**5.6 Are rules for CSR reporting changed frequently?**

Unfortunately, yes, rules for CSR reporting are being developed as CSR reporting is still in its infancy, especially when compared to financial reporting [23, 57]. However, several international organizations that develop CSR reporting standards such as the GRI who created and popularized the GRI standards, AccountAbility, who created AccountAbility standards (AA1000 Series), and the United Nations who created the Global Compact's Communication on Progress (COP) have laid an important foundation for developing and advancing CSR reporting which should make the guidelines and principles for CSR reporting be relatively more stable compared to the past.

### **5.7 Are there benefits from having an immutable CSR reporting database?**

Yes, there are significant benefits from having an immutable CSR reporting database. As discussed above, if people know that they are being watched and their actions will be recorded permanently, it is less likely that they will act in an unacceptable manner [39]. Similarly, as blockchain technology can be used to record CSR related misconducts publicly and immutably, they could be used to deter CSR related misconducts using the same logic.

As sustainability gains more attention among the business community worldwide, there is a growing pressure that everyone wants to look "green". Greenwashing is an example of CSR reporting misconduct, which is defined as a claim, an implication, or a suggestion from a corporation to make itself appears to be environmentally friendly when it is not [57]. A work by de Freitas Netto et al. [60] provides a systematic review of greenwashing literature to categorize various concepts and forms of greenwashing. First, greenwashing can arise in the form of selective disclosure which occurs when companies withhold negative environmental information and/or promote false positive environmental information. Second, greenwashing could be used to "decoupling" underperforming environmental protection performance of a company. In other words, greenwashing can be used to make people forget or lose attention to negative environmental performance. Third, greenwashing can be used to target the environmental practices of a company and/or a specific product or service of a company. Fourth, greenwashing can broadly be classified into claim greenwashing and executional greenwashing. For claim greenwashing, there are several characteristics of "deceptiveness" of a claim which include its ambiguity, its omission of important facts and trade-offs, and its outright false statement. For executional greenwashing, this is a greenwashing that does not use any claims but "manipulates" the environment to affect people believe. An example would be using a green colour or a picture of nature when communicating about a product or a service to make people think that it is an environmentally friendly product or service when it is not.

There are several ways blockchain technology can be used to discourage misconduct. First, blockchain technology can be used to "demystify" and create permanent and immutable public records that correctly inform people about "the current and past" CSR performance of most (or all, if possible) corporations. Imagine a decentralized autonomous organization that acts as "a truth teller" in which all stakeholders can access and obtain the most unbiased information about the CSR performance of all corporations. In particular, this decentralized autonomous organization can be designed (via codes, consensus mechanisms, rewarding systems, and smart contracts) such that each anonymous agent (i.e., each node in the network) is encouraged to

produce CSR claims that are complete (i.e., not half-truth), evidence-based, and unambiguous as much as possible. In fact, the jobs and tasks of these anonymous agents in this decentralized autonomous organization will be quite similar to the current jobs and tasks of workers in traditional intermediaries (such as workers in a CSR assurance company). But unlike the traditional intermediaries in which some of their executives or employees might act dishonestly for their personal or corporate benefits, this decentralized autonomous organization does not have an opportunity (of course, depending on the size and structure of the blockchain network) to do such a thing.

Second, blockchain technology can be used to create permanent and immutable public records that inform people about "the current and past" CSR misconducts of most (or all, if possible) corporations. Even though major corporate misconduct or scandals are regularly highlighted by the news media, blockchain technology can be used to radically revolutionize the traditional "truth-telling" functions of the traditional media. First, the traditional media can be influenced or sanctioned by the government or people with "power". Suppose there was a CSR misconduct which is done by the government or corporates with strong political and/or financial power. It is likely that the traditional approach to truth-telling might be severely restricted in this case. On the other hand, the truth-telling that is powered by blockchain technology can be significantly more effective depending on the size of the blockchain network and how well it has been structured. For the government or corporates with political and/or financial power to be able to influence the truth-telling entities that are powered by blockchain technology, they need to know who they need to approach (which will be impossible given that people in each node in the blockchain network are anonymous) as well as they need to approach a lot of them (e.g., 51 percent consensus rule). Second, the decentralized nature of the blockchain network allows the power of the "crowd" to be utilized more effectively. Some people might have specific and rare information or evidence that otherwise would be inaccessible using the traditional truth-telling approach. In fact, the current social media (such as Facebook and Twitter) have already started to play this important role for quite some time. The blockchain technology will be a platform that takes the truth-telling function of social media to the next level. Third, as the blockchain network is algorithmic, it can leverage the increasing computational power (of modern CPUs, GPUs, or even cloudbased quantum computers) to collect, verify, and disseminate important information or facts to millions of people in real time.
