The Viability of Blockchain in Corporate Governance

26 Pages Posted: 19 Jun 2023 Last revised: 6 Nov 2023

See all articles by Anne Lafarre

Anne Lafarre

Tilburg Law School, Private Business and Labour Law Department, TILEC

Christoph Van der Elst

Tilburg Law School; Ghent University - Department of Business Law; European Corporate Governance Institute (ECGI)

Date Written: June 9, 2023


Blockchain technology, along with distributed ledger technologies (DLT), has gained recognition as a potential game-changer in corporate governance. Proponents argue that it has the capability to enable the creation of decentralized autonomous organizations (DAOs) that operate without hierarchical structures. However, challenges and uncertainties persist regarding the legal status, governance structures, and liability features of DAOs. This chapter sheds light on the practical implementation and use of DAOs and shows that elements of centralization often emerge despite the goal of decentralization.

Additionally, this chapter examines the impact of blockchain technology on the governance of traditional corporations, with a specific focus on strengthening key corporate functions such as share issuance, trading, and decision-making processes. Blockchain has the potential to address custody chain issues and improve transparency in corporate securities and stock ownership records. However, transitioning from existing systems to blockchain-based solutions, as demonstrated by the ASX CHESS Replacement process, is a complex task. While blockchain shows promise in enhancing shareholder and stakeholder rights, a careful assessment of its limitations and practical considerations is necessary. Additionally, it is important to critically evaluate the necessity of blockchain technology itself in corporate governance applications, as centralized systems with secure and transparent digital record-keeping may also be viable alternatives in various cases.

Keywords: Corporate governance, DLT, Blockchain, DAO, Corporate voting, Shareholder rights, stakeholder involvement

JEL Classification: G32, G34, L14, M20

Suggested Citation

Lafarre, Anne and Van der Elst, Christoph, The Viability of Blockchain in Corporate Governance (June 9, 2023). European Corporate Governance Institute - Law Working Paper No. 712/2023, Tilburg Law School Research Paper, Available at SSRN: or

Anne Lafarre

Tilburg Law School, Private Business and Labour Law Department, TILEC ( email )

Tilburg, 5000 LE

Christoph Van der Elst (Contact Author)

Tilburg Law School ( email )

Tilburg, 5000 LE

Ghent University - Department of Business Law ( email )

Universiteitstraat 4
Gent, B-9000

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels

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