TY - JOUR
T1 - Governing decentralized autonomous organizations as digital commons
AU - Li, Sen
AU - Chen, Yan
N1 - Publisher Copyright:
© 2024 Elsevier Inc.
PY - 2024/6
Y1 - 2024/6
N2 - Effective governance plays a pivotal role in aligning the interests of diverse stakeholders and shaping the strategic directions of organizations. However, the dominant model of corporate governance often concentrates power among a limited group of directors, leading to concerns about potential power imbalances that may distort fair representation and compromise decision-making integrity. Decentralized autonomous organizations (DAOs) present an alternative model that distributes power among a broader base of stakeholders, fostering a more democratic approach to collective decision making and governance. However, the openness and fluidity inherent in DAOs can expose them to coordination challenges, governance complexities, and potential exploitation by malicious entities. In response to possible governance challenges, we consider DAOs as digital commons and adapt Ostrom's eight principles for governing the commons to propose a new governance framework for DAOs. This governance framework is designed to foster the collective stewardship of shared digital assets and the equitable distribution of decision-making authority in the Web3 era. As DAOs emerge as a novel organizational structure, our governance framework aims to maintain their resilience, inclusiveness, and decentralization, reinforcing their crucial role in the evolving Web3 landscape.
AB - Effective governance plays a pivotal role in aligning the interests of diverse stakeholders and shaping the strategic directions of organizations. However, the dominant model of corporate governance often concentrates power among a limited group of directors, leading to concerns about potential power imbalances that may distort fair representation and compromise decision-making integrity. Decentralized autonomous organizations (DAOs) present an alternative model that distributes power among a broader base of stakeholders, fostering a more democratic approach to collective decision making and governance. However, the openness and fluidity inherent in DAOs can expose them to coordination challenges, governance complexities, and potential exploitation by malicious entities. In response to possible governance challenges, we consider DAOs as digital commons and adapt Ostrom's eight principles for governing the commons to propose a new governance framework for DAOs. This governance framework is designed to foster the collective stewardship of shared digital assets and the equitable distribution of decision-making authority in the Web3 era. As DAOs emerge as a novel organizational structure, our governance framework aims to maintain their resilience, inclusiveness, and decentralization, reinforcing their crucial role in the evolving Web3 landscape.
KW - Blockchain
KW - Crypto
KW - DAO
KW - Decentralization
KW - Decentralized autonomous organizations
KW - Digital commons
KW - Governance
KW - Web3
UR - http://www.scopus.com/inward/record.url?scp=85182001340&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85182001340&partnerID=8YFLogxK
U2 - 10.1016/j.jbvi.2024.e00450
DO - 10.1016/j.jbvi.2024.e00450
M3 - Article
AN - SCOPUS:85182001340
VL - 21
JO - Journal of Business Venturing Insights
JF - Journal of Business Venturing Insights
M1 - e00450
ER -