Blockchain Technology in Financial Accounting: Enhancing Transparency, Security, and ESG Reporting
Open accessAbstract
Blockchain technology has revolutionized numerous industries, including that of financial accounting. However, its potential to support environmental, social, and corporate governance (ESG) objectives remains underexplored. This paper addresses this gap by investigating how blockchain’s decentralized and tamper-resistant characteristics can enhance green financial instruments, investment strategies, and climate-related financial disclosures. By leveraging these unique features of blockchain and applying knowledge discovery from data (KDD) methods, we uncover patterns and establish rules that highlight blockchain’s role in promoting transparency, accountability, and sustainability within the financial sector. Through a comprehensive analysis of literature, case studies, and real-world examples, this paper not only presents a balanced perspective on the integration of blockchain into financial accounting but also underscores its transformative potential in advancing ESG initiatives. The use of KDD provides novel insights into the effectiveness and implementation strategies of blockchain for ESG, making this study a pioneering resource for academics, professionals, and policymakers seeking to understand and harness blockchain’s impact on ESG in financial accounting.
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Transparency from blockchain breeds confidence among stakeholders and supports right compliance by giving organisations an opportunity to report their sustainability efforts accurately.
“Transparency not only breeds confidence among stakeholders but also supports the right compliance by giving organisations an opportunity to report their sustainability efforts accurately48,49.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
In environmental sustainability, blockchain can be applied to trace origins of raw materials, follow up the environmental impact of processes, and check the legitimacy of sustainability claims.
“In environmental sustainability, for instance, it can be applied to trace origins of raw materials; subsequently, follow-up the environmental impact of processes adopted by any given plant, and finally, check for legitimacy in claims regarding sustainability.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
Organizations can show compliance towards sustainability standards such as carbon emissions cut, natural resource conservation, and renewable power resources utilisation because blockchain records every step of the product life cycle from sourcing through manufacturing to distribution.
“It is also possible that the organisations show compliance towards sustainability standards such as carbon emissions cut, natural resource conservation, and renewable power resources utilisation because blockchain technology records every step of the life cycle of the product from sourcing through manufacturing to distribution.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
The decentralized, distributed ledger system of blockchain stores data in an immutable manner and shares data safely and securely.
“The decentralized, distributed ledger system of blockchain stores data in an immutable manner and shares data safely and securely.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
Using blockchain for capturing transactions and other activities means those transactions and activities will always be transparent, verifiable, and easily traced.
“Hence, using blockchain for capturing transactions and all other activities means that the transactions and other activities will always be transparent, verifiable, and easily traced.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
The key advantages of blockchain in terms of ESG practices lie in its ability to produce transparent records of all actions taken by any organization.
“The key advantages of blockchain in terms of ESG practices lie in this ability to produce transparent records of all actions taken by any organization.”
From A decision-support framework for evaluating AI-enabled ESG strategies in the context of sustainable manufacturing systems (2025) · cites this paper as [48]
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References 78 · Cited by 74
Research works printed but not linked: 10
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- Authors
- Almadadha, R.
- Affiliations
- Mutah University (JO)
- Corresponding author
- Almadadha, Rula
- Venue
- Blockchains
- Publisher
- MDPI AG
- Published
- 2024-09-04
- Volume
- 2
- Issue
- 3
- Pages
- 312-333
- ISSN
- 2813-5288 (ISSN-L)
- OpenAlex
- W4402223076
- Cited by
- 74
- References
- 78
- Citations by year
- 2026: 31 · 2025: 35 · 2024: 8
- FWCI
- 27.71
- Type
- journal article
- Language
- en
- Open access
- gold
- doi.org
- Licence
- Locations
- Blockchains (publishedVersion, cc-by)
- Topics
- Physical Sciences › Computer Science › Information Systems › Blockchain Technology Applications and Security
- Social Sciences › Business, Management and Accounting › Accounting › Accounting and Financial Management
- Social Sciences › Economics, Econometrics and Finance › Finance › Sustainable Finance and Green Bonds
- Keywords
- blockchain, financial accounting, ESG reporting, green financial instruments, climate-related financial disclosure, transparency, data security, sustainability, knowledge discovery from data, corporate governance
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