Batteries stacks are made of cells in certain series-parallel arrangements. Unfortunately,
cell performance degrades over time in terms of capacity, internal resistance, or self-discharge rate. In addition, degradation rates are heterogeneous, leading to cell-to-cell variations. Balancing systems can be used to equalize those differences. Dissipative or non-dissipative systems, so-called passive or active balancing, can be used to equalize either voltage at end-of-charge, or state-of charge (SOC) at all times. While passive balancing is broadly adopted by industry, active balancing has been mostly studied in academia. Beyond that, an emerging research field is multi-functional balancing, i.e., active balancing systems that pursue additional goals on top of SOC equalization, such as equalization of temperature, power capability, degradation rates, or losses minimization. Regardless of their functionality, balancing circuits are based either on centralized or decentralized control systems. Centralized control entails difficult expandability and single point of failure issues, while decentralized control has severe controllability limitations. As a shift in this paradigm, here we present for the first time a distributed multi-objective control algorithm, based on a multi-agent consensus algorithm. We implement and validate the control in simulations, considering an electrothermal lithium-ion battery model and an electric vehicle model parameterized with experimental data. Our results show that our novel multi-functional balancing can enhance the performance of batteries with substantial cell-to-cell differences under the most demanding operating conditions, i.e., aggressive driving and DC fast charging (2C). Driving times are extended (>10%), charging times are reduced (>20%), maximum cell temperatures are decreased (>10 C), temperature differences are lowered (~3 C rms), and the occurrence of low voltage violations during driving is reduced (>5x), minimizing the need for power derating and enhancing the user experience. The algorithm is effective, scalable, flexible, and requires low implementation and tuning effort, resulting in an ideal candidate for industry adoption.