Exploring the impact of responsible AI governance on corporate performance: A quasi-natural experiment

Abstract

The rapid advancement of artificial intelligence (AI) presents significant ethical, legal, and operational challenges, elevating the importance of responsible AI governance. This paper examines the impact of responsible AI information governance mechanisms on corporate performance using a sample of 342 securities firms. Companies are categorized into control and experimental groups based on their responsible AI application scores. Treating the adoption of responsible AI governance practices as a “quasi-natural” experiment, the study applies a multi-period difference-in-differences (DID) regression model to uncover insights into causal relationships. The study also investigates the relative importance of various responsible AI governance dimensions in driving performance improvements. The results demonstrate that firms adopting responsible AI governance practices see significant performance improvements. This study adds to the academic discourse by deepening understanding of how responsible AI governance influences business outcomes and by offering a theoretical foundation for future research. From a practical perspective, it provides actionable guidance for organizations, demonstrating how ethical AI governance can drive sustainable business growth and enhance overall corporate performance.