Since Jensen and Meckling formally defined it in 1976, the information asymmetry problem in corporate governance has remained one of the most studied and least solved challenges in institutional finance. Managers know more than shareholders. Boards see less than they should. And the mechanisms built to close those gaps- annual audits, disclosure regimes, proxy voting, oversight committees- are slow, retrospective, and structurally incapable of operating at the speed at which corporate decisions are actually made.
Decades of regulatory reform have produced better reporting standards, stronger audit frameworks, and more independent boards. None of them has resolved the foundational problem. Information asymmetry increases a firm’s risk premium. If it is pervasive, it results in a less efficient functioning capital market, adversely affecting a broader number of stakeholders, including shareholders. The cost of this gap is not theoretical. It is measured in mispriced risk, misallocated capital, and shareholder value destroyed by decisions made in rooms shareholders never had access to.
Kailash Nath Sadangi, whose academic research at Warwick Business School sits at the intersection of corporate governance and digital transformation, argues that blockchain is the first technology in half a century that structurally threatens this problem, not at the margins, but at its root.
Why Existing Governance Tools Have Not Been Enough
The standard toolkit of corporate governance operates on a lag. Financial statements are published quarterly. Audits are conducted annually. Shareholder meetings happen once a year, if at all. By the time a shareholder receives meaningful information about how their capital has been deployed, the decisions that shaped it have already been made, executed, and — in some cases — reversed.
Annual General Meetings are generally considered mandatory yearly rituals whose important theoretical functions- the information, forum, and decision-making functions- are de facto eroded. The AGM suffers from procedural flaws, especially when shareholders vote remotely. This is not a failure of intent. It is a failure of architecture. The system was never designed to give shareholders real-time visibility. It was designed to give them periodic accountability — and there is a significant difference.
What Blockchain Actually Changes
In his December 2025 academic discussion paper From Boardroom to Blockchain, Kailash Sadangi examines this problem with the rigour of a governance researcher and the clarity of someone who has run finance functions inside billion-dollar institutions. He argues that for shareholders, permissioned ledgers can create a near real-time, immutable record of ownership, transactions, and selected corporate disclosures, potentially supporting continuous or event-driven voting mechanisms and reducing reliance on episodic annual meetings and intermediaries in share registry and proxy plumbing.
This is not an incremental improvement on existing disclosure frameworks. It is a structural redesign of when and how shareholders receive information. By utilising decentralised ledgers, organisations can ensure that financial transactions and reporting are immutable, verifiable, and accessible in real-time — enhancing the reliability of financial data and mitigating risks associated with fraud and misreporting.
Blockchain technology can lower shareholder voting costs and organisation costs for companies substantially, increase the speed of decision-making, and facilitate fast and efficient involvement of shareholders. The research consensus is building. The question is whether the institutions that govern capital markets are willing to accept what that consensus implies about the inadequacy of their current frameworks.
Where Sadangi’s Argument Goes Further
What distinguishes Sadangi’s position from blockchain optimism is his insistence that the technology does not eliminate governance; it reconstitutes it. DLT is unlikely to replace corporate governance; rather, it reconstitutes governance into hybrid configurations in which algorithmic controls coexist with human judgement, legal frameworks, and institutional legitimacy.
The new risks he identifies are precise. Where oracles or off-chain data feeds are required, the attack surface widens and governance risk increases. Digital participation mechanisms can exacerbate inequality if access depends on technical literacy or concentrated token ownership. Protocol designers and dominant token holders can shape rules and upgrades that govern stakeholder outcomes, a new form of governance capture that most board-level conversations have not yet begun to address.
His conclusion is therefore not that blockchain hands power back to shareholders automatically. It is that blockchain makes it possible for the first time to design governance systems that do — if boards, regulators, and institutions are willing to make that design choice deliberately and with accountability.
About Kailash Nath Sadangi
Kailash Sadangi is a senior finance and governance professional with over three decades of experience across the GCC, Asia-Pacific, Europe, and Australia. His career spans multinational corporations, including Emerson and Terex, the Dubai-listed Drake and Scull International, and Public Private Partnerships, Al Muhaidib Group, and Al-Othman Holding. He is a DBA Researcher from Warwick Business School, an MBA, holds Chartered Accountancy and CMA qualifications, and is a Certified Director from the GCC Board Directors Institute.
Sources:
1. Primary Source — Kailash Sadangi’s Academic Paper From Boardroom to Blockchain: Reconfiguring Agency, Accountability, and Governance in a Digitally Mediated Economy (December 2025) https://medium.com/@dba16ks/from-boardroom-to-blockchain-0927a44be247
2. Information Asymmetry and Firm Performance — Taylor & Francis Corporate governance, information asymmetry and firm performance: evidence from Thailand (July 2024) https://www.tandfonline.com/doi/full/10.1080/23322039.2024.2379583
3. Blockchain for Corporate Governance and Shareholder Activism — ECGI Blockchain Technology for Corporate Governance and Shareholder Activism, European Corporate Governance Institute (2025) https://www.ecgi.global/publications/working-papers/blockchain-technology-for-corporate-governance-and-shareholder-activism
4. Blockchain as a Corporate Governance Tool — International Journal of Science and Research Archive Blockchain Technology as a Tool for Corporate Governance and Transparency (2024) https://ijsra.net/content/blockchain-technology-tool-corporate-governance-and-transparency
5. Revolutionising Corporate Governance — Frontiers in Blockchain Revolutionising Corporate Governance: Blockchain’s Transformative Impact and Potential (October 2025) https://www.frontiersin.org/journals/blockchain/articles/10.3389/fbloc.2025.1654633/full
6. Career Profile — ZoomInfo https://www.zoominfo.com/p/Kailash-Sadangi/1867490221
7. Career Profile — The Org https://theorg.com/org/al-othman-holding-co/org-chart/kailash-sadangi
8. LinkedIn — Kailash Sadangi https://www.linkedin.com/in/kailash-sadangi-182b043/
