As industries begin to emerge from the pandemic, Environmental and Social Governance (ESG) has become one of the top priorities across sectors like energy, aviation and manufacturing. The desire to “build back better” has led to a renewed focus on ecological sustainability and social good, and businesses are embracing advanced technologies like blockchain to achieve their ESG goals.
Over the past year and a half, the urgent need to evolve has been clear. The COVID-19 crisis demonstrated just how interconnected and interdependent we all are – and showed weaknesses in our existing systems that may not withstand another global disruption.
According to Julie Moret, head of Franklin Templeton’s global ESG division, environmental and social performance is now intrinsically linked to building a crisis-resilient future.
“The crisis has underscored our conviction that companies which take environmental and social issues into consideration and have good standards of corporate governance, will likely be more resilient businesses and better at navigating periods of shocks,” she said.
This is particularly true in industries like energy, where blockchain applications provide a sophisticated method of tracking environmental performance.
From carbon credits and offsets to certified net-zero energy production, global investors and energy consumers are demanding proof of sustainability — and linking to IoT and digital sensors along the resource value chain, blockchain can create immutable tokens that incorporate energy’s full environmental profile.
The new digital asset marketplace has also started to gain momentum as a way for NGOs to crowd-source funding for social good projects, with
Hydrogen: The clean energy economy is building in advanced digital technologies from the beginning — in the case of hydrogen, multiple projects around the world are using blockchain applications to certify the energy’s ESG profile and carbon-intensity.
Food Security: The pandemic put a massive strain on global food supply chains, and blockchain applications are a growing way build trust in food safety and provenance while creating more robust and automated supply networks that can withstand future shocks.rder payments project.
Renewables: Fundraising for renewable energy projects is a strong use case for blockchain, especially for decentralized forms of energy production like solar. Colonization for peer-to-peer trading and on-ledger tracking of the carbon profile of energy are all growing in popularity.
Blockchain doesn’t solve the world’s ESG challenges all by itself, but it’s an effective way to raise charitable funds and create trust in the kinds of information – like carbon status and provenance – that help industry become more sustainable and empowers stakeholders and consumers to make decisions that align with their values. In the post-COVID world, where ESG is becoming critical for business success, blockchain can provide the essential proof that shows companies are taking real and meaningful action.