How blockchain could transform global corporate accountability

Blockchain technology is fundamentally reshaping corporate governance, creating a new era of transparency, accountability, and stakeholder empowerment, says a new review published in Frontiers in Blockchain.

The paper, titled "Revolutionising Corporate Governance: Blockchain's Transformative Impact and Potential," integrates 106 peer-reviewed studies drawn from Scopus and Web of Science to evaluate blockchain's capabilities, risks, and emerging governance models. The findings point to a technology that could eliminate long-standing inefficiencies in management oversight, while introducing fresh ethical, legal, and operational challenges that demand urgent regulation.

A decade of blockchain governance research under the microscope

The researchers adopted a systematic literature review methodology to assess a decade's worth of academic and industry scholarship. Their goal: to determine whether blockchain can truly improve corporate governance outcomes or whether the technology merely reinvents traditional hierarchies under a digital guise.

Their analysis maps the current research landscape across five major theoretical lenses, agency theory, stakeholder theory, stewardship theory, institutional theory, and transaction-cost economics, each offering a different interpretation of how blockchain influences corporate behavior.

The review reveals that blockchain's core capabilities, transparency, decentralization, immutability, traceability, and smart-contract automation, are central to its governance promise. By embedding trust directly into code, blockchain reduces the dependence on intermediaries such as auditors, regulators, and corporate secretaries.

Yet, the authors caution that technological sophistication alone does not guarantee better governance. Without supportive legal frameworks, proper standardization, and cybersecurity readiness, blockchain-driven systems may replicate or even amplify existing governance flaws.

In traditional governance, accountability depends on trust among shareholders, executives, and boards. Blockchain reconfigures that relationship by replacing interpersonal trust with algorithmic trust, every transaction recorded, verified, and immutable. This transparency deters fraud and improves auditability, but it also raises questions about data privacy and strategic confidentiality.

Balancing transparency and power: The double-edged promise of blockchain

The review shows that blockchain's greatest strength, its ability to decentralize authority, is also its most controversial feature. Through decentralized autonomous organizations (DAOs), tokenized voting systems, and programmable governance, blockchain offers shareholders and stakeholders real-time oversight of corporate decisions.

This reduces agency problems and ensures that managers act in the best interests of the organization. In practice, however, the same token-based voting mechanisms can consolidate power among large investors or technical elites, mirroring old inequities under new rules.

The study finds that while DAOs improve inclusivity and procedural transparency, they also introduce new forms of manipulation, where governance can be skewed by those holding significant voting tokens or possessing the technical expertise to exploit smart contracts.

Another concern is legal ambiguity. Blockchain transactions transcend jurisdictions, but corporate law remains national. This gap complicates enforcement, taxation, and liability in decentralized systems. The researchers emphasize the need for interoperable standards and international regulatory coordination to prevent blockchain governance from devolving into legal grey zones.

Despite these issues, the paper highlights major governance benefits already demonstrated in practice. Companies adopting blockchain-based solutions have improved compliance efficiency, reduced corruption, and enhanced shareholder communication. Smart contracts automatically execute board resolutions and shareholder votes, drastically lowering administrative costs.

However, the authors warn that the technology's energy consumption, scalability limits, and susceptibility to coding errors continue to challenge its widespread adoption. High-profile hacks and software vulnerabilities have underscored that even immutable ledgers are only as secure as the code that powers them.

A framework for the future: Regulation, accountability, and resilience

The review concludes that corporate governance must evolve alongside blockchain, not merely adopt it. They propose a Holistic Governance Synthesis Framework that integrates the five theoretical perspectives into a single roadmap for reform.

This model identifies blockchain's key functional pillars, security, transparency, decentralization, and accountability, while situating them within human and institutional dimensions. The authors argue that sustainable blockchain governance depends on aligning three forces:

• Technology (through robust smart-contract design and cybersecurity),
• Regulation (through adaptive laws and auditing standards), and
• Ethics (through accountability and equitable stakeholder representation).

The paper calls on policymakers and regulators to develop blockchain-specific governance codes, much like the OECD's corporate governance principles, to ensure legal clarity and operational consistency. Such frameworks would define accountability in decentralized systems, determine the fiduciary duties of algorithmic decision-makers, and establish mechanisms for dispute resolution in smart-contract breaches.

The study also stresses the need for multi-stakeholder collaboration between corporations, developers, regulators, and academia to co-design these standards. The authors suggest that blockchain's success depends on education and capacity-building, training directors, auditors, and policymakers to understand both the technology and its governance implications.

Importantly, the review identifies research gaps. Despite growing enthusiasm, empirical evidence remains limited. Most studies rely on conceptual models or small-scale case analyses. The authors recommend more longitudinal and cross-sectoral research, testing blockchain's effects on organizational performance, trust metrics, and ethical outcomes over time.

Redefining corporate governance in the digital age

Blockchain represents both a technological and cultural shift in corporate governance. It replaces trust in institutions with trust in code, challenging centuries-old assumptions about authority, control, and legitimacy in business management.

While blockchain can enhance transparency and accountability, it cannot replace human judgment or ethical responsibility. True transformation, the authors argue, lies in balancing digital automation with human oversight, building systems that are not only efficient but also equitable and resilient.