Can a Machine Fulfil a Director's Fiduciary Duty

AI may soon become the smartest voice in the boardroom. Whether it should have a vote is an entirely different question.

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By Indra Chourasia

Indra is a Senior Industry Advisor in the BFSI unit at TCS, with three decades of experience in business strategy and IT consulting. He leads CXO advisory, and drives data and AI-led innovations.

June 2, 2026 at 6:43 AM IST

Amid the wave of AI advancements, as AI starts dominating board agendas, boards are increasingly burdened with onerous governance responsibilities. This entails navigating diverse complexities, setting strategic contours of reframing business and operating models, and building resilient enterprise AI capabilities across talent, technology, workflows, and operating infrastructures. However, despite boards’ attention and efforts to position AI as a standing priority on the agenda, a big disconnect persists in oversight outcomes. 

The 2026 AI Impact Survey Report by Grant Thornton— based on insights from nearly 1,000 C-suite leaders and executives across industries— highlights that while almost 75% of boards have approved major AI investments, 48% have not established AI governance expectations and 46% have not integrated AI risk into ongoing oversight. 

The growing complexity and urgency of oversight demand a structural shift in the governance approach—emphasising technical expertise and sharper acuity in oversight responses to ensure effectiveness.

Emerging patterns
As intriguing as they may appear, AI-driven governance is making inroads across organisations from various business domains. In September 2025, Albania formally appointed Diella, an AI system, as Minister of State for Artificial Intelligence—the first nation to institutionalise an AI agent as a cabinet minister. Shortly afterwards, Hanneke Faber, CEO of global tech manufacturing company Logitech, advocated adding an AI agent to her board of directors.

In early 2026, Abu Dhabi’s sovereign wealth fund Mubadala introduced MAIA (Mubadala AI & Analytics) as a member of its Investment Committee to establish AI-driven investment governance. In April 2026, Lloyds Banking Group became the first FTSE 100 firm to adopt a specialist AI ‘board bot’ in the boardroom. The bot reviews confidential materials, prepares agendas, checks bias, and supports strategic issues, augmenting board analysis, but it lacks legal voting rights. Beyond boardroom presence, Meta’s CEO Mark Zuckerberg’s AI clone move unravels an exceptional story of executives using AI to expand presence, influence and engagement—helping the workforce feel more connected.

AI Assistance
The role of AI in the boardroom can vary—from basic virtual assistants for notes, summarisation, action tracking, to intelligence and insights bots doing topical research, new ideas, counterfactual analysis, or intelligent advisors offering impromptu situational decision support such as scenario analysis, business case evaluation, strategic assessment, optimal decision paths, and mitigation planning. With perfect recall, exemplary computation skills, and the ability to dig into data and ask questions, the current generation agents—designed to autonomously performance certain tasks—could evolve into board members capable of delivering governance functions.

It is the latter role of intelligent advisors—whether avatars, clones, or AI agents eventually acting as independent board members—that raises the most serious questions about their ability to deliver the broader remit of corporate governance. Setting aside the issue of formal authority, the absence of human-like capabilities—such as cognition, emotion, relationship, discretion, and values—limits an AI agent’s ability to play the role of a board member, requiring real-life prudence and human empathy.

Key concerns
For an AI agent to serve as a full-fledged board member, several fundamental questions must first be answered:

  • Legal boundaries: The legal sanctity of the formal authority an AI member and validity of their vote on key issues is not established in any jurisdictions so far. For example, the Companies Act, 2013 only considers a natural person can be a director in a company to discharge fiduciary duties. 
  • Accountability: Board decisions carry legal and regulatory accountability. The unpredictable behaviour of models—hallucination and inaccuracy—makes agents’ presence in the boardroom upsetting, undermining alignment with accountability and governance integrity expectations.
  • Transparency and bias: Aside from inherent soundness, AI agents must ensure transparency, fairness, and explainability. Sensitive deliberations equire explainable reasoning, auditability, security and privacy safeguards.
  • Human relations: AI agents lack emotional intelligence, lived experience, cultural context and values. Even with sophisticated analysis, they struggle to exercise judgement in the nuanced and often ambiguous situations boards face.
  • Tech-savviness: Less technology-savvy board members may feel threatened by AI participation, potentially weakening candid discussion and board cohesion. 
  • Sensitive information access: While Chinese Walls between board committees are discouraged, it is uncertain as how AI agents will handle scenarios of dealing with sensitive investigations, hostile takeovers, or competition strategies where information flow is restricted or delayed.

Getting Ready
Corporate governance should use AI to strengthen oversight rather than replace it. Boards can deploy AI agents for risk analysis, regulatory review, compliance monitoring and meeting preparation while retaining human responsibility for judgement and accountability.

As AI capabilities evolve, boards will need new expertise, refreshed committee mandates and greater technological fluency. A caution is needed to holistically consider the unpredictable behaviors and learning patterns of AI models, which can threaten governance integrity and influence enterprise AI readiness.The challenge is not bringing AI into the boardroom. It is ensuring that human judgement remains the final authority once it arrives.