Evolving corporate fiduciary duties and liabilities in the era of artificial intelligence-driven sustainability

This study examines how the integration of artificial intelligence (AI) into corporate operations fundamentally reshapes the core doctrines of corporate law and governance. Our analysis establishes that AI represents a structural transformation that necessitates a complete re-evaluation of traditional fiduciary duties, liability frameworks, and supervisory approaches. The ‍research highlights AI’s dual impact on sustainability: its immense potential to advance environmental, social, and governance (ESG) objectives (through enhanced measurement and transparency) is directly counterbalanced by significant risks, including algorithmic discrimination, environmental externalities from high computing intensity, and opaque decision-making. The core finding is that existing corporate governance frameworks inadequately address this dual and contradictory impact. Consequently, the study concludes that a fundamental doctrinal evolution is essential. Specifically, the analysis identifies the ‍imperative to extend fiduciary obligations to encompass technological competence, ethical oversight, and data stewardship—a ‍necessary concept framed here as the “duty of technological prudence”. Furthermore, the research demonstrates how AI exposes firms to amplified liabilities, ranging from privacy claims and cybersecurity failures to complex product liability for autonomous systems. To address the fragmented global regulatory landscape, the paper advances “sustainability-by-design” as a ‍strategic imperative, mandating that ethical and environmental considerations be embedded throughout the entire AI lifecycle. The paper concludes with targeted policy recommendations for legislators and corporate boards to align AI innovation with social progress and human dignity.