THE FUTURE OF AI-DRIVEN LEGAL COMPLIANCE: HOW ARTIFICIAL INTELLIGENCE IS ENHANCING CORPORATE GOVERNANCE AND REGULATORY ADHERENCE

This study examines the role of Artificial Intelligence (AI) in enhancing corporate governance and regulatory adherence through AI-driven compliance tools. Utilizing a systematic literature review and case study analysis, the research evaluates AI’s effectiveness in automating compliance, minimizing legal risks, and addressing ethical concerns. Statistical analysis, including a Chi-Square test (χ² = 5.39, p = 0.99), T-test (t = -9.80, p = 0.0006), and regression analysis (R = 0.95, p = 0.0133), confirms AI’s significant impact on compliance efficiency, risk mitigation, and cost reduction. Findings reveal that AI-driven compliance improved corporate governance efficiency from 59.2% to 73.6%, reduced compliance failures by 37%, and cut legal costs by 0.95% for each 1% increase in AI adoption. Despite these benefits, challenges remain in regulatory acceptance, algorithmic transparency, and data privacy. The study concludes that AI is a transformative force in legal compliance but recommends enhanced regulatory frameworks, bias mitigation strategies, and explainable AI models for responsible integration.