Oklahoma businesses are increasingly relying on artificial intelligence tools in their ordinary business operations. As a result, corporate lawyers must be equipped to advise clients when they inevitably ask, “There are no AI provisions in the OGCA – what do we do?” Although Oklahoma has not yet adopted AI-specific legislation under the Oklahoma General Corporation Act (OGCA), the existing statutory and jurisprudential framework governing corporations provides sufficient guidance for advising Oklahoma companies on the lawful use of AI in relation to corporate governance, contract law and fiduciary duties. This article explains how Oklahoma lawyers can utilize the existing framework to provide responsible advice to clients during the AI era.

OKLAHOMA CORPORATE LAW ALREADY REGULATES DECISION-MAKING TOOLS

Corporate boards, committees and individual officers and directors (i.e., corporate fiduciaries) have long relied on trusted advisors and technology to inform their business decisions. Specifically, the OGCA provides that in performing their duties, board members are protected when, in good faith, they rely on records, information, opinions, reports or statements presented to the corporation by any person as to matters within such person’s competence.[2] As a result, AI tools or vendors should never be used by corporate fiduciaries as an automated decision-maker. Instead, corporate fiduciaries should use AI only as a decision-making support mechanism and never as the sole decision-maker.

In Egleston v. McClendon, the Oklahoma Court of Civil Appeals emphasized the business judgment rule, which presumes that directors act on an informed basis, in good faith and in the corporation’s best interests.[3] The court further highlighted that when reviewing board decisions, the primary focus is on the board’s independence, the reasonableness of the investigation and the board’s good faith.[4] If board members rely in good faith on records, information and reports supplied by AI vendors, they remain protected by the business judgment rule if that reliance is reasonable. It is important to advise clients that blind and unfettered reliance on AI to make decisions will likely never be reasonable. Therefore, corporate lawyers must carefully advise corporate fiduciaries to use AI only as a knowledge enhancement tool.

FIDUCIARY DUTIES APPLY, REGARDLESS OF TECHNOLOGY

Even in the age of AI and increasingly sophisticated technology, fiduciary duties remain the same. Corporate boards, officers and committees must always adhere to the duties of care and loyalty, an increasingly difficult task as technology evolves daily. As trusted advisors, corporate lawyers must routinely advise clients of the importance of these fiduciary duties.

“The duty of care requires that fiduciaries inform themselves of material information before making decisions and act prudently in carrying out their duties.”[5] The duty of care closely relates to care in the decision-making process.[6] Specifically, courts generally look at how the decision was reached, not its correctness.[7] To avoid liability for breaches of the duty of care, lawyers should always advise clients to remain informed by reviewing reports, asking questions, staying informed about the board’s agenda and participating in the inner workings of the corporation.[8] In the age of AI, this advice does not change; instead, it merely evolves. Specifically, if clients wish to use AI in corporate decision-making, lawyers should strongly advise them to require human oversight of each AI tool used in order to ensure reasonable inquiry, adequate oversight and sound judgment.

The duty of loyalty requires that fiduciaries exercise good faith and that self-interest be sacrificed for the good of the corporation.[9] If conflicts of interest arise between corporate fiduciaries and AI vendors contracted by the corporation, the duty of loyalty will govern those relationships and any potential conflicts. The OGCA provides procedural safeguards for certain conflicted transactions that would otherwise be voidable. Specifically, it requires that 1) the material facts about the transaction and the director’s interest be known to the board or committee, and a majority of disinterested directors approve the transaction; 2) the material facts be known to the shareholders, who approve the transaction in good faith; or 3) the transaction be fair to the corporation at the time of shareholder approval.[10] To avoid liability for breaches of the duty of loyalty, lawyers should advise clients to preemptively disclose any conflicts of interest with AI vendors to the corporation prior to entering any potentially conflicted transactions.

Businesses are increasingly using AI tools to support forecasting and pricing, and AI use in the finance market is predicted to nearly triple by 2028.[11] Accordingly, lawyers should be wary of their clients’ use of AI without adequate counsel, as AI tools will never eliminate the human accountability that is central to satisfying fiduciary duties. Therefore, satisfying the duties of care and loyalty must always be at the forefront of clients’ minds when relying on AI to generate business-related information.

CONTRACT LAW FILLS THE REGULATORY GAP

Oklahoma law has long governed relationships between corporations and outside vendors that provide specialized services. AI service providers are no different and fit squarely within existing contract frameworks. Specifically, contracts with AI service providers should always include provisions on data ownership, confidentiality, intellectual property rights in data outputs, indemnification and liability allocation. The absence of an AI-specific corporate statute does not affect the enforceability of negotiated risk allocation, as Oklahoma contract law already serves as the primary risk allocation mechanism for most contracts. In the absence of AI provisions in the OGCA, contracts serve as the primary means of defining the rights and responsibilities between corporations and AI vendors. Thus, corporate lawyers should take special care when reviewing and drafting AI vendor agreements to ensure clarity on AI-specific operational risks.

PRACTICAL GUIDANCE FOR OKLAHOMA PRACTITIONERS

Instead of asking whether the use of AI is permissible under existing Oklahoma corporate law, corporate lawyers should reframe the question and ask whether specific uses of AI are reasonable under existing corporate law. As best practice, corporate lawyers should advise clients to create internal AI usage policies, educate board members on the responsible use of AI tools, provide adequate board oversight and diligently review contracts that contain AI-related content. Corporate lawyers should also avoid overreliance on vendor standard terms and should coordinate AI contract terms with internal governance policies to prevent any breaches of fiduciary duties. Essentially, regularly counseling corporate clients on the responsible use of AI is the primary safeguard in a no-statute environment.

CONCLUSION

Oklahoma corporate law is technologically neutral and inherently adaptable. The use of AI does not create new fiduciary duties – instead, it merely changes how existing fiduciary duties are fulfilled. Thanks to Oklahoma’s preexisting corporate statutes and case law, in the absence of a corporate AI statute, corporate lawyers already have the tools to confidently advise clients on their rights and responsibilities when using AI.

Author’s Note: The information provided in this article is for general informational purposes only and does not constitute legal advice. Lawyers are reminded that ethical obligations regarding the use of AI apply equally to themselves as they do to their clients. As a best practice, lawyers must safeguard the privacy and confidentiality of client information and remain informed about relevant technological advances as standards for AI use in legal practice continue to evolve.

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ABOUT THE AUTHOR

Mikha R. Slone is an associate attorney in the Oklahoma City office of Steptoe & Johnson PLLC. Her practice focuses on mergers and acquisitions, and she is licensed to practice law in Oklahoma and Louisiana.

 

 

 

 

 

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ENDNOTES

[1] This title was crafted by ChatGPT. Additionally, this article was drafted with the assistance of ChatGPT for initial structuring and brainstorming.

[2] “A member of the board of directors, or a member of any committee designated by the board of directors, in the performance of his duties, shall be fully protected in relying in good faith upon the records of the corporation and upon such information, opinions, reports or statements presented to the corporation by any of the corporation’s officers or employees, or committees of the board of directors, or by any other person as to matters the member reasonably believes are within such officer’s, employee’s, committee’s, or other person’s competence and who have been selected with reasonable care by or on behalf of the corporation.” Oklahoma Statutes, Title 36, Section 2608.1(D).

[3] “When applying the business judgment rule, courts presume that in making a business decision the directors of a corporation acted on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the company and its shareholders. Whenever any action or inaction by a board of directors is subject to review according to the traditional business judgment rule, the issues before the court are independence, the reasonableness of its investigation and good faith, and when a board refuses a demand, the only issues to be examined are the good faith and reasonableness of its investigation.” Egleston v. McClendon, 2014 OK Civ. App. 11.

[4] “Whenever any action or inaction by a board of directors is subject to review according to the traditional business judgment rule, the issues before the Court are independence, the reasonableness of its investigation and good faith.” Id., citing Kurtz v. Clark, 2012 OK Civ. App. 103.

[5] United Food & Com. Workers Union & Participating Food Indus. Emps. Tri-State Pension Fund v. Zuckerberg, 262 A.3d 1034 (Del. 2021) (citing Aronson v. Lewis, 473 A.2d 805 (Del. 1984)).

[6] Irving L. Faught, Oklahoma Business and Commercial Law, §7.12 (Matthew Bender and Co., 2025).

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Studies “[p]redict that AI in the finance market will nearly triple by 2028. By automating repetitive tasks, AI financial forecasting improves accuracy, accelerates decision-making, and frees finance teams from manual tasks – positioning CFOs as strategic leaders in a volatile business environment.” “A New Era of Financial Forecasting: AI is Replacing Static Budgets,” The Finance Weekly.