5.3.3. Blockchain Impact and Value Creation

This section is an amalgamation of our identification of the bridge between prior academic research and industry reports on blockchain applications in corporate governance. This key theme was developed by identifying the characteristics, advantages and disadvantages of present and future use case applications of blockchain adoption in corporate governance through our systematic review, then linking these to value creation avenues in terms of prior academic literature and market mechanisms that are affected by blockchain adoption in corporate governance. These key factors include the following: 1. Information asymmetry—blockchain offers transparency. 2. Efficient markets—blockchain offers higher speed, efficiency, lesser agency costs and transparency. 3. Liquidity—blockchain can handle large amounts of data with ease and efficiency and more transparency. 4. Competition—blockchain allows more participation. 5. Social welfare—blockchains would result in lesser agency costs, frauds and mismanagement. 6. Agency costs—removal or reduction of agents in blockchains results in lesser agency costs. 7. Efficient asset allocation—increased speed, efficiency and transparency and more efficient markets would result in efficient resource allocation. 8. Decision-making—blockchain would result in better decision making due to lesser agency costs, more transparency and efficient markets.

#### 5.3.4. Stakeholders

This section synthesizes the stakeholders involved in blockchain adoption in corporate governance. This identification is fundamental to the understanding and implementation of blockchain adoption with regard to corporate governance. The key factors in this section include 1. firm management. 2. shareholders. 3. creditors. 4. auditors. 5. regulators. 6. investors. 7. customers and general public.

## 5.3.5. Market Mechanisms

This section identifies the market mechanisms that would be affected by blockchain adoption in corporate governance. The key factors include 1. trading, 2. short selling, 3. insider trading, 4. mergers and acquisitions, 5. initial public offerings and seasonal equity offerings, 6. executive compensation, 7. financial reporting, 8. earnings management, 9. auditing, 10. Litigation, 11. Regulation, 12. financial fraud and 13. corporate voting.

#### 5.3.6. Blockchain Governance

Finally, at the centre of the framework lies the blockchain governance section that is linked to all other sections. Without proper governance of blockchains, its adoption in any area would not be sustainable long term. Therefore, this section includes the following key blockchain governance factors: 1. blockchain protocol, 2. forks, 3. Privacy, 4. Security, 5. quality assurance, 6. Interoperability, 7. Innovation, 8. usability and efficiency and 9. cost reduction. To ensure efficient, ethical and sustainable blockchain adoption in corporate governance, it is important to understand all themes and factors identified in our DACG framework.
