Blockchain can report environmental impact in detail, automate the report, & also preserve the records. This gives consumers, managers, and investors more visibility into the practices of a company.
In a time when consumers are demanding value-based companies and products and when building, managing, and reporting on environmental, social, and governance (ESG) initiatives is becoming crucial for organisations, distributed ledger technology provides the best path forward.
The distributed ledger can help companies measure the impact of their business on the environment, down to the source of energy powering a plant, and know their records are immutable and true. Climate and social-related disclosures can be manipulated. The distributed ledger and the communal accountability offered by the blockchain makes real-time impact records available to consumers, investors, and regulators.
The immutability of the distributed ledger in the financial space is a model for how ESG metrics can be maintained across borders, throughout a supply chain, and across sectors—ensuring the granular data needed to tackle climate change.
The following are some of the many immediate benefits that scalable Blockchain technology can bring to supply chain partners across the globe:
- Increase Consumer Trust: Blockchain technology can track ingredients along a supply chain to ensure quality. This lets ESG managers report on the environmental impact of the production of goods throughout a supply chain and share accurate data with consumers.
- Add Traceability to Supply Chains: We’ve talked about how to make supply chains more efficient. We can also apply chain-of-custody records to the sourcing of ingredients. A recent Starbucks program is an example of how blockchain can follow a bean from field to cup.
- Building Resilience: Opaque legacy systems make it difficult to respond when supply chains are hit by disruptions. Transparent, digital processes built on top of blockchain make supply chain communication more resilient.
- Meeting Compliance Requirements: Businesses are subject to numerous requirements governing the sourcing, safety, and quality of products. Blockchain-based systems’ auditability and traceability make it easy to prove that products and processes are compliant.
- Guaranteeing Quality: Businesses need to know that their standards are being met when sourcing materials for multiple providers. The traceability of blockchain transactions makes it possible for businesses to identify suppliers that are falling short.
- Meeting Compliance Requirements Digital documents, claim data, and integrated policy details allow insurance companies to connect with industry regulators and scale ad hoc reporting at no additional cost. The blockchain also stores documents and records in the event of a disaster.
- Streamlining Dispute Resolution: When problems arise, identifying where the breakdown occurred and which party is responsible is a lengthy, manual process. By providing a shared source of truth, blockchain makes it possible to resolve disputes quicker.