Kaal claims by topic: corporate-governance, page 2

284 atomic, individually citable claims from the published work of Wulf A. Kaal tagged corporate-governance.

Contemporary corporate governance reforms are unlikely to work as policymakers and regulators intend, because experts agree improvement is needed but disagree widely on what good corporate governance is or how to achieve it. 2017
The corporate governance frameworks developed in the 2000s had little or no impact on the performance of listed companies during the financial crisis, and the number, scale, and effects of corporate scandals are not diminishing. 2017
Regulators should nudge companies and their stakeholders toward recognizing the strategic and financial benefits of an unmediated and technology-based approach to corporate governance, rather than mandating further top-down reform. 2017
Companies that adopt unmediated and technology-driven governance gain a competitive advantage in attracting talent, raising capital, finding partners, and above all in remaining relevant in hyper-competitive global markets. 2017
Signup and approval processes in centralized micro task systems are invasive, privacy challenging, time consuming, and unclear, and they function as market entry barriers for micro task workers. 2018
Centralized approval processes and identity requirements for worker registration significantly limit the registration of new micro task workers. 2018
Unlike shareholders in traditional corporate structures who can vote for or nominate directors, ICO investors have no control whatsoever over promoters. 2018
Many new innovation driven firms that replaced hierarchy with a best-idea-wins culture have struggled to maintain that governance model and to fulfill their initial promise. 2018
A decentralized autonomous organization is merely computer code with no directors, managers or employees, its governance structure built with software, code and smart contracts running on a public decentralized blockchain platform. 2018
In the most successful firms governance is no longer about hierarchy or control; it is about creating a flat, open and inclusive ecosystem that leverages the talents of all stakeholders in the company's network. 2018
The core underlying agency problems of corporate governance cannot be fully resolved within the existing theoretical and legal infrastructure, despite decades of governance experiments and extensive rule revisions. 2019
Shareholder activism reform, taken by itself, has been unable to sufficiently improve the corporate governance system. 2019
Because blockchain guarantees prevent any participant from circumventing the coded set of governance rules, a lower level of oversight and monitoring of agents is needed, which changes the cost structure of the principal agent relationship. 2019
DAOs are unlikely to disrupt existing corporate structures in the foreseeable future because the blockchain industry is still in its infancy and core decentralized infrastructure elements will remain lacking. 2019
Without evolutionary governance upgrades to blockchain protocols, the cost reduction that blockchain brings to the agency relationship cannot be maintained. 2019
Fiduciary duties are less relevant in DAOs because the disciplining effect of such duties on management conduct is less needed where centralized management is minimal and there are fewer or no supervisors. 2019
Because direct ownership on a blockchain removes the need for the Depository Trust Corporation to hold the certificate and for a broker to record beneficial ownership, agency costs can be cut and ownership clarity increases. 2019
Blockchain removes the class of costs generated by human error in record keeping, because it eliminates the possibility that transactions are misreported in ways that cause irreparable harm. 2019
As a foundational technology, blockchain technology builds the infrastructure for decentralized networked governance, which over time creates an environment in which the internal and external monitoring mechanisms previously necessitated by agency problems in corporate governance can be removed. 2019
Blockchain technology produces a substantial increase in the efficiency of the agency relationship and lowers agency costs by orders of magnitude. 2019
The core agency conflicts that emanate from the separation of ownership by shareholder principals and control by manager agents cannot be fully addressed by the existing theoretical and legal framework, because monitoring agents is inevitably costly and transaction costs abound. 2019
Applying blockchain to corporate governance requires the relevant authorities, who most likely understand the governance use case but not the technology, to reach consensus on how and when to implement it. 2019
The interests of manager agents and shareholder principals are never fully aligned despite best efforts at monitoring and bonding, so agency losses in the form of residual loss inevitably arise. 2019
Residual loss arises because the cost of enforcing suboptimal contracts between principals and agents always exceeds the benefits of performing the contractual obligations. 2019
Agency costs are the sum of monitoring costs, bonding costs, and residual loss, and in the corporate context they can be seen as the lost share value resulting from diverging interests between shareholders and corporate managers. 2019
The standard remedy of appointing outside independent directors to separate decision management from decision control is undermined because CEOs often dominate the board, which makes the separation much more difficult and hurts shareholders. 2019
Shareholder activism reform by itself has been unable to sufficiently improve the corporate governance system. 2019
Government-sponsored organizational experimentation that enables new business models and new organizational structures is desirable and may be one of the few ways to facilitate the needed corporate governance reform. 2019
The continued popularity of existing corporate governance mechanisms may be a product of path dependencies created by the historical evolution of internal and external monitoring mechanisms, rather than of their effectiveness. 2019
Supervisory tasks traditionally performed by principals to control their agents can be delegated to decentralized computer networks that are reliable, secure, immutable, and independent of fallible human input and discretionary human goodwill. 2019
Blockchain provides an alternative governance mechanism that eliminates agency costs, meaning the principal's cost of supervising agents, by creating trust in the contractual relationship between principal and agent. 2019
Because governance guarantees are embedded in code, there is no need in the blockchain infrastructure for the principal to institute oversight and monitoring, and the associated agency costs disappear. 2019
Cryptographic hashes increase blockchain security and remove the trust barriers in agency relationships that otherwise require monitoring of agents and generate agency costs. 2019
Smart contracts enabled by blockchain technology allow comprehensive, near error free, and zero transaction and agency cost coordination of agency relationships. 2019
The removal of checks and balances, agent monitoring, audit requirements, disclosure regimes, market pressure, and executive compensation schemes produces a qualitative shift in efficiency in the agency relationship and in corporate governance overall. 2019
Because of the value to effort focus of work flows in the DAO structure, supervision of management and the imposition of legal duties on management are less needed, since there are fewer or no supervisors, so the fiduciary duties on which the traditional regulatory infrastructure relies become less necessary. 2019
The basis of coded blockchain guarantees will itself evolve and require protocol upgrades, and without evolutionary governance upgrades the cost reduction achieved for the agency relationship cannot be maintained. 2019
General Electric's decentralization under Jack Welch worked because each business unit was made fully accountable through its own profit and loss statement and market price internal transactions, which removed inefficiencies and drove up market value. 2019
The first DAO removed, in essence, all of the core control mechanisms that principals typically employ in agency relationships, having no directors, no managers, and no employees. 2019
Less successful companies share a myopic short term focus on shareholder value maximization, which produces an unhealthy emphasis on share price, market valuations, and financial metrics that obscure issues of relevancy. 2019
Because governance guarantees are embedded in blockchain code, there is no need for a principal to institute oversight and monitoring, which eliminates the associated agency costs. 2019
A DAO realigns the otherwise disparate interests of principals and agents because all participants in the DAO share the same goal, which reduces behavior contrary to the interests of the organization. 2020
Institutional investors face a distinct barrier beyond volatility: fiduciary responsibility to their clients limits the type of risk they may take on, and the lack of custody solutions recognized by regulators compounds the problem. 2020
Applying the trust label to digital asset firms without an accompanying fiduciary duty is problematic, because the typical legal obligation of a trust company is to place customers' interests above its own. 2021
Agency theory and the existing legal framework have failed to resolve the core agency conflict arising from the separation of ownership and control, so peaceable and productive coordination of human behavior remains wanting. 2021
A decentralized human backstop to code is a core and often overlooked infrastructure requirement, because without it the immutability of the blockchain and its cryptographic security may not create genuine transactional guarantees or trust between principals and agents in the integrity of their contractual relationship. 2021
Firms that fare worst under disruptive innovation share a myopic short-term focus on shareholder value maximization, because emphasis on share price and financial metrics obscures the question of whether the firm remains relevant. 2021
Blockchain based guarantees remove agency costs because principals become less essential for monitoring agents, which addresses the inherent agency problems in modern finance and corporate governance. 2021
The strong trust that sustained Maghribi trade, in which embezzlement was rare despite extreme information asymmetry, cannot be explained by a strong centralized government, since the Maghribis could not form a centralized legal or political hierarchy and the official legal channels were slow and unreliable. 2021
Honesty would be the wrong strategy for an agent if the contract were anonymous and its resolution did not affect future contracts, because that situation is a single-stage zero-sum game in which stealing all the entrusted wealth is optimal. 2021
DAOs are truly global borderless entities that coordinate agency relationships and limit liabilities via smart contracts, which is what positions them to address the identified flaws in the charitable giving process. 2021
Only applicants who demonstrate both successful fundraising and successful fulfillment of donative intent are eligible for CHARITYxDAO voting associate status. 2021
Forum comments let existing voting associates identify the most competent commenters and invite them to apply for membership by providing work for a grant, creating constant onboarding feedback effects that cannot exist in traditional centralized charitable organizations. 2021
Just as centralized institutions rely on the vetting of candidates by other centralized institutions, the CHARITYxDAO may serve as a decentralized oracle for philanthropic endeavors. 2021
Under Type 1 onboarding the DAO treasury matches the assets the candidate raised, and the value of those raised assets is used to mint reputation under the DEVxDAO MVPR at a ratio of one thousand dollars per reputation unit. 2021
Elected representatives are incentivized to maintain their own power of office rather than to vote for outcomes reflecting the presumptive wishes and needs of their constituents. 2021
Blockchain based guarantees remove agency costs because principals are less required to institute oversight and monitoring of agents, which addresses inherent agency problems in modern finance and corporate governance. 2021
Detailed and easy to follow operator documentation produced by the early testnet community drove participation up to roughly 950 nodes running on the network, with around 200 nodes rewarded each week. 2021
SDAO membership is gated by a vote combined with evidence of NFT ownership and a posted performance record as a Shasper Network validator. 2021
The SDAO performance based onboarding metric deliberately goes well beyond validator node uptime, adding criteria such as node performance, running a dApp on the network, response time to upgrades, technical background, adherence to instructions and hardware specifications, and community behavior. 2021
Meaningful reputation in a business network removes the need for monitoring cost and lowers transaction costs by orders of magnitude. 2021
Traditional underwriting also fails at the agent level, because individual agents within an underwriter may sacrifice the underwriter's overall reputation for personal gain, for example by putting out a fraudulent offering. 2021
In the theoretical model, the incentive design of decentralized reputation staking governance aligns the individual with the group so tightly that the agent cannot gain personally at the expense of the principal. 2021
Significant information asymmetries in venture capital can lead portfolio company managers to engage in opportunistic behavior after an investment is made. 2021
Because traditional VCs need to defend their investment choices to their own investors, they are often reluctant to invest in digital asset startups that have little history or sales records. 2021
The Maghribi traders show that reputation alone can sustain a decentralized network under extreme information asymmetry: using only handwritten letters, Jewish merchants built a reputational system spanning the Silk Road in which nothing but the promise of better reputation deterred agents from cheating. 2021
Traditional work in centralized structures is prone to extrinsically motivated engagement, which intensifies principal agent problems and produces suboptimal outcomes because a principal dictates where, what, and when workers perform. 2022
Founders may hold significant influence over DAO votes initially depending on the DAO design, but higher levels of governance decentralization mitigate these centralization effects quickly through the onboarding of new DAO members. 2022
When only a minority of members, such as Audius node operators, can stake or earn weighted votes, the majority of token holders occupy the same powerless position as an ordinary shareholder in a corporation. 2023
Invasive, privacy challenging, time consuming, and unclear signup and approval processes on centralized platforms create market entry barriers for micro task workers, shrinking the supply of labor available to produce AI training data. 2024
LER reduces stock price volatility because ongoing consumption-based voucher rewards give shareholders a reason to hold rather than sell, which stabilizes demand for the issuer's stock. 2025
LER converts marketing expenditure into shareholder value by redirecting budgets from conventional advertising, whose returns are indirect and uncertain, into voucher rewards that flow directly to shareholders. 2025
Traditional board defenses such as staggered boards and poison pills protect incumbent boards at the cost of value creation and reduce board accountability to shareholders, even when they succeed in defeating an activist campaign. 2025
Liquid Equity Rewards is defined as a blockchain enabled system that grants verified holders of stock or tokenized equity time-weighted, utility-only rewards rather than financial yield. 2025
LER produces shareholder loyalty by using smart contracts to distribute consumptive utilities such as merchant vouchers or platform credits, so retention is encouraged without imposing any lock-up on the shareholder's liquidity. 2025
Negotiated settlements that hand activists board seats risk entrenching incumbents, whereas LER's consumptive utilities are designed to produce consensus and alignment without ceding board representation. 2025
LER's central comparative advantage is a projected fifteen to thirty percent reduction in shareholder turnover, benchmarked against established loyalty programs, which stabilizes the ownership base during activist-driven price swings. 2025
Issuing LER selectively to management-aligned shareholders while excluding others breaches the duty of loyalty by creating an uneven playing field, so rewards must be allocated uniformly on objective criteria such as ownership tenure. 2025
Traditional golden leash arrangements pay activist-nominated directors and generate conflicts of interest, whereas LER offers non-transferable utility-only rewards that induce activists to withdraw nominations without any cash flowing to directors. 2025
In ESG disputes, a board facing an aggressive shareholder proposal can deploy LER to distribute vouchers to shareholders who vote for management's competing proposal. 2025
Using LER to secure say-on-pay support falls within Delaware's business judgment rule, which presumes good faith board decisions absent self-dealing or gross negligence. 2025
LER can backfire by attracting short-term mercenary shareholders who chase the reward rather than hold, eroding the loyalty benefit and increasing volatility, with studies pointing to as much as seventy percent value dilution after reward emissions. 2025
Principal agent frictions reemerge in new forms in the agentic economy, as user sovereign bring your own agents compete with platform controlled bowling shoe agents, creating incentives for proprietary enclosure and interoperability throttling. 2025
DAO members owe each other duties of good faith, transparency and loyalty within the scope of the DAO Agreement, which imports fiduciary style obligations into a relationship that would otherwise be purely contractual. 2025