 Tahun 2022 tentang Cipta Kerja menjadi Undang-Undang.
Schneider, J., Kuss, P., Abraham, R., & Meske, C. (2024). Governance of generative artificial intelligence for companies. arXiv. https://arxiv.org/abs/2403.08802.
Siebecker, M. R. (2024). Reconceiving corporate rights and regulation in the AI era. Missouri Law Review, 89(3), 789–820. https://scholarship.law.missouri.edu/mlr/vol89/iss3/8.
Wirtz, B. W., Weyerer, J. C., & Geyer, C. (2021). Artificial intelligence and the public sector—Applications and challenges. International Journal of Public Administration, 44(9), 596–615. https://doi.org/10.1080/01900692.2021.1893829.
Zhang, Y. (2024). Artificial intelligence intervention in corporate governance: Directors’ fiduciary duties. Interdisciplinary Humanities and Communication Studies, 2(7). https://doi.org/10.61173/jse43g13.
