AI in Corporate Governance: Can Machines Recover Corporate Purpose?

Department: Finance

Speaker: Norman Schürhoff (University of Lausanne)

Room: TBD

Abstract

A key question in automating governance is whether AI can recover the corporate objective.
We develop a corporate recovery framework and apply it to firms’ investment and financing
decisions. From observed behavior, we recover the weights managers place on financial, behavioral, and ESG factors and construct a shareholder-alignment measure. Investment decisions systematically understate the shadow cost of capital relative to theoretical benchmarks, and managerial objectives remain imperfectly aligned with shareholder value. These findings show how AI can uncover and help correct misaligned objectives.