Business and digital technologies are two sectors that have gone hand in hand for decades. Today, businesses are seeking solutions that not only make doing business easier, but also safer. Learn more about the role of blockchain in a board meeting, as well as the other benefits of blockchain.
What do I need to know about blockchain?
Blockchain is a type of digital technology that was developed for the accounting and management of cryptocurrencies (particularly bitcoins). But today, the technology has moved beyond the cryptocurrency market and is more commonly used for economic transactions. Its distinguishing features include:
- maximum security of deposited data;
- management by authorization only;
- the ability to create databases based on cryptographically secured blocks.
As blockchain developers claim, the technology is completely incorruptible – it cannot be changed in any existing way. No wonder this technology has become so popular with stock exchanges, government agencies at various levels, and companies that specialise in supply and shipment.
How is blockchain being used for board meetings?
Blockchain technology can be used for more than just global purposes. It is also suitable for corporate governance, and it is already the most promising area for business modernisation. Blockchain is an opportunity to modernize governance:
- Make directors’ meetings more transparent. There will no longer be a way to influence the outcome of a vote in any way, nor will management influence ordinary shareholders. Thanks to the high speed of information processing, the results of votes will be available immediately and it will not be possible to change them.
- Modernise the stock market. In particular, blockchain will help simplify the process of buying and selling shares by increasing the speed and transparency of transactions. It will also help make shares more accessible to a wide range of buyers.
- Transform the accounting system. It’s not just about changing the way bookkeeping and financial reporting is done. It will also be possible to create an accurate shareholder register to alert shareholders to impending meetings or changes in the market.
- Introduction of new tools. The use of smart contracts, points-based remuneration systems and other ways of digital transformation will help optimise the overall production process, track the actions of specific employees or departments, and raise capital even without issuing additional shares.
- Risk management. Blockchain technology makes it possible to conduct transactions without third-party intervention, reducing the possibility of financial loss. In addition, all parties’ actions are recorded and information cannot be changed, eliminating the possibility of fraud.
Despite the obvious benefits, there are many business opponents to blockchain. They believe that installing and maintaining blockchain systems, as well as training staff, can incur significant financial costs. But keep in mind that these costs can be recouped fairly quickly. In addition, when partnering, it is worth considering the differences in the laws that govern blockchain – not all countries have already made the appropriate changes to the legal system.
When considering the adoption of blockchain, it is worth considering the pros and cons of the technology in order to get the most out of it.