Reframing Corporate Governance

This seems like a big deal.

For those just tuning in, Aragon is a platform for running entirely decentralized, borderless, autonomous organizations. The idea is that it handles some of the basic functions of organizing, like governance and finance, and grant folks value for work completed toward some common purpose. It operates atop the Ethereum cryptocurrency. It's all very future.

And now they're launching a dispute-resolution platform, called Aragon Court. On this platform, issues can be surfaced, jurors selected, and resolutions agreed; using tokens, it's possible to ensure that jurors are aligned to the best interests of the organization.

Why Should I Care?

Self-organizing firms need ways to adjudicate disputes

When running and operating inside a self-organizing firm, especially one without some of the hard-coded hierarchical assessment elements that come with a system like Holacracy, we struggled with determining exactly how someone gets removed from the organization. Sure, if folks don't get elected into roles, you've got some signal that shows that they're not a fit for the work.

But what happens when you break the rules? We had to design a system from scratch to handle that. If we had something like Aragon Court, we'd have an obvious way to determine our path forward – distributed, fair, and transparent.

Regular firms have disputes, too, and more transparent systems might help move them toward becoming more efficient markets/information systems

Imagine a large, matrixed organization. Within that org, picture a dispute between a local, or regional marketing department, and their central peers. Central has a clear strategy, vetted up through senior leadership – it's all about maintaining a premium price-point. The local folks are feeling some sales pressure and are contemplating a discounting plan. Central and local intend to find an agreement, but can't – the incentives are in the way (the local President is bonused on sales growth, and the central Marketing Lead is bonused on overall growth and brand health). They probably end up escalating this to some leadership council...which results in weeks of deck-making and hand-wringing before a decision is made, driven by the political theatre of the moment and the strategic advisability of the decision.

My hypothesis is that with systems like Aragon Court, we could dramatically shorten that process by formatting the inputs and outputs, and creating clear rules around the actual decision-making. (While the matrixed org I describe above certaily has a set of charters describing the same, I doubt they follow them in practice, let alone have a digital system of record for deciding.) And on top of this, we could start to work toward a system of common law within organizations: one could imagine that the result of the tradeoff described above could be revised incentives, instead of adjusted plans and clear winners/losers.