At Finboot, we recently hosted a conversation between Nish Kotecha and Dr. Iain Moore , delving into the pharmaceutical supply chain, regulatory landscapes, and the critical role of traceability in ensuring drug safety. But who are these experts?
Nish Kotecha is an impact and technology entrepreneur, journalist, and seasoned investment banking professional. As the co-founder and chairman of Finboot, Nish has been a driving force in pioneering enterprise and innovation on a global scale.
Dr. Iain Moore, an industry expert with over 40 years of experience, has dedicated his career to advancing standards, improving supply chains, and emphasizing the importance of traceability. Trained as a chemist — and proudly declaring, “Once a chemist, always a chemist” — Dr. Moore has spent 25 years specializing in pharmaceutical excipients, the inactive yet vital ingredients in medications. The components are critical in drug formulation and delivery, underscoring his commitment to ensuring that what we consume is both safe and effective.
The Pharmaceutical Landscape
The pharmaceutical industry is vast, generating nearly $2 trillion annually in revenues, and its importance became even more evident during the COVID-19 pandemic, where pharmaceutical brands took center stage. Public concern about drug safety and trust reached new heights, sparking questions about the contents and reliability of the medications we are taking. How do we ensure what we’re putting into our bodiescan be trusted?’”
These questions highlight the critical importance of regulations. As Dr. Moore explains, “The pharmaceutical industry is very heavily regulated. You just can’t make up a drug product, put it on the market, and claim that it has a therapeutic effect.” This rigorous framework, enforced by government-authorized regulatory bodies, ensures that drug products are safe, effective, and meet the highest standards of patient care.
Developing a drug involves nearly a decade of work, starting with synthesizing the active ingredient—whether chemical or biologic—and progressing through extensive clinical trials. These trials, beginning with animal testing and culminating in human studies, aim to demonstrate both safety and therapeutic benefit.
However, exceptional circumstances like the COVID-19 pandemic saw governments and industry working together to accelerate these processes; vaccines were approved in record time without compromising safety, demonstrating the ability of regulatory frameworks to adapt in emergencies.
Supply Chain and Traceability in Pharmaceuticals
The pharmaceutical supply chain is complex, involving various stakeholders from raw material suppliers to manufacturers and distributors. Given the industry’s stringent regulation, ensuring traceability is essential for maintaining drug safety and efficacy. Traceability involves tracking each ingredient from its origin through production to delivery, ensuring transparency at every stage.
Good Manufacturing Practices
Good Manufacturing Practices (GMP) play a key role in this. Dr. Moore highlights that GMP’s origins date back 60 to 70 years, when it became clear that drug products had to be made hygienically and safely. According to the World Health Organization, GMP is a quality assurance process that ensures medicinal products are consistently produced and controlled to meet the quality standards required for their intended use and in accordance with the product specifications.
While GMP regulations are well-defined for drug products and active ingredients, excipients (inactive ingredients) are only regulated in countries like China and Brazil. This places responsibility on pharmaceutical manufacturers to ensure excipient compliance, guided by GMP standards.
Nish Kotecha adds that the power of traceability lies in connecting producers, regulators, and consumers, ensuring every step is verifiable. In an industry where safety is crucial, traceability technologies are essential for building trust and ensuring compliance.
Challenges in tracing ingredients through the supply chain
One of the primary obstacles facing the pharmaceutical industry in tracking ingredients throughout the supply chain is the reliance on outdated and inefficient data management systems. Many players in the sector still rely on hybrid paper-based systems, where digital records are simply scanned copies of paper documents. This approach raises serious concerns regarding data integrity and traceability. Paper systems, while tangible, lack the transparency and security offered by modern digital solutions. For example, in pharmaceutical supply chains, ensuring that each ingredient is accurately tracked from manufacturer to distributor is a complex process. Ingredients often pass through multiple intermediaries before reaching their final destination, and each transition introduces the potential for errors, fraud, or contamination.
A significant challenge is the issue of authenticity, particularly in ensuring that digital records are tamper-proof. As Iain mentions, in the past, there were concerns that digital data could be altered without leaving a trace, but modern technologies like blockchain have successfully addressed this issue. However, implementing such technologies on a large scale in the pharmaceutical industry requires overcoming regulatory hurdles, as the industry is highly regulated, and adopting new systems could take time. Despite these challenges, the push for greater transparency and efficiency is increasing as the risks of ingredient adulteration—such as the introduction of toxic materials—remain a real and dangerous threat.
Conclusion
The lack of transparency has often been masked under the banner of commercial confidentiality, but in industries that directly impact human health, such practices are no longer acceptable. The consequences of adulterated ingredients, such as fatal incidents involving toxic substances in over-the-counter medicines, underscore the importance of trust and visibility in the supply chain.
Digital solutions, such as blockchain technology, offer a path to solving the industry's transparency problems. By creating a decentralized, immutable ledger of all transactions, blockchain enables the secure tracking of ingredients from their origin to their final use. This provides pharmaceutical companies with the ability to trace the journey of every batch of ingredients, ensuring that they meet safety and quality standards. Also, it allows companies to share essential data with regulators and consumers without revealing sensitive business information, thereby fostering trust in the product.
Nish emphasizes that, in a world where industries like pharmaceuticals are pivotal to human survival and health, transparency is the key. We must be sure that what we are putting into our bodies can be trusted. For that, we need trusted data.
The future of the pharmaceutical industry hinges on greater transparency, and the technology to make that happen already exists. Adopting a digital ledger system can prevent catastrophic events, such as the injection of adulterated products. That's why we developed the MARCO Track &Trace platform—that solves exactly this problem.
In today’s rapidly evolving regulatory landscape, the approach companies take to manage their supply chains is facing unprecedented scrutiny. Initiatives like the European Union Deforestation Regulation (EUDR) are pushing industries to ensure full traceability and transparency across their value chains, ushering in a new era of accountability. For companies operating in heavily regulated industries—such as chemicals, oil and gas, energy, mining, metals, packaging, and agri-food—these changes are not just a shift in policy but a radical transformation in how business is done.
Increasing Demands for Supply Chain Transparency
The need for transparency is driven not only by regulatory mandates but also by growing pressure from consumers, investors, and stakeholders who demand sustainable practices and ethical sourcing. For example, the EUDR specifically requires businesses to verify that commodities are sourced from land free from deforestation post-December 31, 2020. This seemingly simple requirement has triggered extensive data needs, as companies must now acquire accurate, verifiable information on land use, geolocation, and the status of sourcing locations—a task that’s far from straightforward for global, multifaceted supply chains.
However, supply chains, especially for large enterprises, are intricate ecosystems with numerous stakeholders. Many companies find themselves in overlapping roles as both customers and suppliers, interwoven into a network that spans continents and involves a vast array of processes. This scale and complexity complicate data collection, verification, and reporting, transforming transparency into an operational hurdle. As data requirements expand, companies are realizing that the traditional methods of handling supplier data—through spreadsheets, emails, and manual checks—are no longer viable or scalable.
A Tangled Web of Data Management Challenges
The challenge of collecting and verifying data from suppliers is a significant barrier for many businesses. Information must be gathered from countless sources, standardized to meet regulatory requirements, and constantly updated to reflect any changes in the supply chain. The process is resource-intensive and error-prone, especially when businesses rely on manual inputs. Moreover, a lack of standardized data formats among suppliers exacerbates the problem, making it difficult for organizations to consolidate information efficiently.
These logistical hurdles are compounded by the urgent need for decarbonization within many industries. Without effective data on emissions, waste, and resource use, companies are left with an incomplete picture of their environmental impact. Regulations like the EUDR and increasing global focus on sustainability add further pressure, with significant financial and reputational risks tied to non-compliance. In this context, the need for a streamlined, collaborative approach to supplier data management has become not just advantageous but essential for companies aiming to navigate the modern compliance landscape successfully.
It is within this framework of escalating requirements, operational challenges, and regulatory pressures that digital solutions emerge as pivotal tools. By harnessing advanced digital technologies, businesses can transform these challenges into opportunities for efficiency, compliance, and sustainable growth.
Technology Reashaping Supply Chain Collaboration
Digital ecosystems are changing the way companies interact with their suppliers and customers. These interconnected networks of digital platforms and services enable seamless communication and data sharing, breaking down traditional silos and fostering a more collaborative business environment. By creating a shared digital space, organizations can:
Facilitate real-time information exchange
Standardize processes and data formats
Enhance visibility across the entire supply chain
Enable more agile and responsive decision-making
Enhancing Compliance Through Digital Collaboration
Supplier and customer portals are web-based interfaces that facilitate seamless communication and data sharing between an organization and its supply chain partners. These digital platforms serve as centralized hubs for information exchange, process management, and compliance monitoring, revolutionizing the way companies interact with their supply chain partners.
Key Features of Finboot's supplier Portals
Supplier data share: Suppliers can easily upload and manage their sustainability data, including emissions, waste management, and energy consumption. There are 3 main options you can submit information into your partner portal, detailed below.
Process Optimization: Automates the collection and review of sustainability information, reducing administrative burdens and increasing efficiency.
Standardized Assessments: provides templates and guidelines for consistent data submission across all suppliers.
Performance Scoring: The portal evaluates suppliers based on submitted data, generating a sustainability score that reflects their performance.
Assessment Tagging: Automatically tags assessments based on scoring, allowing for easy identification of high-performing and low-performing suppliers.
Risk Management Alerts
High-Risk Notifications: The system sends automated alerts for suppliers identified as high-risk based on their sustainability scores or compliance metrics, enabling proactive management.
Actionable Insights: Provides recommendations for improvement, helping suppliers to address identified risks effectively.
Successful implementation requires a strategic approach, clear communication, and ongoing support to ensure all parties realize the full potential of these collaborative platforms.
By leveraging the capabilities of supplier and customer portals, businesses can create more robust, efficient, and collaborative compliance processes. This not only helps in meeting regulatory requirements but also positions organizations to proactively address emerging compliance challenges and build more resilient supply chains.
Supplier Data Share: Which options do we have?
MARCO T&T Supplier Portal is a powerful tool designed to provide suppliers with seamless access for submitting essential sustainability data, optimizing processes, and enhancing collaboration throughout the supply chain.
Option 1
Option 1: A portal for suppliers to submit information directly by accessing MARCO T&T interface, this can increase the engagement with the supplier, working in the same roof. But also for many suppliers need of registration can be a drawback, that is the reason we have other options available from MARCO Track & Trace.
Option 2
Option 2: MARCO Track & Trace integrates easily with technologies like Google Forms, Microsoft Forms, and others, providing flexibility and accessible options for suppliers to upload data in a user-friendly format. Although this method offers convenience, it has limitations such as lower security and minimal data validation, as it allows public access. Consequently, while this isn’t our preferred approach, it can be valuable for collecting customer feedback or onboarding suppliers with minimal digital capabilities.”
Option 3
Option 3: A portal for suppliers to submit information directly by accessing MARCO T&T interface, this can increase the engagement with the supplier, working in the same roof. But also for many suppliers need of registration can be a drawback, that is the reason we have other options available from MARCO Track & Trace.
MARCO Track & Trace can also generate customized forms tailored specifically for data portals, striking an ideal balance between security and ease of access. These customized forms can be automatically sent to users within workflows or integrated via API to accompany our customers’ purchase orders. This setup allows suppliers to receive a personalized link with pre-filled information, minimizing human errors and enhancing security through authentication methods. We offer options such as two-factor authentication (2FA) or secure sign-in using supplier credentials, ensuring a robust, seamless experience for both data integrity and user access.
Moreover, MARCO Track & Trace advanced supplier and customer portal incorporates a range of features designed to enhance collaboration and streamline supply chain processes:
User-friendly interfaces: Intuitive design ensuring easy navigation and adoption
Customizable workflows: Tailored processes to meet specific business needs
Real-time data updates: Ensuring all parties have access to the latest information
Integration capabilities: Seamless connection with existing ERP and other business systems
Mobile accessibility: Enabling on-the-go access and management
Analytics and reporting tools: Providing insights for informed decision-making
Multi-language support: Facilitating global collaboration
EUDR Case Study: Tackling Data Challenges in Global Supply Chains
To comply with European Union Deforestation Regulation (EUDR), businesses must verify that their commodities are sourced from land that has not undergone deforestation after the cut-off date of December 31, 2020. This compliance requires accurate, verifiable data on land use, geolocation, and the deforestation status of plots involved in commodity production.
In a recent partnership announcement, Finboot and OpenAtlas have introduced a comprehensive solution tailored to meet the EUDR requirements, aimed at addressing both compliance and sustainability challenges.
The Complexities of Data Acquisition in the Petrochemical Industry
The petrochemical industry, known for its complex supply chains and significant environmental impact, faces mounting pressure to enhance sustainability and reduce its carbon footprint. With the introduction of regulations like the EUDR, companies in this sector are compelled to demonstrate unprecedented levels of transparency and due diligence in their sourcing practices.
Our client, a major player in the global petrochemical industry, faced several challenges in complying with EUDR, particularly in the context of geolocation and product information.
Petrochemical supply chains often span multiple continents, making precise geolocation data crucial yet challenging to obtain.
Petrochemical products can have slight variations in composition based on source materials, requiring detailed tracking.
Development of unique digital identifiers for each batch of raw materials and finished products.
Requirement to conduct and document comprehensive risk assessments of suppliers
Design of an intuitive portal for suppliers to easily input and update information.
Implementation of real-time data checks to ensure accuracy and completeness.
Need to streamline the collection and verification of vast amounts of supplier data
Implementing a Digital Solution to Enhance Supplier Engagement and Data Collection
To address these challenges, the company implemented our supplier portal powered by blockchain technology. Key features of the solution included:
Secure, permissioned access for suppliers to submit sustainability data
Automated workflows for collecting and verifying supplier information
Integration with remote sensing and geolocation technologies for plot-level traceability
Customizable risk assessment tools aligned with the company's specific criteria
Moreover, Finboot is registered within the European Commission, allowing direct integration with the EU's Information System for EUDR compliance reporting
While deforestation monitoring is a core component of EUDR compliance for our customers, MARCO Track & Trace extends its functionality beyond this, enabling businesses to monitor their legal obligations as outlined in the regulation. The suite provides critical tools such as mass balance, digital product passports, GHG tracking, smart contracts, and more. By embracing these technologies, companies can not only meet current regulatory requirements but also build more resilient, transparent, and sustainable supply chains for the future.
Outcomes and Benefits
The implementation of the digital supplier portal of our MARCO Track & Trace solution yielded significant benefits:
Streamlined sustainability compliance process, reducing time and resources required
Enhanced visibility into the supply chain, enabling better risk management
Improved supplier relationships through transparent and collaborative processes
Significant reduction in manual data processing and associated errors
Ability to demonstrate robust due diligence to regulators and stakeholders
Positioning as an industry leader in sustainable and transparent supply chain management
This case study examines how a leading petrochemical company leveraged MARCO Track & Trace supplier portal to meet EUDR compliance requirements and transform its approach to supply chain management.
In the recent partnership announcement, Finboot and OpenAtlas have introduced a comprehensive solution tailored to meet the European Union Deforestation Regulation (EUDR) requirements, aimed at addressing both compliance and sustainability challenges.
This partnership leverages Finboot’s blockchain-powered MARCO Track & Trace system and OpenAtlas’s VANTAGE-X remote sensing technology (geolocalization), providing a powerful tool for companies needing to comply with the regulation. To further explore the impact of this collaboration, we’ve invited Harry Marshall, OpenAtlas founder, to share his insights in this guest blog post.
Why Open Data Solutions Aren't Safe for EUDR Compliance
The European Union Deforestation Regulation (EUDR) aims to prevent deforestation linked to the production of key commodities entering the EU market. While open data solutions like Global Forest Watch (GFW) and others are often seen as low-cost tools for deforestation monitoring, they present critical risks when it comes to ensuring compliance with the stringent requirements of the EUDR.
Here’s why open data is not a safe bet for EUDR compliance:
Inaccurate Forest Definitions:
Open data solutions frequently fail to distinguish between actual forests and perennial crop plantations, such as palm oil, cocoa, and coffee. This poses a significant issue for EUDR compliance, which relies on precise forest cover data.
Under the EUDR, deforestation specifically refers to the conversion of forests into agricultural land, yet many open datasets mistakenly classify perennial crops (like oil palm) as forests. Such misclassification not only triggers false deforestation alerts but also exposes businesses to potential non-compliance penalties.
For example, as highlighted in OpenAtlas’ white paper, they may significantly overestimate forest cover in areas where crops are planted. Such overestimations can mistakenly flag plantation activities as deforestation, thus jeopardising compliance for smallholder farmers and leading to unwarranted exclusion from the EU market.
Lack of Plot-Level Accuracy:
Open datasets are excellent for global stocktaking or raising awareness of deforestation trends. However, when it comes to due diligence at the plot level, these datasets often fall short. Many global data sources frequently fail to meet the strict forest definitions required by the EUDR.
For example, according to Satelligence, they may overreport forest cover by 40-95% in some countries, such as Côte d'Ivoire, the world's largest cocoa producer. This overestimation results in significant inaccuracies when conducting risk assessments for EUDR compliance due diligence statements.
Compliance with the EUDR requires plot-level precision that open data simply cannot deliver. Using open data alone risks false positives and negatives, which can lead to unnecessary fines or exclusion from the market altogether. OpenAtlas’ VANTAGE-X tool offers a specialised solution by layering real-time, high-resolution data from Sentinel-2 and other sources, alongside well-vetted systems like CCDC, to ensure precise plot-level monitoring that aligns with the EUDR’s stringent requirements.
Misalignment with EUDR Definitions:
A key challenge with using open data for EUDR compliance lies in the mismatch between global forest definitions and the specific legal definitions required by the EUDR.
Approximately 80% of producer countries have forest definitions that do not align with the EUDR. This inconsistency creates further complexity in ensuring accurate monitoring and compliance. Even the European Commission’s Forest Observatory Global 2020 map, a widely used open dataset, has been shown to overestimate forest cover by incorporating plantations under the category of forests.
The EUDR requires clear differentiation between forest degradation and deforestation. Global open data solutions often don’t make this distinction clear enough, leading to incorrect risk assessments.
The Need for Custom Solutions:
For businesses that want to ensure EUDR compliance, relying solely on open data is risky. OpenAtlas’ VANTAGE-X tool is built specifically to mitigate these challenges by incorporating advanced AI-powered deforestation detection, using high-resolution satellite data, and layering multiple datasets to provide accurate, actionable insights at the plot level. OpenAtlas provides a compliance-driven alternative to open data systems
Traceability Partnerships for E2E Compliance:
Partnerships between remote sensing companies like OpenAtlas and traceability service providers, such as Finboot, are essential for EUDR compliance.
Finboot enhances supply chain visibility through its blockchain-powered MARCO Track & Trace solution, ensuring accurate and verifiable geolocation data of source plots. This precise data is vital for remote sensing providers like OpenAtlas to perform effective deforestation monitoring on the correct plots, ensuring compliance with the EUDR’s stringent regulations.
By integrating Finboot’s traceability solutions with OpenAtlas’ advanced satellite-based monitoring tools, businesses can confidently track agricultural products back to their origins, verify compliance, and avoid the risk of hefty fines for non-compliance. Furthermore, Finboot’s technology allows for immutable record-keeping and facilitates the creation of digital product passports (DPPs), enhancing overall supply chain transparency. This partnership not only strengthens deforestation risk assessments but also ensures that businesses meet the high standards expected in the European market.
Conclusion:
Open data sources are invaluable for raising global awareness and monitoring large-scale deforestation. However, for the precise, plot-level monitoring required by the EUDR, these solutions fall short. They often misclassify perennial crops, lack real-time data integration, and fail to align with specific legal definitions. To navigate the complexities of EUDR compliance, businesses must adopt custom EUDR solutions like OpenAtlas' VANTAGE-X tool and Finboot’s MARCO Track & Trace platform, which ensure accuracy, minimise false positives, and reduce the risk of costly fines.
For more information on how OpenAtlas and Finboot can help your business meet EUDR compliance, feel free to contact us for a demo.
Implications for Developing and Emerging Economies
The CBAM is a groundbreaking EU initiative to combat climate change and promote fair trade. By pricing carbon in imports, it challenges global commerce norms, forcing businesses to rethink production and trade strategies. This mechanism impacts developing economies, reshapes supply chains, and drives innovation in clean tech, aiming to catalyze a shift towards a low-carbon global economy.
As we delve into the implications of this mechanism, we'll explore its far-reaching effects on various sectors, the challenges and opportunities it presents for different economies, and its potential to catalyze a global shift towards more sustainable industrial practices. By understanding the multifaceted nature of CBAM's influence, we can better appreciate its role as a transformative force in the pursuit of a low-carbon global economy.
Sectoral vulnerabilities
As the CBAM is implemented and its impacts on developing and emerging economies become more apparent, it will be essential for the EU and the international community to work together to ensure that the mechanism does not exacerbate existing inequalities or hinder sustainable development efforts.
Developing countries, which often rely on carbon-intensive manufacturing and exports, may be disproportionately affected by the CBAM. A quantitative assessment by He, Zhai, and Ma (2023) suggests that welfare losses in countries like Ukraine, Egypt, Mozambique, and Turkey could range between $1 billion and $5 billion, significant relative to their gross domestic product (GDP). Mozambique's economy, for instance, could shrink by 2.5% due to decreased demand for its exports.
A study by the LSE and the African Climate Foundation estimated that Africa would be the most negatively affected region, with CBAM potentially resulting in a decrease in exports from Africa to the EU in aluminum by up to 13.9%, iron and steel by 8.2%, fertilizer by 3.9%, and cement by 3.1%.
Opportunities for green industrialization
Despite the challenges posed by the CBAM, it also presents opportunities for developing and emerging economies to transition towards greener industrialization. By investing in cleaner technologies and adopting more sustainable practices, these countries can reduce their carbon footprint and maintain their competitiveness in the EU market. However, this transition will require significant financial and technical support from developed countries and international organizations.
Need for technical assistance
To assist developing and emerging economies in complying with the CBAM and transitioning towards greener industrialization, the EU has committed to providing technical and financial support, technology transfer, and capacity development. This support will be crucial in helping these countries to measure and report their greenhouse gas emissions, adopt cleaner production methods, and develop their own carbon pricing mechanisms. The EU has also suggested considering time-limited exemptions for least developed countries, linked to their adoption of CBAM accounting and reporting standards and investments in clean technologies.
Sectoral Impact Analysis
The Carbon Border Adjustment Mechanism (CBAM) is set to have far-reaching implications across various sectors, with the iron and steel, cement and concrete, aluminum, and fertilizer industries being among the most heavily impacted. These sectors are characterized by their high carbon emissions, significant exposure to international trade, and vulnerability to carbon leakage.
In the iron and steel sector, the EU is a major player, but faces intense competition from global producers. With 30% of EU demand for steel basic materials and key intermediates met by foreign supply, the introduction of CBAM is expected to level the playing field for domestic producers. However, the mechanism may also lead to supply chain disruptions and price increases for downstream manufacturing, potentially making the energy transition more expensive in the EU compared to other regions.
For example, Spain imported 14.5 million tons of steel in 2022, half of which came from outside the EU. Assuming an average carbon intensity of steel and the current EU carbon price, Spanish steel importers could face annual tariffs of some 1 billion euros when CBAM regulations are fully enforced in 2034. Implementing digital traceability and advanced carbon tracking solutions will be instrumental in reducing and avoiding a significant share of these tariffs. One example of this is how US Steel recently earned the world’s first certification for Responsible Steel for their Big River Steel operation. Big River Steel also leverages Finboot’s Green Supply Chain solutions to trace their scrap to metal processes.
The cement and concrete sector, another significant contributor to carbon emissions, will also be subject to CBAM. As a key building material, any price increases resulting from the carbon tax could have ripple effects across the construction industry. The sector's high trade intensity and the prevalence of lower-cost imports from countries with less stringent climate policies make it particularly vulnerable to carbon leakage. Some industry leaders, like Costa Rica’s Pedregal, have already started to reduce the carbon intensity of their construction materials by introducing non-reusable plastic waste to replace carbon-intensive materials while at the same time improving product performance, an initiative that leverages Finboot’s Green Supply Chain Solutions to demonstrate their advanced recycling efforts and back up their carbon-saving claims.
Aluminum production, known for its energy-intensive processes, will also face the impacts of CBAM. The EU aluminum industry largely depends on imports of primary aluminum, with EU dependency on imports reaching close to 50% in 2020. The application of CBAM to primary aluminum imports could lead to higher costs for downstream producers, potentially incentivizing the relocation of production outside Europe or increasing imports of semi-finished products.
The fertilizer industry, crucial for agricultural productivity, will also be affected by CBAM. The sector's reliance on natural gas as a key input and its significant carbon footprint make it particularly sensitive to carbon pricing. The inclusion of fertilizers in the CBAM could drive up production costs and impact agricultural competitiveness, with potential implications for food security.
As the EU moves forward with the implementation of CBAM, close monitoring of its impacts on key sectors will be essential. Policymakers must remain responsive to the evolving needs of industries, ensuring that the mechanism achieves its intended objectives without undermining the competitiveness and sustainability of European businesses. By fostering a level playing field and encouraging the adoption of cleaner production practices globally, CBAM has the potential to drive meaningful progress towards a low-carbon future.
CBAM and International Climate Negotiations
Influence on NDCs
Nationally Determined Contributions (NDCs) are the cornerstone of the Paris Agreement, representing each country's voluntary commitments to reduce greenhouse gas emissions and adapt to the impacts of climate change. The CBAM's potential to level the playing field for carbon-intensive industries and prevent carbon leakage may incentivize countries to enhance their NDCs, setting more ambitious emission reduction targets to maintain their competitiveness in the global market.
Potential for broader adoption
As the world's largest trading bloc, the EU's leadership in this area could set a precedent for other major economies to follow suit, creating a domino effect of carbon border adjustments across the globe as countries recognize the benefits of aligning their climate policies with those of their trading partners.
Implications for climate finance
The revenues generated by the CBAM could potentially be used to support climate action in developing countries, helping to address the long-standing issue of inadequate climate finance flows from developed to developing nations.
However, the allocation of CBAM revenues remains a contentious issue, with some arguing that the funds should be used to support the EU's own climate goals, while others advocate for a more equitable distribution of resources to support global climate action.
Adapting to CBAM: Strategies for Businesses and Governments
For businesses, a crucial first step is to establish robust emissions monitoring and reporting systems. This involves investing in advanced carbon accounting methodologies and technologies that enable accurate tracking of greenhouse gas (GHG) emissions throughout the supply chain. By leveraging end-to-end traceability solutions, such as those offered by Finboot, companies can enhance supply chain transparency and streamline the process of gathering and reporting emissions data required under the CBAM regulation.
Moreover, businesses should proactively invest in low-carbon technologies and production processes to reduce their carbon footprint and minimize exposure to the carbon tax imposed by CBAM. This may involve adopting renewable energy sources, implementing energy efficiency measures, and exploring innovative solutions for carbon capture and storage. By demonstrating a commitment to emission reductions, companies can not only mitigate the financial impact of CBAM but also gain a competitive edge in an increasingly sustainability-conscious market.
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Conclusion
The Carbon Border Adjustment Mechanism has a significant influence on global trade dynamics, presenting both challenges and opportunities for businesses and governments worldwide. Its implementation has far-reaching implications for various sectors, particularly those with high carbon emissions, and has the potential to reshape international supply chains. As countries grapple with the need to reduce greenhouse gas emissions, CBAM serves as a catalyst for adopting cleaner production practices and investing in low-carbon technologies.
To navigate this evolving landscape, businesses must prioritize emissions monitoring and reporting, leveraging solutions like Finboot's MARCO Track & Trace to enhance supply chain transparency.
Governments, in turn, need to develop comprehensive strategies to support industries in their transition to a low-carbon economy. As CBAM continues to evolve, its role in driving global decarbonization efforts and shaping international climate negotiations will be crucial to watch. The mechanism's success in promoting a more sustainable and equitable global trade system will depend on ongoing collaboration between nations, industries, and stakeholders to address the complex challenges of climate change.
LONDON, 28th October, 2024 - Finboot, a leader in blockchain-powered green supply chain management solutions, proudly announces its achievement of SOC 2 Type 2 compliance, underscoring our unwavering commitment to data security and regulatory compliance.
Finboot specializes in enhancing transparency, traceability, and efficiency across industries such as energy, chemicals, mining, and aviation. Our innovative blockchain applications empower organizations to achieve net-zero goals while optimizing operations. Finboot's technology traces carbon emissions and minimizes sustainability risk through immutable data.
The SOC 2 Type 2 assessment rigorously evaluates controls pertaining to security, availability, processing integrity, confidentiality, and privacy. Finboot partnered with Vanta to help us automate some of our process to reduce the unknowns and the time required to collect evidence. This SOC 2 attestation provides our clients and stakeholders with assurance regarding the security and integrity of Finboot's systems and processes, particularly in handling sensitive customer data. This level of integrity and security is crucial for Finboot, given the critical nature of raw material sourcing, production, and commercialization processes our customers trace with our Green Supply Chain solutions.
Angel Pateiro, Co-Founder and CTO of Finboot, who spearheaded the company's compliance efforts, states: "Achieving SOC 2 Type 2 compliance is a significant milestone for Finboot. It validates our robust security practices and demonstrates our commitment to protecting our clients' data. In the blockchain and green supply chain space, where data integrity is paramount, this attestation reinforces our position as a trusted partner. It assures our clients, particularly those in highly regulated industries, that their sensitive information is handled with the utmost care and in compliance with the highest industry standards. This achievement not only enhances our credibility but also aligns perfectly with our mission to provide transparent, secure, and efficient solutions for sustainable supply chains."
Key Benefits of SOC 2 Type 2 Compliance:
Client Trust: SOC 2 Type 2 examinations provide assurance to clients and stakeholders regarding the security and integrity of your systems and processes, enhancing trust and confidence among our clients and stakeholders.
Risk Mitigation: By identifying and addressing control deficiencies, SOC 2 Type 2 examinations help mitigate risks associated with data breaches, unauthorized access, and service disruptions.
Regulatory Compliance: SOC 2 Type 2 examinations demonstrate compliance with industry standards and regulatory requirements, ensuring adherence to best practices for data security and privacy.
Competitive Advantage: Achieving SOC 2 Type 2 compliance gives Finboot a competitive edge, demonstrating our commitment to data security and integrity to clients, partners, and regulators.
Alvaro Llobet, Head of Product of Finboot, highlights: "We extend our gratitude to Insight Assurance for their diligent evaluation and validation of our compliance efforts, ensuring that we uphold the highest standards of security and accountability. Through their expertise and impartial assessment and auditing process, we've demonstrated our adherence to the stringent requirements outlined by the SOC 2 Type 2, reinforcing our dedication to safeguarding sensitive data and maintaining operational resilience."
As we celebrate this achievement, we reaffirm our commitment to transparency, integrity, and continuous improvement in all aspects of our operations, ensuring the ongoing protection of our stakeholders' data and interests.
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ABOUT FINBOOT
Finboot’s technology provides green supply chain management for the world's largest capital-intensive companies. Our technology traces carbon emissions and minimises risk through immutable data. Finboot is backed by SABIC and Repsol. Finboot has created the first green supply chain management suite with features including integrated traceability, allowing you to track carbon emissions, automate digital product passports, create your sustainability credits, and facilitate compliance. Finboot is headquartered in Cardiff with a base in Barcelona.
Finboot is a leading provider of blockchain technology solutions, specializing in enhancing transparency, traceability, and efficiency across various industries. With a focus on sustainability and innovation, Finboot empowers organizations to achieve net-zero goals while optimizing their operations through cutting-edge blockchain applications.
For more information about Finboot's compliance solutions or to explore collaboration opportunities, please visit www.finboot.com or contact info@finboot.com.
The Carbon Border Adjustment Mechanism (CBAM) is gearing up to cause a revolution in global trade dynamics, presenting a pivotal shift in how countries approach carbon emissions and international commerce with the European single market. As a cornerstone of the European Union's Green Deal, CBAM has an impact on businesses worldwide, compelling them to reassess their carbon footprints and adapt to new regulatory landscapes. This groundbreaking policy not only aims to reduce carbon leakage but also has the potential to reshape global supply chains and stimulate innovation in low-carbon technologies.
To analyze the effects of CBAM, this ebook explores its economic implications, sectoral impacts, and role of technology in global decarbonization efforts. It discusses the challenges and opportunities CBAM presents for developing economies, its influence on international climate negotiations, and strategies for businesses and governments to adapt. The importance of supply chain transparency and advanced emissions tracking solutions is also highlighted.
The Context of EU's Climate Leadership
The European Union has long been at the forefront of global efforts to combat climate change, setting ambitious targets and implementing comprehensive policies to reduce greenhouse gas emissions; the European Deforastion Regulation (EUDR) is an example.
As the world's third largest emitter of carbon dioxide, the EU recognizes its responsibility to lead by example in the transition to a low-carbon economy. The EU's climate leadership is underpinned by a robust framework of targets, policies, and initiatives aimed at driving down emissions across all sectors of the economy.
EU's climate targets
Central to the EU's climate strategy are its binding emission reduction targets. In 2014, the EU set a goal of reducing greenhouse gas emissions by at least 40% by 2030 compared to 1990 levels. However, in light of the growing urgency of the climate crisis, the EU has since raised its ambition, committing to a reduction of at least 55% by 2030 as part of the European Green Deal This increased target puts the EU on a trajectory to achieve climate neutrality by 2050, in line with the objectives of the Paris Agreement.
The role of carbon pricing
To achieve its emission reduction targets, the EU has implemented a range of policy instruments, with carbon pricing playing a central role. The EU Emissions Trading System (EU ETS), launched in 2005, was the world's first and largest carbon market, covering around 40% of the EU's greenhouse gas emissions. Under the EU ETS, a cap is set on the total amount of emissions allowed, and companies must purchase or receive allowances for each ton of CO2 they emit. This creates a financial incentive for companies to reduce their emissions and invest in clean technologies.
The need for a border adjustment mechanism
While the EU ETS has been effective in driving down emissions within the EU, it has also raised concerns about the risk of carbon leakage — the relocation of carbon-intensive industries to countries with less stringent climate policies — and it has become a cause of concern for EU competitiveness in the global scene. To address this issue and ensure a level playing field for EU companies, the EU is introducing a Carbon Border Adjustment Mechanism (CBAM).
The CBAM will put a carbon price on imports of certain goods from outside the EU, ensuring that the price of carbon is internalized in the cost of these products, aligning with the carbon price paid by EU producers under the EU Emissions Trading System (EU ETS). This will not only prevent carbon leakage but also encourage other countries to adopt more ambitious climate policies, thereby contributing to global emission reductions.
CBAM: A Comprehensive Overview
CBAM is governed by EU Regulation 2023/956. It's being introduced in two stages: a trial period from 2023 to 2025, followed by full implementation starting in 2026.
During the transitional period, importers of CBAM goods are required to register with national authorities and comply with quarterly reporting obligations on the quantities of imported goods and their embedded greenhouse gas emissions.
The definitive regime will involve the purchase and surrender of CBAM certificates corresponding to the declared emissions, with the price of certificates linked to the weekly average auction price of EU ETS allowances. By 2030, when fully phased in, CBAM is expected to capture more than 50% of the emissions in ETS-covered sectors.
Covered products and sectors
While CBAM is expected to rapidly expand to other carbon-intensive industry segments, it will initially apply to imports of certain goods and selected precursors whose production is carbon-intensive and at significant risk of carbon leakage. These include:
cement,
iron and steel, aluminum,
fertilizers,
electricity, and
hydrogen.
The specific goods can be identified by their code under the EU's Combined Nomenclature (CN-Code) listed in Annex I of the CBAM-Regulation.
The European Commission will review the product scope by 2026 to assess the feasibility of including additional goods, such as downstream products, and those identified as suitable candidates during negotiations.
Implementation phases
The implementation of CBAM follows a phased approach, with a transitional period from October 1, 2023, to December 31, 2025, followed by the definitive regime starting from January 1, 2026.
During the transitional period, importers are required to report the total quantity of goods imported, the embedded direct and indirect emissions, and any carbon price paid abroad.
Importers can utilize different reporting options until the end of 2024, including full reporting according to the EU methodology, reporting based on equivalent methods, or using default values published by the European Commission.
From January 1, 2025, only the EU method will be accepted, with estimates allowed for complex goods if they represent less than 20% of the total embedded emissions.
The definitive regime will involve the purchase and surrender of CBAM certificates, with free allocations under the EU ETS gradually reduced and proportionally offset by CBAM certificates until complete replacement by 2034.
Economic Impacts on Global Markets
As mentioned, the CBAM is poised to have a significant impact on global trade flows, commodity prices, and the competitiveness of firms both within and outside the European Union (EU). As a carbon tax on imports, the CBAM aims to level the playing field for EU producers facing higher costs due to the EU Emissions Trading System (EU ETS) and incentivize emission reductions in countries exporting to the EU. However, the mechanism's ripple effects on international trade patterns and the global economy are complex and far-reaching.
Let's take a closer look at this.
Changes in trade flows
One of the most immediate consequences of the CBAM will be a shift in trade flows as importers adjust their sourcing strategies to minimize exposure to the new carbon tax. Countries with higher carbon emissions intensities in their production processes, particularly in the cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen sectors covered by the CBAM, may see a decline in their exports to the EU. A study by the European Commission estimates that the CBAM could reduce imports of covered goods into the EU by up to 12%. This could lead to a reorientation of trade patterns, with EU importers favoring suppliers from countries with lower carbon footprints or those that have implemented comparable carbon pricing mechanisms.
Price effects on commodities
The CBAM is expected to exert upward pressure on the prices of covered commodities in the EU market, as the carbon tax will be incorporated into the final price. This could have implications for downstream industries that rely on these commodities as inputs, potentially affecting their competitiveness both within the EU and globally. For example, the steel industry, a major consumer of coal and electricity, may face higher production costs, which could be passed on to end-users such as the automotive and construction sectors.
The extent of price increases will depend on various factors, including the carbon intensity of production in exporting countries, the availability of low-carbon alternatives, and the elasticity of demand for the covered commodities. In some cases, exporters may absorb part of the CBAM cost to maintain their market share, while in others, EU consumers may bear the brunt of higher prices.
Competitiveness of EU and non-EU firms
We know that the CBAM is designed to protect the competitiveness of EU firms subject to the EU ETS by ensuring that importers face equivalent carbon costs. This should help prevent carbon leakage, where production shifts to countries with less stringent climate policies. However, the mechanism's impact on competitiveness will vary across sectors and firms, depending on their carbon intensity, trade exposure, and ability to pass on costs to consumers.
EU firms in CBAM-covered sectors may benefit from a more level playing field, as they will no longer be undercut by cheaper imports from countries with weaker climate regulations. This could encourage investment in low-carbon technologies and production processes within the EU. However, EU firms that rely heavily on imported inputs from high-carbon countries may face increased costs, potentially eroding their competitiveness in global markets.
For non-EU firms, the CBAM presents both challenges and opportunities. Exporters from countries with carbon pricing systems that are aligned with or linked to the EU ETS may be exempt from the CBAM or face lower adjustment costs. This could create incentives for countries to adopt more ambitious climate policies and engage in carbon market cooperation with the EU. On the other hand, firms from countries without comparable carbon pricing may struggle to maintain their market share in the EU, particularly if they cannot readily reduce their carbon footprint or pass on the CBAM cost to customers.
The CBAM's impact on global competitiveness will also depend on the extent to which other major economies adopt similar measures. If the EU remains the only jurisdiction with a carbon border adjustment, it could face accusations of protectionism and potential trade disputes. However, if other countries follow suit, it could accelerate the transition to a low-carbon global economy and create a more level playing field for firms worldwide.
This high-tech partnership combines blockchain-powered traceability with advanced remote sensing technology to address growing sustainability regulations.
Cardiff, 16 October 2024: In response to the increasing global push for sustainability compliance, Finboot and OpenAtlas have announced a groundbreaking partnership to launch an innovative solution for European Union Deforestation Regulation (EUDR) compliance.
Unlike other regulations, the EUDR is product-based and prohibits non-compliant companies from placing certain commodities or derived products on the market unless three conditions are met: they must be deforestation-free, produced in accordance with the relevant legislation of the country of production, and covered by a Due Diligence Statement (DDS). This significantly impacts global supply chains and sustainability initiatives. For instance, the EUDR covers full supply chain traceability and due diligence reporting on timber, palm oil, soy, cocoa, coffee, cattle, and rubber (as well as their derived products)—responsible for 90% of global deforestation—affecting EU operators, suppliers exporting to the EU, companies transforming commodities into products, and traders reselling them.
Under the EUDR, operators must gather detailed information about their products at the farm/producer level and create a DDS, which is then uploaded to a system managed by the European Commission. This information includes the geolocation of all land plots where the product, or its parts, have been produced or stored – specific to the case of cattle.
Beyond deforestation's impact on climate change, a recent report from the World Economic Forum (𝘏𝘪𝘨𝘩-𝘌𝘮𝘪𝘵𝘵𝘪𝘯𝘨 𝘚𝘦𝘤𝘵𝘰𝘳𝘴: 𝘊𝘩𝘢𝘭𝘭𝘦𝘯𝘨𝘦𝘴 𝘢𝘯𝘥 𝘖𝘱𝘱𝘰𝘳𝘵𝘶𝘯𝘪𝘵𝘪𝘦𝘴 𝘧𝘰𝘳 𝘓𝘰𝘸-𝘊𝘢𝘳𝘣𝘰𝘯 𝘚𝘶𝘱𝘱𝘭𝘪𝘦𝘳𝘴, September 2024), analyzes decarbonization pathways in six high-emitting sectors responsible for approximately 25% of global greenhouse gas emissions: aviation, shipping, trucking, aluminum, cement/concrete, and steel. As the world grapples with the urgent need to mitigate climate change, these industries are under increasing pressure to implement strategies to reduce their carbon footprint - Carbon emissions from these sectors need to decline by an astounding 93% by 2050 to achieve net zero carbon emissions. The report concludes that ¨suppliers are a key player in this ecosystem as they are instrumental in driving innovation, piloting low-carbon technologies and bringing these solutions to market, thereby influencing downstream emissions across the global value chain.¨
This partnership between Finboot, a top technology provider for green supply chain management solutions for capital-intensive companies, and OpenAtlas, a company that leverages remote sensing technology to monitor for deforestation-risk and ensure compliance, is an example of suppliers working together to improve transparency and accountability in supply chains across different industries. This is especially important now because regulations like EUDR, ESPR, and CS3D are demanding higher levels of transparency and accountability from businesses that, in turn, require increasingly sophisticated third-party technology solutions to meet compliance.
The partnership brings together Finboot's expertise in blockchain-powered traceability through its MARCO Track & Trace solution and OpenAtlas's VANTAGE-X deforestation verification remote sensing solution (geolocalization), offering real-time monitoring, comprehensive compliance data, and immutable record-keeping, addressing the growing need for companies to ensure and demonstrate sustainable practices throughout their supply chains, particularly in relation to deforestation risks. This integration allows companies to:
Perform algorithmic deforestation risk analysis on up to 50,000 hectares in less than 20 minutes;
Leverage high-resolution satellite imagery for frequent and accurate forest monitoring;
Securely record and verify compliance data using blockchain technology;
Create digital product passports and due diligence compliance statements.
Juan Miguel Pérez Rosas, CEO of Finboot, stated, "Our collaboration with Open-Atlas represents a significant step forward in providing businesses, especially in these hard-to-decarbonize markets such as oil and gas, mining, packaging, and chemicals, with the tools they need to meet complex regulatory requirements. By combining our blockchain capabilities with OpenAtlas's cutting-edge remote sensing technology, we're offering comprehensive solution that not only ensures compliance but also drives sustainable practices across industries."
Harry Marshall, CEO of OpenAtlas, celebrates, "We're excited to expand our footprint into the oil & gas, chemicals, steel, and aviation industries where Finboot has a strong presence.".
Open Atlas technical capabilities include:
Analysis of over 650,000 hectares of land for EUDR compliance efforts;
Utilization of Sentinel-2 ESA Copernicus space mission satellites for high-frequency, multispectral imaging;
Integration of various datasets for comprehensive risk assessment and legal compliance verification.
Despite discussions continuing regarding potential changes to EUDR deadlines, Finboot and OpenAtlas strongly advocate that companies must prepare their supply chain for compliance. Initially the regulation was set to come into effect on December 30, 2024, however, on October 2nd, the European Commission proposed an additional 12-month delay, with large companies potentially facing compliance by December 2025 and small businesses by June 2026. While all the tools for implementation are technically ready, the Commission suggests this extension to ensure smooth phasing-in.
"EUDR compliance will be more challenging and time-consuming than many anticipate. Our advice to businesses is to aim for end-of-year compliance this year and continue improving through 2025," Harry added.
Alvaro Llobet, Head of Product at Finboot, highlights: "Our combined solution provides a unique value proposition to the market, automating the whole process, lowering operational costs, increasing efficiency, and minimizing deforestation risks within supply chains."
For companies looking to prepare for upcoming regulations and enhance their sustainability efforts, the Finboot and Open-Atlas solution offers a powerful, efficient, and future-ready approach to compliance and supply chain transparency.
Finboot extends beyond EUDR and can address other current and upcoming regulatory requirements such as ESPR, REDIII, CS3D, and CBAM. This adaptability ensures that businesses can future-proof their compliance efforts in an ever-evolving regulatory landscape.
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ABOUT FINBOOT
Finboot’s technology provides green supply chain management for the world's largest capital-intensive companies. Our technology traces carbon emissions and minimises risk through immutable data. Finboot is backed by SABIC and Repsol. Finboot has created the first green supply chain management suite with features including integrated traceability, allowing you to track carbon emissions, automate digital product passports, create your sustainability credits, and facilitate compliance. Finboot is headquartered in Cardiff with a base in Barcelona.
Finboot is a leading provider of blockchain technology solutions, specializing in enhancing transparency, traceability, and efficiency across various industries. With a focus on sustainability and innovation, Finboot empowers organizations to achieve net-zero goals while optimizing their operations through cutting-edge blockchain applications.
For more information about Finboot's compliance solutions or to explore collaboration opportunities, please visit www.finboot.com or contact info@finboot.com.
ABOUT OPEN-ATLAS
OpenAtlas is an innovative, Amsterdam-based remote sensing business, dedicated to providing cutting-edge deforestation monitoring and compliance solutions. Utilising state-of-the-art, high-revisit rate satellite imagery and proprietary machine learning algorithms, our technology empowers businesses, governments, and NGOs to effectively monitor and verify deforestation activities, ensuring adherence to global environmental regulations such as the European Union’s Deforestation Regulation (EUDR).
Founded by a team of leaders in Artificial Intelligence (AI), remote sensing, and enterprise technology solutions, OpenAtlas is at the forefront of promoting sustainable land management practices. Our platform does more than detect deforestation; it delivers actionable insights and detailed analytics that help our clients reduce environmental risks, make informed decisions, and streamline compliance efforts efficiently.
At OpenAtlas, we are committed to using technology for the betterment of the planet. Our solutions are designed to be scalable, precise, and user-friendly, simplifying environmental management for companies worldwide. As we continue to enhance our technology and expand our reach, OpenAtlas stands as a leader of innovation in environmental compliance and satellite monitoring.
Discover how OpenAtlas can streamline your business’ compliance efforts at www.open-atlas.com or connect with us on LinkedIn for the latest updates and insights.
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A Digital Product Passport (DPP) serves as a comprehensive digital record of a product's journey throughout its lifecycle. It provides a structured collection of product-related data, accessible via electronic means through a unique identifier. The European Commission defines a 'product passport' as a product-specific dataset that can be electronically accessed via a data carrier to facilitate the electronic registration, processing, and sharing of product-related information among supply chain entities, authorities, and consumers.
The DPP aims to enhance sustainable production, extend product lifetimes, support consumers in making sustainable choices, enable the transition to a circular economy, and assist authorities in verifying compliance. It tracks a product's entire lifecycle, from material sourcing and extraction to end-of-life recycling, much like a travel passport documents a journey.
Industries Prioritized for DPP Implementation
The European Union has identified several priority sectors for DPP implementation by 2026.
These include:
Batteries
Textiles (garments and footwear)
Electronics
Furniture (including mattresses)
Iron and steel
Aluminum
Chemicals
The construction industry, which accounts for approximately 40% of raw materials consumption worldwide, is also a high priority for European DPP utilization.
Key Components of a DPP
A Digital Product Passport typically includes the following key components:
Product Identification: Information on the product's name, model, serial number, and other identifying characteristics.
Materials: Details on all materials used within the product's lifecycle, including their origins and availability.
Technical Specifications: Information on the product's performance, capabilities, and other relevant specifications.
Product Lifecycle: Data on the consecutive, interlinked stages of a product from raw material use to final disposal.
Maintenance and Repair: Records of product service, repairs, and upgrades performed.
Environmental Information: Data on the product's environmental impact, including carbon footprint and resource consumption.
Exemplary information shared in a DPP across the product lifecycle
Data Carriers for DPPs
To access the DPP data, an electronically accessible data carrier with a unique product identifier is used. This carrier must be physically present on the product, its packaging, or accompanying documentation. Common options for data carriers include:
QR codes
Barcodes
RFID tags (NFC or RAIN)
QR codes have gained popularity due to their ease of use and widespread familiarity. They can be read with a smartphone camera without requiring a specific app. The choice between NFC and RAIN RFID tags depends on factors such as read range and bulk reading capabilities.
By leveraging these data carriers, stakeholders can easily access the DPP information, enabling a better understanding of the product's composition, environmental impact, and recycling solutions throughout its lifecycle.
Benefits of Implementing Digital Product Passports
Enhanced Supply Chain Transparency
Digital Product Passports (DPPs) revolutionize supply chain transparency by providing detailed information about a product's journey throughout its lifecycle. This comprehensive digital record enables businesses to track and verify the authenticity, origin, and composition of their products. By implementing DPPs, companies gain unprecedented visibility into their supply chains, allowing them to detect and avoid counterfeit goods more effectively. This enhanced transparency protects consumers and maintains brand integrity, which is crucial as 46% of consumers desire clarity on product sourcing.
Improved Product Sustainability
DPPs play a vital role in advancing product sustainability and promoting a circular economy. By tracking the environmental impact of products, including their carbon footprint, DPPs enable consumers and businesses to make informed decisions favoring eco-friendly options. This transparency is particularly important as estimates show agriculture drives over 90% of tropical deforestation; deforestation and land use change, in turn, accounts for 11% of global carbon emissions, significantly contributing to environmental impact. DPPs also facilitate more efficient recycling processes by providing detailed information about product materials, helping recycling facilities sort and process materials more effectively. This contributes to waste reduction and promotes a circular economy, where products are designed to be reused, repaired, or recycled.
Consumer Trust and Brand Reputation
Implementing DPPs fosters consumer trust and enhances brand reputation by providing transparent and verifiable information about a product's sustainability and ethical sourcing. This transparency is crucial, as 33% of consumers have stopped purchasing from brands over sustainability concerns. DPPs enable businesses to validate their green claims, combating the issue of greenwashing, which is becoming increasingly problematic. By ensuring that raw materials and manufacturing processes adhere to pre-set standards, DPPs protect consumers from illegitimate, dangerous, and subpar products, safeguarding brands from negative PR issues such as product recalls.
Operational Optimization
DPPs contribute to operational optimization by streamlining processes, reducing waste, and enabling more efficient resource management throughout the product lifecycle. By providing a centralized platform for all product information, DPPs enhance transparency and simplify compliance with regulatory standards. This centralized approach to data management can lead to measurable gains in time-saving and human error prevention, particularly in the face of mounting regulatory requirements. Additionally, the newfound supply chain visibility offered by DPPs allows businesses to mitigate risks, cut unnecessary procurement costs, and optimize their supply chains.
Unlocking Revenue Streams in Recycling
On how organizations can effectively monetize and generate revenue from implementing a digital product passport system, the options should cover a range of potential monetization strategies, such as:
Charging fees for access to product lifecycle data and traceability
Offering subscription-based services for supply chain visibility and analytics
Generating revenue from sustainability credits or carbon offsets enabled by the digital passport
Monetizing the resale or recycling of products through the digital passport system
Leveraging the digital passport to enable new circular business models or product-as-a-service offerings
EU Regulations Driving DPP Adoption
The European Union is actively implementing regulations to drive the adoption of Digital Product Passports (DPPs) across various industries. These regulations aim to enhance sustainability, transparency, and circularity in product lifecycles.
Ecodesign for Sustainable Products Regulation
The Ecodesign for Sustainable Products Regulation (ESPR) is set to replace the current Ecodesign Directive (2009/125/EC) on July 18, 2024. This new regulation expands the scope of ecodesign criteria to a broader range of products, with the goal of making sustainable products and packaging the norm in the EU market. The ESPR introduces the concept of a digital product passport for all regulated products and packaging, providing easily accessible sustainability information to supply chain actors, regulators, and consumers.
Key aspects of the ESPR include:
Ban on destroying unsold consumer products
Disclosure requirements for unsold product disposal data
Implementation of the Right-to-Repair principle
The ESPR is expected to have a significant impact on energy savings. By 2030, it could lead to energy savings equivalent to the EU's imports of Russian gas.
EU Strategy for Sustainable Textiles
The textile industry is one of the top priorities for implementing Digital Product Passports. The EU Strategy for Sustainable and Circular Textiles addresses the production and consumption of textiles as part of the European Green Deal and Circular Economy Action Plan. This strategy is crucial, as EU textile consumption has the fourth highest impact on the environment and climate change, after food, housing, and mobility.
The DPP requirements for textiles are expected to be fully implemented by 2030. At this point, all textile products and their components manufactured in or placed on the EU market will need to comply with DPP regulations.
CASE STUDY:
Stahl Adopts Blockchain for Verified Sustainability in Textile Supply Chain
Stahl, a leading supplier of specialty chemicals for leather, synthetics, and fabric treatments, has revolutionized industry transparency. Using our technology to create digital passports for its renewable products. These digital passports contain provenance data and help track them and aid compliance and life cycle assessments. This offers the brands that use materials treated with Stahl chemicals end-to-end visibility of the manufacturing process, from raw materials to finished products.
The construction sector is a significant contributor to environmental impact, responsible for:
50% of all extracted raw materials in the EU
1/3 of fresh water usage
250 million tons of CO2 emissions annually from manufacturing alone
30% of total waste generation in the EU
The revised Construction Products Regulation (CPR) acknowledges the need for ecodesign in construction products. However, environmental groups have expressed disappointment with the lack of specific guidance, deadlines, and targets for implementation. The regulation mandates disclosure of environmental information, starting with Global Warming Potential (GWP), with other environmental impacts to be included by 2028 and 2030.
New EU Battery Regulation
The battery industry is at the forefront of DPP implementation. By February 18, 2027, a "battery passport" will be mandatory for EV batteries, LMT batteries, and rechargeable industrial batteries with a capacity greater than 2 kWh. This electronic record will contain information collected throughout the battery's lifecycle.
The battery passport will include:
General characteristics (model, manufacturer, production facility)
The EU's Deforestation-Free Products Regulation (EUDR) aims to curb deforestation by restricting the sale of certain products in the EU. Targeting commodities like cattle, cocoa, coffee, oil palm, rubber, soy, and wood, which contribute to 90% of global deforestation, the regulation takes effect on December 30, 2024 (June 30, 2025 for small businesses). To comply, products must be deforestation-free, produced according to the country of origin's laws, and accompanied by a due diligence statement. This initiative aligns with the EU's broader environmental and climate change goals, promoting deforestation-free supply chains.
These regulations collectively demonstrate the EU's commitment to promoting sustainability and transparency across various industries through the implementation of Digital Product Passports.
Mass Balance in the Circular Economy
Chain of custody refers to the documentation and tracking of the handling, movement, and location of materials as they pass through various stages of a supply chain. In the context of sustainability, it's essential to verify the origin, processing, and distribution of sustainable or certified materials.
Mass balance is a method used within the chain of custody framework to track and account for sustainable materials when they are mixed with conventional materials during processing or manufacturing. This approach allows companies to gradually increase the proportion of sustainable materials in their supply chains without the need for separate processing lines or storage facilities. This can be particularly beneficial in industries such as palm oil, cocoa, or recycled plastics, where complete segregation might be impractical.
However, to maintain credibility, companies using mass balance within their chain of custody systems must ensure:
Rigorous accounting: Accurate tracking of sustainable material inputs and outputs.
Third-party verification: Regular audits by independent bodies to confirm compliance.
Clear communication: Transparent explanation of the mass balance approach to stakeholders and consumers.
Benefits for Businesses:
Enhanced Sustainability and Market Position:some text
Improved sustainability credentials through credible claims about recycled or bio-based materials
Market differentiation appeals to environmentally conscious consumers
Increased stakeholder trust through transparent reporting
Operational Efficiency and Cost Management:some text
Cost reduction by identifying inefficiencies and waste in production
Risk management through clear visibility of material flows in supply chains
Long-term resilience against resource scarcity and price volatility
Regulatory Compliance and Innovation:some text
Robust method for demonstrating compliance with sustainability regulations
Drivers for innovation in product design and manufacturing processes
Support for developing new circular business models
Scalability and Adaptability:some text
Gradual introduction of recycled or bio-based materials without immediate, large-scale changes
Facilitation of circular practices and material recovery/reuse strategies
Meet MARCO Track & Trace
Finboot's MARCO Track & Trace is a digital traceability solution powered by blockchain. It is the first Green supply chain management suite for the world's largest capital intensive companies.
MARCO Track & Trace enables trusted shared record-keeping between stakeholders in a supply chain. It empowers businesses to easily configure and create digital product passports and to manage their ESG and sustainability data through end-to-end traceability and visibility (from raw materials to finished products).
Key Features and Capabilities
Creating a Digital Product Passport (DPP) Get ahead of regulation and be ready to easily create, configure and share Digital Product Passports with your direct clients, brand owner, and consumers. Secure a competitive advantage and grow your market share by sharing enriched supply chain data and insights with clients.
Automated Sustainability Credits Bookkeeping: Finboot enables automated bookkeeping for sustainability credits, compatible with Mass Balance and Book & Claim approaches. Ensure accurate and efficient sustainability credit management and prevent double spending.
GHG Emissions Tracking: Designed for supply chain emissions with a special focus on scope 3 emissions. This enables business to gather, verify, and share info on their greenhouse gas emissions linked to specific products. A more transparent monitoring of CO2 and equivalent emissions broken down in each part of the supply chain.
Scheme regulation: Easily create and manage certification documents for voluntary and regulatory schemes such as Sustainability Declarations for Mass Balance certifications. Streamline compliance and reduce audit costs, giving you more time to focus on your business sustainability goals.
ESG reporting also faces the risk of greenwashing, where companies exaggerate or falsely claim environmental benefits. This is where blockchain technology can play a crucial role by providing an immutable record of data transactions, thereby ensuring transparency and accountability. This data is invaluable for investors, allowing them to make more informed decisions.
Supplier and Customer Portals: Get supply chain data directly from suppliers and offer your customers an opportunity to join an expand your traceability ecosystem. Our permissioned portals foster supply chain collaboration, enhance data quality and promote more sustainable and collaborative supply chains.
Enhanced security: You'll have an immutable record of data transactions. This means no transaction can be changed or altered in any way. This provides an extra layer of reliability and trust.
Streamline processes and reduce the cost and time associated with certain operations, making businesses more productive while reducing waste in the process.
Global multilingual solution: Our solutions are used globally (4 continents and counting). Our web applications are available in 5 languages, with more available on request.
Interoperability with legacy and emerging tech: MARCO, our no-code/low-code solution, offers seamless interoperability with both legacy and emerging technologies. Our clients have integrated our solutions into their ERPs, procurement systems, and financial systems. We can also operate with other emerging technologies like IoT, RFID, and NFC.
Additionally, our partnership with Algorand’s environmentally friendly blockchain technology reduces our ecological impact, aligning with our sustainability commitments and ensuring that we meet the environmental expectations of our customers.
We can have MARCO Track and Trace operational in 8 to 12 weeks. This will prepare us for case testing and business case validation.
Implementing MARCO Track & Trace typically involves the following steps:
Contact one of our experts - Jump a call with one of our experts to discuss your situation. What low-carbon, renewable, and circular products is your business woking with. What are the biggest challenges in managing these sustainable supply chains.
Bespoke product tour - Get a bespoke product tour with our team showing you exactly how our solution can help ease supply chain management and minimize risks.
Business case and solution design - Our team will work with you to provide a detail solution design and an implementation plan for our technology. We will also help you build a business case and estimate the return on investment.
Set up and configuration - Start working on your own digital traceability ecosystem. Our implementation and delivery team will work with you to configure and document your entire solution.
Onboarding and scale - Once the configuration is approved we will start onboarding and training users. Get you traceability ecosystem ready to scale in under 8 weeks.
Conclusion
Digital Product Passports are revolutionizing the way businesses approach sustainability and transparency. By providing a comprehensive digital record of a product's journey, these passports have a significant impact on supply chain management, environmental sustainability, and consumer trust. The EU's regulatory push, particularly in sectors like batteries, textiles, and construction, is driving widespread adoption of DPPs, creating a ripple effect across industries and stakeholders.
The benefits of implementing Digital Product Passports are far-reaching, from boosting supply chain transparency to improving product sustainability and enhancing brand reputation. As businesses navigate this new landscape, it's crucial to consider the opportunities DPPs offer for fostering a circular economy and meeting ESG goals.
I recently wrote an article about LEGO, where I cover my passion for the classic bricks toy and how much I enjoyed them growing up. A passion that years later I extended to my oldest nephew. However,as my concern about plastic waste increased, my younger niece and nephews started getting more wooden toys.
Now, the reason I wrote about LEGO, might make for another turn of mindset for me: the toy giant announced that it will increasingly and rapidly move toward certified recycled resin as raw material in their products, aiming to have 30% of their resin purchases certified in 2024 (50% by 2026 and 100% by 2032).
The “certified” part of this exciting news it’s the key. In order to substantiate their claim of recycled plastics, LEGO will be implementing a chain of custody approach through the Mass Balance model in their supply chain. This initiative demonstrates how a robust chain of custody can support sustainability goals within complex value chains. But, what exactly is a chain of custody and how is it that they can prove the use circular or renewable nature of a LEGO brick? That’s what I’ll be aiming to cover in this piece.
WHAT IS THE CHAIN OF CUSTODY AND WHICH IS ITS ROLE IN MAINTAINING TRUST AND TRANSPARENCY IN MANUFACTURING?
Chain of Custodyrefers to the systematic documentation and verification of the custody, control and transfer of materials, products or data throughout a supply chain. It ensures traceability, integrity, and authenticity by meticulously recording each step from origin to final destination.
Chain of Custody plays a vital role in maintaining transparency, demonstrating compliance with legal and regulatory standards, and supporting ethical and sustainable practices.
It's no secret that in the global business environment, tracking the chain of custody is complex due to the number of trading partners and multi-party transactions involved in moving raw materials, components and final products. However, modern digital supply chains, which use a single chain of custody model, are simplifying the process and minimizing the risk of tampering, contamination or loss.
The benefits of implementing a robust chain of custody system are numerous:
Increased credibility and trust: By demonstrating a commitment to maintaining an unbroken chain of custody, businesses can enhance their credibility and foster trust among stakeholders, customers and regulatory bodies.
Regulatory compliance: Adhering to industry-specific regulations like the EUDR and the EU Battery Regulation can help businesses avoid costly fines, legal liabilities and reputational damage; the EU won’t ignore non-compliance.
Quality assurance: It ensures the integrity and quality of products, services and data, enabling businesses to deliver consistent and reliable offerings. Setting the example, the Ecodesign for Sustainable Products Regulation states that a data carrier must be physically present on the majority of products, on their packaging or accompanying documentation. The data inside needs to be accurate, complete and up to date (validated with a Digital Product Passport).
Improved efficiency and accountability: Clear documentation streamline processes and reduce errors.
Competitive advantage: Something that I’m always repeating is that implementing robust systems can differentiate your business from competitors and provide a competitive edge.
MODELS OF CHAIN OF CUSTODY
a. Identity preservation
The identity preservation model is a traceability system that ensures certified products maintain their unique identity from the production site to the final point of transformation or labeling. By keeping certified materials separate from others and rigorously documenting every step, this approach preserves the integrity and distinctive qualities of products, such as those in organic agriculture, ensuring they remain authentic and verifiable throughout their entire journey.
b. Segregation
The segregation model ensures that certified products are kept separate from non-certified ones throughout the supply chain, allowing products to be mixed only if they come from certified sources adhering to the same standards. This approach maintains the integrity of certified materials while allowing blending from multiple certified sources, with strict documentation to verify their origins. Commonly used in industries like pharmaceuticals and food, this model helps prevent cross-contamination.
c. Mass balance
The mass balance model is a practical approach for industries where it’s difficult or too expensive to keep certified and non-certified materials completely separate. Unlike models that require strict separation, mass balance focuses on accurately tracking the flow of materials through volume reconciliation.
That means that certified and non-certified products can be physically mixed at any stage of the supply chain, but the quantities are carefully controlled to ensure that the volume of certified input matches the volume sold as certified output. This ensures that sustainability claims are supported by robust data, even if the certified content is not physically isolated.
Mass balance operates on different levels:
Batch-level, where segregation is maintained until the point of blending
Site-level, where mixing can occur during processing
Group-level, where certified content is tracked across multiple sites
The degree of physical mixing and the point in the supply chain where segregation is lost can vary, affecting the level of certainty about the presence of certified content in the final product. However, the model’s focus on balancing input and output volumes ensures that certified claims are still reliable and transparent. This approach is especially valuable in industries like forestry, biofuels and recycling, where maintaining physical separation can be logistically challenging.
d. Book & claim
The book & claim model separates certified products from their sustainability claims, allowing certified and non-certified materials to flow freely through the supply chain. Sustainability certificates or credits are issued by an independent body at the start of the supply chain and can be bought and sold via trading platforms.
This model is used when directly sourcing certified products is difficult, as it allows companies to meet sustainability targets without physical traceability, although the end product contains no certified content or controlled equivalent under a chain of custody system.
Each chain of custody model has its own set of pros and cons. Traceability within the chain of custody is essential for advancing toward a more sustainable value chain. When selecting a model, you must consider the sustainability standards, certification types and the specific requirements that you need for your products.
Chain of Custody's types
CHAIN OF CUSTODY IN ACTION
As globalization advances, emerging technologies—such as blockchain and AI—are poised to enhance and streamline chain of custody systems. Blockchain, in particular, offers a powerful solution for improving the transparency and security of chain of custody records, something really important in today's business landscape.
Our digital platform, MARCO Track & Trace, leverages multiple chain of custody models to provide our clients with a comprehensive solution for tracking and verifying the flow of products throughout the supply chain. We’ve worked with Segregated, Mass Balanced and Book & Claim processes across many of our customers in capital intensive industries. Some of our case studies include:
Cepsa Case: MARCO Track & Trace enables Cepsa to implement a digital traceability system for tracking each batch of vegetable oil from its origin to its biodegradable production. The platform also automates bookkeeping and accurately determines the percentage of output derived from renewable and circular inputs.
SABIC Case: As a chemicals industry leader, SABIC has become the first in its sector to achieve batch-level traceability from waste to packaging for its TRUCIRCLE products using MARCO Track & Trace; it supports end-to-end digital traceability of circular feedstock in customer products.
Repsol Case: A client since 2018, Repsol extensively utilizes our digital traceability solutions across multiple business areas. One of those businesses includes the use of our digital ecosystems to trace low-carbon fuels such as HVO (Hydrotreated Vegetable Oil), as well as circular chemical products such as packaging.
By implementing MARCO's chain of custody system, our clients can:
Gain real-time visibility into the flow of materials or products
Verify the authenticity and sustainability credentials of the materials or products they source, process or distribute.
Comply with regulations related to traceability and sustainability.
Enhance their brand reputation and consumer trust by demonstrating a commitment to ESG claims
At Finboot, we are dedicated to empowering businesses to foster trust, transparency and accountability.
Our goal is to help companies like LEGO to substantiate their ESG and sustainability credentials with evidence-backed data; ensuring that their targets are followed through and leveraging digital technologies to monetize their sustainability transformations. The mass balance model together with other chain of custody approaches are a core part of our offering. We need to enable scalable and auditable record-keeping for our customers to accelerate production of circular, low carbon and renewable products.
If you want to learn more about how to implement mass balance in your manufacturing processes, contact us and our team will reach out to you!
Cardiff, 18 September, 2024: Finboot, a technology company that provides green supply chain management for the world's largest capital-intensive companies, today announces Finboot's solution, MARCO Track & Trace, is now available on Google Cloud’s Marketplace in two pivotal categories: ¨Climate¨ and ¨Web3¨, further solidifying its position as an industry innovator and marking a significant milestone in the company's Partner Program growth strategy.
Finboot technology enables companies to incorporate blockchain within their value and supply chains, enhancing traceability, transparency, and compliance, which, in turn, helps them meet sustainability and ESG requirements while also increasing operational efficiency.
Market Recognition and Strategic Partnerships
Finboot's inclusion in Google Cloud Marketplace underscores its growing influence in the blockchain technology sector. The company's platform has garnered attention from industry analysts, with seven mentions in Gartner reports to date, including two this year alone. These latest mentions highlight Finboot's impact in the Web3 and authenticated provenance categories, as well as its medium-to-high impact on business operations.
The availability of Finboot’s flagship platform, MARCO Track & Trace, on Google Cloud Marketplace has far-reaching implications for Finboot's market presence and offers unprecedented opportunities for both sales and partnerships. This platform serves as a global stage for Finboot's innovative blockchain solutions, particularly in the realms of Web 3 and Climate Action.
Earlier this year, in a move to enhance its sustainability offerings, Finboot partnered with the Algorand Foundation. This collaboration integrates Algorand's sustainable blockchain technology into the core of Finboot's solutions, reinforcing the company's commitment to environmentally responsible practices.
"Our feature on Google Cloud Marketplace and collaboration with Algorand Foundation represent significant steps forward in our mission to provide cutting-edge, sustainable blockchain-powered supply chain solutions," said Carles García, Partnerships Lead at Finboot. "These developments, coupled with our consistent recognition by Gartner, validate our position as a trusted leader in the industry."
"As companies increasingly seek innovative solutions to meet their digital transformation and ESG goals, MARCO Track & Trace visibility on Google Marketplace in both Web3 and Climate categories places Finboot at the forefront of providing these critical solutions to our enterprise clients" said Alvaro Llobet, Head of Product at Finboot.
Finboot recently participated in the prestigious annual Decipher event, hosted by Algorand for its key partners. At this high-profile gathering, Finboot had the opportunity to present its cutting-edge solution, MARCO Track & Trace, to an audience of industry leaders and innovators. This interview, highlighting the synergy between Finboot's technology and Algorand's sustainable blockchain, has now been released across both companies' communication channels:
Empowering Sustainability in Hard-to-Decarbonize Industries
Finboot continues to make strides in assisting capital-intensive and hard-to-decarbonize industries in their net-zero journey. The company's impressive client roster includes industry giants such as SABIC, REPSOL, CEPSA, and others. By leveraging Finboot's digital traceability blockchain-based technology, these organizations can provide tangible evidence of their sustainability efforts, enhancing transparency and accountability in their operations.
About Finboot
Finboot is a leading provider of blockchain technology solutions, specializing in enhancing transparency, traceability, and efficiency across various industries. With a focus on sustainability and innovation, Finboot empowers organizations to achieve net-zero goals while optimizing their operations through cutting-edge blockchain applications.
For more information about Finboot's Partner Program or to explore collaboration opportunities, please visit www.finboot.com or contact info@finboot.com.
The products we use every day have a profound impact on the environment. In the European Union (EU), consumer habits are a major contributor to climate change and pollution.
Here’s another interesting way to look at it: how many Earths does a country need to meet its residents’ demand on nature? For example, we would need 2.8 Earths to meet Spain’s demands, 2.9 to meet Portugal’s and 3.0 to meet Germany’s.
Lately, we are seeing more regulations aimed at increasing sustainability, such as the EUDR, which regulates deforestation-free products; the CSRD, which requires companies to report on sustainability; and the CBAM, which introduces a carbon border adjustment mechanism to prevent carbon leakage.
The ESPR replaces the Ecodesign Directive 2009/125/EC and establishes a framework for setting ecodesign requirements across most product categories: it aims to enhance product durability, reusability, upgradability, and reparability; boost energy and resource efficiency; address substances hindering circularity; increase recycled content; and simplify remanufacturing and recycling. Additionally, it sets rules on carbon and environmental footprints and improves access to sustainability information.
Ecodesign Regulation Requirements
Moreover, it aims to protect our planet, promote sustainable business practices, and bolster the competitiveness and resilience of the EU economy.
In case of non-compliance with the regulation, the Member State concerned shall implement all necessary measures to restrict or prohibit the product being made available on the market, or ensure it is recalled or removed from sale.
ESPR’SSCOPE
This Regulation applies to all physical goods placed on the market or put into service, including components and intermediate products. However, it excludes:
Food items, specifically beverages, chewing gum and any substance (including water) intentionally added to food during its manufacture, preparation, or treatment.
Animal feed
Medicinal products
Veterinary medicinal products
Products of human origin
Products of plant and animal origin related directly to their future reproduction
Vehicles, specifically: agricultural & forestry vehicles; two- or three-wheel vehicles & quadricycles intended for public road use; and motor vehicles in categories M and N, their trailers in category O, intended for public road use.
Sustainable Products
For a product to be sustainable, it must have one or more of these traits: use less energy, last longer, be easily repaired, have parts that are easily disassembled and repurposed, contain fewer harmful substances, be easily recycled, include more recycled content and have a lower carbon & environmental footprint over its lifecycle.
Sustainable Products
The regulation also introduces innovative measures such as a digital product passport, mandatory green public procurement requirements, and a framework to prevent the destruction of unsold consumer products.
Digital Product Passport (DPP)
By July 19, 2026, the Commission will establish a secure digital registry to store (at least) the unique identifiers. Additionally, the Commission will create and manage a publicly accessible web portal that allows stakeholders to search for and compare data within digital product passports.
The information requirements of the digital product passport shall ensure that products can only be placed on the market or made available for use if a DPP is provided. The data contained within the digital product passport must be accurate, complete and up to date. It must link to a persistent, unique product identifier via a data carrier —The data carrier must be physically present on the product, its packaging or accompanying documentation.
Additionally, the economic operator marketing the product must provide dealers and online marketplaces with a digital copy of the data carrier or unique product identifier, ensuring potential customers can access it.
Green Public Procurement
The Green Public Procurement policy focuses on how contracting authorities and entities buy products and services: they must award public contracts in line with Directive 2014/24/EU or Directive 2014/25/EU, ensuring that these contracts meet the minimum requirements for purchasing products covered by the ESPR, as well as works or services that use these products.
These minimum requirements (that will be set by the Commission) are designed to encourage the supply and demand of environmentally sustainable products, considering the value and volume of public contracts and the economic feasibility of acquiring such products without disproportionate costs.
Destruction of unsold consumer products
Economic operators are required to take all reasonable measures to prevent the destruction of unsold consumer products. Those who discard unsold consumer products, either directly or through a third party, must disclose specific information. This includes:
The number and weight of discarded products per year, categorized by type or product category.
The reasons for discarding products, along with any applicable exemptions, include health, hygiene, and safety concerns; irreparable damage caused during handling or detected after return; unfitness of products for their intended purpose in accordance with relevant Union and national laws and technical standards; non-acceptance of products offered for donation; unsuitability for reuse or remanufacturing; unsaleability due to intellectual property rights violations; and instances where destruction presents the option with the least negative environmental impact.
The proportion of discarded products that are sent for reuse, refurbishment, remanufacturing, recycling or other recovery methods —in alignment with the waste hierarchy outlined in Directive 2008/98/EC: (a) prevention, (b) preparing for reuse, (c) recycling, (d) other recovery, e.g. energy recovery, (e) disposal.
The measures taken and those planned to prevent the destruction of unsold products.
Fortunately, recycling is becoming increasingly popular, and major companies are adding dedicated sections on their websites to promote it — which also translates into profits. Examples include fashion retailers like H&M, where customers can hand in unwanted clothing or textiles in exchange for a digital coupon for future purchases; tech companies like Apple, which offers discounts on new devices when you trade in your current one; and Back Market, a marketplace entirely focused on refurbished technology. Online platforms like Vinted and Wallapop also give a second life to clothing and other items, fostering sustainable consumption.
Starting from 19 July 2026, the destruction of some unsold consumer products shall be prohibited, except for micro and small enterprises. For medium-sized enterprises, this prohibition will take effect from 19 July 2030.
ESPR’SMEASURES
ESPR’STIMELINE
Here's a brief timeline outlining the key milestones for the Ecodesign for Sustainable Products Regulation (ESPR):
11 March 2020: The New Circular Economy Action Plan was adopted.
18 July 2024: ESPR came into force.
Q2 2025: The first ESPR working plan will be adopted and published.
19 July 2026: The regulation will start applying, prohibiting large companies from destroying certain unsold products, and creating a digital registry for unique identifiers.
19 July 2030: The prohibition on destroying certain unsold products will extend to medium-sized companies.
ESPR’STIMELINE
EMBRACING FINBOOT TECHNOLOGY FOR COMPLIANCE
Digital traceability, enabled by the DPP, is transforming supply chain transparency. It provides a comprehensive digital record of a product's lifecycle—from raw material sourcing to end-of-life disposal—, ensuring the authenticity of recycled or sustainably sourced products. This enhanced transparency supports better tracking of materials and compliance with circular economy principles.
Our collaboration with forward-thinking clients highlights the benefits of integrating the DPP. For example, our work with Cepsa on Digital Product Passports for Homecare Products demonstrates how our MARCO Track & Trace system has revolutionized their operations. By implementing digital traceability, Cepsa can track each batch of vegetable oil from its origin to its use in biodegradable surfactant production, automate bookkeeping and accurately determine the percentage of output from renewable and circular inputs.
In the following interview between my colleague Noslen Suarez and Juan Miguel Perez, CEO and Co-founder of Finboot, she explains in detail the Cepsa use case:
Adopting the DPP is not only an environmental imperative but also a strategic business advantage. Companies that integrate this technology are better positioned to enhance sustainability practices, improve operational efficiency, and achieve regulatory compliance, all while gaining a competitive edge in the market.
If you want to learn more about how to monetize the circular economy, download our free ebook “Monetizing the Circular Economy: Unlocking Revenue Streams with Digital Product Passports”:
The circular economy represents a paradigm shift in how we produce, consume, and manage resources. It offers a promising path to address the pressing environmental challenges we face, including climate change and resource depletion. With mounting pressure on companies to adopt sustainable practices and the advent of new technologies, the transition to a circular economy is not just necessary but increasingly feasible. As we move forward, embracing circular principles will be crucial to our collective effort to create a more sustainable and resilient global economy.
Digital traceability can enhance supply chain transparency, allowing for better tracking of materials and ensuring the authenticity of recycled or sustainably sourced products. This innovative approach to product lifecycle management offers a comprehensive digital record of a product's journey, from raw material sourcing to end-of-life disposal, creating a digital product passport (DPP) to drive sustainability and transparency across supply chains.
This ebook delves into the concept of DPP, examines the regulatory landscape driving its adoption, and highlights the benefits for businesses in terms of achieving ESG goals and fostering a circular economy.
Additionally, we will present MARCO Track & Trace, Finboot’s innovative traceability solution to automate ESG and sustainability credit record-keeping, create digital product passports, and manage sustainability declarations and certifications.
Monetizing the Circular Economy
The circular economy represents a paradigm shift in how we approach production, consumption, and resource management. This innovative economic model is designed to revolutionize our traditional linear "take-make-dispose" approach by eliminating waste and maximizing resource efficiency throughout the entire product lifecycle.
At its core, the circular economy is built on three fundamental principles:
Designing out waste and pollution from the outset
Keeping products and materials in use for as long as possible
Regenerating natural systems to ensure long-term sustainability
According to various reports, projections indicate substantial growth opportunities across various sectors within the circular economy. As consumers become more environmentally conscious and regulations tighten around waste and emissions, businesses that embrace circular and low-carbon models are likely to see increased demand and potential for profitability.
Recent McKinsey research proved that consumers care about sustainability, and they back it up with their wallets. Products that make ESG claims have disproportionate growth.
On average, across 32 different categories, consumer products with ESG claims have 1.7% higher growth than products with no claims. Some categories, like paper and plastics, have seen as much as 20% higher growth.
Global Market Size: The Ellen MacArthur Foundation estimates that the circular economy could unlock more than half a trillion euros in economic benefits annually by 2035.
Electronics: By 2030, 80% of hardware vendors’ product portfolio will be linked to circular initiatives, up from 20% in 2023, according to Gartner. In fact, re-manufacturing and reusing end-of-life devices instead of having them end up in a landfill has become top of mind for most businesses around the world.
Recycled Plastics Market: The global recycled plastics market is projected to reach $72.6 billion by 2026, growing at a CAGR of 8.5% from 2021 to 2026 (MarketsandMarkets).
Circular Fashion: The secondhand clothing market is expected to reach $64 billion by 2024, growing 39% annually (ThredUp).
Renewable Energy: The global renewable energy market is projected to reach $1,977.6 billion by 2030, growing at a CAGR of 8.4% from 2021 to 2030 (Allied Market Research).
Electric Vehicles: The global electric vehicle market is expected to reach $802.81 billion by 2027, growing at a CAGR of 22.6% from 2020 to 2027 (Allied Market Research).
Sustainable Packaging: The global sustainable packaging market size was valued at USD 244.30 billion in 2022. It is projected to reach USD 476.28 billion by 2031, growing at a CAGR of 7.70% during the forecast period (2023-2031).
Embracing sustainability isn't just about boosting revenue; it's about cultivating a diverse array of enduring economic advantages by transforming eco-friendly initiatives into profitable enterprises. While initial investments may be necessary, they hold significant potential for long-term gains. This is particularly true because circular practices significantly reduce expenses related to raw materials, energy consumption, and waste management.
Being a first mover will put you in a strong position as we explore new revenue streams and business opportunities that can only be unlocked through digital traceability and green supply chain management.
Consider techniques such as solvent recovery, material recycling, and waste repurposing. These methods aren't merely environmentally responsible; they're financially astute. They lead to considerable cost savings, increased revenues, and enhanced profitability.
In the circular economy, companies have several strategic positioning options within the value chain:
Circular Design and Materials: Utilize bio-based or other sustainable materials in product design to minimize environmental impact throughout the product lifecycle.
Comprehensive Product Stewardship: Adopt models like "product as a service" to maintain control over materials and ensure their return to the production loop. For example, ¨polymer as a service¨ in the chemical industry.
Resource Sharing and Recovery: Implement innovative approaches such as shared platforms and technologies to maximize resource efficiency.
Value Chain Coordination: Orchestrate local or regional loops to optimize material flow and resource utilization.
By adopting these circular economy principles, businesses can simultaneously drive profitability and environmental sustainability, creating a win-win scenario for both their bottom line and the planet.
Understanding the Value of the Green Premium
As businesses transition towards a circular economy, it's crucial to reassess and reimagine your value chain, particularly regarding the reuse of waste products. The journey begins with a deep dive into your target circular value chain.
Identifying potential partners along this chain is essential, but equally important is adopting your customers' viewpoint. Scrutinizing their purchasing processes is a critical step in successfully monetizing the green premium. Gone are the days when a product-centric, feature-focused portfolio sufficed.
To effectively sell the green premium, two key factors come into play: product quantification and customer qualification. Quantifying the product requires a shift from traditional cost-based pricing to a value-based approach, addressing the crucial question: "What are customers willing to pay for sustainability?"
Deloitte outlines four interconnected elements crucial for monetizing the circular economy's green premium. These elements reach their full potential only when integrated into a comprehensive Monetizing Circular Economy Framework:
Monetizing CE Framework
Customer insights and engagement form the backbone of this framework, influencing every aspect from product development to commercialization. By understanding customer perspectives, needs, and preferences, businesses can align their offerings with sustainability-driven demands.
Checklist for Monetizing the Circular Economy:
Identify your position in the circular value chain
Adopt a circular mindset
Foster collaboration and understand customer needs throughout the value chain
Engage customers and partners early in the process
Continuously challenge and refine business models
Develop a suitable monetization strategy
Craft a compelling narrative
By following this approach, businesses can effectively navigate the transition to a circular economy while capitalizing on the green premium, creating value for both the company and its environmentally conscious customers.
Examples show companies can establish and monetize the circular economy
In our experience working with forward-thinking clients, we've observed the tangible benefits of adopting cutting-edge technologies to support circular economy initiatives. Two key tools have emerged as game-changers in this space:
Digital Product Passports: These provide a comprehensive digital record of a product's journey, from raw materials to end-of-life, enhancing transparency and traceability.
Mass Balance Approaches: These enable companies to track and allocate recycled or bio-based content in complex production processes, supporting credible sustainability claims.
Our clients are already reaping the rewards of implementing these technologies. They're not only enhancing their sustainability practices but also gaining competitive advantages in terms of operational efficiency, regulatory compliance, and market differentiation.
Business Opportunities:
Recycled Products:
The Cepsa Case: Digital Product Passports for Homecare Products
Finboot’s MARCO Track & Trace has allowed Cepsa to implement digital traceability systems for tracking each batch of vegetable oil from its origin to its use in biodegradable surfactant production, in addition to automating bookkeeping and determining what percentage of output is from renewable and circular inputs.
The SABIC Case: Blockchain to Deliver Sustainable Packaging
SABIC, the global leader in the chemicals industry, becomes the first in their industry to unlock batch-level traceability from waste to packaging for their TRUCIRCLE products through MARCO Track and Trace.
The project, with advanced recycling pioneer Plastic Energy and packaging specialist Intraplás, uses the Finboot application to support end-to-end digital traceability of circular feedstock in customer products.
The Repsol Case: Full Traceability of net-zero emissions fuels (HVO)
Repsol has been a client since 2018 and uses our digital traceability solutions extensively across several business areas. They use our digital ecosystems for the traceability of low-carbon fuels like HVO (Hydrotreated Vegetable Oil), and circular chemical products like packaging.
The transition to a circular economy is not just an environmental imperative; it's becoming a business necessity. As we move forward, the companies that will thrive are those that embrace these principles and leverage innovative technologies to create value while contributing to a more sustainable future.
2024 – the year in which Earth’s temperatures ranked the warmest in the past 175 years, breaking world records like our Gold Medalists at the Paris Olympics. Temperatures were recorded at 1.29°C (2.32°F) above the 1901-2000 average of 13.5°C (56.2°F). There is a 59% chance, according to NCEI's statistical analysis, that 2024 will rank as the warmest year on record and a 100% chance that it will rank in the top five.
Climate change is not something that is about to happen to our future generations. It is happening right here right now. Scientists concur that GreenHouse Gases (GHGs) such as carbon dioxide (CO2) are warming our planet at alarming rates. They also concur that it is possible to achieve Net-Zero, as pledged by 196 global nations, by swiftly transforming the way we produce and consume energy.
While governments, industry and academia are trying to keep on track with their climate pledges through emissions tracking, standards, legislature and disclosures, clean energy solutions, supply chain decarbonization, and carbon offsetting, simple natural climate solutions like reforestation could yet be the holy grail to move the needle on climate change.
Source: Bronson W. Griscom et al. PNAS 2017; 114:11645-11650
Trees remain the most efficient, cost-effective, accessible, and actionable solution for carbon removal & sequestering. So how do trees combat climate change?
Trees absorb carbon dioxide from the air and store it in their roots, trunks and leaves, converting about 50% of their weight into carbon and releasing oxygen into the atmosphere. Trees effectively trap carbon, reducing the amount of CO2 in the atmosphere. To summarize various research studies, it can be concluded that annual CO2 offsetting ranges from 21.77 kg CO2/tree to 31.5 kg CO2/tree. This means that one CO2 ton can be absorbed by 31 to 46 trees. But only when they remain planted!
When trees are cut down, burned or deforested, this stored carbon is released back into the atmosphere as carbon dioxide, which contributes to climate change. It is, therefore, no surprise that there is a proliferation of tree planting and forest restoration initiatives including the UN Decade on Ecosystem Restoration, the World Economic Forum’s Trillion Trees Platform1t.org, the Time for Trees initiative and others. Most recently, the European Union (EU), which has led the global climate action on Net-Zero, has introduced the European Deforestation Regulation (EUDR), aimed at curbing EU’s impact on global deforestation, forest degradation, GHG emissions, biodiversity and human rights protection, coming into force on 30th December 2024.
The EUDR encompasses full supply chain traceability and due diligence reporting on sourcing timber, palm oil, soy, cocoa, coffee, cattle, and rubber – which cause 90% of the world’s deforestation - not only to the commodities, but also to the derived products, affecting the entire downstream supply chain. It will impact not only the operators in the EU but also the suppliers exporting them into the EU market, companies transforming the commodities into products, and traders buying and reselling them. To learn more, prepare and comply with EUDR, download Finboot’s EUDR Playbook.
While companies operating in and selling to the EU are racing to adding traceability systems and processes to stay compliant and avoid penalties by December 2024; for the Corporate Sustainability Digiterati, planting trees and saving forests can become a competitive advantage for their businesses and customers they serve.
A case in point is The Green Button Project launched by MIT’s Center for Transportation and Logistics (MIT CTL) in 2019 which highlights that consumers are motivated to save trees and will prefer corporate practices that exhibit responsible behavior. The era of eCommerce and online shopping has increased consumer expectations from 5 days to 2 days to even same-day fulfillment. But fast shipping makes last-mile delivery environmentally costly. Dr Josue Velazquez Martinez, research scientist at MIT CTL and Director of MIT Sustainable Supply Chain Lab (I was fortunate to have taken his class), led an interesting research project in 2019. He ran a month-long simulation with 3 test groups of consumers to find out if they would wait a few days to receive their product (Willingness To Wait) if they were educated about the impact to climate change. The groups received information about environmental impact in terms of CO2, energy consumed, and trees saved respectively. The results were surprising.
“Explaining the impact in terms of trees led to almost 90 percent of consumers willing to wait another day or two, compared to less than 40 percent for the group that received the data in kilograms of CO2.” Dr Velazquez Martinez says that providing an option that says ‘same-day delivery is equivalent to killing 300 trees’ compared with one that says ‘if you wait three to four days, then it’s equivalent to killing 10 trees, and by the way we are going to plant 15,’ can really drive consumer behavior.
It is true governments and businesses have the biggest responsibility in the transition to net-zero emissions by mid-century. But as consumers, we wield unfettered power and accountability. As Mahatma Gandhi once said, we can be the change we want to see in the world. Given a single tree offsets about 20 kg (44 pounds) of carbon dioxide each year, individuals in the US emitting 17 tons of emissions each year will need to plant about 16 trees every year, to successfully offset their carbon footprint. So go hug trees and celebrate them. In noted author, Richard Mabey’s uncanny words: To be without trees would, in the most literal way, mean to be without our roots. And our roots are planet Earth.
Europe aims to become the world's first carbon-neutral continent. To realize this vision and channel investments into sustainable projects, the European Union (EU) has introduced the EU Taxonomy Regulation. This innovative legislation introduces a standardized system for identifying what counts as environmentally sustainable economic activities, giving investors, businesses and policymakers a clear guide to the complex field of sustainable finance.
As a key component of the European green deal, the regulation is crucial for directing investments towards projects that genuinely support environmental goals. By providing a standardized definition of which economic activities can be considered environmentally sustainable, the EU Taxonomy facilitates a shared understanding among both financial and non-financial entities. In this way, it plays an important role in:
Scale up sustainable investments across the EU
Provide security for investors and protect them from greenwashing
Support companies in becoming more climate-friendly
Mitigate market fragmentation
According to the Taxonomy Regulation, there are 4 overarching conditions that an economic activity has to meet in order to qualify as environmentally sustainable (Taxonomy-aligned”):
Making a substantial contribution to at least one of the environmental objectives:some text
Climate change mitigation
Climate change adaptation
The sustainable use and protection of water and marine resources
The transition to a circular economy
Pollution prevention and control
The protection and restoration of biodiversity and ecosystems
Doing no significant harm to any of the other five environmental objectives
Complying with minimum safeguards
Complying with the technical screening criteria
Scope
Only companies subject to the Corporate Sustainability Reporting Directive (CSRD) are required to comply with the Taxonomy Regulation by disclosing in their annual reports how their activities align with the Taxonomy (Taxonomy-eligibility) and meet the criteria set out in the Taxonomy delegated acts (Taxonomy-alignment). Companies not covered by the CSRD can choose to disclose this information voluntarily to access sustainable financing or for other business-related reasons.
In April 2021, the European Commission adopted the EU Taxonomy Climate Delegated Act to establish the criteria for economic activities crucial for achieving climate neutrality. The act identified over 80 activities across various sectors, including forestry, environmental protection and restoration, manufacturing, energy water supply, sewerage and others. Additionally, for adaptation-related activities, it covers financial and insurance activities, education, human health, social work activities, arts, entertainment and recreation.
Later, in March 2022, the Commission introduced the Complementary Climate Delegated Act, specifying criteria for the gas and nuclear energy sectors.
The regulation also interacts with the EU Sustainable Finance Disclosure Regulation (SFRD): According to Articles 5 and 6 of the Taxonomy, all financial products that fall under Articles 8 (products promoting environmental or social characteristics, provided the invested companies adhere to good governance practices) and 9 (products aiming for sustainable investment) of the SFDR must reveal the extent to which their underlying investments align with the Taxonomy. Specifically, financial products disclosed under Article 8 of the SFDR have sustainable investment as their primary goal.
The EU Taxonomy Compass provides the latest list of Taxonomy-aligned economic activities, though activities not listed do not necessarily imply unsustainability; it may indicate that criteria are still under development.
Timeline
The reporting obligations and timelines for undertakings are set out in the Disclosures Delegated Act, which supplements Article 8 of the Taxonomy Regulation. Here is a timeline overview:
12 July 2020: The EU Taxonomy Regulation entered into force.
1 January 2022 - 31 December 2022: Non-financial entities disclosed the proportion of Taxonomy eligible and non-eligible economic activities in their total turnover, capital, and operational expenditure, along with the qualitative information as in Annex I.
1 January 2022 - 31 December 2023:some text
Financial entities disclosed the proportion in their total assets of exposures to Taxonomy eligible and non-eligible economic activities, the proportion in their total assets of the exposures referred to in Article 7 and the qualitative information referred to in Annex XI.
Credit institutions disclosed the proportion of their trading portfolio and on-demand inter-bank loans in their total assets.
Insurance and reinsurance undertakings disclosed the proportion of Taxonomy-eligible and Taxonomy non-eligible non-life insurance economic activities.
1 January 2023: Non-financial entities began disclosing their key performance indicators, including any accompanying information as specified in Annexes I and II.
1 January 2024: Financial entities must now disclose their key performance indicators, including any accompanying information as specified in Annexes III, V, VII, IX, and XI.
1 January 2026: Sections 1.2.3 and 1.2.4 of Annex V will come into effect.
Embracing Finboot technology for compliance
Navigating the EU Taxonomy Regulation can be complex, but it's crucial for businesses and financial institutions. To ensure compliance and maximize benefits we recommend you to:
Engage experts and stakeholders to ensure compliance and effective implementation.
Develop a comprehensive sustainability strategy that encompasses ESG considerations.
Invest in robust data management systems to collect, analyze, and disclose the necessary information required, because leveraging technology and automation can streamline these processes.
Embrace transparency and accountability to build trust, enhance reputation and support long-term sustainability objectives.
Don't let the complexities of EU Taxonomy Regulation slow you down. Finboot's cutting-edge blockchain solutions can streamline your compliance process, enhance data management, and boost transparency. Some of the features that MARCO Track & Trace offers to align with the regulation requirements are automated ESG and sustainability credits record-keeping, Digital Product Passports creation and management and GHG emission tracking.
On Wednesday, August 1, we officially exhausted all of Earth's resources allocated for the year, with five months still remaining. Humanity's consumption rate is 1.7 times faster than the Earth's ability to regenerate its resources, which means that we are using the resources of 1.7 planets. Therefore, sustainability is no longer a choice but a necessity, making the Corporate Sustainability Reporting Directive (CSRD)crucial for businesses aiming to thrive.
The CSRD is a groundbreaking initiative by the European Union (EU) and part of the European Green Deal, designed to enhance transparency and accountability in corporate sustainability reporting.
The new rule will ensure that investors and other stakeholders have access to the information they need to assess the impact of companies on people and the environment. For instance, investors should assess the financial risks and opportunities arising from climate change and other sustainability issues.
Also, reporting costs will be reduced for companies over the medium to long term by harmonising the information to be provided.
Scope
The CSRD impacts various types of businesses based on their size and listing status. Initially, it affects large firms that were already subjected to the Non-Financial Reporting Directive (NFRD). It will then extend to other large firms, and eventually to listed SMEs.
Double Materiality: Annual management reports should cover both financial and non-financial (sustainability/ESG) data.
Digital Format: Information must be presented in a standard digital format (ESEF/XBRL) to ensure machine readability.
Regulatory Alignment: The reporting must align with the EU Taxonomy Regulation, establishing a digital taxonomy for the data.
Independent Assurance: Reports require mandatory verification by an independent third party. This assurance must be provided by a qualified individual or firm authorized under either the national laws of the third country or an EU Member State.
What is the double materiality?
Double materiality is a crucial concept in the CSRD that guides companies on what sustainability information to include in their reports. This approach ensures comprehensive and effective reporting by considering both sides of sustainability impacts. It involves two main perspectives:
Financial Materiality: How sustainability issues affect a company’s financial performance. This means evaluating how factors like climate change or social issues could impact the company’s profits and overall financial health.
Impact Materiality: How the company’s actions affect the environment and society. This includes assessing the company’s carbon footprint, resource usage, and social impacts, including those throughout its value chain.
Double Materiality
Understanding what data is important involves evaluating both how sustainability matters impact the business and how the business impacts people and the planet. This approach ensures that all relevant factors are considered, from supplier locations to the risks associated with specific commodities.
CSRD timeline
The CSRD is a well-planned and strategically executed initiative. To facilitate a smooth transition and give businesses sufficient time to adapt, the EU has established a clear timeline for its implementation. Here's a brief overview:
April 21, 2021: Adoption of the CSRD.
December 2022: European Commission approves the European Sustainability Reporting Standards (ESRS) and gives the member states 18 months to incorporate the CSRD into national legislation.
January 1, 2024: CSRD applies to large firms already subject to the Non-Financial Reporting Directive (NFRD).
January 1, 2025: CSRD applies to other large firms.
January 1, 2026: CSRD applies to listed SMEs.
Final stage: Full development and implementation of the reporting requirements.
CSRD Timeline
CSRD and CSDDD (or CS3D):
The Corporate Sustainability Due Diligence Directive (CSDDD/CS3D), aims to promote sustainable and responsible corporate behavior in companies' operations and throughout their global value chains. Both the CSDDD and the CSRD are part of the EU's initiatives to enhance sustainability and corporate responsibility. These directives complement each other, working together to improve reporting and due diligence standards for companies operating in the EU, thereby increasing transparency and accountability in corporate sustainability practices.
Differences:
The CSDDD focuses on ensuring that companies take concrete actions to reduce or prevent harmful effects on the environment and human rights. It mandates that companies conduct due diligence to identify, assess, and address risks related to human rights and environmental issues throughout their supply chains. By requiring companies to implement due diligence processes, the CSDDD aims to ensure that they actively work to mitigate negative impacts.
In contrast, the CSRD aims to ensure consistent reporting of ESG performance, giving stakeholders a complete and easily understandable view of a company's sustainability performance. It enhances the quality and scope of sustainability reporting by requiring companies to disclose detailed information about their sustainability practices, risks, and impacts. By establishing guidelines and standards for sustainability reporting, the CSRD increases transparency and accountability.
CSRD x CS3D
Embracing Finboot technology for compliance
Achieving CSRD compliance requires collecting data from suppliers, operators, and partners, which can be challenging. To streamline this process, a secure, efficient system for data sharing and management is essential. The EFRAG has expressed their encouragement for businesses to initiate their compliance efforts promptly and to consider integrating technological innovations into their approaches.
Blockchain technology supports compliance by ensuring transparency and traceability across complex supply chains. It captures detailed data on assets, including environmental impacts and responsible sourcing.
Finboot’s MARCO Track & Trace platform enhances green supply chain management by integrating blockchain technology. Key applications in MARCO’s system include: Digital Product Passport (DPP), which offers end-to-end supply chain visibility, asset digitalisation, and tracking; Mass Balance, which ensures traceability of circularity and renewables and manages sustainability credits to support ESG claims; and Smart Contracts, which facilitate invoice reconciliation for supplier communications and automated business rule validation. These applications help companies address climate impacts and meet regulatory requirements effectively.
The EU Deforestation Regulation (EUDR) is a significant legislative measure aimed at curbing the European Union's impact on global deforestation and forest degradation. The regulation was introduced to promote deforestation-free supply chains, reduce greenhouse gas emissions, and protect biodiversity, human rights, and the rights of indigenous people.
Relevant commodities and relevant products shall not be placed, made available on the market, or exported unless all three following conditions are fulfilled:
they are deforestation-free;
they have been produced in accordance with the relevant legislation of the country of production; and
they are covered by a due diligence statement.
Given its scope, the EUDR affects numerous industries, particularly those involved in the processing or export of palm oil, soy, cocoa, coffee, cattle, and rubber. These impacts will include:
Food and Beverage Industry
Textile and Leather Industry
Automotive Industry
Furniture and Wood Products Industry
Chemical industry
Pharmaceutical Industry
Energy Industry
Construction Industry
EUDR timeline
The regulation impacts both large corporations and small to medium-sized enterprises (SMEs), mandating that large companies achieve compliance by December 30, 2024, while SMEs have until June 30, 2025, to meet the requirements.
Companies that start collecting data and preparing themselves and their value chain for compliance will avoid the risks of penalties for non-compliance, which may include fines up to 4% of company turnover within the European Union (EU), temporary exclusion from public procurement and access to public funding, and confiscation of goods.
By leveraging digitalization, companies can effectively meet the stringent transparency requirements in their supply chains. Streamlining processes and the collection and sharing of verified data are vital for the seamless implementation of the EUDR program. With digital tools, companies can ensure accurate tracking and tracing of goods, enabling them to demonstrate compliance and maintain trust with consumers and regulatory bodies.
Due to the countdown to compliance, companies should be Preparing Your Supply Chain for the EUDR, starting with Gathering Necessary Documentation. Operators must collect detailed, farm-level information about their products and create a Due Diligence Statement, which is uploaded to a system run by the European Commission. This includes:
The type of products and that they are 1) deforestation free and 2) have been produced in accordance with the laws in the production country. This information must be kept for at least five years.
Details such as the trade name, the quantity in kg, as well as the country of production and contact information of the products’ supplier and recipient.
If the product is or contains wood, the common name of the species as well as the full scientific name.
The geolocation of all plots of land where the product or parts of it have been produced or held – in the case of cattle.
Through this process, it's important to consider certain questions:
What materials, supplies, or parts must be tracked?
Do you have an internal compliance solution, or will an external solution be necessary?
What additional tools does your business require for compliance success? Ej. Like ours, MARCO Track & Trace.
How will you onboard suppliers into your compliance program?
How should suppliers be reminded to submit the data (and how often)?
How are you going to handle non-responsive suppliers?
When collecting data, how to automate and verify them?
Here are our recommendations regarding data collection:
Start collecting data early – Aid your process by collecting data early to handle any obstacles that may arise.
Collect tamper-proof data – Suppliers must provide verified information to prove legal and deforestation-free production in these areas.
Automate and facilitate data sharing – Find a way to collect data all at once to reduce the need for multiple interactions with suppliers. Digitize your data collection to avoid double cauting, human risks, and enhance transparency and trust among your stakeholders.
Meet MARCO Track & Trace: Leveraging Blockchain for Compliance
It's no surprise that tracking goods in increasingly complex supply chains is becoming more challenging. Even well-structured companies often experience information gaps. Additionally, issues of confidentiality and trust are prevalent.
With more parties involved in supply chains and the expansion of third-party support networks, communication disruptions are rampant, making it nearly impossible to determine who has what information and when.
Blockchain technology solutions, such as Finboot's MARCO Track & Trace platform, seek to address these challenges by providing a streamlined approach to managing data, information, communications, and transactions. This technology has become crucial for ensuring traceability and transparency in supply chains, especially in compliance with the European Union Deforestation-free Regulation (EUDR).
Track & Trace, our no-code/low-code digital suite that leverages blockchain, enhances the security and immutability of data, ensuring that all recorded information is authentic and unaltered. This capability is vital for maintaining a chain of custody that can withstand rigorous audits.
MARCO Track & Trace for EUDR compliance
Key Benefits:
Easy to Implement: MARCO's no-code/lowcode capabilities allow for quick implementation without technical programming knowledge. It offers interoperability with existing ERP and supply chain software, IoT devices, and other technologies.
Verified and Traceable Claims: The platform generates verified and traceable claims for products traded between companies and their partners. Blockchain ensures the security and integrity of records, preventing loss, forgery, or unauthorized access.
Collaboration and Transparency: MARCO facilitates the sharing of relevant data about raw materials, promoting transparency, accountability, and sustainability in supply chains. It provides a secure platform for companies to share and view data, fostering collaboration and trust among stakeholders. Process automation also leads to faster processes through automated data input and agreement validation enabled by blockchain technology.
MARCO Track & Trace real-time tracking ensures that companies can continuously monitor their supply chain's deforestation status and quickly adapt to any changes required for compliance,
Key MARCO Track & Trace features that can support you in complying with the EUDR:
Integrated Traceability
Automating Digital Product Passports
Facilitating Compliance (Document creation as the ISCC but for EUDR)
MARCO Track & Trace for deforestation (EUDR)
Immediate Action Required
The crucial takeaway for today is to start taking action immediately! Begin integrating the right tools and systems to support you on this journey. It's no longer about merely setting goals or discussing strategies. The stakes are high, and it's essential to take concrete steps, showcasing your milestones and achievements with evidence-backed data. Failure to do so could lead to significant financial disruptions for your business.
As previously mentioned, the changes facing companies and their supply chains are profound and enduring. These changes will transform markets and global economies for decades. Companies must act now, advancing on the path of transformation and decarbonization with disciplined urgency.
Finboot's Green Supply Chain Management Suite, MARCO Track & Trace, provides a strategic solution for your organization. It enables you to trace your low-carbon, circular, and renewable products, and communicate these efforts with evidence-backed data, all while enhancing efficiency and profitability. Our solution is specifically designed for EUDR compliance.
If you'd like to learn more, please reach out to our team.
Many countries around the world have made significant efforts over the past decade to reduce deforestation, for example by introducing moratoria or measures to improve transparency in the supply chain, yet deforestation and forest degradation continue at an alarming rate, contributing more than 10% of global greenhouse gas emissions.
This level of destruction has significant social, economic, and environmental consequences locally and globally. Deforestation contributes significantly to climate change and the loss of biodiversity.
The European Union has a significant role in this issue because it consumes a large number of products that contribute to deforestation. As a result, the EU has a responsibility to help fight against and ultimately stop deforestation.
World Resources Institute
The European Union’s regulation on deforestation-free products (EUDR) aims to promote the use of products that do not contribute to deforestation within the EU. This regulation is specific to certain products and will prevent companies from selling these products in the EU. Specifically, the regulation focuses on commodities such as cattle, cocoa, coffee, oil palm, rubber, soy, and wood, (some of the products that cause 90% of the world's deforestation) along with products derived from these commodities.
The regulation will come into effect on December 30, 2024 (or June 30, 2025, for micro or small businesses) and is part of the EU's broader commitment to protecting the environment and addressing climate change. The goal is to transition to supply chains that are free from deforestation.
Understanding the EU Deforestation Regulation (EUDR)
The EU Deforestation Regulation (EUDR) is a significant legislative measure aimed at curbing the European Union's impact on global deforestation and forest degradation. The regulation was introduced to promote deforestation-free supply chains, reduce greenhouse gas emissions, and protect biodiversity, human rights, and the rights of indigenous people.
Relevant commodities and relevant products shall not be placed or made available on the market or exported, unless all the 3 following conditions are fulfilled:
1. they are deforestation-free;
a) that the relevant products contain, have been fed with or have been made using, relevant commodities that were produced on land that has not been subject to deforestation after 31 December, 2020; and
b) in the case of relevant products that contain or have been made using wood, that the wood has been harvested from the forest without inducing forest degradation after 31 December, 2020;
2. they have been produced in accordance with the relevant legislation of the country of production in terms of:
- land use rights;
- environmental protection;
- forest-related rules, including forest management and biodiversity conservation, where directly related to wood harvesting;
- third parties’ rights; labour rights; human rights protected under international law;
- the principle of free, prior and informed consent (FPIC), including as set out in the UN Declaration on the Rights of Indigenous Peoples;
- tax, anti-corruption, trade and customs regulations.
3. they are covered by a due diligence statement (DDS), linked to a traceability system with evidence of chain-of-custody from the source of origin demonstrating that the product is deforestation-free and produced in accordance with relevant legislations.The due diligence shall include:
a) the collection of information, data and documents needed to fulfil the requirements set out in Article 9;
(b) risk assessment measures as referred to in Article 10;
(c) risk mitigation measures as referred to in Article 11.
The EUDR aims to significantly reduce the EU's contribution to global deforestation, forest degradation, and associated greenhouse gas emissions. Over time, the regulation is expected to help cut greenhouse gas emissions and limit biodiversity loss. The Commission may extend regulatory protections to include other threatened ecosystems in the future.
The new rules aim to:
avoid that the listed products Europeans buy, use and consume contribute to deforestation and forest degradation in the EU and globally.
reduce carbon emissions caused by EU consumption and production of the relevant commodities by at least 32 million metric tonnes a year.
address all deforestation driven by agricultural expansion to produce the commodities in the scope of the regulation, as well as forest degradation.
EUDR requirements
Deforestation-free: Their production did not cause deforestation or forest degradation after 30th Dec 2020, regardless of whether the deforestation or forest degradation was legal according to the applicable legislation in the country of production.
Legally produced: Their production occurred in accordance with relevant legislation of the country where the production took place.
Due diligence: They are covered in a due diligence statement, that is based on a due diligence risk assessment, to be shared with authorities. The documentation process involves several key actions:
Information Collection: Operators must collect detailed information and documents demonstrating that the products comply with the EUDR.
Risk Assessment: A risk assessment must be conducted for each product to ascertain the risk of non-compliance with the EUDR. This assessment considers various factors, including the risk category of the country of production, which could be classified as 'high risk', 'standard risk', or 'low risk' by the European Commission.
Risk Mitigation: Depending on the assessed risk, adequate procedures and measures must be implemented to mitigate and manage non-compliance risks. This may involve independent surveys or audits, additional documentation, or engagement with suppliers to ensure compliance.
By adhering to these steps and ensuring all required documentation is in place, businesses can effectively prepare their supply chains for the upcoming implementation of the EUDR, thereby minimizing risks and enhancing their sustainability practices.
Key Dates and Milestones
The regulation, which officially came into force on June 29, 2023, traces its inception back to long-standing concerns over the detrimental environmental effects of deforestation. Key events within EUDR’s timeline include:
29 June 2023: The regulation comes into force, with compliance dates depending on business size.
30 Dec 2024: Compliance is necessary for large businesses, subject to checks, fines, and potential bans.
30 June 2025: Small and medium enterprises are now also officially liable.
Commodities and Products Covered
The EUDR applies to seven key commodities and their derived products, however, the regulation does not apply to goods made entirely of material that has completed its life cycle and would otherwise have been disposed of as waste. Specifically, the regulation focuses on commodities such as cattle, cocoa, coffee, oil palm, rubber, soy, and wood (some of the products that cause 90% of the world's deforestation), along with products derived from these commodities. The EUDR mandates that these products must not contribute to deforestation or forest degradation, be produced in compliance with the relevant legislation of the country of production, and be accompanied by a due diligence statement.
These products are identified in the EUDR by their HS code (customs code), which should be use to collect information for the due diligence:
Relevant commodity / products
Cattle
0102 21 , 0102 29 Live cattle
ex 0201 Meat of cattle, fresh or chilled
ex 0202 Meat of cattle, frozen
ex 0206 10 Edible offal of cattle, fresh or chilled
ex 0206 22 Edible cattle livers, frozen
ex 0206 29 Edible cattle offal (excluding tongues and livers), frozen
ex 1602 50 Other prepared or preserved meat, meat offal, blood, of cattle
ex 4101 Raw hides and skins of cattle (fresh, or salted, dried, limed, pickled or otherwise preserved, but not tanned, parchment-dressed or further prepared), whether or not dehaired or split
ex 4104 Tanned or crust hides and skins of cattle, without hair on, whether or not split, but not further prepared
ex 4107 Leather of cattle, further prepared after tanning or crusting, including parchment-dressed leather, without hair on, whether or not split, other than leather of heading 4114
Cocoa
1801 Cocoa beans, whole or broken, raw or roasted
1802 Cocoa shells, husks, skins and other cocoa waste
1803 Cocoa paste, whether or not defatted
1804 Cocoa butter, fat and oil
1805 Cocoa powder, not containing added sugar or other sweetening matter
1806 Chocolate and other food preparations containing cocoa
Coffee
0901 Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion
Oil palm
1207 10 Palm nuts and kernels
1511 Palm oil and its fractions, whether or not refined, but not chemically modified
1513 21 Crude palm kernel and babassu oil and fractions thereof, whether or not refined, but not chemically modified
1513 29 Palm kernel and babassu oil and their fractions, whether or not refined, but not chemically modified (excluding crude oil)
2306 60 Oilcake and other solid residues of palm nuts or kernels, whether or not ground or in the form of pellets, resulting from the extraction of palm nut or kernel fats or oils
ex 2905 45 Glycerol, with a purity of 95 % or more (calculated on the weight of the dry product)
2915 70 Palmitic acid, stearic acid, their salts and esters
2915 90 Saturated acyclic monocarboxylic acids, their anhydrides, halides, peroxides and peroxyacids; their halogenated, sulphonated, nitrated or nitrosated derivatives (excluding formic acid, acetic acid, mono-, di- or trichloroacetic acids, propionic acid, butanoic acids, pentanoic acids, palmitic acid, stearic acid, their salts and esters, and acetic anhydride)
3823 11 Stearic acid, industrial
3823 12 Oleic acid, industrial
3823 19 Industrial monocarboxylic fatty acids; acid oils from refining (excluding stearic acid, oleic acid and tall oil fatty acids)
3823 70 Industrial fatty alcohols
Rubber
4001 Natural rubber, balata, gutta-percha, guayule, chicle and similar natural gums, in primary forms or in plates, sheets or strip
ex 4005 Compounded rubber, unvulcanised, in primary forms or in plates, sheets or strip
ex 4006 Unvulcanized rubber in other forms (e.g. rods, tubes and profile shapes) and articles (e.g. discs and rings)
ex 4007 Vulcanised rubber thread and cord
ex 4008 Plates, sheets, strips, rods and profile shapes, of vulcanised rubber other than hard rubber
ex 4010 Conveyer or transmission belts or belting, of vulcanised rubber
ex 4011 New pneumatic tyres, of rubber
ex 4012 Retreaded or used pneumatic tyres of rubber; solid or cushion tyres, tyre treads and tyre flaps, of rubber
ex 4013 Inner tubes, of rubber
ex 4015 Articles of apparel and clothing accessories (including gloves, mittens and mitts), for all purposes, of vulcanised rubber other than hard rubber
ex 4016 Other articles of vulcanised rubber other than hard rubber, not elsewhere specified in chapter 40
ex 4017 Hard rubber (e.g. ebonite) in all forms including waste and scrap; articles of hard rubber
Soya
1201 Soya beans, whether or not broken
1208 10 Soya bean flour and meal
1507 Soya-bean oil and its fractions, whether or not refined, but not chemically modified
2304 Oilcake and other solid residues, whether or not ground or in the form of pellets, resulting from the extraction of soya-bean oil
Wood
4401 Fuel wood, in logs, in billets, in twigs, in faggots or in similar forms; wood in chips or particles; sawdust and wood waste and scrap, whether or not agglomerated in logs, briquettes, pellets or similar forms
4402 Wood charcoal (including shell or nut charcoal), whether or not agglomerated
4403 Wood in the rough, whether or not stripped of bark or sapwood, or roughly squared
4404 Hoopwood; split poles; piles, pickets and stakes of wood, pointed but not sawn lengthwise; wooden sticks, roughly trimmed but not turned, bent or otherwise worked, suitable for the manufacture of walking sticks, umbrellas, tool handles or the like; chipwood and the like
4405 Wood wool; wood flour
4406 Railway or tramway sleepers (cross-ties) of wood
4407 Wood sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end-jointed, of a thickness exceeding 6 mm
4408 Sheets for veneering (including those obtained by slicing laminated wood), for plywood or for other similar laminated wood and other wood, sawn lengthwise, sliced or peeled, whether or not planed, sanded, spliced or end-jointed, of a thickness not exceeding 6 mm
4409 Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, moulded, rounded or the like) along any of its edges, ends or faces, whether or not planed, sanded or end-jointed
4410 Particle board, oriented strand board (OSB) and similar board (for example, waferboard) of wood or other ligneous materials, whether or not agglomerated with resins or other organic binding substances
4411 Fibreboard of wood or other ligneous materials, whether or not bonded with resins or other organic substances
4412 Plywood, veneered panels and similar laminated wood
4413 Densified wood, in blocks, plates, strips or profile shapes
4414 Wooden frames for paintings, photographs, mirrors or similar objects
4415 Packing cases, boxes, crates, drums and similar packings, of wood; cable-drums of wood; pallets, box pallets and other load boards, of wood;
pallet collars of wood
(not including packing material used exclusively as packing material to support, protect or carry another product placed on the market)
4416 Casks, barrels, vats, tubs and other coopers’ products and parts thereof, of wood, including staves
4417 Tools, tool bodies, tool handles, broom or brush bodies and handles, of wood; boot or shoe lasts and trees, of wood
4418 Builders’ joinery and carpentry of wood, including cellular wood panels, assembled flooring panels, shingles and shakes
4419 Tableware and kitchenware, of wood
4420 Wood marquetry and inlaid wood; caskets and cases for jewellery or cutlery, and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling in Chapter 94
4421 Other articles of wood
Pulp and paper of Chapters 47 and 48 of the Combined Nomenclature, with the exception of bamboo-based and recovered (waste and scrap) products
ex 49 Printed books, newspapers, pictures and other products of the printing industry, manuscripts, typescripts and plans, of paper
ex 9401 Seats (other than those of heading 9402 ), whether or not convertible into beds, and parts thereof, of wood
9403 30 , 9403 40 , 9403 50 , 9403 60 and 9403 91 Wooden furniture, and parts thereof
The Regulation affects both large companies and SMEs, although obligations for the latter are delayed until 30 June 2025 (with simplified obligations for SME traders).
Large companies would have 18 months to comply with the EUDR requirements, and small and medium-sized enterprises would have up to 24 months, setting the dates as Dec. 30, 2024, and June 30, 2025, respectively.
medium companies: defined as those <250 employees and turnover of <€50 million),
small companies: defined as those with <50 employees and a turnover of <€10 million)
Micro-enterprises: defined as those with <10 employees and a turnover of <€2million)
As for subjects, the EUDR’s definition of ‘operator’ is key. Are they:
- Operators: An operator is any natural or legal person who, in the course of a commercial activity, places relevant products on the market or exports them. For example, a company that imports cocoa butter and another company that uses that cocoa butter to produce chocolate and places it on the market would both be considered operators.
- Traders: Any person in the supply chain other than the operator who makes relevant products available on the market. For example, a company that buys chocolate from an EU-based producer and sells it on to retail chains without further processing it would be a trader under this definition.
Given its scope, the EUDR affects numerous industries, particularly companies involved in the processing or export of rubber, wood, and oil palm. These impacts will include: (i) higher costs for both manufacturers and exporters connected to reporting and supply chain checking and verification; (ii) the possible loss of competitiveness for smaller players if these cannot meet the EUDR requirements; and (iii) the gradual exclusion of players from manufacturing supply chains and the diversion of global investment flows away from the country classified as high risk by the EU.
Food and Beverage Industrysome text
Meat Products: Including beef and other cattle-derived products.
Dairy Products: Associated with cattle farming.
Confectionery: Chocolate and other cocoa-based products.
Coffee: Coffee beans and related beverages.
Edible Oils: Palm oil and its derivatives.
Soy Products: Soybeans, tofu, soy milk, and other soy-based foods.
Textile and Leather Industrysome text
Leather Goods: Including shoes, bags, and other leather accessories.
Rubber Products: Natural rubber used in footwear, clothing, and accessories.
Automotive Industrysome text
Rubber: Used in tires and various automotive components.
Furniture and Wood Products Industrysome text
Wood and Timber: Furniture, flooring, and other wood-based products.
Pulp and Paper: Paper products, packaging materials, and other pulp-derived goods.
Chemical industry some text
Palm Oil Derivatives: Used in a wide range of beauty, cosmetics and personal care products.
Pharmaceutical Industrysome text
Natural Rubber: Used in various medical supplies and equipment.
Energy Industrysome text
Biofuels: Derived from soy and palm oil.
Construction Industry
Using Blockchain for Supply Chain Transparency
Blockchain technology has become indispensable for ensuring traceability and transparency within supply chains, particularly under the European Union Deforestation-free Regulation (EUDR). Finboot's MARCO Track & Trace, a no-code/low-code digital suite that leverages blockchain, enhances the security and immutability of data, ensuring that all recorded information is authentic and unaltered. This capability is vital for maintaining a chain of custody that can withstand rigorous audits.
Key Features and Benefits:
Verification of Certification Status: MARCO Track & Trace allows companies to verify the certification status of suppliers at the point of transaction, ensuring they source from EUDR-compliant sources.
Generation of Verified and Traceable Claims: The platform generates verified and traceable claims regarding products traded between companies and their trading partners.
Data Transmission: It facilitates the passing of relevant data about raw materials, including geo-location of origin, time of harvest, species, product groups, and other essential data points.
By leveraging blockchain technology, companies can ensure robust traceability and transparency, thereby meeting EUDR compliance and fostering sustainable business practices.
Conclusion
The core aim of the EUDR is to ensure that products associated with deforestation and forest degradation are not available on the EU market. This initiative targets a significant reduction in the EU's carbon footprint by minimizing carbon emissions from the production and consumption of certain commodities.
The EUDR is likely to reconfigure trade and supply chains across deforestation-linked commodities over the next decade. Operators and traders are required to compile comprehensive documentation that proves the deforestation-free status of the commodities and their adherence to the relevant legislation of the country of production.
By creating a tamper-proof record of all transactions and product movements, MARCO Track & Trace provides a robust foundation for compliance with deforestation regulations.
Forests are disappearing rapidly worldwide. The main threats to these important ecosystems are deforestation and forest degradation. In the last 3 decades, about 10% of the world's forests, an area bigger than the European Union, have been destroyed due to deforestation.
Over the past decade, governments around the world have committed to halting deforestation and restoring forest land. Yet, despite these commitments, 2023 data shows that the equivalent of 10 football fields of tropical primary forest is lost every single minute.
This level of destruction has significant social, economic, and environmental consequences locally and globally. Deforestation contributes significantly to climate change and the loss of biodiversity.
The European Union’s regulation on deforestation-free products (EUDR) aims to promote the use of products that do not contribute to deforestation within the EU. This regulation is specific to certain products and will prevent companies from selling these products in the EU.
Specifically, the regulation focuses on commodities such as cattle, cocoa, coffee, oil palm, rubber, soy, and wood, (some of the products that cause 90% of the world's deforestation) along with products derived from these commodities.
The regulation will come into effect on December 30, 2024 (or June 30, 2025, for micro or small businesses) and is part of the EU's broader commitment to protecting the environment and addressing climate change. The goal is to transition to supply chains that are free from deforestation.
Relevant commodities and relevant products shall not be placed or made available on the market or exported, unless all the 3 following conditions are fulfilled:
they are deforestation-free;
they have been produced in accordance with the relevant legislation of the country of production; and
The regulation, which officially came into force on June 29, 2023, traces its inception back to long-standing concerns over the detrimental environmental effects of deforestation. Key events within the broad EU Deforestation Legislation's timeline include:
23 July 2019: European Commission adopts the 2019 Communication on Stepping up EU Action to Protect and Restore the World’s Forests
June 2020: EC introduces a roadmap for feedback on the initiative to tackle global deforestation and receives feedback from over 1.2 million EU citizens.
December 2020: EC launches a public consultation on stepping up EU action against deforestation and forest degradation.
October 2021: EC publishes the draft proposal, replacing the previous EU Timber Regulation and adding additional commodities.
December 2021: EC approves the final text of the EUDR.
December 2022: The regulation is officially adopted, encompassing both illegal and legal activities contributing to deforestation.
9 June 2023: Regulation (EU) 2023/1115 published in the Official Journal of the European Union
29 June 2023: The regulation comes into force, with compliance dates depending on business size.
30 Dec 2024: Compliance is necessary for large businesses, subject to checks, fines, and potential bans.
30 June 2025: Small and medium enterprises are now also officially liable.
Source: live-eo.com
Impact on businesses and difference from previews laws:
The EUDR, along with other regulations like the CSDDD, also known as CS3D (Fostering sustainable and responsible corporate behaviour for a just transition towards a sustainable economy), and the CSRD (EU rules require large companies and listed companies to publish regular reports on the social and environmental risks they face and on how their activities impact people and the environment), will have a significant impact on global supply chains and their sustainability. However, because the EUDR is product-based legislation, it prohibits companies from placing certain commodities or derived products on the market without compliance. That is the main difference between the other regulations we have seen so far, which are more business than product-based.
The new regulation supersedes the EU Timber Regulation that came into force back in 2013. The EUDR will apply to all products harvested from June 29th, 2023, and imported to or exported from the EU market after December 30th, 2024.
Any wood harvested after June 29th, 2023, but imported to the EU before December 30, 2024, must adhere to the superseded EU Timber Regulation (EUTR).
Since the EUDR has a broader scope as well as stricter due diligence requirements, the following table summarizes some of the key differences.
EUDR x EUTR
Identifying Relevant Commodities and Products
To prepare your supply chain for compliance with the European Union's Deforestation Regulation (EUDR), it is crucial to first identify which commodities and products fall under the scope of the regulation. The EUDR applies to seven key commodities: cattle, cocoa, coffee, oil palm, rubber, soy, and wood, as well as a wide array of products derived from these commodities, such as meat, leather, chocolate, glycerol, pneumatic tires, soybean oil, wood furniture, newspapers, and books.
Operators and traders must ensure that from 30 December 2024, these commodities and their derivatives, whether produced within the EU or imported, do not contribute to deforestation or forest degradation post-31 December 2020. This requirement is crucial for businesses aiming to access the EU market, making it essential to carefully check the product's tariff classification under the Combined Nomenclature to verify its coverage under the EUDR.
Gathering Necessary Documentation
Once the relevant commodities and products have been identified, the next step involves gathering the necessary documentation to comply with the EUDR's due diligence requirements. Operators and traders are required to compile comprehensive documentation that proves the deforestation-free status of the commodities and their adherence to the relevant legislation of the country of production. This includes a due diligence statement, which must be filed prior to placing or making the products available on the EU market or exporting them from the EU.
The documentation process involves several key actions:
Information Collection: Operators must collect detailed information and documents demonstrating that the products comply with the EUDR. This includes:
The type of products and that they are 1) deforestation free and 2) have been produced in accordance with the laws in the production country. This information must be kept for at least five years.
Details such as the trade name, the quantity in kg, as well as the country of production and contact information of the products’ supplier and recipient.
If the product is or contains wood, the common name of the species as well as the full scientific name.
The geolocation of all plots of land where the product or parts of it have been produced or held – in the case of cattle.
Risk Assessment: A risk assessment must be conducted for each product to ascertain the risk of non-compliance with the EUDR. This assessment considers various factors, including the risk category of the country of production, which could be classified as 'high risk', 'standard risk', or 'low risk' by the European Commission:
9% for high
3% for standard
1% for low risk level
Risk Mitigation: Depending on the assessed risk, adequate procedures and measures must be implemented to mitigate and manage non-compliance risks. This may involve independent surveys or audits, additional documentation, or engagement with suppliers to ensure compliance.
By adhering to these steps and ensuring all required documentation is in place, businesses can effectively prepare their supply chains for the upcoming implementation of the EUDR, thereby minimizing risks and enhancing their sustainability practices.
Conducting Risk Assessments
To comply with the EU Deforestation Regulation (EUDR), companies must implement a robust due diligence process, starting with comprehensive risk assessments. These assessments are crucial for determining the potential risks associated with deforestation and forest degradation in the supply chain. The primary focus is to ensure that no products linked to deforestation are placed on or exported from the EU market. This involves collecting detailed geolocation coordinates and conducting a deforestation analysis for plots where in-scope commodities—such as cocoa, coffee, soy, palm oil, cattle, wood, and rubber—are harvested.
The risk assessment process should address both legality and deforestation risks for each shipment. Companies need to evaluate various factors, including the presence of forests, land rights conflicts, and the overall transparency and governance of the supply chain. This comprehensive analysis, which must be updated annually, serves as a foundation for confirming that all commodities are sourced from areas free of deforestation post-December 31, 2020.
Risk Mitigation Strategies
Once risks are identified through assessments, companies must develop and implement effective risk mitigation strategies. If the initial risk assessment indicates a high risk of non-compliance, additional evidence and more rigorous checks are necessary to mitigate these risks. This may involve enhancing the traceability of the supply chain, conducting independent audits, or collaborating closely with suppliers to ensure all sourced commodities comply with EUDR requirements.
Operators are encouraged to adopt a flexible approach to legality, collecting a broad spectrum of documents and information to substantiate compliance. This includes verifying land use rights, environmental protection measures, and adherence to local and international human rights laws. Regular audits and independent verifications play a critical role in ensuring ongoing compliance and addressing any potential issues proactively.
To further solidify the due diligence process, companies can leverage technology such as satellite monitoring to verify the absence of deforestation in specific locations. Automating parts of the due diligence process can improve consistency and efficiency, reducing the reliance on manual efforts and speeding up the overall compliance timeline.
In summary, implementing due diligence measures under the EUDR requires a multi-faceted approach that includes thorough risk assessments and proactive risk mitigation strategies. By adhering to these guidelines, companies can not only comply with regulatory requirements but also contribute to global efforts against deforestation and forest degradation.
Due Diligence Statements Registry information system
The European Union Deforestation Regulation (EUDR) requires that statements of due diligence be submitted electronically to a deforestation registry created by the European Commission. These statements will be checked in the registry by both the European Commission and the authorities of the Member States.
The information system is an online tool designed to assist in creating due diligence statements for supply chains. Its purpose is to simplify the process of submitting and processing these statements for relevant operators, traders, competent authorities, and customs. The goal is to ensure a smooth transition when the rules of the EUDR become effective at the end of 2024.
However, it's important to note that this system is currently in the pilot testing phase. In the summer of 2024, the European Commission, in coordination with member states authorities, will provide a training environment and sessions to train interested companies. This will allow stakeholders to become familiar with the system before the Regulation becomes effective. Additionally, the Commission will provide user manuals and other self-learning materials, such as video tutorials.
Leveraging Finboot's MARCO TRACK & TRACE
Blockchain technology has become indispensable for ensuring traceability and transparency within supply chains, particularly under the European Union Deforestation-free Regulation (EUDR). Finboot's MARCO Track & Trace, a no-code/low-code digital suite that leverages blockchain, enhances the security and immutability of data, ensuring that all recorded information is authentic and unaltered. This capability is vital for maintaining a chain of custody that can withstand rigorous audits.
Key Features and Benefits:
Verification of Certification Status: MARCO Track & Trace allows companies to verify the certification status of suppliers at the point of transaction, ensuring they source from EUDR-compliant sources.
Generation of Verified and Traceable Claims: The platform generates verified and traceable claims regarding products traded between companies and their trading partners.
Data Transmission: It facilitates the passing of relevant data about raw materials, including geo-location of origin, time of harvest, species, product groups, and other essential data points.
By leveraging blockchain technology, companies can ensure robust traceability and transparency, thereby meeting EUDR compliance and fostering sustainable business practices.
Maintaining Compliance: Ongoing Monitoring and Reporting
Annual Reporting Requirements
Under the European Union's Deforestation Regulation (EUDR), companies are mandated to publicly report on their due diligence systems annually. This requirement is crucial as it ensures transparency and accountability in monitoring deforestation risks within supply chains. The reports must detail the steps taken to comply with the regulation, including risk assessments and the measures implemented to mitigate those risks. Additionally, companies must retain all documentation related to their due diligence for at least five years, making these records available to authorities upon request. This rigorous documentation and reporting process is designed to facilitate ongoing compliance and enable timely adaptations to regulatory changes.
Adapting to Regulatory Changes
The dynamic nature of environmental regulations necessitates that companies remain agile and responsive to new developments. The EUDR is no exception, and it is expected that the regulation will evolve to encompass more stringent measures and possibly extend to other threatened ecosystems in the coming years. Companies must therefore conduct documented annual reviews of their compliance policies and procedures to ensure they align with the current regulatory requirements. This proactive approach not only aids in maintaining compliance but also positions companies to swiftly adapt to any regulatory changes, thereby safeguarding their market access and operational continuity.
Conclusion
The EUDR mandates that the products within the EU must not contribute to deforestation or forest degradation, be produced in compliance with the relevant legislation of the country of production, and be accompanied by a due diligence statement.
The regulation is based on the principle of due diligence, requiring companies to perform thorough assessments to identify, analyze, and mitigate risks related to deforestation within their supply chains.
This approach not only promotes transparency and traceability but also ensures that the origins of products are verifiable and not sourced from lands experiencing deforestation or degradation.
● Carles Garcia will forge new partnerships and relationships to grow Finboot’s client base
● Carles is based out of Finboot’s Barcelona office, well-positioned to develop partnerships with European capital-intensive businesses
● His appointment re-affirms Finboot’s determination to roll-out its technology amongst the hard to decarbonise industries to accelerate the journey to net-zero
BARCELONA, Wednesday 26 June 2024 – Finboot today announces the appointment of Carles Garcia as its new Partnerships Lead based out of its Barcelona office.
This strategic hire underscores Finboot's commitment to expanding its innovative green supply chain management solutions across Europe, particularly within capital-intensive industries striving for decarbonisation. Carles Garcia will play a pivotal role in developing and nurturing partnerships in Europe, driving the adoption of Finboot’s low code/no code platform, MARCO Track & Trace. This platform is designed to trace carbon emissions, enable mass balancing and minimise supply chain risks through high-integrity data secured by blockchain technology.
Key clients benefiting from Finboot's solutions include industry leaders such as SABIC, Repsol, Cepsa and Gestamp.
Juan Miguel Perez, CEO and Co-Founder, Finboot says: “Industries like steel, oil and gas produce around 30 per cent of global emissions and use about 37 per cent of global energy. To reach net-zero by 2050, these industries need to significantly cut their carbon footprint. Our MARCO Track & Trace solution simplifies managing sustainability in supply chains and makes it easy to comply with in-coming regulations.
“Carles' appointment strengthens our mission to help industries achieve their sustainability goals. His expertise in sustainability and digital technology is key as we tackle supply chain risks and expand partnerships in Europe.
“Europe is leading in the field of sustainability introducing leading edge regulations, like the EU Deforestation Regulation (EUDR), coming into force in December, which aims to reduce greenhouse gas emissions and limit biodiversity loss.
Carles Garcia Finboot’s new Partnerships Lead added: “I am really pleased to have joined Finboot’s stellar team to increase and deepen its partnerships and help move heavy industry to a more sustainable and circular model.
“I will add value to Finboot’s partnership ecosystem by leveraging our innovative platform – MARCO – to bring benefits to our partners and their customers by accelerating progress towards their sustainability goals. For example, a supply chain provider can connect their systems to our platform to seamlessly obtain a certified traceability along the supply chain, and in addition easily create a Digital Product Passport or a compliance certification. Other kinds of companies such as ESG (Environmental, Social and Governance) consultancies and IT integrators can benefit from our platform too.
“I love to connect things - bridging the gap between business and technology. It is clear to me the value Finboot´s platform deliver for the world. It helps companies achieve their sustainability goals by leveraging new technology.
“I love and value nature. My values align with Finboot’s values and I´m very happy to be joining such a motivated and focused team.”
Finboot continues to be at the forefront of providing cutting-edge solutions for the world's largest capital-intensive companies, promoting sustainability and efficiency in supply chain management. This appointment aligns with Finboot’s growth plan, recently announced after its latest successful fundraise, and reflects the company's dedication to meeting the demands of green supply chain management.
Carles is a proven and energetic entrepreneur – with over 24 years’ experience. He is passionate about technological innovation in the development of positive impact businesses. He specialises in implementing strategies for disruptive technologies. He is a charismatic and passionate speaker. He has spoken at business schools, events and other channels. His key theme is extolling the benefits and positive digital innovation provides to companies that integrate it into their supply chains and systems. He has previously worked at Polygon ID which, through blockchain technology seeks to support and scale lasting positive impact on the world.
Finboot’s technology provides green supply chain management for the world's largest capital-intensive companies.
Our technology traces carbon emissions and minimises risk through immutable data. Finboot is backed by SABIC and Repsol. Finboot has created the first green supply chain management suite with features including integrated traceability, allowing you to track carbon emissions, automate digital product passports, create your sustainability credits and facilitate compliance. Finboot is headquartered in Cardiff with a base in Barcelona.
· Sunitha Ray will forge new strategic partnerships and alliances to grow thebusiness
· She is New York-based and well-positionedto develop partnerships with US capital-intensive businesses
· Sunitha holds a master’s degree in supply chain and data sciencefrom Massachusetts Institute of Technology (MIT) and an MBA from International Management Institute (IMI)
CARDIFF, Wednesday 29 May2024 – Finboot today announces the appointment of Sunitha Rayas as its new strategic partnerships and alliances adviser.
Finboot’s technology provides green supply chain management for the world's largest capital-intensive companies. Its low code / no code platform traces carbon emissions, allows mass balancing and minimises supply chain risk through high-integrity data using blockchain technology. Its key clients include SABIC, Repsol and Cepsa.
Juan Miguel Perez, CEO and Co-Founder, Finboot says: “I am delighted to welcome Sunitha to the Finboot family.
Sunitha has both the technical and commercial expertise, experience and track record to help us meet the demand from capital intensive, hard to decarbonise, industries like energy, chemical, steel and cement across all geographies including, North America, India and Europe.
As Sunitha is New York based, she will be a key bridge to help us meet demand in the key, high carbon emitting, North American market in particular.”
Sunitha Ray, Finboot’s new strategic partnerships and alliances adviser added: “Finboot helps companies, particularly high capital, high carbon, industries like oil and gas, chemicals and steel, not only be more efficient, but establishes supply chain transparency, enabling companies to move towards closed-loop supply chains by tracking immutable operational data, circular credits and carbon emissions across end-to-end value chain.
I am delighted to join a green supply chain organisation with a mature blockchain-based no code / low-code platform, that not only tracks emissions data, but also factors in the granularity necessary to drive decarbonisation to accelerate our customers journey towards net-zero.
We only have one planet today that will sustain life and it is an ideal opportunity for me to work with an experienced stellar team at Finboot, help our customers measure, track, take action, give back and make earth a better place for us and our future generations.”
Whilst Sunitha was Principal Partner at Capgemini responsible for consumer-packaged goods, retail and distribution in North America, based out of Chicago, she developed and implemented supply chain strategy roadmaps and technology-led solutions. She was the global client executive on: Walmart, Kroger, The Gap, HyVee, Shure and Ulta Beauty amongst others.
– ENDS –
Notesto Editors
For more information, please contact flavia@finboot.com
About Sunitha Ray
Sunitha Ray is a digital transformation specialist focused on supply chain optimisation. She has led key digital initiatives in her previous roles with Benjamin Moore, Flow Beverages and most recently with Shark Ninja, as Vice President of Information Technology and Digital. As a Partner at CapGemini she led large digital programmes at Walmart, Johnson Controls, FedEx, Ahold, Morrisons, Tesco, Motorola, Shureand Gap among others. At Wipro, prior to Capgemini, Sunitha was the account lead on: FedEx, Kroger, Morrisons,Tesco, Sonae, Makro, Primark, Renner, Johnson Controls and Motorola.
Sunitha has the following qualifications:
· A bachelor’s degree in finance and accounting from Stella Maris College
· A master’s degree in software engineering from NIIT
· An MBA from International Management Institute (IMI)
· A master’s in supply chain and data science from Massachusetts Instituteof Technology (MIT)
Sunitha mentors MIT scholar course students, start-ups, scale-ups, private equity and venture capital firms.
Sunitha is also an MIT tech review panellist and keynote speaker.
Sunitha is a recreational scuba diver and volunteers her time for ocean and animal conservation.
Finboot’s technology provides green supply chain management forthe world's largest capital-intensive companies.
Our technology traces carbon emissions and minimises risk through immutable data. Finboot is backed by SABIC and Repsol. Finboot has created the first green supply chain management suite with features including integrated traceability, allowing you to track carbon emissions, automate digital product passports, create your sustainability credits and facilitate compliance. Finboot is headquartered in Cardiff with a base in Barcelona.
CARDIFF, UK / BARCELONA,SPAIN, Friday 24 May 2024 – Today,Finboot announces it has won the coveted Logistics and Supply Chain Tech of theYear Award as part of the National UK Technology Awards, presented in London,at Grosvenor Square last night.
Finboot hascreated the first green supply chain management suite with features includingintegrated traceability, allowing you to track carbon emissions, automatedigital product passports, create your sustainability creditsand facilitate compliance.
In 2021, Finboot was shortlisted for an NTAunder the Blockchain Innovation of the Year category. This year, the judges atthe National Technology Awards were searching for a company who coulddemonstrate they deliver solutions which increase logistical efficiencies,optimise costsand enable companies tooperate effectively, especially in hostile economic climates. Finboot’s platform, MARCO, has proven it'sability to deliver this and more to it's global flagship customers.
Nish Kotecha, Executive Chair andCo-Founder of Finboot, received the award in person.
Nish commented:“It is a huge honour to receive the Logisticsand Supply Chain Tech of the YearAward at the National Technology Awards on behalf of all the team at Finboot!
“This award is a testament to Finboot’sthinking and its innovative green solutions which help businesses andorganisations make their supply chains more efficient, circular, andsustainable - saving time, money and carbon.
“Thank you to National Technology Awards forgiving us this award and recognising Finboot for the 2nd time,understanding our thinking, and our mission.
Congratulationsto all other finalists!”
Juan Miguel Perez, CEO and Co-Founder of Finbootadded:
“AtFinboot we are on a mission to accelerate the next phase of our growthstrategy: helping stellar clients including SABIC, Repsol and Cepsa get to net zeroand using green technology to achieve this.
“Thankyou to the NTA judges for recognising and rewarding our efforts!”
Finboot’s technology helps businesses,particularly capital-intensive industries, to make their supply chains moreefficient with less waste and carbon emissions. They work with companies suchas SABIC - one of the largest chemical manufacturing companies in the world - toadopt a more circular and sustainable approach. Using Finboot’s no code / lowcode platform MARCO, SABIC is now accurately tracking and tracing renewable plastic feedstocks to guarantee authenticity, transparency andreduce waste to protect the environmental impact of the products at the end ofthe supply chain.
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Notes to Editors
For more information, please contact flavia@finboot.com
About the National Technology Awards
The National Technology Awards celebratetechnological achievements in 2023. This year, 2024, marks the eighth annualNational Technology Awards. The awards are organised by NationalTechnology News.
https://nationaltechnologyawards.co.uk/
About us
Finboot’s technology provides green supplychain management for the world's largest capital-intensive companies. Ourtechnology traces carbon emissions and minimises risk through immutable data. Finbootis backed by SABIC and Repsol. Finboot has created the first green supply chainmanagement suite with features including integrated traceability, allowing youto track carbon emissions, automate digital product passports, create yoursustainability credits, and facilitate compliance. Finboot is headquartered in Cardiff with abase in Barcelona.
Capital intensive industries play a pivotal role in the global economy but also significantly contribute to global emissions. The pressure from governments, investors, consumers, and the broader societal push for sustainability is driving these sectors to adopt strategies for decarbonization. While challenges remain, the transition towards more sustainable practices is essential for mitigating climate change and ensuring a healthier planet for future generations.
Green supply chain management (GSCM) embodies a strategic approach, integrating eco-friendly practices from eco-design to green purchasing to mitigate environmental degradation while also enhancing operational efficiency and fostering economic growth. It not only prioritizes environmental sustainability but also aligns with customer expectations for quality and sustainability, significantly contributing to competitive advantages and improved market share.
Advancements in technology, like Finboot’s MARCO Track & Trace, play a critical role in accelerating the net-zero transition for capital-intensive industries by optimizing supply chain emissions through visibility and accountability. This transparent approach ensures compliance, drives sustainability, and supports the global movement towards supply chain decarbonization, promising a sustainable future with reduced supply chain carbon emissions and enhanced organizational performance.
The Weight of Heavy Industries on Worldwide Emissions
Heavy industry, which typically carries a high capital cost (i.e. capital intensive) currently accounts for about 30% of global emissions and roughly 37% of global energy consumption (The World Economic Forum). Carbon emissions from this sector need to decline by an astounding 93% by 2050 to achieve net zero carbon emissions. Capital intensive industries, such as steel manufacturing, oil and gas, mining, and utilities, are characterized by their heavy reliance on physical assets and infrastructure, which often involve energy-intensive processes. As the world grapples with the urgent need to mitigate climate change, these industries are under increasing pressure to implement strategies to reduce their carbon footprint. The significant factors contributing to their high emissions include:
Energy Consumption: These industries consume vast amounts of energy, primarily from fossil fuels, for their operations, making them significant sources of carbon dioxide (CO2) emissions.
Process Emissions: Certain industrial processes, such as the production of cement and steel, release CO2 as a byproduct, contributing to their high emission profiles.
Resource Extraction: Activities like mining and oil extraction disturb large areas of land and release methane, a potent greenhouse gas.
Pressure to Decarbonize
The urgent need to combat climate change has led to increased scrutiny of capital intensive industries. Various stakeholders are exerting pressure on these sectors to decarbonize, including:
Government Regulations: Many countries are implementing strict regulations and policies to reduce GHG emissions, such as carbon pricing, emissions trading, and renewable energy mandates.
Investor Expectations: Investors are increasingly considering sustainability and climate risks when making investment decisions. Shareholders are pressuring companies to adopt greener practices and disclose their carbon emissions and reduction strategies.
Consumer Demand: Consumers are demanding eco-friendly products, leading companies to adopt cleaner technologies and practices.
Business Priority: Business partners prefer companies with a sustainable focus due to consumer demand and the global shift towards environmental responsibility. Not following this can pose a risk to business opportunities.
Competitive Advancements: Advancements in technology are enabling industries to reduce emissions more effectively and affordably. Early adopters gain a competitive advantage through increased sustainability.
Strategies for Decarbonization
In response to these pressures, capital intensive industries are exploring and implementing various strategies to decarbonize, including:
Energy Transitioning: Companies are investing in renewable energy sources, such as wind and solar, to power their operations. Therefore, there is a focus on optimizing processes and equipment to reduce energy consumption.
Adopting Circular Economy Principles: Industries are exploring ways to reuse and recycle materials to minimize waste and reduce emissions.
Investing in Carbon Capture and Storage: carbon capture and storage (CCS) technologies are being considered as a way to capture CO2 emissions from industrial processes and store them.
Innovating in Low-Carbon Technologies: Investment in research and development of new technologies that emit less CO2 is critical for long-term decarbonization. For example, sustainable fuels, such as SAF (Sustainable Aviation Fuel) and HVO (Hydrogenated Vegetable Oil) emit less CO2 throughout their supply chain lifecycle.
Key Barriers to Decarbonization in Capital Intensive Industries
Financial and Technical Challenges
High Capital Costs: Implementing decarbonization technologies often requires significant upfront investment, which can be a major barrier for capital-intensive industries. These costs stem from the need to develop or integrate new technologies that are often expensive and not yet widely adopted. For example, adapting vehicles, vessels and aircraft for sustainable fuels or segregating these fuels within industrial processes can be costly, hindering the transition to greener practices in certain sectors.
Uncertainty in Carbon Pricing: The lack of predictability around future carbon pricing and regulations makes it difficult for businesses to plan and justify the investments needed for decarbonization projects. This uncertainty can delay or deter initiatives aimed at reducing carbon emissions.
Resource and Regulatory Hurdles
Raw Material and Energy Constraints: Limited availability of essential raw materials for industries like steel production and inadequate access to renewable energy sources for industrial processes are significant obstacles. For example, cobalt and other rare minerals play a crucial role in energy transition as they are used in the production of batteries and wind power systems.
Complexity of Regulatory and Administrative Landscapes: The ever-shifting global regulatory environment, coupled with the expanding administrative intricacies, presents a significant challenge for industries. This complexity is amplified by the necessity for increased collaboration among a growing number of stakeholders involved in the regulatory process. Particularly, the inclusion of Scope 1, 2, and 3 emissions in the supply chain demands an unprecedented level of cooperation, trust, and transparency. Achieving this is nearly impossible to achieve without using digital technologies to streamline processes and ensure compliance with constantly evolving standards, thereby intensifying the operational workload.
Human and Social Factors
Workforce and Technical Integration: Shortage of qualified staff and challenges in integrating green technologies into existing plants. A pivotal aspect of this digital transformation is the rise of low-code and no-code solutions, which have democratized the development process, making it accessible and enabling businesses to adopt them faster.
Social and Environmental Concerns: Public resistance to industrial changes and challenges in environmental protection can also pose barriers. The recent farmer outrage in Europe against sustainability policies in agriculture is one example.
Strategies for Implementing Green Supply Chains and Reaching net-zero
Management and Collaboration
Supply Chain Mapping: To effectively implement Green Supply Chain Management (GSCM), companies must start by mapping their supply chains to baseline their Scope 3 emissions and identify climate-related risks. This initial step is crucial for understanding the full extent of emissions and pinpointing critical areas for intervention.
Strategic Supplier Identification: Identifying key strategic suppliers is essential for leveraging influence to reduce Scope 3 emissions. By collaborating with these suppliers, companies can significantly impact their overall environmental footprint.
Supplier Engagement and Collaboration: Building strong collaborations with suppliers and business partners is vital. This includes setting shared sustainability goals and engaging in joint projects that focus on emissions reduction. Such collaborations are supported by transparency and continuous communication, fostering a mutual commitment to sustainability.
Leveraging Technology and Innovation
The importance of technology in decarbonization efforts and climate change mitigation is widely discussed in numerous studies and articles. McKinsey's article emphasizes the crucial role of technology in protecting the planet and offers resources for organizations to advance toward a low-carbon future. Additionally, the World Economic Forum whitepaper highlights the need for digital transformation in the environment and climate sectors to address urgent global challenges. It explores the potential of blockchain technology to enhance climate action by democratizing ownership, improving transparency, and providing real-time visibility into emissions reduction and sequestration efforts.
We are using digital innovation to help capital intensive industries, such as Energy and Chemicals, achieve sustainable and traceable operations. Our solutions enable these industries to meet the requirements of digital product passports, including data management, data sharing, and traceability.
Our all-in-one traceability solution, MARCO Track & Trace, positions our customers’ low-carbon, renewable, and/or circular products at the center, with our modules and flagship features around these sustainable products to help our clients improve profitability and margins, while mitigating risks. Four flagship modules are already in the market:
Automated sustainability credit bookkeeping: to effortlessly track and manage the inflow and outflow of credits, lowering audit costs and improving customer satisfaction with enriched traceability.
Scheme regulation: streamline compliance and introduce efficiencies in the creation, verification, and distribution of regulatory and voluntary certifications and declarations of sustainability.
GHG emissions tracking: calculate, manage, and reduce your supply chain’s carbon footprint with evidence-backed data. Move away from estimates and assumptions on emissions and get closer to more accurate carbon tracking and reporting.
Digital Product Passports: get ahead of upcoming regulatory pressures and embrace the market opportunity and significant returns that can come from investing in sustainability by sharing enriched supply chain data with your customers, covering emissions, credits, certifications, and much more.
These modules meet and comply with the regulatory landscape affecting capital intensive supply chains.
Finboot's MARCO Track & Trace offers an innovative traceability solution to automate ESG and sustainability credits record-keeping, create Digital Product Passports, and manage sustainability declarations and certifications.. MARCO Track & Trace enables trusted shared record-keeping between stakeholders in a supply chain.
Track & Trace was designed with interoperability at its core. MARCO can aggregate emerging technologies into our ecosystems, including legacy systems such as enterprises’ ERP or other supply chain and production software, while emerging systems will include the use of IoT devices and the connectivity to different underlying database structures, including the many layer-1 blockchain technologies and frameworks. We also have a proven track record of integrating to legacy systems, without the need for bespoke software development.
MARCO Track & Trace
Case Studies: Our success stories in industrial decarbonization
Automated Mass Balance in Sustainable and Circular Packaging
SABIC: SABIC becomes the first in their industry to unlock batch-level traceability from waste to packaging for their TRUCIRCLE products through MARCO Track and Trace. SABIC tracks the use of circular and renewable raw materials, such as plastic waste, and traces it down to the brands and eventually the consumer. The ultimate goal is to provide consumers with visibility into the origin and composition of plastic packaging.
Digital Product Passports in Chemical Supply Chains
CEPSA: Finboot has been working with Cepsa – a global energy company with a diverse portfolio spanning oil and gas and petrochemicals – since the start of 2023. Finboot’s MARCO Track & Trace has allowed Cepsa to implement digital traceability systems for tracking each batch of vegetable oil from its origin to its use in biodegradable surfactant production, in addition to automating bookkeeping and determining what percentage of output is from renewable and circular inputs.
Full Traceability of Net-Zero Emissions Fuels (HVO)
Repsol: Repsol has been a client since 2018 and uses our digital traceability solutions extensively across several business areas. They use our digital ecosystems for the traceability of low-carbon fuels like HVO (Hydrotreated Vegetable Oil), and circular chemical products like packaging.
Digital Traceability of Renewable Energy
Amber: Finboot and Amber have created a fully traceable ecosystem that tracks renewable energy from source to end user. This innovative solution, based on blockchain technology, matches energy generation and use, ensuring a certifiable and accurate means of proving origin. We set-out to build a new application, powered by Finboot’s MARCO platform, that allows management of data received from renewable energy plants (such as solar or wind). We will be able to provide the tools that securely record and validate these newly designed Digital Guarantees of Origin (GOs) because of the underlying blockchain technology on which they were built, thereby avoiding the real issue in the industry surrounding "double spending".
Regulatory Landscape Influencing Green Supply Chains
The transition towards green supply chains is increasingly being influenced by a dynamic policy and regulatory landscape. Governments and international bodies are implementing regulations and guidelines to promote sustainability, reduce greenhouse gas (GHG) emissions, and ensure transparency in environmental, social, and governance (ESG) reporting. This landscape is pivotal in driving organizations towards adopting more sustainable practices across their supply chains.
Key Focus Areas and Policies:
Digital Product Passport (DPP): Regulations around DPPs are central to enhancing product lifecycle transparency and promoting circular economy principles. The EU has introduced the DPP as a key component of the proposed Ecodesign for Sustainable Products Regulation (ESPR), which is set to be implemented in 2024.
GHG Emissions Reduction: Stringent policies targeting GHG emissions are pushing companies to innovate and adopt greener supply chain practices. Look for the Environmental Protection Agency (EPA) in the United States or the European Environment Agency (EEA) in Europe, for detailed policies and regulations.
ESG Reporting: Mandatory ESG reporting is increasing transparency and pushing sustainability to the forefront of corporate agendas. For instance, in the United States, the Securities and Exchange Commission (SEC) may provide relevant guidelines on ESG reporting.
Circular Economy Incentives: Policies and regulations incentivizing circular economy practices are crucial for minimizing waste and promoting resource efficiency. The European Union's Circular Economy Action Plan, provides a roadmap for transitioning to a circular economy, encouraging organizations to consider environmental and social factors in their purchasing decisions, impacting supply chain sustainability.
Compliance Benefits and Penalties
Businesses must stay abreast of these developments to not only comply with regulations but to also leverage opportunities for innovation and competitive advantage in a rapidly evolving market.
Advantages of Regulatory Compliance: Adhering to the above regulations not only fosters ethical business practices but also enhances company reputations, builds consumer trust, and supports sustainable supply chains. Compliance helps attract socially responsible investors and can provide a competitive advantage in increasingly eco-conscious global markets.
Consequences of Non-Compliance: Companies failing to comply with these regulations face severe penalties, including fines, reputational damage, and potential legal actions. Non-compliance can also lead to exclusion from critical markets and loss of business partnerships, significantly impacting the financial and operational aspects of the business.
Conclusion
The journey to reduce carbon emissions in capital intensive industries presents opportunities for innovation. By using technology and collaborating with others, companies can improve their competitive advantage and contribute to a sustainable future. Partnering with Finboot's expertise in green supply chain management helps businesses accelerate their transition to net-zero, showing their commitment to the environment and operational excellence. This approach aligns with consumer demands and regulations, integrating eco-friendly practices into core business strategies.
Contact us to learn how we can assist you in your journey towards net-zero, ensuring a smooth and meaningful transition for a greener tomorrow.
Blockchain technology fundamentally serves as a digital ledger that records transactions across a network of independent contributors. This decentralized nature enhances the security of the network. Once a transaction is recorded, it cannot be altered retroactively. In simpler terms, this means that the transaction records are permanent, which we describe as 'immutable.’
This immutability is crucial for improving supply chain management across various industries for several reasons:
Transparency: In a blockchain-enabled supply chain management system, transparency ensures the independent verification of claims. By storing supply chain events on the blockchain, customers can prove that events actually occurred, enhancing trust throughout the supply chain process.
Security: The strong cryptographic nature of blockchain makes it highly secure. There is no single point of failure, making each transaction's authenticity and accuracy the cornerstone of blockchain's application. In supply chain management, this verifiability is critical for maintaining the integrity and trustworthiness of the entire supply chain network.
These features make blockchain an important tool for companies looking to improve the integrity of their supply chain operations. By using this technology, businesses can ensure greater compliance with regulatory standards, foster trust with their consumers, and streamline their operations and trustworthiness.
Introduction and Advantages of Algorand
Algorand is recognized as a pioneering blockchain platform designed with a strong emphasis on environmental sustainability, speed, and low operating costs. Algorand supports the creation of greener blockchain solutions, making it an attractive choice for us and our customers who are looking to reduce their ecological footprint.
Energy Efficiency: Algorand’s architecture is specifically designed to reduce its energy use, supporting rigorous environmental sustainability goals. The efficiency comes from Algorand’s decision-making process, utilizing a consensus algorithm called Pure Proof of Stake (PPoS). Unlike other blockchain technologies that require significant amounts of energy to secure the network, PPoS minimizes energy consumption. This is because it relies on a system where network participants are randomly selected to verify the transactions, reducing the need for energy-intensive computing tasks.
Security and Transparency: Security is a cornerstone of Algorand’s design and their commitment to transparency is visible from its open-source codebase. The platform’s transparent operations enhance accountability and governance, crucial for organizations committed to high standards of social responsibility.
These characteristics make Algorand the ideal blockchain platform for Marco Track and Trace and for those seeking to improve the integrity and efficiency of their operations while at the same time following strong environmental and governance standards.
Updating to use Algorand and its Impact
We chose to expand our operations to use Algorand as the main blockchain solution for Marco Track & Trace (T&T) due the scalability and the operational improvements the network offers. These enhancements allow us to scale our services in tandem with the growing demands of our customers and to extend robust support to new clients. Algorand's architecture is adept at managing large volumes of transactions efficiently, maintaining high speeds that are essential for handling complex supply chains in near real-time.
Moreover, the compatibility of Algorand with our existing infrastructure allows for seamless integration without the need for a complete system overhaul. This compatibility facilitates a smoother adoption, reducing the time and resources needed for implementation.
Environmental Alignment
We previously highlighted Algorand's strong sustainability guarantees, which closely align with our environmental goals. This influenced our decision to adopt Algorand, as its energy-efficient approach minimizes environmental impact, reflecting our commitment to sustainable practices across our business.
Benefits to Customers:
For our customers, the transition to Algorand for Marco Track & Trace will be seamless, requiring no effort on their part. By integrating Algorand’s high-performance capabilities, we offer near real-time verifiability of supply chains with enhanced scale and capacity to meet higher demands.
Additionally, the use of Algorand’s environmentally friendly blockchain technology reduces our ecological impact, aligning with our sustainability commitments and ensuring that we meet the environmental expectations of our customers.
This transition emphasizes our dedication to operational excellence and environmental responsibility. While also strengthening the trust our customers place in us as a forward-thinking partner in supply chain management.
ESG Reporting and Compliance
Algorand's blockchain technology significantly enhances our ability to meet stringent ESG (Environmental, Social, and Governance) reporting requirements through its capacity to maintain immutable and accurate data. This is essential for ESG compliance as it ensures the recorded information—ranging from energy usage and waste management to corporate governance—accurately reflects what actually happened, without the risk of post-recording manipulation.
Verification of Sustainability Claims
The transition to Algorand aids in accurately verifying sustainability claims, a critical factor in combating greenwashing. Greenwashing is
The act of providing the public or investors with misleading or outright false information about the environmental impact of a company's products and operations. - Investopedia
Leveraging blockchain technology, Marco Track & Trace can provide a verifiable and transparent account of sustainability efforts. Everything is recorded and then “stamped” onto the blockchain to build up the Digital Product Passport (DPP). DPP’s allow for verification of compliance with environmental standards and practices. This transparency enhances the trust and credibility of our clients brand in the eyes of their customers, regulators and the broader public.
These advancements in ESG reporting and compliance underscore our commitment to upholding the highest standards of environmental and ethical conduct, ensuring that our operations are sustainable and transparent at every level.
Future Outlook
Looking ahead, our migration to Algorand sets us up for significant future gains in supply chain transparency, security, and operational efficiency. By leveraging Algorand's capabilities, we anticipate scaling our services to meet growing customer demand while ensuring seamless real-time traceability and the immutability of transactions. This will also enhance our compliance with ESG (Environmental, Social, and Governance) standards.
In the coming years, we will continue to innovate with blockchain technology, allowing us to bring new solutions to the marketplace and identify real-world use cases that maximize the potential of this technology. By leveraging Algorand’s capabilities, we aim to find unique ways to solve logistical challenges, improve efficiency, and maintain the integrity of data across the supply chain.
This migration underscores our dedication to innovation and ethical conduct, empowering us to adapt swiftly to regulatory changes and shifting customer expectations. By staying at the forefront of blockchain adoption, we remain a step ahead in providing future-ready, efficient, and sustainable supply chain management solutions that will benefit our clients and stakeholders for years to come.
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About Algorand
Algorand is an energy-efficient, quantum-secure, single-layer blockchain with instant finality, consistently high throughput, and low fees. Designed by Turing Award-winning cryptographer Silvio Micali, it is built for real-world scale.
Algorand has grown into a vibrant ecosystem of developers, entrepreneurs, and enterprise partners that benefit from institutional-grade certainty and resilience. Its fees, instant finality, and a minimal carbon footprint appeal to the protocol's millions of retail users, and developers of all kinds appreciate the ability to use common programming languages like Python. Builders on Algorand are creating protocols and companies that solve important problems at a global scale: instant payments in war and disaster zones, self-sovereign identity for the disenfranchised, supply-chain traceability for global commerce, permissionless protocols addressing financial inclusion, and the creation of entirely new markets through tokenization, to name a few. To learn more and start your journey on Algorand, visit algorand.co .
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About Algorand Foundation
Algorand’s mission is to power a world where information has integrity and innovative ideas can scale. The Algorand Foundation supports Algorand’s rapidly growing ecosystem by providing a best-in-class developer environment, supporting key infrastructure and setting technical standards, offering comprehensive support to builders and entrepreneurs, and providing the framework for decentralized governance.
Founded by Turing Award-winning cryptographer Silvio Micali in 2019, Algorand has grown into a vibrant ecosystem of developers, entrepreneurs, and enterprise partners that benefit from institutional-grade certainty and resilience. Its fees, instant finality, and a minimal carbon footprint appeal to the protocol's millions of retail users, and developers of all kinds appreciate the ability to use common programming languages like Python. Builders on Algorand are creating protocols and companies that solve important problems at a global scale: instant payments in war and disaster zones, self-sovereign identity for the disenfranchised, supply-chain traceability for global commerce, permissionless protocols addressing financial inclusion, and the creation of entirely new markets through tokenization, to name a few. To learn more and start your journey on Algorand, visit algorand.co.
This blog post is a summary version of our live interview streamed on YouTube and LinkedIn, with our Co-Founders, Juan Miguel Perez and Nish Kotecha. The video is about Finboot’s growth plan after its latest successful fundraise, and how it aligns with the demands of Green Supply Chain Management.
Finboot has recently completed its latest fundraise thanks to its alignment with Green Supply Chain Management, which is at the heart of the movement on the need for sustainable practices.
Regulating initiatives are knocking on businesses’ doors, asking for data. Over the next few years, industries will face heightened scrutiny; compliance will be mandatory, with penalties and taxes looming. As regulators demand more transparency, our clients —such as Repsol, SABIC and CEPSA— are feeling the pressure. They’re required to provide granular data.
At Finboot, we anticipated this challenge years ago when we built our MARCO platform that acts as the conduit; it is based on blockchain technology, which is the ultimate data record-keeper. Data is securely recorded from end-to-end, creating an unbreakable chain of trust and transparency. As a result, we have a single source of immutable truth that reveals:
Product Location: know exactly where your product is at any given moment.
Workflow Insights: what’s happening, who’s involved and when.
Verifiable Communication: pinpoint who said what, eliminating ambiguity.
Finboot thrives on innovation and global expansion:
Our growth strategy involves leveraging cutting-edge technology, focusing on market expansion in Europe, the US, and the UK, driving our efforts in hard-to-decarbonize industries such as oil and gas, chemicals, and steel, and forging connections with businesses worldwide.
If you want to know more about what we do, follow us on Linkedin, X and Youtube and stay tuned for our upcoming events:
Ami Polymer Sourcing and Distribution Event —May 14-16, Brussels.
Gartner Global Symposium on Global Supply Chains —June 10-12, Barcelona.
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[Blog based on Finboot’s Growth Strategy: Green Supply Chain Management webinar, Wednesday 17 April 2024]
Cardiff, April 16, 2024 – Finboot, the leading tech firm, has announced a strategic growth plan after a successful investment round to strengthen the company's position and accelerate its expansion in green supply chain management for capital-intensive industries.
Leading Green Supply Chain Management for Capital Intensive Companies
The funding will be instrumental in furthering the development and commercialisation of Finboot's flagship product, MARCO Track & Trace, and expanding the company's global reach.
Nish Kotecha, Executive Chair and Co-Founder of Finboot, says: "With a strengthened financial position, Finboot is committed to expanding its presence in key markets across North America, Europe, and the UK. The company aims to establish strategic partnerships and alliances to drive adoption and maximise the value of blockchain technology for enterprises in promoting supply chain visibility and driving decarbonisation through digitalisation."
Juan Miguel Perez, CEO and Co-Founder of Finboot, added: “The successful investment round marks a pivotal moment for Finboot, empowering us to accelerate our innovation and expand our global footprint.”
“Our technology helps our clients substantiate their ESG and sustainability credentials, which leads to a stronger market position. We facilitate the core priorities of industry leaders in sectors like Oil & Energy, Chemicals and Steel; our digital solutions help them close the gap between strategy and execution.”
“This strengthened positioning comes after valuable feedback from our key clients and investors - in high capital industries, including SABIC, Repsol, and Cepsa.”
“Going forward, our messaging will emphasise our expertise in green supply chain management to enable clients to accelerate their net-zero transition through technology. With our product, MARCO Track & Trace, we will continue to reduce operational costs and mitigate risks in complex supply chains; all while driving sustainability, traceability, and crucially compliance across the whole value and supply chains.”
Finboot's Strategic Growth Plan
Building on the momentum generated by the latest investment round, Finboot is poised to execute an ambitious growth strategy focused on product development, market expansion, and talent acquisition.
One of the main shifts is the repackaging of our all-in-one traceability platform, MARCO Track & Trace. By actively listening to our client’s needs and preferences, we have now focused our offering. We’ve positioned our customers’ low-carbon, renewable, and/or circular products at the centre. Our modules and features go around these sustainable products to help our clients improve profitability and margins. Four flagship modules are already in the market:
Automated sustainability credit bookkeeping: to effortlessly track and manage inflow and outflow of credits, lowering audit costs and improving customer satisfaction with enriched traceability.
Scheme regulation: streamline compliance and introduce efficiencies in the creation, verification, and distribution of regulatory and voluntary certifications and declarations of sustainability.
GHG emissions tracking: calculate, manage, and reduce your supply chain’s carbon footprint with evidence backed data. Move away from estimates and assumptions on emissions and get closer to more accurate carbon tracking and reporting.
Digital Product Passports: get ahead of upcoming regulatory pressures and embrace the market opportunity and significant returns that can come from investing in sustainability by sharing enriched supply chain data with your customers, covering emissions, credits, certifications, and much more.
Alvaro Llobet, Head of Product, added: “Finboot will continue to invest in product and technology; advancing MARCO's capabilities, enhancing its scalability, security, and interoperability to meet the evolving needs of enterprise clients."
"We are launching new modules, such as Carbon Credits, and improving existing features. We are also working to enhance the customer experience by offering a new, and enhanced user experience."
Finboots is also expanding its marketing efforts. Flavia Sales, who has been promoted to Marketing Manager to lead Finboot's marketing initiatives, is excited about the launch of the new company’s website, announced on Monday, April 15, which will better align with Finboot’s updated messaging and positioning.
"The new website aims to enhance its support for clients and ensure they have the necessary resources to navigate their own journey towards net-zero, providing them with relevant content at every step of the way."
To communicate the company's messaging and strategy, the co-founders Nish Kotecha and Juan Miguel Pérez Rosas went in a 20-minute live interview on Wednesday, April 17, 2024, at 3pm (CET) and streamed it on Finboot’s social media channels (YouTube, LinkedIn, and X):
About Finboot
Finboot’s technology provides green supply chain management for the world's largest capital-intensive manufacturing companies.
Our technology traces carbon emissions and minimises risk through immutable data. Finboot is backed by SABIC and Repsol. Finboot has created the first green supply chain management suite with features including integrated traceability, allowing you to track carbon emissions, automate digital product passports, create sustainability credits, and facilitate compliance. Finboot is headquartered in Cardiff, with a base in Barcelona.
Welcome to our interview series on the circular economy and sustainability.
In this article, we will delve into the challenges and initiatives undertaken by the Ecosense Foundation, a leading organization in promoting tray-to-tray recycling in Europe through their certification scheme, RETRAY. I had the privilege of speaking with Mercedes Gomez, the Managing Director of Ecosense Foundation, to gain insights into their flagship initiatives, future plans, and the impact of regulatory considerations on the industry. Let's dive into the future of thermoformed PET packaging and its role in the circular economy!
About Ecosense Foundation and RETRAY Certification Scheme
The Ecosense Foundation was established in 2017 as a joint initiative between multiple companies in the packaging industry, with support from the European Commission. Their mission is to promote tray-to-tray recycling in Europe through the RETRAY certification scheme. RETRAY focuses on certifying the recycled content and recyclability of thermoformed PET packaging, a specific type of packaging commonly used for fresh food, fish, meat, and cold cuts.
Under the accreditation of ISO 17065, RETRAY ensures traceability and compliance with EN Standard 15343 requirements. The scheme has already certified over 30 companies and more than 70 processes and products in Spain, Portugal, France, and Italy. With plans to expand to the United Kingdom and Germany, Ecosense aims to further enhance the recycling infrastructure for thermoformed PET packaging in Europe.
About Ecosense
Addressing theChallenges of Decarbonization and Circular Economy
Decarbonization, sustainability, and circularity are key challenges faced by the packaging industry. Thermoformed PET packaging plays a crucial role in addressing these challenges. Mercedes Gomez highlights that PET has excellent properties for food conservation, thus reducing food waste. Additionally, its light weight nature enables efficient transportation, minimizing CO2 emissions.
Ecosense's certification scheme promotes circularity in thermoformed PET packaging through tray-to-tray recycling. This aligns with the European Commission's goal of closing the loop on packaging, both from an eco-design perspective and bottle-to-bottle recycling. By certifying converters and recyclers, RETRAYensures that the infrastructure for PET tray recycling is established and meets the targets outlined in the new packaging and packaging waste regulation.
RETRAY certification
Integrating Innovative Technologies for Environmental Performance
In their commitment to enhancing environmental performance, resource efficiency, and supply chain transparency, Ecosense is embracing innovative technologies. They are collaborating with Finboot to study the implementation of blockchain technologyin the PET thermoform value chain. This integration of blockchain aligns with their certification scheme's emphasis on traceability, chain of custody, and transparent information sharing.
Blockchain technology allows for secure, auditable, and trustworthy digital traceability ecosystems. By utilizing Finboot's solution, MARCO Track & Trace, Ecosense could ensure that the information regarding the recycling and recyclability of thermoformed PET packaging is verifiable by third parties. This digitalization of the value chain facilitates compliance with legislative requirements, such as the European Greenwashing Directive and the upcoming Eco Design for Sustainability Regulation.
The Impact of Regulatory and Policy Considerations
Regulatory initiatives play a pivotal role in shaping market access and the adoption of sustainable products and technologies within the packaging industry. The European Greenwashing Directive requires third-party verification for environmental claims, reinforcing the importance of certifications like RETRAY. The EcoDesign for Sustainability Regulation will introduce mandatory information requirements and labeling, further driving the need for digital passports and blockchain technology.
The packaging sector faces a high level of regulation, including the No. 2022/1616 regulation for plastic food contact products. Compliance with these regulations poses challenges for both multinational companies and small and medium enterprises. The complexity of gathering and interconnecting requirements varies across member states, making it crucial for companies to stay updated and connected with industry associations and platforms like the Circular Plastics Alliance and the PETCORE Association.
Communicating Sustainability Efforts and Environmental Initiatives
Effective communication and dissemination of sustainability efforts and environmental initiatives are as important as the transition itself. Ecosense ensures their message reaches stakeholders through various channels. They actively participate in industry platforms and associations, such as the Circular Plastics Alliance, the PACKNET (Spanish Packaging Technology Platform), the PETCORE Association in Europe, and TCEP, which is the Tray Circularity Evaluation Platform. This presence allows Ecosense to advocate for circularity and provide valuable insights into improving recycling practices.
Ecosense also employs digital communication strategies, including a dedicated blog on their website.This blog serves as a platform for sharing technical and legislative information relevant to the packaging industry. Additionally, they maintain a strong presence on LinkedIn, where they engage with professionals to share corporate updates, videos, and newsletters.
The Future Outlook for thermoformed PET Packaging
Looking ahead, digitalization will play a crucial role in the future of thermoformed PET packaging and the circular economy. Ecosense's focus on implementing blockchain technology through their collaboration with us highlights the importance of traceability and chain of custody in achieving sustainability goals. The integration of digital traceability ecosystems will provide a robust foundation for compliance with regulations and support the industry's transition towards circularity.
As the demand for sustainable packaging solutions continues to grow, the thermoformed PET packaging industry will face both challenges and opportunities. By leveraging innovative technologies, embracing regulatory frameworks, and fostering effective communication, Ecosense and other stakeholders in the value chain can drive the adoption of sustainable practices and contribute to a more circular and environmentally conscious future.
Conclusion
The Ecosense Foundation, through their RETRAY certification scheme, is leading the way inpromoting tray-to-tray recycling in the thermoformed PET packaging industry. Their initiatives align with the goals of decarbonization, sustainability, and circularity. By integrating innovative technologies like blockchain and actively engaging with regulatory frameworks, Ecosense is driving the industry towards enhanced environmental performance, resource efficiency, and supplychain transparency.
As the industry continues to navigate regulatory considerations, effective communication and dissemination of sustainability efforts are crucial. Ecosense's dedication to keeping stakeholders informed and engaged through their communication channels is vital to promoting relevant content and avoiding misleading information.
With a strong focus on digitalization and the future integration of blockchain technology, Ecosense is poised to shape the future of thermoformed PET packaging and contribute to amore circular economy.
The journey towards circularity and sustainable packaging solutions is ongoing, but with the commitment and collaboration of organizations like Ecosense, a brighter and more environmentally conscious future is within reach.
Maritime decarbonization is the critical path towards limiting global temperature rise to 1.5 degrees Celsius by reducing greenhouse gas (GHG) emissions from the maritime industry, which accounts for about 3% of annual global GHG emissions, according to the International Maritime Organization’s (IMO’s).
This endeavor is essential, given the shipping industry's foundational role in the global economy and the pressing need to mitigate its environmental impact amidst predictions that maritime emissions could soar to 17% by 2050 without concerted action (international shipping enables 80-90% of global trade and comprises about 70% of global shipping energy emissions).
The exploration of alternative fuels, such as hydrogen and LNG, stands at the forefront of strategies for decarbonizing shipping, leveraging existing maritime transport infrastructure while contemplating the carbon footprint across the supply chain to ensure genuine sustainability.
As governments establish ambitious maritime emissions reduction targets, the alignment between regulatory frameworks and industry support becomes paramount. This synergy paves the way for implementing low-carbon fuels and advanced technological solutions, like carbon capture and electrification, within the maritime law and policy structures designed to spur the transition towards a greener maritime industry.
Such collaborative efforts underscore the dual focus on immediate reductions in transport-related emissions and the long-term goal of achieving a transparent and reliable decarbonization process through enhanced supply chain transparency, supported by digital innovations such as blockchain technology.
Emerging Fuels in Maritime Decarbonization
In order to reduce carbon emissions in the maritime industry, it is important to focus on exploring and using new types of fuels. These fuels can be easily incorporated into the existing infrastructure of the maritime industry. However, using these fuels comes with both advantages and challenges that need to be carefully considered and addressed.
This transition is already happening, and the report Maritime Forecast to 2050 by DNV predicts that by 2030, the shipping industry will require 30-40% of the global supply of carbon-neutral fuels. This estimate takes into account the expected demand of 17 MTOe (million metric tons of oil equivalent) per year and the current greenhouse gas (GHG) strategy set by the International Maritime Organization (IMO).
A recent survey conducted by Global Centre for Maritime Decarbonisation, the Global Maritime Forum, and the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (with analytical support provided by McKinsey), to find out how industry leaders are thinking about future fuels. Collectively, these shipping companies own and operate fleets—including container ships, tankers, dry bulkers, gas carriers, car carriers, cruise ships, tugs, and offshore vessels—comprising roughly 20 percent of the world’s total capacity.
The snapshot that emerges from respondents’ answers portrays a world with a wide range of fuels in the mix through 2050. Many respondents expect their fleets to run on multiple types of fuel well into the future. This suggests that shipping’s route to decarbonization could be complex. But companies that are currently plotting investment strategies might consider viewing this inchoate moment as an opportunity for bold decision making. Multiple fuel pathways continue to be viable, and advantages for first movers are there for the taking.
Among the survey findings:
More than 80% of respondents indicate that the following four developments would be most transformative: greater availability of alternative fuels, cost reductions for alternative fuels, customer willingness to pay a “green premium,” and regulatory change.
80% of respondents believe that greater availability, cost reductions, customer willingness to pay a premium, and regulatory change are key to accelerating the transition to greener fuels.
49% of respondents expect to adopt four or more fuel families by 2050.
46% of companies have run pilot programs with low-carbon fuels and have plans for further implementation.
35% of companies have taken no action regarding greener fuels.
Projections for fuel consumption in 2050 are split evenly among various options.
Respondents expect to spread their consumption across multiple fuel families.
¨In the world suggested by these survey answers, the role of first movers—and of entities that can galvanize entire value chains, from fuel production to a vessel’s consumption—will be vital. Organizations that lead the way might provoke and shape others’ actions, catalyzing investments that create their own momentum and, over time, perhaps result in the inevitability of a specific fuel scenario.¨
Liquefied Natural Gas (LNG): While LNG emits the lowest amounts of CO2 among fossil fuels, its environmental benefit is mitigated by methane slip in certain engines. Its abundance and relative affordability make it a transitional fuel, yet its methane content, a potent greenhouse gas, raises concerns.
Biofuels and Synthetic Fuels: Derived from biogenic sources or synthesized through processes like the Fischer-Tropsch method, these fuels promise significantly lower lifecycle GHG emissions. Sustainable marine fuels, including bio-methanol, lignin-alcohol mixes, and bio-diesel, can achieve over 70% reductions in emissions with the right feedstock and processes. Their compatibility with existing engines and infrastructure positions them as immediate solutions for reducing emissions.
Hydrogen-based Fuels: Hydrogen, offering clean and scalable energy, faces hurdles in cost, availability, and safety. Ammonia, a hydrogen derivative, emerges as a carbon-free option when produced renewably, though it presents challenges in energy density and safety.
Also, another viable alternative is:
Electrification: Electrification suits shorter voyages, with ongoing advancements to overcome limitations for longer distances. According to a study on the potential for using batteries on ocean-going cargo ships led by The Maritime Battery Forum and CIMAC, currently there are 94 cargo ships with a battery system installed, with 17% being inland cargo ships, 64% coastal cargo ships, and 19% ocean-going cargo ships.
The transition to these fuels underscores the importance of a lifecycle approach, emphasizing supply chain transparency and chain of custody to ensure genuine sustainability. This comprehensive view addresses the critical question of sustainability by tracing the origin and production process of these fuels, from raw materials to end-use, highlighting the role of renewable energy and carbon capture in achieving a lower carbon footprint.
Regulatory Framework and Industry Support for Maritime Decarbonization
The regulatory framework and industry support play a vital role in facilitating the transition towards greener shipping practices, ensuring the successful implementation of maritime decarbonization measures.
The U.S. co-leads global efforts like the Mission Innovation Zero-Emission Shipping Mission and the Clydebank Declaration for Green Shipping Corridors, aiming to reduce maritime fuel emissions.
Federal agencies, including the Maritime Administration and the Environmental Protection Agency, support maritime decarbonization through programs like the Maritime Environmental Technical Assistance (META) and the Port Initiative.
The International Maritime Organization (IMO) targets a 50% GHG emission reduction by 2050, setting the stage for stringent emission limits and energy-efficient ship designs. This paper by IRENA provides details on these mandates.
Main barriers include regulatory uncertainty, the cost and availability of zero-carbon fuels, and the slow pace of innovation within the maritime value chain.
It is important to note that ports play a crucial role in shipping logistics, requiring access to land near manufacturing districts and/or raw materials. Decarbonizing these ports can significantly reduce CO2 emissions from shipping infrastructure. To reduce greenhouse gas emissions in the shipping sector, it is essential to improve the infrastructure and processes involved in the supply chain and logistics of shipping. Shipping lanes, which are predetermined routes for ships, are also crucial for optimizing trade routes. When planning these routes, factors such as geographical boundaries and access to international industrial regions are taken into consideration.
As we can see, the synergy between regulatory frameworks, industry initiatives, and international partnerships is instrumental in overcoming these challenges. By focusing on planning, policymaking, and facilitating research and development, stakeholders can accelerate the adoption of sustainable fuels and technologies, ensuring maritime decarbonization aligns with global climate goals.
The concept of life cycle assessment (LCA) methodology encompasses the assessment of emissions of greenhouse gasses from the point of fuel production to its ultimate consumption by a vessel, an approach often termed as "Well-to-Wake." This methodology is bifurcated into two segments:
Well-to-Tank: This segment accounts for the emissions incurred during the upstream phase of the fuel's lifecycle.
Tank-to-Wake: This segment covers the downstream emissions that occur from the storage tank of the ship until the point of utilization.
The International Maritime Organization Convention laid down the "Guidelines on Life Cycle GHG Intensity of Marine Fuels," also known as the LCA Guidelines.The purpose of these guidelines is to delineate procedures for the precise calculation of both well-to-wake and tank-to-wake GHG emissions for all types of fuels and energy sources utilized on maritime vessels, which also includes electrical power. These guidelines are subject to ongoing evaluations and enhancements, particularly in areas such as default emission factors, sustainability benchmarks, fuel authentication, and strategies for carbon capture on ships.
The LCA Guidelines serve as a resource detailing the GHG emissions that occur during the entire lifecycle of marine fuels. The term "lifecycle" refers to the comprehensive process that starts with fuel production and continues through its distribution to its final application in maritime operations. The "GHG intensity" is indicative of the volume of greenhouse gas emissions produced for each unit of fuel utilized. The primary objective of the LCA Guidelines is to establish a uniform framework that facilitates the assessment and comparison of GHG intensity across various marine fuel types.
EU ETS – Emissions Trading System
The EU ETS (Emissions Trading System) is a key policy tool used by the European Union to control greenhouse gas emissions. It operates on the "cap and trade" principle, where a cap is set on the total amount of certain greenhouse gasses that can be emitted by covered entities. These entities are then allocated or auctioned a limited number of emission allowances, which they can trade with one another as needed, in order for the EU to meet its target of a 55% reduction in GHG emissions by 2030 relative to 1990 and net zero by 2050. The maritime industry has been brought into the EU ETS from 2024 as part of the EU's efforts to reduce emissions from this sector. Here are some key points to consider:
Business Impactsome text
For maritime companies, this inclusion means they will need to account for their emissions and acquire the necessary allowances to cover their activities.
Compliancesome text
Maritime companies will need to ensure compliance with the EU ETS regulations, which may involve implementing new monitoring and reporting processes to accurately measure and report their emissions.
EU ETS timeline and Requirements
The European Union Emissions Trading System (EU ETS) will be introduced over a three-year period, with the coverage of emissions increasing gradually. The timeline is as follows:
Phase-In Period: The EU ETS will start by covering 40% of emissions in 2024, increasing to 70% in 2025, and reaching 100% coverage in 2026.
Scope Expansion: Initially, the EU ETS will apply to cargo and passenger ships above 5000 gross tonnage (GT) from 2024, and it will extend to offshore ships above 5000 GT from 2027.
Inclusion of Additional Gasses: While initially focused on carbon dioxide emissions, the EU ETS will be broadened to encompass methane and nitrous oxide from 2026.
Potential Inclusion of Smaller Ships: General cargo ships between 400 and 5000 GT may also be required to report emissions and could be incorporated into the EU ETS at a later stage.
Shipping companies operating to or from ports in the EU or European Economic Area (EEA) will have to adhere to the following obligations:
EUA Holdings: They must possess an adequate number of EU Allowances (EUAs) to cover the greenhouse gas (GHG) emissions from the ships under their control and surrender these allowances to the authorities annually.
Emissions Monitoring and Reporting: These companies are mandated to monitor, report, and verify their GHG emissions annually under the EU Monitoring, Reporting, and Verification (MRV) regulation. The reported information is utilized to determine the allowances they are obligated to surrender.
By implementing robust digital solutions and integrating them into the supply chain, the maritime industry can effectively streamline operations and reduce greenhouse gas emissions. These digital solutions enable real-time monitoring and optimization of fuel consumption, route planning, and vessel performance, leading to enhanced operational efficiency and competitiveness. With the collective efforts of industry stakeholders, regulatory bodies, and technological innovations, the maritime sector can accelerate its journey towards decarbonization and contribute to the global effort to reduce carbon emissions.
How digitalization can Accelerate Decarbonization in the Maritime Industry
Shipping was easy, fuel costs were passed on to cargo owners. Now, the maritime industry must comply with regulations and meet expectations from stakeholders, customers, and partners. The industry needs to manage CII performance, account for carbon emissions, settle EUAs, follow LCA Guidelines, and handle the impact of the EU Emissions Trading System in the maritime supply chain.
Digitalization can significantly help the maritime industry decrease carbon emissions through innovative technologies and digital tools. Here's how:
Utilizing cloud computing, edge AI, blockchain, big data, sensors, IoT, satellite, and 5G can optimize onboard energy consumption, routing, and terminal operations.
These technologies enable real-time monitoring and data sharing for energy-efficient practices, facilitating access to emissions data for the entire merchant fleet and increasing visibility into shipping-related emissions across the supply chain.
For instance, the development of chain of custody systems – which allow the emission profile of a zero-emission fuel to be separated from the physical flow of that fuel in a transportation supply chain, can play a major role in accelerating the early phases of shipping’s decarbonisation transition, by ensuring the security, compliance, and integrity of goods during their journey to meet the needs of fuel producers, shipowners, cargo owners and charterers shipping ocean freight.
Digital Traceability Solutions for Sustainable and Traceable Operations
Transparency is crucial in order to foster sustainability in the transport sector. By embracing data-driven approaches and cutting-edge technologies like blockchain, stakeholders can ensure the tracking of the origin, production, and distribution of sustainable fuels. This heightened transparency fosters accountability, bolsters emissions reduction efforts, and aids in ensuring adherence to regulatory standards, thus significantly contributing to decarbonization initiatives. Our digital traceability solution, MARCO Track & Trace, offers four flagship features that can help in your commitment to sustainability:
Automated Mass Balance and Book & Claim Chain of Custody: Streamline your record keeping for sustainability credit and bring traceability from feedstock to final product, down to batch-level granularity.
GHG Emissions: Track and trace your supply chain emissions, obtaining a final measure of a product's emission footprint that is broken down for the emissions caused by each part of the supply chain.
Scheme Regulation: Simplify document creation and management. Easily configure and create sustainability declarations and other supply chain documentation based on readily available data in your traceability ecosystem.
Digital Product Passports: Bring all your product and value chain data together in one place to share with clients, regulators, and consumers in the form of interactive Digital Product Passports.
We are committed to using digital innovation to help the transport industry achieve sustainable and traceable operations, including data management, data sharing, and traceability; furthermore, we promote sustainable practices, circular product management, responsible manufacturing, and carbon credits.
By integrating these digital solutions, the maritime industry can accelerate its journey towards decarbonization, optimizing operations, and reducing GHG emissions while enhancing operational efficiency and competitiveness.
Conclusion
Throughout this blog on maritime decarbonization, the compatibility of emerging fuels with current infrastructure offers immediate emission reductions but requires scrutiny for sustainability. Their lifecycle emissions must be evaluated, not just their combustion outcomes. Fuels derived from plant matter, waste products, or carbon capture techniques rely on transparent supply chains and tracing of origins and production processes to ensure a lower carbon footprint than traditional fossil fuels.
It is important to remember that while the adoption of sustainable fuels is crucial, it is also essential to explore other decarbonization solutions, such as speed reduction, route optimization, digitized systems, and energy-saving technologies. Additionally, onboard carbon capture and storage and nuclear propulsion should be considered as potential long-term solutions.
In light of these considerations, the collaboration between industry stakeholders, regulatory bodies, and technological innovations is crucial for navigating the complexities of maritime decarbonization. Collective efforts in promoting sustainable fuels, digitalization, and regulatory support pave the way for a greener maritime industry. This transformation is not only an environmental imperative but also a strategic economic shift towards sustainable development in global trade. Maintaining vigilance in supply chain management and promoting transparency are essential.
Contact us to learn how we can optimize resource management and enhance transparency in maritime transport, contributing to global decarbonization.
Download this eBook to learn how to optimize resource management, monitor emissions, optimize supply chains, promote sustainable fuel usage, and enhance transparency and accountability in air transport.
CARDIFF,UK, 4 April 2024 – Finboot announced on April 4th, it has appointed Mark Redwood a financial and professional services specialist, former Chairman KarnovGroup, and Thomson Reuters President, to its Advisory Board.
Mark has forty years of professionalexperience, including senior roles not just at Karnov Group, but also currentlyas a Non-Executive at GeoPura, Nimbus® and Spektrix, and previously at the world's leading provider of news andinformation-based tools to professionals - Thomson Reuters. KarnovGroup is a Scandinavia-based leading provider of knowledge and workflowsolutions in legal, tax and accounting together with environmental, healthand safety legal compliance and monitoring.
Nish Kotecha, Executive Chair and Co-Founder of Finboot, says:
“We are excited Mark Redwood is joining the Finboot Advisory Board. Mark’s in-depth experience in financial and professional services will guide the implementation of our MARCO platform in the financial and professional services value chain.”
“Mark will help us combine blockchain powered traceability with trade finance andother financial and professional services sector opportunities.”
“Mark's experience is second to none – he is a highly experienced tech entrepreneur. During his time at Thomson Reuters, he was President of Sales and Trading, the world's leading provider of news and information-based tools.”
Mark Redwood says:
“Ilook forward to working with Finboot’s forward thinking team to help Finboot deploy its leading-edge tech opportunities in the financial and professional services sector.
“Finboot’s no-code/ low-code blockchain platform and ecosystem, MARCO, is a trailblazer. It is a user-friendly platform that will help companies audit and in turn comply with incoming ESG regulations.
· Sporting Index, Chairman and non-executive Director
· Achilles Group, Non-Executive Chairman
· Benchmark Solutions, Non-Executive Director
About us
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain. Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: Bringing the future of the internet to business. MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability. Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
In the chemical manufacturing sector, there has been significant change in recent years.
The CEO and Co-Founder of Finboot, Juan Miguel Perez, was delighted to be able to spend some time with Ron Abbott, Vice President Chemical Recycling, Vopak to discuss these changes and look ahead to the challenges capital intensive industries face as they look to accelerate their role in the energy and feedstock transition.
Ron’s professional journey began at the Phillips Petroleum Company, which led him to Chevron Phillips Chemical Company after the merger of Chevron Chemical and Phillips Petroleum’s chemical division.
Ron has so far amassed an impressive 31 years’ of experience, primarily in R&D and new technology development. His focus throughout his career has always been on practical application of new technologies and making a positive difference. For the past five years Ron has focused on chemical recycling of plastics.
During the conversation, Ron highlighted the need for but the limitations of mechanical recycling. Supply issues loom large, and the resulting material is typically not suitable for regulated applications. Enter advanced technologies like chemical recycling, which is emerging as an effective complementary approach to mechanical recycling needed to meet future regulatory recycled content requirements.
Vopak recognizes that the path to sustainability lies in collaboration. As Vice President of Chemical Recycling, Ron is excited about where Vopak is heading. Vopak seeks to help pyrolysis[1] oil companies and resin producers scale up their technologies and build efficiencies.
In the end, the global community needs to achieve a more circular economy. Vopak’s sprint towards this more circular economy is fuelled by innovation, transparency, and an unwavering, long-standing commitment to serve their customers. Transparency in supply chain data is instrumental for true sustainability. Ron said, ¨At Vopak, we’re not just witnesses to this global shift; we’re active participants shaping a future where the circular economy isn’t an aspiration but a tangible reality. ¨
Navigating Toward Net-Zero and Sustainable Growth
Vopak was established in 1616. This 400-year-old company has weathered many storms, adapting, and evolving to remain relevant. But how does a company maintain its longevity in a world that’s rapidly transforming? The answer lies in innovation, foresight, and a commitment to sustainability.
Vopak has had to reinvent itself periodically to grow. The need for emissions reduction present both challenges and opportunities. Fossil fuels, once the lifeblood of our economies, are no longer sustainable. Vopak recognises this seismic shift and embraces it. Their new energies team at Vopak, that Ron is a part of, is at the forefront of this transformation.
“As one example, we’ve been repurposing storage tanks,” Ron says. In Los Angeles for example, 22 tanks have been converted to store Sustainable Aviation Fuel (SAF) and renewable diesel. Similarly, 16 new storage tanks have been constructed in Rotterdam for the same purpose. In Singapore, bio methanol bunkering activities are also underway. “Renewable feedstocks - they’re the future,” says Ron. Major petrochemical producers now integrate renewable feedstocks into their portfolios. It’s a shift towards net-zero emissions – an audacious goal, but one Vopak embraces.
In the dynamic landscape of energy and sustainability, Vopak, a global leader in storage and infrastructure solutions, has charted a strategic course that combines growth with a steadfast commitment to environmental responsibility. Ron said Vopak’s strategy, can be summarised as “improve, grow, and accelerate.”
Three Pillars of Vopak’s Strategy
1 - Improving Financial and Sustainability Performance
The bedrock of Vopak’s strategylies in enhancing both financial and sustainability metrics. By optimizing operations, reducing emissions, and fostering responsible practices, Vopak aims to create value for shareholders while minimizing its environmental footprint.
2 - Growing in Base, Industrial and Gas Terminals
Vopak recognises the critical role it plays in the energy transition. As the world shifts toward cleaner fuels, liquefied natural gas (LNG) has emerged as an interim solution. Vopak's terminals, strategically positioned across the globe – serve as vital hubs forstoring and distributing essential energy resources.
3 - Accelerating Toward New Energies and Sustainable Feedstocks
The future demands innovation.Vopak is committed to investing in low-carbon alternatives, such as green hydrogen, ammonia, and carbon capture, storage, and utilization. By leveraging existing assets and exploring other opportunities, Vopak aims to contribute significantly to a net-zero society.
Ron emphasized that urgency underscores Vopak mission. "Climate change is a serious threat, and we can't be complacent. Our environment has given us a deadline, and we need to pay attention to it. But there's a paradox: While developed countries are transitioning quickly, there are still many places that haven't reached the same level of growth. How can we bridge this gap? ¨
One part of the solution, he advocates, is to see energy transition and sustainability initiatives as opportunities for growth. Instead of obstacles, developed countries can help under developed regions move forward. ¨By investing in renewable energy, green technologies, and circular practices, we can create chances for economic progress. It's adelicate balance – combining urgency with inclusivity – but one that has great potential for humanity."
¨Vopak's dedication to sustainability is clear through three major investment commitments:
● Improve: Our commitment to shaping a better future has led us to set ambitious goals to guide us towards 2030. Our focus is on continuing to improve the financial and sustainability performance of our portfolio and on creating value for all stakeholders.
● Grow: We aim to grow in industrial and gas infrastructure by investing EUR 1 billion by 2030. We operate, strategically located industrial terminals that are well connected to our customers' industrial facilities. In addition our gas terminals handling LNG and LPG form a vital connection between supply and demand and play an important role in the security of energy supply.
● Accelerate: Vopak aims to accelerate the transition to new energies and sustainable feedstocks by investing EUR 1 billion by 2030. Our investments will help to facilitate new logistic chains to support customers in their energy transition ambitions. Decarbonizing our value chains will be a long-term journey involving many stages, while the speed and approach will vary from region to region. However, one thing is certain: infrastructure will be critical at every stage and location. ¨
Final thoughts: The Climate Risk Imperative
Why does circularity matter? Because we’re reshaping the world for generations to come. Consider Ron’s three-year-old grand daughter, poised to enter the workforce two decades from now. What legacy will she inherit? Our mission is clear: reduce carbon footprints, enhance efficiencies, and leave a planet that thrives.
Challenges and Tools
Yes, challenges loom large. But so do opportunities. As the population of the planet grows our planet demands steward ship. The key tools are digitisation, innovation, and the collective will to create behavioural change. Taken together these tools can be our compass – guiding us toward a sustainable destination.
Call to Action
We need to build a world where circularity isn’t an abstract concept but a daily practice. Together, we’ll turn challenges into stepping stones and opportunities into reality. And in the end the sprint (perhaps it’s a marathon AND a sprint!) to net-zero isn’t just about business; it’s about legacy. And in 20 years, when Ron’s grand daughter steps into her role, we will have been successful if she finds a world transformed—one where emissions goals have been met and circularity is the norm.
______
[1] “Pyrolysis is one of thetechnologies available to convert biomass to an intermediate liquid productthat can be refined to drop-in hydrocarbon biofuels, oxygenated fuel additivesand petrochemical replacements. Pyrolysis is the heating of an organic material,such as biomass, in the absence of oxygen”, USDA
------ END OF THE INTERVIEW ------
Final Note: This interview marks the beginning of our Circular Economy Series. Stay tuned for upcoming episodes, where thought leaders like Ron will discuss their perspectives and insights.
Discover More: For deeper insights, explore our ebooks and blog. Dive into the world of blockchain-powered solutions, where trust meets efficiency.
Connect with Finboot on social media:
● LinkedIn: Follow us for the latest updates and industry trends.
● X (formerly known as Twitter): Join the conversation and stay informed.
Reach out to Finboot team – we’re eager toshare knowledge and collaborate.
Aviation is one of the fastest-growing sources of greenhouse gas emissions. Aviation currently accounts for approximately 2 to 3% of global carbon emissions. According to IATA projections air travel is going to double by 2040.
IATA projections for air travel.
In a world increasingly focused on reducing carbon footprints, the aviation industry is soaring towards a greener horizon with the adoption of Sustainable Aviation Fuel (SAF). Here's what sets SAF apart:
Diverse Feedstocks: SAF is produced from a variety of sources, including waste vegetable oils and agricultural residues. This flexibility in raw materials is crucial for the scalability and sustainability of SAF production.
Compatibility with Existing Engines: One of SAF's most compelling features is its ability to be used in current aircraft engines without the need for modifications. This compatibility accelerates the adoption of SAF across the aviation industry.
Potential to Reduce Emissions: SAF has the potential to reduce greenhouse gas emissions by up to 80% over its lifecycle compared to traditional aviation fuels. This significant reduction is a cornerstone in the quest for net-zero emissions in aviation.
However, to ensure the environmental benefits of SAF, it's crucial to foster transparency and traceability throughout its production process. This involves:
Tracking the Production Process: From the origin of raw materials to the complete supply chain, meticulous tracking ensures a transparent reduction in carbon intensity.
Collaborative Frameworks: SAF producers and air carriers need to establish a collaborative framework to share and validate supply chain data. This collaboration is essential for substantiating the sustainability claims of both parties.
Our digital tracking solutions are crucial in guaranteeing the transparency and dependability of Sustainable Aviation Fuel (SAF) lifecycles, fostering a cooperative environment throughout its supply chain.
The Evolution and Importance of SAF: types, benefits and uses of each one
Sustainable Aviation Fuel (SAF) represents a significant advancement in the aviation industry’s journey towards a more environmentally friendly future. As the sector anticipates a substantial expansion by 2050, the role of SAF in reducing carbon emissions becomes increasingly vital. Here, we explore the evolution, types, and benefits of SAF, along with its practical applications.
Types and Benefits of Sustainable Aviation Fuels (SAF):
Cooking Oil and Animal Waste Fat: These waste-derived feedstocks are converted into SAF, offering a sustainable second life for materials that would otherwise contribute to landfill waste.
Solid Waste: Municipal solid waste, including non-recyclable plastics, provides another source for SAF production, turning societal refuse into renewable energy.
Forestry and Agricultural Residues: Utilizing byproducts from forestry and agriculture not only minimizes waste but also leverages existing industries to create a circular economy.
Energy Crops: Specifically grown for fuel production, these crops are cultivated with sustainability in mind, ensuring minimal impact on food supply and biodiversity.
Key Advantages:
Reduced Carbon Footprint: SAF boasts a similar chemical composition to traditional jet fuels, yet it can reduce lifecycle carbon emissions by up to 80%, making it a cornerstone in the industry's carbon reduction strategy.
Compatibility and Safety: SAF can be blended with conventional jet fuel up to 50% without necessitating modifications to aircraft or refueling infrastructures, ensuring a smooth transition to greener operations.
Universal Application: All aircraft certified to use standard jet fuel specifications are cleared for SAF, which has already been distributed across multiple continents, marking a significant step in global adoption.
The integration of SAF into the aviation fuel mix represents a pivotal step in the industry's commitment to a sustainable future, ensuring that the skies remain open for travel while protecting the planet for generations to come.
Challenges and Solutions for SAF Adoption
While Sustainable Aviation Fuel (SAF) stands as a beacon of hope for a greener aviation future, its path is strewn with challenges that must be navigated with strategic solutions. The aviation industry's commitment to reducing its carbon footprint through the use of SAF is clear, yet the production volume and economic factors present significant hurdles.
Production and Infrastructure Challenges:
Insufficient Production: With SAF production at approximately 200,000 metric tons in 2019, there is a stark contrast between available SAF and the aviation industry's total fuel consumption. The demand far outstrips the current supply, underscoring the need for a ramp-up in production capabilities.
Cost Barriers: The premium price of SAF, coupled with the nascent stage of production and distribution infrastructure, makes widespread adoption financially challenging for many airlines.
Solutions to Enhance SAF Production and Adoption:
Government Incentives: Implementing economic incentives such as subsidies or tax credits can significantly lower the cost barrier, making SAF a more attractive option for airlines.
Investment in Infrastructure: To address the scarcity of production facilities, substantial investment is required to establish and expand SAF production plants and distribution networks.
Streamlined Certification: Simplifying the standardization and certification processes will facilitate the introduction of SAF into the market, ensuring safety and performance standards are met efficiently.
Technical and Regulatory Challenges:
Ensuring Performance and Safety: SAF must meet rigorous performance and safety criteria to be viable for widespread use. This necessitates ongoing research and development to optimize SAF formulations for aviation requirements.
Complex Certification Requirements: The process of certifying new types of SAF is intricate, requiring a collaborative effort to streamline and expedite approvals.
Strategies for Technical Advancement and Compliance:
R&D Investment: Continued investment in research and development can lead to more efficient and cost-effective SAF production processes, enhancing its competitive edge against conventional jet fuels.
Multi-Stakeholder Collaboration: Industry, government, and academia need to work in concert to tackle the technical challenges and streamline the certification process, paving the way for swiffer SAF adoption.
Driving Demand and Meeting Goals:
Educational Initiatives: Increasing awareness about the environmental and operational benefits of SAF can stimulate market demand and support its broader adoption across the industry.
Policy Alignment: National and international policies must be aligned with economic incentives and sustainability criteria to promote the production of climate-beneficial SAF.
Global Collaboration: The international aviation community, including member states participating in CORSIA, must collaborate to ensure that SAF meets stringent sustainability criteria and contributes to the sector's net-zero ambitions.
In summary, while the challenges to SAF adoption are formidable, they are not insurmountable. With targeted strategies and collaborative efforts, the aviation industry can overcome these obstacles, ultimately leading to a sustainable future that aligns with environmental goals and regulatory mandates. The commitment of administrations, such as the Biden administration's ambitious targets for SAF production and emissions reduction, is a testament to the global dedication to this crucial transition.
The Role of Government and Industry in Promoting SAF: Adoption and Infrastructure
The aviation industry's transition to sustainable aviation fuel (SAF) is a collaborative effort that hinges on the strategic alignment of government policies and industry initiatives. This synergy is crucial in establishing the necessary infrastructure and compliance timelines that will accelerate SAF deployment and contribute to the sector's net-zero ambitions by 2050.
The regulations on ensuring a level playing field for sustainable air transport (also known as the ReFuelEU aviation initiative) aim to increase the uptake of sustainable fuels by aircraft and ships to reduce their environmental footprint.
The proposals are part of the Fit for 55 legislative package, which aims to reduce the EU’s greenhouse gas emissions by at least 55% by 2030.
Incentive programs, when paired with mandates, can expedite the integration of SAF by making it more economically viable for airlines. These incentives might take the form of tax credits, subsidies, or other financial mechanisms designed to lower the cost barrier associated with SAF production and adoption.
Implement the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) which is intended to be introduced from 2021, is initially (in its first phase to 2027) a voluntary scheme covering 66 countries and 80% of international aviation emissions.
The package proposes to revise several pieces of EU climate legislation, including the EU Emissions Trading System (EU ETS) for aviation, which is a mandatory cap and trade mechanism that applies to intra-EEA flights. The monitoring and reporting of greenhouse gas emissions must be robust, transparent, consistent and accurate for the EU ETS to operate effectively.
Establishment of the Union Database for Biofuels (UDB) is based on Clean energy for all Europeans package & Article 28 (2) and (4) of the Renewable Energy Directive (RED II) to Improve the traceability of gaseous and liquid fuels in Transport Sector with the objective to avoid double counting and mitigating the risks for irregularities/ fraud.
The EU ETS acts as a regulatory framework for emissions within the European Union, while CORSIA addresses emissions from international flights. The UDB supports these systems by ensuring the sustainability of biofuels, which are a key element in reducing aviation emissions. Sustainable aviation fuel, monitored by the UDB, can be used to reduce an airline's carbon footprint, thus affecting their obligations under both the EU ETS and CORSIA.
Our digital traceability solution, MARCO Track & Trace, helps companies comply with RED II regulations for various renewable energy products such as biofuels and hydrogen, each with specific emissions rules. Its flexibility allows adaptation to different traceability ecosystems, ensuring compliance with SAF, HVO, hydrogen, packaging, chemicals, steel, and more.
2014 Onshore wind is cheaper than coal, gas and nuclear energy
2009 Renewable Energy Directive: EU target of 20% renewables by 2020 and national binding targets
2008 Olmedilla Photovoltaic park (Spain) - largest power plant (60MW) in the world - generates enough to power 40 000 homes/year
2003 Directive on biofuels and renewable fuels for transport: national targets for biofuels
2001 Directive on electricity production from renewables: national indicative targets
2000 First large-scale offshore wind farm (Denmark)
1997 Energy for the future: renewable sources of energy: indicative EU target of 12% renewables by 2010
1991 Germany introduces first feed-in-tarif for renewables
To meet the growing demand for aviation fuel and achieve the targeted reduction in emissions, the industry and governments must continue to push for robust policies and tangible support mechanisms. This includes grants and policies that encourage innovation and investment in SAF technologies and production facilities. The collective effort to advance SAF is not just about compliance but about ensuring that the aviation industry can sustain its growth while honoring its commitment to environmental stewardship.
Several European States have established national policy actions to promote the supply and use of Sustainable Aviation Fuels (SAF). A European SAF Map is available at EUROCONTROL’s public website with a selection of pioneering industry initiatives of SAF use in Europe, based on publicly available information.
The California Low Carbon Fuel Standard (CA-LCFS) aims to reduce greenhouse gas emissions in transportation. It assigns values to carbon reduction from renewable fuels, including SAF recognized since 2019. The benefits of SAF are measured through life cycle assessment, and credits earned can incentivize its production and be sold to others.
The U.S. Renewable Fuel Standard (RFS), established in 2005 and updated in 2007, focuses on increasing renewable fuel use in ground transportation. SAF can opt-in, generating compliance units known as RINs. Currently, SAF generates 1.6 RINs per gallon, aiming to enhance its competitiveness without mandates.
The U.S. Sustainable Skies Act, introduced in May 2021, incentivizes the use of SAF. Credits up to $2/gallon are offered for high-GHG-saving SAF, provided it meets ICAO sustainability standards. Additionally, a $1 billion grant over 5 years is allocated to expand SAF facilities.
The Biden Administration's newly announced SAF policies set a goal to produce 3 billion gallons/year of SAF by 2030. These include a proposed tax credit to reduce costs and increase production, funding for SAF projects and producers, and collaboration with international partners for global SAF availability.
SAF Accounting and Supply Chain Transparency to Support the Energy Transition
In the pursuit of a more sustainable future for aviation, the importance of robust SAF accounting and supply chain transparency cannot be understated. These measures are foundational to the credibility and effectiveness of the energy transition in aviation. Here, we examine the mechanisms that support these processes:
Book and Claim Mechanism:
Verified Information Flow: The Book and Claim system facilitates the flow of verified information about the production of clean fuels, such as SAF. This model is critical for sectors like aviation, where the physical mixing of sustainable and conventional fuels is logistically complex.
Emissions Savings: Through this system, companies can "book" emissions reductions when they purchase SAF, and "claim" these benefits in their climate disclosures, even if the SAF is not used in their own flights.
Certificates and Registry: SAF certificates represent the lifecycle emissions reductions and are tracked in a registry, ensuring each certificate is unique and accounted for, thus preventing double counting and ensuring transparency.
Mass Balance Approach:
Sustainability Verification: The physical supply chain for SAF is independently verified against sustainability criteria, ensuring that the production process adheres to stringent environmental standards.
Chain of Custody: A mass balance approach maintains the chain of custody, documenting the quantities of sustainable and conventional fuels throughout the supply chain to provide an auditable trail for GHG accounting and ESG reporting.
Regulatory Assurance: Policymakers and regulatory authorities are instrumental in creating a framework that incentivizes the production and use of SAF, by reducing costs and enhancing sustainability.
By integrating Finboot's systems into the broader framework of aviation regulation and industry practices, the aviation sector can ensure that its transition to sustainable aviation fuels is not just a goal but a tangible reality backed by verifiable environmental benefits. Finboot offers end-to-end traceability solutions for complex industrial supply chains using blockchain technology, creating a digital enterprise ecosystem. These decentralized systems provide crucial product information to relevant stakeholders, empowering the aviation sector to meet regulatory requirements and enhance traceability for sustainable operations.
Through digital innovation, Finboot assists industries like petrochemicals, oil, and gas in achieving sustainability goals and maintaining traceable operations, ensuring compliance with regulation standards, and facilitating data management, sharing, and traceability.
Our digital traceability solutions are underpinned by 4 flagship features:
Automated Mass Balance: streamline your record keeping for sustainability credit, and bring traceability from feedstock to final product to batch-level granularity.
GHG Emissions: track and trace your supply chain emissions, obtaining a final measure of a product’s emission footprint that is broken down for the emissions caused by each part of the supply chain.
Scheme regulation: simplify document creation and management. Easily configure and create sustainability declarations, and other supply chain documentation based on data readily available in your traceability ecosystem.
Digital Product Passports: bring all your product and value chain data together in one place to share with clients, regulators, and consumers in the form of interactive Digital Product Passports.
The Cepsa Case: Digital Product Passports in Chemical Supply Chains
Finboot has been working with Cepsa – a global energy company with a diverse portfolio spanning oil and gas and petrochemicals – since the start of 2023.
Finboot’s MARCO Track & Trace has allowed Cepsa to implement digital traceability systems for tracking each batch of vegetable oil from its origin to its use in biodegradable surfactant production, in addition to automating bookkeeping and determining what percentage of output is from renewable and circular inputs.
The Amber Case: Blockchain Case Study: ‘Digital Traceability of Renewable Energy’ Finboot & Amber
We’ve teamed up with Amber to develop a traceable ecosystem for renewable energy (like solar or wind), tracking it from source to end user using blockchain technology. This solution ensures accurate verification of energy origin and usage, enhancing certification reliability by securely recording and validating Digital Guarantees of Origin (GOs) to prevent industry issues like 'double spending'.
The Repsol Case: Full Traceability of net-zero emissions fuels (HVO)
Repsol has been a client since 2018 and uses our digital traceability solutions extensively across several business areas. They use our digital ecosystems for the traceability of low-carbon fuels like HVO (Hydrotreated Vegetable Oil), and circular chemical products like packaging.
The SABIC Case: Blockchain to Deliver Sustainable Packaging
SABIC, the global leader in the chemicals industry, becomes the first in their industry to unlock batch-level traceability from waste to packaging for their TRUCIRCLE products through MARCO Track and Trace.
The project, with advanced recycling pioneer Plastic Energy and packaging specialist Intraplás, uses the Finboot application to support end-to-end digital traceability of circular feedstock in customer products.
Conclusion and Future Outlook for Energy Transition in the Aviation Industry
The aviation industry is actively transitioning to renewable, low-carbon alternatives, driven by governmental support, increased biofuel adoption, and technological advancements. Sustainable aviation fuel (SAF) stands as a cornerstone in this transition, offering significant emission reductions and compatibility with existing aircraft. Challenges such as production scaling and cost remain, but with advancing technology and collaborative efforts, SAF's potential as a vital component of eco-friendly aviation becomes more evident.
Crucially, ensuring the credibility and effectiveness of this transition relies on robust SAF accounting and transparent supply chains. Transparent supply chains are essential to enhance traceability and integrity in the biofuels market, preventing issues such as double counting and fraud. Collaboration among policymakers, industry stakeholders, and the public is imperative for achieving lower emissions and fostering a sustainable aviation future.
Download the first ebook in a series that explores fuels and technologies driving the energy transition in land, air, and sea transport.
A just transition to net-zero is impossible without sustainable mindsets fuelling sustainable strategies. But who is responsible for shaping this thinking?
Research suggests women have a huge part to play. According to a 2021 GreenBiz Report, there has been a significant increase in women taking up sustainability leadership roles in recent years.
In 2011 for example - in the United States, “women held 28 per cent of chief sustainability officer positions, but by 2021, this had increased to 54 per cent.” This is a 94 per cent increase! Although this uptake seems a significant step in the right direction for sustainability, combatting climate change, and indeed female empowerment, the all-male COP29 committee suggests it is not the end of the journey but the beginning.
Azerbaijan, the host country for COP29, initially appointed 28 men and no women to organise this year’s Climate Summit. This announcement – rightly – drew a powerful backlash. It was hastily announced the committee would include 12 women.
Against this global microcosm, Finboot asked four senior female leaders in the tech sector about their experience around the existential issue of sustainability.
The key point is all the female leaders interviewed expressed a huge determination to preserve our natural world.
Natalia’s background is in industrial engineering. She began at Spanish energy giant, Repsol, as a process engineer. Then, following a successful twenty years working at the multi energy company, she went on to lead Net Zero Ventures as Managing Partner. Net Zero Ventures' mission is to reduce carbon emissions through investing in new renewable energy / disruptive technologies. Natalia’s focus is seeking decarbonisation in mobility and industry.
Noslen is a client facing Executive at Finboot. Noslen collaborates closely with leadership to champion sustainability, energy transition, and circularity within the organisation.
Deepa Poduval is the Senior Vice President and Global Advisory Leader & Global Head of Sustainability at Black & Veatch. Deepa has led the development of their sustainability strategy framework anchored around corporate, client and community focus areas for their actions and investments to advance sustainability.
Bettina Uhlich is a former CIO at a global leader in the sustainability in the chemicals sector. She believes that leaders need to convince and encourage people to work towards a common goal: making sustainable decisions.
Challenges and Triumphs
For Natalia, the journey to net-zero presents both exciting challenges and opportunities. ‘The scale of investment needed is immense and the pace at which we need to reach net-zero should be fast. 2050 is the deadline, so ‘action must be taken swiftly and decisively.’
Deepa commented on the pace of progression towards finding sustainable solutions and said that ‘perhaps one of the biggest challenges is gaining organisational attention and access to resources especially given competing priorities.’
For Noslen, she has discovered the opportunity to influence the organisational mindset by facilitating discussions, providing insights on viable investments, and highlighting the business case for embracing environmental responsibility. If a business can be inspired to prioritise and allocate resources towards sustainable initiatives, this will inevitably build the company’s long-term resilience to climate change.
Bettina believes that short-sightedness is a luxury we cannot afford and said: ‘Climate change is the biggest global threat... it’s a huge investment and it starts in the mindset. Sustainable resource management is very expensive. The return on investment takes longer.’... ‘Investment is always future-orientated and that’s why leaders need the courage to convince people to invest in sustainable solutions. As well as this, we need laws and regulations that force people to invest.’
Impact and Innovations
At Black & Veatch, Deepa has helped to deliver several groundbreaking projects in sustainable infrastructure. They have helped to construct ‘the world’s largest green hydrogen hub: Initially designed to convert over 220 MW of renewable energy to 100 metric tonnes per day of green hydrogen, which will then be stored in two massive salt caverns capable upon start up of storing more than 300 GWh of dispatchable clean energy, which is 150 times the current installed grid scale battery capacity!
Natalia has invested in several companies over the years, but Finboot holds a special place in her heart. ‘Finboot is backed by an exceptional team. When you combine great technology with a talented team, success and impactful outcomes are practically guaranteed.’
Bettina believes that partnerships and alliances create impact, especially when you encourage them to invest sustainably. But digital innovation is also required to create impact. ‘In the chemical industry, our consumers expect us to adhere to safe protection of data as well as a negative CO2 footprint. Blockchain is just one example of improving effectiveness and efficiency - creating safe ecosystems and cloud systems.’
Leadership and Empowerment
Natalia strongly recommends that women pursue roles in sustainability. It positively impacts the world, and this leads to a fulfilling and rewarding career. Her one piece of advice would be to recognise the power of collaboration and understand that this is what we need to achieve sustainability goals. Equally, collaboration must include everyone, meaning that inclusive and diverse working environments must be fostered.
Bettina has a powerful desire and motivation to inspire the next generation of girls and women. ‘I am a president of an initiative in Germany, Austria and Switzerland called: ‘She’s goes IT’. This involves partnering with schools and creating exercises for children (no code/low code exercises.) I also go into universities and offer discussions and support for academic pieces. I encourage women to be IT and software engineers. I coach and mentor more young females and say to them: “Don’t work harder, work smarter.” We offer special lessons to top female managers on how to promote themselves and be part of hard discussions.’
Deepa said: “Embrace agility, seek to learn from others and their lessons learned – the collective ecosystem is critical to success. This is not a journey to take alone so build a network for your company. Be patient and realistic about challenges along the way and don’t let perfection get in the way of progress.”
Embrace a sustainable mindset and new technology
Our fantastic four women agreed that digital innovation and sustainability are ‘inextricably interlinked.’ and that to fulfil sustainability goals, everyone must adapt and adopt this new technology. Companies who do not invest in sustainability today will face a huge disadvantage tomorrow. While initial investment to develop digital innovations is high, this should not dissuade investors from making financial decisions that will benefit future generations. The time to automate these processes is now, but leadership, collaboration and inclusion are essential components in making this happen.
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Editor’s note: A huge thank you to the women who all shared their wisdom on sustainability, leadership, and digital innovation.
A digital product passport is a sophisticated tool that stores vital product data throughout the product lifecycle. It holds detailed information about the product's production, testing, and recycling. The purpose of a digital product passport is to ensure product compliance with various regulations and to provide a comprehensive record of the product’s history. This is particularly crucial for batteries sold to consumers, as it provides assurance that the battery they are purchasing is safe, compliant, and sustainable.
The digital product passport initiative is a key action under the Circular Economy Action Plan (CEAP) and is part of the proposed Ecodesign for Sustainable Products Regulation. The objective of this initiative is to gradually introduce digital product passports in key markets by 2024, such as the battery passports for electric vehicles.
Digital vehicle passports represent a groundbreaking innovation in the automotive industry, serving as a comprehensive digital identity for vehicles. These passports encapsulate a detailed history and current status of a vehicle, utilizing blockchain technology to ensure authenticity, security, and immutability of data. Stakeholders, including manufacturers, dealers, regulatory bodies, and end-users, benefit significantly from the transparency and efficiency these digital passports offer.
Manufacturers: Initiate the digital passport by entering the vehicle's production data.
Suppliers: Contribute by adding information on parts and materials used, enhancing traceability.
Regulatory Bodies: Monitor compliance with safety and environmental standards through access to detailed vehicle data.
Dealers and Service Providers: Utilize the passport to verify vehicle history and authenticity, facilitating maintenance and resale processes.
End-users (Customers): Gain access to a trustworthy and comprehensive vehicle history, making informed decisions regarding purchase and maintenance
While DPPs can apply to a wide range of products, the focus in this article is on a specific type - the Digital Battery Passport (DBP). This technology is of particular relevance considering the increasing reliance on batteries for various applications, from electric vehicles to renewable energy storage systems. DBPs provide crucial information about a battery's life cycle, including its production, use, recycling, and disposal.
Understanding the core concept of DBPs is the first step towards appreciating their potential impact on different industry sectors and the environment at large. These digital passports are, in essence, a manifestation of digital traceability, which entails tracking and documenting every phase of a product's life cycle. By offering in-depth visibility, DBPs can significantly enhance the ethical and environmental practices in the battery industry.
Digital Battery Passports: The Pioneer
Battery passports are essentially digital tools that encapsulate all critical information about a battery’s lifecycle. From the raw materials used in its manufacture to its disposal or recycling, a battery passport will offer a comprehensive view of the product's journey. But who needs this information, and why is it important?
For Consumers: Battery passports bestow upon consumers the power of knowledge. They enable informed decision-making regarding the acquisition, utilization, and responsible disposition of products. This empowerment is pivotal in fostering a more sustainable and environmentally conscious consumer behavior.
For Governments and Regulatory Bodies: For these entities, battery passports serve as an indispensable instrument for monitoring compliance with environmental standards and regulations. They facilitate the oversight of industry practices, ensuring adherence to prescribed sustainability benchmarks.
For the Industry Sector: From a business perspective, battery passports can significantly streamline supply chain operations, unveiling potential inefficiencies or environmental liabilities. This insight can catalyze operational enhancements, cost reductions, and an overall elevation in sustainability. Specifically, in sectors such as oil and gas, energy, mining, steel, textiles, construction, electronic waste, plastics, chemicals, and automotive, Digital Battery Passports (DBPs) offer unprecedented visibility into the lifecycle of batteries. This visibility is instrumental in mitigating environmental risks and championing sustainable practices across the board.
Battery passports are setting the precedent for digital product passports. From 2027, every industrial and electric vehicle battery will have to come with a digital product passport, more specifically a battery passport. This passport will contain critical information linked to safety requirements and targets for recycled content in batteries.
The digital battery passport will provide data on:
Material sourcing
Carbon footprint
Percentages of recycled materials used
Battery durability
Guidelines for repurposing and recycling
Leveraging Digital Battery Passports for Carbon Footprint Mitigation
Heavy industries such as oil and gas, energy, mining, steel, textiles, construction, electronic waste, plastics, chemicals, and automotive are increasingly adopting DPPs. By leveraging digital traceability, these sectors can enhance their sustainability efforts and comply with regulatory requirements.
In the energy sector, for instance, Digital Battery Passport (DBPs) can provide detailed information about the environmental footprint of batteries used in renewable energy storage systems. Similarly, in the automotive industry, DBPs can offer insights into the lifecycle of batteries used in electric vehicles, helping to reduce their overall environmental impact.
By enabling greater transparency and traceability in the battery supply chain, DBPs can help identify and reduce carbon-intensive activities. This could include improving manufacturing processes, optimizing logistics, and facilitating effective recycling.
Furthermore, DBPs can help to combat greenwashing, a practice where companies misrepresent their environmental impact to appear more sustainable than they actually are. By providing verifiable information about a battery's lifecycle, DBPs can hold manufacturers accountable for their environmental footprint and discourage deceptive practices.
Navigating the Regulatory Landscape of Digital Battery Passports:Key Dates and Requirements
The new EU Battery Regulation approved in July 2023 by the EU (Regulation 2023/1542), introduces significant changes and requirements aimed at enhancing the sustainability and safety of batteries and battery-operated products. The regulation introduces new battery categories, including portable, industrial, automotive, electric vehicle (EV), and light means of transport (LMT) batteries. Each category has specific requirements and regulations.
The development of digital battery passports (DBPs) is being propelled by efforts in the European Union, China, and through collaborative initiatives like the Global Battery Alliance (GBA) and the Battery Pass consortium. These passports aim to bolster transparency and foster sustainable, circular value chains.
– The EU Battery Regulation mandates comprehensive content requirements for the digital battery passport, including general battery and manufacturer information, compliance and certifications, carbon footprint, supply chain due diligence, battery materials and composition, circularity and resource efficiency, and performance and durability.
– Following the 2023 revision of the EU Battery Legislation, the Chinese government launched the development of a Chinese digital battery passport. The aim is to facilitate trade with the EU, by requiring similar data transparency requirements along the EV battery value chain in China, such as the carbon footprint, circularity, and ESG.
– Policy-makers can scale digital battery passports globally by standardizing reporting parameters and technical frameworks, integrating with existing systems and initiatives, and advancing and supporting industry action.
The emergence of DBPs is closely tied to the evolving regulatory landscape around sustainability and circular economy. The European Union's Circular Economy Action Plan and the Sustainable Products Initiative are notable frameworks that advocate for greater product traceability. The Ecodesign for Sustainable Products Regulation, in particular, is expected to play a crucial role in promoting the adoption of DBPs.
Who Will Need to Implement Digital Battery Passports?
The EU's Battery Regulation Amendment lays out a comprehensive set of rules designed to protect the environment by reducing hazardous materials in batteries and increasing the recycling rate of batteries. A key component of this amendment is the battery passport, which stores relevant battery data throughout the product's lifecycle.
Every industrial or electric vehicle (EV) battery on the EU market with a capacity of over 2 kWh will require a battery passport, irrespective of the origin of the battery. It is the responsibility of the party placing the battery on the market to ensure that all required data is entered into the digital record and that the information is correct and up-to-date.
Source: Battery Pass Consortium, 2023
Compliance Timeline for Digital Battery Passports in the EU
Starting Aug. 18, 2024, manufacturers shall affix the CE marking before placing the battery on the market or putting it into service. The manufacturer shall affix the CE marking to each individual battery that meets the applicable requirements or, where that is not possible or not warranted due to the nature of the battery, to the packaging and the documents accompanying the battery.
From 1st February 2027, all EV and industrial batteries sold in the EU market will require a unique battery passport. Information on the battery is to be retrieved using a QR code, and must include performance classification for carbon impact, electrochemical performance, and durability requirements.
Key milestone:
2023
Entry into force of the Battery Regulation
End of 2023 – Article 7 and Annex II on carbon footprint: delegated act on methodology for EV batteries, implementing act on declaration format
2024 - Battery management system (BMS)
Beginning of 2024 – Article 11 commission guidance on implementation
Middle of 2024 – safety of stationary battery ESS application documentation
Aug. 18, 2024 – Chapter VI economic operators and Article 17, conformity assessment procedures for Articles 6, 9, 10, 12, 13 and 14
Aug. 18, 2024 – CE marking (Articles 19 and 20)
End of 2024 – Article 7 and Annex II on carbon footprint delegated act on methodology for industrial batteries and Article 71, recycling efficiencies and material recovery targets implementation act methodology
2025
Feb. 18, 2025 – Article 7, carbon footprint for EV batteries
Aug. 18, 2025 – Chapter VII, Due Diligence, and Chapter VIII, management of waste batteries
End of 2025 – Article 10 and Annex IV, performance, durability for LMT, EV and industrial batteries delegated act minimum values
Mid-2026 – Labeling Article 13, general information required per Annex VI A; non-rechargeable portable batteries will need to display their minimum average duration (MAD) for specific applications and be labelled as "non-rechargeable"
H1 2026 – Article 76, Reporting to Commission implementing act reporting format and verification methods; Article 13 on labeling of batteries implementing act harmonised specifications
H1 2026 – Article 8, recycled content delegated act methodology for calculation and verification of the recovered material, and Article 71, recycling efficiencies and material recovery targets – Commission assessment of targets
2027
Feb. 18, 2027 – Article 11, Removability and Replacability
Feb. 18, 2027 – Battery passport: LMT batteries, industrial batteries (above 2 kWh) and EV batteries will be required to be electronically registered. This will be in the form of a battery passport carrying an identification QR code and CE marking
Beginning of 2027 – Labeling Article 13: All batteries should be marked with a QR code providing access to more detailed information
Mid-2027 – Article 9, performance and durability parameters for portable batteries delegated act minimum values, and Article 85, green public procurement delegated act minimum criteria
Mid-2027 – Article 7 on carbon footprint delegated act on maximum thresholds for EV batteries
2028
Aug. 18, 2028 – Article 7, Carbon Footprint for LMT batteries, and Article 8, recycled content for SLI, EV and industrial batteries — document on share of material recovered from waste (cobalt, lead, lithium or nickel) for LMT from 2033
End of 2028 – Article 8 on recycled content commission assessment of targets.
What information goes into a digital battery passport?
A digital product passport, as a rule, encompasses a thorough and detailed set of data about the product's origin, its composition, the possibilities for repair and dismantling, and the procedures for handling it at the end of its life. In addition, it meticulously documents the product's environmental footprint over the course of its entire lifecycle, which includes factors such as energy consumption, emissions produced, and the generation of waste. This wealth of information is of paramount importance when it comes to assessing the product's overall sustainability and its compliance with established environmental standards.
Digital Product Passports (DPPs) not only enhance the value of products by providing detailed information about their lifecycle, but also foster a deeper engagement with customers. Consumers today are increasingly conscious about their environmental footprint and are seeking products that align with their values. By providing transparency about a product's environmental impact, DPPs empower consumers to make informed purchasing decisions, thereby fostering loyalty and trust.
- General battery and manufacturer information: Battery Identification; manufacturer’s identification; manufacturing place; manufacturing date; battery category; battery weight; battery status.
– Compliance, labels, certifications: Separate collection symbol; symbols for cadmium and lead; carbon footprint label; meaning of labels and symbols; EU declaration of conformity and its ID; compliance of test results.
– Battery carbon footprint: Declared carbon footprint; share of battery carbon footprint per life cycle stage; carbon footprint performance class; web link to public carbon footprint study; administrative information about the manufacturer; information about the geographic location of the battery manufacturing facility.
– Supply chain due diligence: Information on responsible sourcing as indicated in the report on due diligence policies (the due diligence report is the only mandatory supply chain due diligence requirement for the digital battery passport).
– Battery materials and composition: Battery chemistry; critical raw materials; materials used in the cathode, anode, and electrolyte; hazardous substances; impact of substances on the environment and on human health or safety.
– Circularity and resource efficiency: Design for circularity information (i.e. disassembly and dismantling information, spare parts information; safety instructions); recycled and renewable content (i.e. recycled content for cobalt, lithium, nickel, and lead; renewable content share); end-of-life battery information (i.e. information on waste prevention and collection).
– Performance and durability: Battery performance reporting (e.g. battery capacity, energy round trip efficiency), durability data (e.g. expected lifetime in cycles/calendar years).
Mandatory reporting requirements for the EU battery passport
Decarbonization of the Heavy Industry: The Role of Digital Innovation
Digital battery passports play a crucial role in the decarbonization of the energy sector. They provide transparency and traceability for the carbon footprint of batteries, enabling more sustainable sourcing, manufacturing, and recycling processes. This, in turn, contributes to the reduction of greenhouse gas emissions.
Digital battery passports also empower consumers to make more informed purchasing decisions by providing them with clear and reliable information about the environmental impact of the batteries they buy. This can incentivize more sustainable consumer behaviors and drive demand for more sustainable batteries.
The technical design and operation of the battery passport required it to be fully interoperable with other digital product passports required by Union law concerning eco-design, in relation to the technical, semantic and organizational aspects of end-to-end communication and data transfer; allows data authentication, reliability and integrity shall be ensured; and the battery passport shall be such that a high level of security and privacy is ensured and fraud is avoided. The Regulation also says that to ensure that the battery passport is flexible, dynamic and market-driven and evolves in line with business models, markets and innovation, it should be based on a decentralized data system.
Distributed Ledger Technology (DLT), commonly known as blockchain, is a significant player in enabling supply chain traceability. By providing a secure, transparent, and immutable record of transactions, DLT can verify the provenance of products and ensure the accuracy of information in DBPs. This plays a critical role in enhancing transparency, combating greenwashing, and promoting sustainability in various industry sectors.
Finboot provides end-to-end traceability for complex industrial supply chains using blockchain technology to implement a digital enterprise ecosystem to create digital product passports. Blockchain decentralized systems are able to meet these requirements and provide key product information to the parties who value it most.
Blockchain technology ensures that any modifications or updates to information about each specific battery from source to production, to end user, reuse and recycling are recorded and validated, and it cannot be altered or tampered with. Open public blockchains, in particular, are beneficial as they more easily allow for interoperability with existing systems and the transfer of information and records from one system to another.
Our digital traceability solutions are underpinned by 4 flagship features:
Automated Mass Balance: streamline your record keeping for sustainability credit, and bring traceability from feedstock to final product to batch-level granularity.
GHG Emissions: track and trace your supply chain emissions, obtaining a final measure of a product’s emission footprint that is broken down for the emissions caused by each part of the supply chain.
Scheme regulation: simplify document creation and management. Easily configure and create sustainability declarations, and other supply chain documentation based on data readily available in your traceability ecosystem.
Digital Product Passports: bring all your product and value chain data together in one place to share with clients, regulators, and consumers in the form of interactive Digital Product Passports.
We are using digital innovation to help the petrochemicals, oil, and gas industry achieve sustainable and traceable operations. Our solutions enable these industries to meet the requirements of digital product passports, including data management, data sharing, and traceability.
The Cepsa Case: Digital Product Passports in Chemical Supply Chains
Finboot has been working with Cepsa – a global energy company with a diverse portfolio spanning oil and gas and petrochemicals – since the start of 2023.
Finboot’s MARCO Track & Trace has allowed Cepsa to implement digital traceability systems for tracking each batch of vegetable oil from its origin to its use in biodegradable surfactant production, in addition to automating bookkeeping and determining what percentage of output is from renewable and circular inputs.
The Amber Case: Blockchain Case Study: ‘Digital Traceability of Renewable Energy’ Finboot & Amber
Finboot and Amber have created a fully traceable ecosystem that tracks renewable energy from source to end user. This innovative solution, based on blockchain technology, matches energy generation and use, ensuring a certifiable and accurate means of proving origin.
We set-out to build a new application, powered by Finboot’s MARCO platform, that allows management of data received from renewable energy plants (such as solar or wind). Thanks to the underlying blockchain technology that we will build on, we’ll be able to provide the tools that securely record and validate this newly designed Digital Guarantees of Origin (GOs), avoiding the real problem in the industry around ‘double spending’.”
The Repsol Case: Full Traceability of net-zero emissions fuels (HVO)
Repsol has been a client since 2018 and uses our digital traceability solutions extensively across several business areas. They use our digital ecosystems for the traceability of low-carbon fuels like HVO (Hydrotreated Vegetable Oil), and circular chemical products like packaging.
The Repsol Case: Full Traceability of net-zero emissions fuels (HVO)
The Future of Digital Product Passports
As the world accelerates towards achieving electrification, the demand for sustainable battery production is skyrocketing. The EU is taking steps to ensure this growth is sustainable and traceable. One such step is the introduction of the digital product passport, a revolutionary tool that provides end-to-end traceability for complex industrial supply chains.
While digital product passports are still in their early stages, they hold great promise for promoting sustainability and transparency in various industries, not just in battery production. The EU's commitment to implementing digital product passports in key markets by 2024 is a clear indication of their potential impact.
In the near future, we can expect to see digital product passports for other types of products in the sectors identified in the Circular Economy Action Plan, such as textiles, construction, consumer electronics, packaging, and food. As these developments unfold, the importance of digital product passports in supporting the energy transition will become increasingly evident.
In conclusion, digital product passports are set to transform the way we produce, use, and recycle products. By providing a comprehensive record of a product’s history, they ensure compliance with regulations, promote sustainability, and create new opportunities for innovation and growth. As the adoption of digital product passports continues to grow, they will play an increasingly crucial role in supporting the energy transition and building a more sustainable future.
Finboot reports its key clients in the vital chemical sector, far from being in terminal decline, are investing for the future to modernise and streamline their supply chains and production processes and starting to see a return on this investment.
The global chemical sector is currently facing a range of challenges. These challenges include:
• Market volatility: The COVID pandemic, the Russian illegal invasion of Ukraine, the Gaza-Israel situation and the energy crisis have disrupted the supply and demand for chemicals, leading to price fluctuations, inflation, and recession risks.
• Decarbonisation and sustainability: The chemical industry is under pressure to reduce its environmental impact and meet the ESG expectations and requirements of regulators, customers and investors. This requires exploring alternative feedstocks and technologies, such as biofuels, green hydrogen, and electric heating, as well as integrating sustainability into the business strategy and culture.
This has led to a narrative that the chemical sector is facing an almost existential crisis with dwindling order books and weak demand as the economies pivot away from “old” heavy fossil fuel using industries like chemical, steel and cement manufacture.
However, Finboot’s clients in this sector, like SABIC, CEPSA and Repsol, who are all investing in tech to improve their supply and production chains, all report strong demand and growth.
The challenges the chemical industry is facing are opportunities to create value and competitive advantage in the medium to long term. Leading players, like SABIC, CEPSA and Repsol are taking a proactive and holistic approach to transformation, balancing short-term solutions with long-term vision.
Juan Miguel Perez, CEO and Co-Founder, Finboot, said: “Investing in digital technology and innovation is key to producing chemicals society needs, but producing them in a sustainable / net-zero way.”
“Digital traceability and shared record keeping across the value chain is key accelerating our transition to a circular economy. This is especially true for capital intensive and difficult to decarbonise sectors like the Chemical industry. Chemicals are instrumental to many of our society’s needs, but we have a responsibility to produce them in a sustainable way which moves us closer towards a net zero emissions industrial complex.”
In its 2022 Annual Report, SABIC, reported: “This year, TRUCIRCLETM [TRUCIRCLETM is a trademark of SABIC, that refers to its portfolio of circular solutions and services for plastics] also embarked on a blockchain pilot project that allows digital traceability and additional transparency along the supply chain. This was conducted in collaboration with technology partner Finboot and Plastic Energy and packaging specialist Intraplás, and should help to lower costs, save time, and improve data integration for all value chain partners.” [Page 50.]
David Liras, Director, CEPSA Chemicals said: “We partnered with Finboot because they are an experienced and innovative company in its sector. Its product enabled us to rapidly implement a digital traceability ecosystem powered by blockchain technology, which ensures that every step of our supply chain is securely recorded, enhancing our credibility and accountability. This innovation will help us to maintain our client’s trust in our renewable chemicals.”
Dr Bettina Uhlich, Finboot board of directors independent member, and blockchain for business pioneer who wrote the book ‘Blockchain’ observed: “To continue to thrive in a world that is accelerating to net-zero, the chemical industry needs to further leverage digital tools and data to enhance its operational efficiency, customer experience and differentiate its products. This involves investing in digital capabilities, such as cloud, analytics – including blockchain, artificial intelligence, and automation, as well as fostering a culture of innovation and agility.”
John Fletcher, Finboot independent advisory board member, remarked: “The chemical industry needs to increase its use of bio-based feedstocks, as well as designing products that can be reused, repaired, or recycled, thereby reducing raw material inputs, waste and emissions and moving to a more circular model.”
At Stahl John was instrumental in procuring and rolling out Finboot’s blockchain solution at Stahl to create digital passports for its renewable products. These digital passports contain provenance data and help track them and aid compliance and life cycle assessments.
The chemical industry is essential building block to modern human life because it produces a wide range of products and technologies that enhance human health, safety, comfort and well-being. Key examples include:
• Agriculture: The chemical industry provides fertilizers, pesticides, and biotechnology that improve crop yield and quality, and help ensure food security and nutrition. Or, in plain language, without the chemical industry a large proportion of the Earth’s population would be in food poverty and go hungry.
• Pharmaceuticals: The chemical industry develops and manufactures drugs and vaccines that prevent and treat diseases, such as antibiotics, painkillers, insulin, and of course COVID vaccines.
• Plastics and synthetic fibres: The chemical industry creates materials that have versatile applications in various sectors, such as packaging, clothing, electronics, transportation and construction.
• Clean energy: The chemical industry contributes to the transition to a low-carbon economy by developing renewable and alternative sources of energy, such as solar cells, batteries, hydrogen and biofuels.
These are some of the ways that the chemical industry is vital to underpinning modern life and to maintaining and improving standards of living. The chemical industry also supports economic growth, innovation, and sustainability, and helps address some of the humanity’s most pressing challenges.
About Finboot
Finboot is a technology company enabling digital traceability ecosystems for large industrial companies to help them gather and share supply chain and product data in a secure, reliable, and trustworthy way. Our technology helps our clients substantiate their ESG and sustainability credentials, which leads to a stronger market position. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital traceability ecosystems powered by blockchain. Finboot is headquartered in Cardiff with a base in Barcelona.
SABIC is a global leader in chemicals producing a wide range of products, such as petrochemicals, plastics, fertilisers, and metals, for industries, such as automotive, construction, healthcare and packaging. Finboot’s partnership with SABIC has resulted in reduced costs and time and contributed to improved data integration, as highlighted in SABIC’s third-quarter 2022 report and 2022 Annual Report.
CEPSA is a Spanish multinational petrochemical company providing sustainable mobility and energy solutions. CEPSA Chemicals is a division of CEPSA, producing a wide range of chemical products, such as solvents, plasticizers, phenol, acetone, and LAB1. CEPSA Chemicals is a world leader in LAB, which is a key ingredient in biodegradable detergents, and phenol, which is used in industries like automotive, construction, and pharmaceutical. CEPSA is also involved in the production of renewable and alternative sources of energy, such as green hydrogen, second-generation biofuels and solar PV cells. It is part of Mubadala Investment Company Group and The Carlyle Group and has almost 90 years of experience in the sector. CEPSA operates in more than 20 countries and employs over 10,000 people.
The global push for sustainable development has led to a significant focus on transitioning to cleaner and more environmentally friendly energy sources. Nearly 200 countries at the Cop28 climate summit have agreed to a deal that, for the first time, calls on all nations to transition away from fossil fuels to avert the worst effects of climate change.
This shift, known as the energy transition, aims to reduce greenhouse gas emissions, combat climate change, and create a more sustainable future.
One crucial aspect of the energy transition is the transformation of the transportation sector, which accounts for a significant portion of global emissions.
Heavy industrial and transport sectors, which account for more than 40% of global greenhouse gas emissions, need multifaceted solutions that accelerate the speed of technology development, build supporting infrastructure, and raise necessary capital to finance the transformation. A robust and ambitious policy agenda, supported by collaboration across sectors and between countries, is critical to aligning the decarbonization of heavy industrial and transport sectors with the pathways aligned with net-zero emissions by 2050.
Global greenhouse gas emissions
Transition Fuels
As the world moves towards a decarbonized future, transition fuels play a vital role in bridging the gap between traditional fossil fuels and renewable energy sources. These fuels, such as Hydrotreated Vegetable Oil (HVO) or Renewable natural gas (RNG), offer a cleaner alternative to conventional diesel and gasoline. HVO is produced from renewable feedstocks, such as vegetable oils and animal fats, through a hydrotreating process. It can be used as a drop-in fuel in existing diesel engines without requiring engine modifications, making it compatible with existing fleets and infrastructure. RNG is produced from organic waste such as manure, food waste, or sewage and can serve as a drop-in replacement for natural gas in numerous applications, including motor vehicles, domestic heating, and industrial processes.
However, their reduction in emissions happens through the sourcing and production of the fuel itself, making supply chain and raw material traceability essential to proving the sustainability of this option.
Finboot’s MARCO Track & Trace technology enables digital traceability ecosystems for large industrial companies to help them gather and share supply chain and product data in a secure, reliable, and trustworthy way.
Repsol HVO Fuel Case Study
Electric Vehicles (EVs)
Electric vehicles have gained significant traction in recent years as a sustainable alternative to internal combustion engine vehicles. EVs are powered by electricity stored in rechargeable batteries, eliminating tailpipe emissions. The widespread adoption of EVs relies on the availability of a robust charging infrastructure. Governments and private companies are investing in the development of charging stations to meet the growing demand for EVs. Additionally, advancements in battery technology are increasing the range and efficiency of EVs, making them more practical for everyday use.
At the COP28 climate change conference in Dubai, more than 130 national governments, including the European Union, agreed to work together to triple the world’s installed renewable energy capacity to at least 11,000 GW by 2030.
There is a need for more supply chain transparency to accelerate the circular transition. The Commission’s proposal for an Ecodesign for Sustainable Products Regulation (ESPR) includes obligations for a digital product passport (DPP). As a central digital and policy tool, the DPP is expected to revolutionise the way product-related data is collected and shared across supply chains. Batteries are the first product group for which the use of a DPP will be a legal requirement as of 2027, through the recently adopted Battery Regulation.
Following the 2023 revision of the EU Battery Legislation, the Chinese government launched the development of a Chinese digital battery passport. The aim is to facilitate trade with the EU, by requiring similar data transparency requirements along the EV battery value chain in China, such as carbon footprint, circularity, and ESG.
Circular Cars Initiative Policy Levers Framework
The World Economic Forum's latest briefing paper makes a powerful case for a holistic digital vehicle passport (DVP) to accelerate the automotive industry’s journey to circularity.
This WEF briefing paper outlines that a DVP should combine the EU’s proposed circularity vehicle passport (CVP) and environmental vehicle passport (EVP). A holistic DVP should include: General vehicle information (e.g. registration numbers, ownership history); Upstream information (e.g. Scope 3 emissions of vehicle materials, supply chain due diligence); Vehicle use information (e.g. events tracking and accident history); and Downstream information (e.g. component disassembly information).
Such an approach would support informed purchasing decisions by increasing transparency. The transparent sharing of information is key to helping build trust while setting global standards. Compliance requirements are also being upgraded with the addition of ESG metrics. Such Digital Product Passports (DPPs), like CVPs and EVPs, and hopefully DVPs in the automotive sector, need to capture the entire life cycle of a product through its supply chain. This provides invaluable data for a regulator, but only if the data has integrity and trust.
By tracking products throughout their lifecycle, MARCO Track & Trace can help identify opportunities to recycle or reuse them at the end of their lives, making it simpler for the end-users to make informed decisions about their purchases and recycling habits. MARCO Track & Trace collects data about the product's journey from raw materials to finished goods, including information on the energy used, the emissions generated, and the waste produced. In addition, it would help businesses to design products with sustainability in mind.
The data is stored on a blockchain, a distributed database that allows for transparent and tamper-proof data sharing. The digital product passport can verify the sustainability of a product and ensure that it meets environmental and social standards.
Why Use Digital Product Passports?
Increased Transparency for both Consumers and Businesses
Improved Sustainable Practices in a Product's Lifestyle
Boost the Circular Economy
Centralised Information Flow
Hydrogen Fuel Cell Vehicles
Hydrogen fuel cell vehicles (FCVs) are another promising technology in the energy transition. FCVs use hydrogen gas stored in onboard fuel cells to produce electricity, which powers the vehicle's electric motor. The only byproduct of this process is water vapour, making FCVs emission-free. However, the widespread adoption of FCVs faces challenges, including the availability of hydrogen refuelling infrastructure and the high cost of fuel cell technology. Efforts are underway to address these barriers and promote the use of hydrogen as a clean energy source for transportation.
Hydrogen is considered an alternative fuel under the Energy Policy Act of 1992 and qualifies for alternative fuel vehicle tax credits in the United States.
Finboot's MARCO Track & Trace is a digital traceability solution powered by blockchain. MARCO Track & Trace enables trusted shared record-keeping between stakeholders in a supply chain. It empowers businesses to easily configure and create digital product passports and to manage their ESG and sustainability data through end-to-end traceability and visibility (from raw materials to finished products).
It can store, track, and share data regarding suppliers, quality control checks, production processes, sustainability claims, and much more. Moreover, it involves an automated calculation of a product's carbon footprint, and also includes automated reporting of sustainability credits and mass balance ledgers, aligning book keeping with physical tracking.
Mass Balance & Book keeping example
The Need for Infrastructure
To support the transition to cleaner fuels and technologies, the development of infrastructure is crucial. This includes the establishment of refuelling and recharging stations for electric and hydrogen vehicles. Governments, private companies, and international organisations are investing in the expansion of this infrastructure to facilitate the widespread adoption of sustainable transport options. The availability of a comprehensive network of refuelling and recharging stations is essential to address range anxiety and ensure the convenience of using alternative fuels and technologies.
The new Regulation for the deployment of Alternative Fuels Infrastructure (AFIR) sets mandatory deployment targets for electric recharging and hydrogen refuelling infrastructure in the road sector. Fleet-based targets will ensure that the publicly accessible recharging infrastructure for cars and vans grows at the same speed as the electric vehicle fleet.
Law Marks the Way
As you can see, legislation plays a crucial role in driving the energy transition in the transport sector. Governments worldwide are implementing regulations and standards to encourage the adoption of cleaner fuels and technologies.
The European climate law makes reaching the EU’s climate goal of reducing EU emissions by at least 55% by 2030 a legal obligation. EU countries are working on new legislation to achieve this goal and make the EU climate-neutral by 2050. For example, the European Union has introduced the ReFuelEU Aviation and FuelEU Maritime regulations to increase the use of sustainable aviation fuels and decarbonize the maritime sector. These regulations set targets for the minimum share of sustainable fuels, ensuring the reduction of greenhouse gas emissions in these industries.
Infographic
Why Data is Key to Lowering Your Carbon Emissions
To achieve net zero by 2050 or sooner, industries must tackle Scope 3 emissions at a much faster pace. This requires companies to take responsibility for emissions beyond their immediate operations and make profound changes throughout their products and business models, using emerging technologies and embracing new partnerships across value chains.
In 2022, the World Economic Forum launched the Industry Net Zero Accelerator initiative to help accelerate the industry transition to net zero. The paper highlights emerging opportunities and best practices presenting 12 “No Excuse” opportunities for businesses and governments to accelerate their Scope 3 decarbonization journey. These opportunities are grouped into four action levels:
Opportunities for businesses and governments to accelerate their Scope 3 decarbonization journey
In the pursuit of a transparent and sustainable supply chain for electric vehicles, data plays a crucial role. By leveraging advanced technologies like blockchain, companies can ensure transparency, traceability, and accountability throughout the entire lifecycle. Blockchain technology enables secure and immutable data records, allowing stakeholders to track the origin of raw materials, monitor manufacturing processes, and verify the environmental impact of their production. This data-driven approach fosters trust and promotes sustainability.
Sustainable mining
Circular battery management
Responsible manufacturing
Carbon credits
Conclusion
The energy transition is driving the transformation of the transport sector, with a focus on sustainable fuels and technologies. Transition fuels like HVO, electric vehicles, and hydrogen fuel cell vehicles are offering cleaner alternatives to traditional fossil fuels. The development of necessary infrastructure, including charging and refuelling stations, is crucial to supporting the widespread adoption of these sustainable options. Legislation and regulations are playing a significant role in promoting the use of sustainable fuels in the transport, aviation, and maritime sectors.
Moreover, digital traceability plays a crucial role in reducing carbon emissions and ensuring the sustainability of the transport sector by improving resource management, enabling emissions monitoring, facilitating supply chain optimization, promoting sustainable fuel usage, and fostering transparency and accountability. These efforts collectively contribute to the reduction of the carbon footprint in the transport sector.
By embracing data-driven approaches and cutting-edge technologies like blockchain, stakeholders can ensure the tracking of the origin, production, and distribution of sustainable fuels. This heightened transparency fosters accountability, bolsters emissions reduction efforts, and aids in ensuring adherence to regulatory standards, thus significantly contributing to decarbonization initiatives.
Want to learn more? Watch our webinar on-demand:
Download our second ebook in a series that explores fuels and technologies driving the energy transition in land, air, and sea transport.
Techfirm Finboot, creators of the world-class blockchain technology solution, MARCO, announced a strategic partnership with MINDSPRINT, a global leader in digital solutions and services. The partnership will focus on access to integrated solutions that combine the strengths of MINDSPRINT’s agri-domain-based technology solutioning and Finboot’s blockchain technology creating new possibilities for building trust and transparency, innovation and growth.
Through thisstrategic collaboration, Finboot will further strengthen MINDSPRINT’s digital portfolioby embedding its low code / no code blockchain ecosystem, MARCO – the first-of-its-kind. Finboot’s MARCO connects multiple ledgers simultaneously and will enable MINDSPRINT to incorporate blockchain across their various digital solutions. MARCO will bring increased traceability, and transparency which in turn, will help meet sustainability and ESG compliance requirements and increase operational efficiency.
Nish Kotecha, Executive Chair and Co-Founder, Finboot says: “We are thrilled to be partnering with MINDSPRINT. Finboot’s and MINDSPRINT’s values are very much aligned, and we believe in the power of technology to solve many of the key challenges humanity faces including accelerating the journey to net zero and the need for more secure and transparent supply chains to measure and ensure goods and services are net positive.”
Sriram Gopalakrishnan, President & Head of Global Delivery, MINDSPRINT says: “For over 20 years, MINDSPRINT has been the digital and technology partner to a USD$40 billion agri-commodity company, driving its digital transformation in over 70 countries. The application of blockchain technology in any sector can benefit organizations globally by bringing in sustainable business practices with increased transparency, smart contracts, and secure transactions. With ESG regulations being paramount to business strategy across the world, we believe Finboot's blockchain expertise combined with our deep knowledge of supply chains, could help global organisations build and enhance transparency and trust.”
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain. Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: bringing the future of the internet to business. MARCO greatly improves the management of value chains anddrives forward digitalisation, sustainability, and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finbootis making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
MINDSPRINT’s purpose is to reimagine business with talent, technology, and insights-driven services. With a proven record of enabling global organizations in their business and technology transformation journey, MINDSPRINT is a leading provider of purpose-built industry-first digital solutions and services. MINDSPRINT offers a broad spectrum of solutions and services, and our capabilities include Data and Analytics, Product Engineering, Cloud-Native Development, Generative AI, SAP Transformation, Business Processes, Cybersecurity, and Automation as a Service. A Great Place to Work Certified™ company, MINDSPRINT is headquartered in Singapore with a presence in India (Chennai and Bengaluru), the U.S, and the UK.
As we wrap up another eventful year, we wanted to take a moment to reflect on the incredible journey we've had together at Finboot. 2023 has been a year marked by consolidation, growth, and remarkable achievements that have propelled us to new heights.
Prestigious Accolades: The pinnacle of our year was reaching new heights with the honour of winning the prestigious Logistik Heute, PwC Germany-sponsored, Supply Chain Award in Frankfurt in November. This recognition is a testament to our unwavering commitment to excellence and innovation. Additionally, we were privileged to share our insights at COP28 in Dubai, where we participated in a panel discussion invited by SABIC, showcasing our dedication to sustainable solutions.
Client Success Stories: Throughout the year, Finboot has been dedicated to working with both existing and new clients and partners, crafting bespoke blockchain-powered supply chain digital ecosystems. Our collaboration with esteemed clients such as Amey, CRDC, and Cepsa has been nothing short of inspiring. Notably, our partnership with SABIC has not only resulted in reduced costs and time but has also contributed to improved data integration, as highlighted in their third-quarter report and 2022 Annual Report. SABIC's commitment to sustainability is further echoed in their compelling video, "Using Blockchain to Deliver Sustainable Packaging."
Driving Blockchain Adoption: Our commitment to driving blockchain adoption in high-capital industries remains steadfast. Clients have consistently cited their desire for greater visibility and traceability of raw materials, the need to embed trust across the supply chain, and staying ahead of ESG reporting regulations as the driving forces behind their investments in blockchain solutions. Finboot continues to empower organizations to embrace the digital future confidently.
Engaging Conversations and Insights: This year, we had the privilege of engaging in insightful conversations with industry leaders. The interview with Gestamp's Chief ESG Officer, Ernesto Barcelo, and Agile Agent at Cepsa Química, David Carvajal, provided valuable insights into the transformative power of blockchain in supply chains. These conversations are a testament to our commitment to fostering collaboration and sharing knowledge within our community.
Policy and Regulatory Influence: In the latter half of 2023, our Executive Chair and Co-Founder, Nish Kotecha, engaged in meaningful discussions with policymakers in the UK Parliament, further establishing Finboot as a thought leader in shaping technology policy.
Brand Evolution: In June, we proudly unveiled our new brand, symbolizing Finboot's commitment to evolution and innovation. The new brand reflects our dynamic approach to blockchain technology and our dedication to staying at the forefront of industry trends.
Expanding Our Expertise: To further strengthen our capabilities, we welcomed Dr. Bettina Uhlich to our Board of Directors and John Fletcher to our advisory board in 2023. Their expertise will undoubtedly contribute to our continued growth and success.
As we approach the holiday season, we extend our heartfelt gratitude to our clients, partners, and the entire Finboot community for your continued support. May the festive season bring joy, reflection, and anticipation for the promising journey that lies ahead in 2024.
Wishing you a joyful holiday season and a prosperous New Year!
The 2023 United Nations Climate Change Conference, known as COP28, held in Dubai, United Arab Emirates, brought together diplomats and leaders from around the world to advance initiatives in climate action. This year, I had the privilege of participating in this global event. Invited by our client SABIC, I attended a panel discussion on plastics circularity in the electronics industry, examining the challenges but specifically looking for solutions.
This gave me the opportunity to showcase the potential of Finboot’s digital traceability and supply chain data sharing solutions to contribute to the climate action effort. With the ability to bring transparency and reliability to complex and difficult to decarbonise supply chains, our solutions have emerged as a powerful tool helping capital intensive industries in their energy transition.
Advancing the Circular Economy in Consumer Electronics
The transition to a more circular economy is gaining momentum across industries. Perhaps with a special impact in the consumer electronics sector, given it plays a role in the convergence of multiple capital intensive industries like chemicals, metals, and semiconductors. Blockchain technology, with its ability to provide digital traceability, can play a crucial role in advancing the transition towards a circular economy. By overcoming challenges in data sharing and data quality across supply chains, we ensure access to reliable information about product provenance and composition, enabling the repurposing and reinsertion of critical raw materials.
Policy and Regulation: Driving Plastic Recycling in Consumer Electronics
Policy and regulation play a significant role in driving the transition towards circularity in the consumer electronics sector. However, voluntary schemes are proving to be more effective than formal regulations, as they can adapt and evolve faster to meet the changing needs of the industry. Collaboration between governments, corporates, and global multi-governmental organizations like the United Nations Framework convention on Climate Change (UNFCC) is crucial in creating global standards and accelerating the adoption of circular practices. But industry innovators have the opportunity and the responsibility to take the first steps in transforming their industrial processes for a lower carbon footprint and to promote circularity by design. SABIC is a great example of that, as a leading company in circular packaging solutions, SABIC is set an example by being among the first in their industry to obtain the ISCC+ certification, a voluntary scheme that audits the sourcing and manufacturing of recycled products to prevent greenwashing. More recently, in their work with Finboot, SABIC is once more taking the lead in transparency in their circular packaging solutions; by using blockchain technology and digital traceability to become the first in the industry to provide batch-level traceability for the circular packaging solutions.
Collaboration Across Sectors: Accelerating the Circular Economy
Collaboration across different sectors is essential for accelerating the transition towards circularity across industries including consumer electronics. The complex value chains involved in the production of consumer electronics require communication standards and collaboration to ensure the compatibility and interoperability of circular solutions with the existing industrial complex. Examples of successful collaboration can be seen in some of Finboot’s initiatives like tracing conflict minerals with Minexx [LINK to Minexx] and implementing advanced recycling solutions with CRDC Global [LINK TO CRDC]. By prioritizing circularity and low-carbon operations, industries can work together to create a more sustainable economic system.
Looking Towards the Future
While there is still much work to be done to achieve a global transition to circular and sustainable economic systems, there is hope in the actions of specific industry segments and innovators. The focus should now shift towards accelerating the transition. COP28 emphasized the importance of taking action, but the future lies in accelerating the adoption of circular practices and low-carbon operations. By embracing blockchain technology and fostering collaboration, we can create a more sustainable and circular future for the consumer electronics industry and beyond.
We need to accelerate towards a more circular and sustainable global economic system.
Conclusion
COP28 highlighted the significant role that blockchain technology can play in advancing the circular economy in the consumer electronics sector. By providing transparent and reliable energy tracking, enabling digital traceability, and fostering collaboration, blockchain can drive the transition towards a more sustainable and circular economic system. Policy and regulation, combined with industry innovation, are essential in accelerating this transition. With the right actions and a focus on accelerating the adoption of circular practices, we can create a brighter and more sustainable future for generations to come.
During the last few months, our Executive Chair and Co-Founder, Nish Kotecha, has held a series of very interesting and useful meetings with influential politicians in the UK Parliament with an interest in and influence on UK technology policy.
These included:
• Lord Iain McNicol is the Labour Life Peer for West Kilbride. He is the Deputy-Speaker in the Lords and Vice Chair, Blockchain, FinTech and Fair Business Banking APPGs and Treasurer, Crypto & Digital Assets APPG. Lord McNicol spoke at Gitex Global – the largest tech event in the world – in October 2023.
• Tan Dhesi MP is the Labour MP for Slough and the Shadow Exchequer Secretary (Treasury). He is an expert in construction industry supply chain having been a director of a construction firm for a number of years before entering Parliament.
• Catherine West MP is the Labour MP for Hornsey and Wood Green and of Shadow Minister (Foreign and Commonwealth Affairs) – with specific responsibility for the Far East, including China. So Catherine was particularly interested in being briefed by Nish on China’s National Blockchain Academy.
• Chi Onwurah MP is the Labour MP for Newcastle upon Tyne Central and the role of Shadow Minister (Science, Research and Innovation) and has raised blockchain technology a number of times on the floor of the House of Commons.
• Chris Evans MP is the Labour MP for Islwyn and the Shadow Defence Procurement Minister.
Amongst the key discussion points raised and debated in each UK Parliamentarian briefing meeting were:
• The World Economic Forum White Paper, Blockchain for Scaling Climate Action, published in April 2023: “Blockchain is a powerful tool that can provide breadth and depth to climate mitigation and adaptation efforts by democratising ownership, improving transparency and integrity, and enabling real-time visibility into emissions reduction and sequestration efforts”.
• It was agreed blockchain technology is likely to be a key part of trusted global trade network ecosystem going forward as it improves traceability and efficiency (including CO2 emissions) whilst at the same time bears down on fraud.
• There was a consensus around improving the UK’s global trading system to confirm and validate the UK’s status as a trusted trading partner.
• It was accepted that compliance must be automated - that is no longer can an emailed Excel spreadsheet meet the growing demands of the regulators while processing the volume throughput that is and will be required.
• The EU Digital Product Passport, to be launched in 2026, will create a digital environment which would enable data-exchange mechanisms and transparency throughout our supply chains to address political and environmental challenges
• Despite having a vibrant tech hub in the UK the UK is currently behind the curve in terms of blockchain regulations to get ahead of EU and G7 (via the International Sustainability Standards Board (ISSB)) regulations requiring Digital Product Passports.
• In Spain, the Alastria Consortium, launched in 2017, is described as the “first regulated Blockchain ecosystem”.
• China’s National Blockchain Research Centre - targeting training 500,000 professionals in blockchain technology - launched in May 2023, in Beijing, is a game changer: It follows President Xi’s speech in 2019, where he stated: “We must take the blockchain as an important breakthrough for independent innovation of core technologies." It is anticipated China, in the coming months, will launch a kitemark to identify products whose data can be verified in the Blockchain.
• There are also industry specific networks e.g. Energy Web Foundation. Energy Web states on its website: “Energy Web technology is powering decarbonisation solutions in dozens of countries.”
Opportunities for the UK
• The scenario of a successful creation of a UK Digital Product Passport ecosystem – including legislation and regulation, would put the UK ahead of the EU and the rest of the EU and make it a pre-eminent global trading hub in the 21st century.
• Rt Hon Kevan Jones MP told us: “I am excited about how Blockchain for business applications, can help UK plc move to net zero as quickly as possible.”
• “I also think if we get any legislation and regulation right, so Blockchain is adopted across the economy, it could help reduce costs and wastage and carbon.”
• “Jobs in Blockchain and tech generally, are high skill, high pay jobs too.”
• Also it was noted that blockchain, in underpinning web3 will enable more effective monitoring and regulation of Artificial Intelligence (AI).
Takeaways
Nish was encouraged by the consensus amongst them that blockchain for enterprise and increased digitalisation of supply chains can help accelerate industries’ journey to net zero.
There also was a willingness and a determination to get the regulations around digital product passports right – working with the UK’s international friends and partners.
There was also a willingness and a determination to ensure the UK becomes a tech – and specifically a blockchain – powerhouse to create and sustain highly skilled and highly paid tech jobs in the UK.
Lots more work to do but this is a good foundation to build on.
Pictured: NishKotecha with Rt Hon Lord Iain McNicol
Pictured: NishKotecha with Tan Dhesi MP
Pictured:Nish Kotecha with Catherine West MP
Pictured: Chi OnwurahMP
Pictured: NishKotecha with Chris Evans MP
Pictured: NishKotecha, Rt Hon Kevan Jones MP and Juan Miguel Perez
Download our ebook to learn how Finboot solutions can help reach the net-zero.
Finboot is thrilled to announce the launch of the new digital ecosystem specially designed for Cepsa Chemicals, which is part of Cepsa group - a leading energy group committed to sustainable mobility, energy and chemicals with a proud history of investing in innovative technology to drive its business forward. It went live yesterday.
In early 2023, Cepsa Química announced NextLab, the world's first sustainable linear alkylbenzene (LAB), used in the homecare industry to manufacture biodegradable detergents. Cepsa is the largest LAB producer in the world and a pioneer in the production of biodegradable products and the development of safer and more environmentally friendly technologies. NextLab is the LAB produced with sustainable raw materials, such as palm and coconut oil; using the mass balance approach, with a reduced Greenhouse Gas (GHG) footprint.
Cepsa’s continuing partnering with Finboot, with its award-winning and leading digital traceability solution, MARCO Track & Trace, is very much aligned with Cepsa commitment with innovation to support sustainable mobility and energy.
MARCO Track & Trace has enabled Cepsa to implement an auditable and transparent ecosystem for the traceability of vegetable oil from source to its use in biodegradable surfactant production. Finboot’s digital traceability solution enables Cepsa to easily gather, verify, and share enriched supply chain data. Cepsa can easily create and share fully auditable Digital Product Passports with evidence-backed claims on the sustainability of NextLab.
In this first phase of the project, Cepsa will use MARCO Track & Trace in two of its product lines, NextLab-R, which is produced from Puente Mayorga in Spain and from Camaçari in Brazil; and LAB Low Carbon (integrating low CO2 emissions), which is produced from Bécancour plant in Canada.
“We partnered with Finboot because they are an experienced and innovative company in its sector. Its product enabled us to rapidly implement a digital traceability ecosystem powered by blockchain technology, which ensures that every step of our supply chain is securely recorded, enhancing our credibility and accountability. This innovation will help us to maintain our client’s trust in our renewable chemicals.
We hope to gain significant value in our sustainable product traceability processes. These processes are being strengthened as part of our "Positive Motion" strategy, which aims to enable Cepsa’s customers and society to move to a more sustainable future. Finboot’s technology offers us many advantages in this regard, and it will help us scale use cases to other areas within our organisation quickly and easily.¨
Juan Miguel Perez, Chief Executive Officer and Co-Founder of Finboot, added:
“Our partnership with Cepsa is another example of Finboot’s capacity to adapt our MARCO Track & Trace product to very complex global supply chains with unmatched speed and agility. Our solution will help strengthen Cepsa’s position as a world leader in the production of sustainable and circular chemicals.
Our Digital Product Passports provide an excellent opportunity for Cepsa Chemicals to differentiate their products in the market and deliver additional value to their clients. Additionally, our capability to automate their Mass Balance record-keeping simplifies compliance and certification processes with minimum resource allocation.”
Finboot’s digital traceability solution, MARCO Track & Trace, simplifies supply chain workflows with blockchain assurance, redefines the way to manage this value chains, and drives forward digitalisation, sustainability and ESG agendas.
– ENDS –
Notes to Editors
For more information, please contact chris@impactandinfluence.global
About Finboot
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain. Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: Bringing the future of the internet to business. MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
Cepsa is a leading international company committed to sustainable mobility and energy with a solid technical experience after more than 90 years of activity. The company also has a world-leading chemicals business with increasingly sustainable operations.
In 2022, Cepsa presented its new strategic plan for 2030, Positive Motion, which projects its ambition to be a leader in sustainable mobility, biofuels, and green hydrogen in Spain and Portugal, and to become a benchmark in the energy transition.
The company places customers at the heart of its business and will work with them to help them advance their decarbonization goals. ESG criteria inspire everything Cepsa does as it advances toward its Net Positive objective. This decade, it will reduce its Scope 1 and 2 CO2 emissions by 55% and its carbon intensity index by 15-20%, with the goal of reaching net zero emissions by 2050.
Cepsa Química is a world leader in its sector and is leading the shift towards sustainable chemistry, with a clear commitment to the fight against climate change and the transition to a circular, non-fossil economy.
The company is a world leader in the production of LAB, the main raw material used in biodegradable detergents. It is also number one in the production of cumene, an intermediate product used in the production of o phenol and acetone, which are the main raw materials for the manufacture of engineering plastics and of which it is the world’s second largest producer. Cepsa Química currently employs more than 1,000 people and has plants in seven countries around the world (Spain, Germany, Canada, China, Indonesia, and Nigeria).
The industrial sector is keen to curb carbon emissions and reach carbon neutrality, yet monitoring the origins of raw materials poses a substantial challenge. Consumers are now demanding supply chains that are not only sustainable but also ethically sound, which calls for complete visibility throughout the entire supply chain process.
Traceability provides insights into a product's lifecycle, from its inception to its disposal, enabling consumers to make more educated buying decisions and choose their suppliers wisely.
What are the challenges for businesses?
Supply chain complexity: The difficulty in tracking down the sources of raw materials can make it difficult to ensure ethical sourcing and responsible practices all the way through the supply chain.
Data management: gathering and managing data on product traceability can be complex and resource-intensive.
Consumer expectations: Today's consumers seek not only tailor-made products, fair costs, and ethical companies. They also want better visibility into their supply chain dealings, expecting clear information about a product's environmental and social impact.
Regulatory compliance: Businesses face growing demands to comprehend and handle risks within their supply chains. Incorporating ESG elements into the supply chain is essential to keep informed and loyal customers satisfied, as they are becoming more conscious of ESG issues.
In terms of ESG efforts, it's crucial to have secure, auditable, and transparent data to build trust. After monitoring, the most critical aspect is record-keeping. Monitoring, measuring, and reporting are vital to reaching the goal of net zero. However, these measures are too complex to handle manually. According to Deloitte’s Environmental, Social, and Governance Preparedness Survey Report, published in May 2023:
Unpacking the Power of Blockchain for Digital Traceability
Product tracking fits well with the sustainable economy as people, authorities, and investors increasingly want clear information about a product's environmental and social impact. They're interested in the origins of materials, how products are made, and their fate after use.
Blockchain offers a reliable record of a product's environmental footprint, fostering transparency, accountability, and sustainability in supply chains. It provides a secure, tamper-proof platform for companies to share and view data, promoting collaboration and trust among stakeholders.
Furthermore, blockchain can track materials throughout the supply chain for recycling, reuse, or remanufacturing. This makes it a significant tool for the circular economy and ESG reporting.
Introducing Finboot's flagship digital traceability solution: MARCO Track & Trace
Finboot's MARCO Track & Trace is a digital traceability solution powered by blockchain. MARCO Track & Trace enables trusted shared record-keeping between stakeholders in a supply chain. It empowers businesses to easily configure and create digital product passports and to manage their ESG and sustainability data through end-to-end traceability and visibility (from raw materials to finished products).
Digital Product Passport: is a digital tool leveraging blockchain technology to create secure, immutable records of materials and products. By tracking the complete lifecycle of a product—from origin to consumption end—it provides real-time insights into the supply chain journey of any product. This increased transparency can help businesses showcase the quality of their products and operations, thereby enhancing their sustainability credentials.
It can store, track, and share data regarding suppliers, quality control checks, production processes, sustainability claims, and much more.
(MARCO screenshot: Digital Product Passport)
Premium Tracking (Mass Balance and Carbon Footprint): essentially, the mass balance model mixes used materials with specific characteristics with other materials without the same characteristics, resulting in an output proportional to the input. Independent audits throughout the transition check the origin and quantity of renewable feedstock, enabling certification.
This approach also includes automated reporting of sustainability credits and mass balance ledgers, aligning bookkeeping with physical tracking. Moreover, it involves an automated calculation of a product's carbon footprint, which can be shared as part of the Digital Product Passport (DPP) to reflect a company's commitment to sustainability and compliance with regulations.
By accurately tracking and analyzing these flows, mass balance and carbon footprint can help verify the sustainability claims made by companies, thereby combating 'greenwashing'—a deceptive tactic where companies exaggerate or falsely claim environmental benefits.
(MARCO screenshot: Mass Balance)
Interoperability to legacy and emerging tech: traceability ecosystems do not live in isolation. Siloed solutions will only be adequate for niche use cases and very specific applications. To address the broader market opportunity vendors must have the capability to integrate and interoperate with legacy and emerging systems. Legacy systems include an enterprises’ ERP or other supply chain and productions software, while emerging systems will include the use of IoT devices and the connectivity to different underlying database structures including the many layer-1 blockchain technologies and frameworks.
MARCO was designed with interoperability at its core. MARCO can aggregate emerging technologies into our ecosystems, which strengthens our market position. We also have a proven track record of integrating to legacy systems, without the need for bespoke software development.
Do you want to see MARCO in Action? Read some of our Circular Economy Use Cases:
Finboot is a technology company offering digital traceability solutions to clients in capital intensive and difficult to decarbonise industries such as oil and gas, chemicals, and steel.
Finboot’s CEO and Co-Founder at Finboot, Juan Miguel Perez, recently conducted a video interview with Ernesto Barcelo, Chief ESG Officer, at Gestamp. This blog is a summary and further thoughts and insights on that interesting conversation at a key point in time as the world looks to accelerate its journey to net-zero for the good of people and the planet.
Gestamp Automoción, S. A. is a Spanish multinational specialized in the design, development, and manufacture of highly engineered metal components for the main vehicle manufacturers – the OEMs (original equipment manufacturers). The company develops products with an innovative design to produce lighter and safer vehicles, which offer lower energy consumption and a lower environmental impact. Its products cover the areas of BiW, chassis and mechanisms. Gestamp is a well-established and respected player in this highly competitive, highly regulated and scrutinized sector.
Gestamp’s business was founded 26 years ago – in 1997. It is now a multinational company with a presence in 24 countries and 115 production sites, and perhaps more importantly, when thinking about the just transition to net-zero, it also has 13 R&D centres where it helps customers design new solutions to the challenges society faces today. Gestamp has 43,000 colleagues with around 1,500 (c. 3.5 per cent) R&D specialists.
In a wide ranging and enjoyable conversation, Ernesto recounted how Gestamp has always been mindful of the environment since it started trading in 1997. Ernesto went on to set out how Gestamp has embedded Environmental, Social and Governance (ESG) targets and considerations right across the business. He also offered numerous thoughts on how Gestamp is working towards monitoring progress on ambitious decarbonisation objectives. He stressed that greater transparency, trust and responsibility are foundational in meeting these challenges.
To meet these decarbonisation and net-zero targets and challenges, Gestamp is looking at their whole supply chain (upstream and downstream) and not just tier one suppliers. So, for example, on steel supply, this means knowing and working with steel makers who produce the iron ore that is made into the steel that Gestamp uses to manufacture automotive parts. This is total supply chain transparency and traceability.
Ernesto made it very clear that traceability and evidence backed data are essential – both for compliant reporting in an increasingly regulated world, but perhaps more importantly for effective decision making to accelerate digitisation and the journey to net-zero.
Juan and Ernesto spoke at some length about the Greenhouse Gas Protocol, and scopes one, two, and three. Scope one covers direct emissions from owned or controlled sources. Scope two covers indirect emissions from the purchase and use of electricity, steam, heating, and cooling. By using the energy, an organisation is indirectly responsible for the release of these greenhouse gas emissions. Scope three includes all other indirect emissions that occur in the upstream and downstream activities of an organization. Scope three is the biggest challenge for most companies – in the automotive sector and beyond. Decarbonising the energy system may add extra cost initially, but in the longer-term renewable energy is cheaper – and of course, better for the environment.
Gestamp’s number one material is steel followed by aluminium. Both face exactly the same challenges: metallurgical production processes have emissions embedded within them. Steel producers around the world are currently investing to produce steel low in emissions. While this technology is being fully developed and deployed, Gestamp is adopting a circular approach as an interim solution by using as much recycled steel as possible.
They also spoke about how our world is increasingly interconnected and increasing regulatory requirements. Gestamp, like all companies in the EU, is bound by the new EU Corporate Sustainability Reporting Directive, compelling them to produce more granular reports about the effects their business and its entire value chain has on the environment. There are similar regulations coming in other markets, such as North and South America and the Far East.
These twin drivers are wanting to do the right thing for the environment, its stakeholders (including its staff, customers, suppliers, and investors) and de-facto global regulations means Gestamp is accelerating its digitisation by investing and collaborating with tech firms like Finboot. In this new world, blockchain is a vital tool to help monitor and measure and improve supply chains – in line with its ESG goals. Gestamp needs to control and monitor all aspects of its business and, at the same time, have trusted, open and honest dialogues with all the different suppliers and stakeholders – in a non-siloed way – to find the solutions to accelerate its journey to net-zero. The words trust and transparency kept coming up!
Juan reflected after the interview that he is confident that with this honest and can-do attitude, Gestamp will meet these significant challenges, navigate the Fourth Industrial Revolution and thrive. Finboot and Gestamp look forward to going on this important journey together.
FRANKFURT,GERMANY, TUESDAY 14 NOVEMBER 2023 – Finboot is thrilled to announce today it has been awarded the coveted Smart Solution Award as part of the 2023 Supply Chain Management Awards, sponsored by PwC Germany; LogistikHeute and Strategy&.
Since 2006, the Supply Chain Awards have celebrated innovations to improve industrial value chains. The Smart Solution Award was first presented in 2018. The Smart Solution Award specifically highlights supply chain solutions in the early stage of implementation. The judges are looking for innovations which have the potential to fundamentally improve supply chains.
The Supply Chain Management Awards are renowned for a very rigorous assessment andjudging process. The judging panelconsists of senior managers from leading industrial businesses such as BASF, Continental,Electrolux Europe and Knorr-Bremse. As aresult these awards are highly valued and respected.
Alvaro Llobet, Head of Product, Finboot says:
“I am delighted to receive this 2023 Supply Chain Smart Solution Award! I am acceptingthis award on behalf of all the Finboot team. All of us at Finboot have enjoyed and got value out of this competitionand its rigorous judging process.
“To be awarded this prestigious award is a huge vote of confidence in Finboot’s thinking and the development our no-code / low-code blockchain platform, MARCO.
“Congratulations to all the finalists in this fiercely competitive category – all were brilliant entrants. We are all winners in a sense to be in Frankfurt today!”
Nish Kotecha, Chair and Co-Founder of Finboot, added:
“We are delighted to not only to be a nominated for this award but to win it! The judges and sponsors come from our world of supply chains and this award is an endorsement of our mission to digitise and enhance the overall transparency, productivity and efficiency of the world’s supply chains.
“Congratulations to the Finboot team and thank you again to sponsors and judges for your warm words of encouragement. ”
Finboot’s blockchain platform MARCO improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
– ENDS –
Winners of the Supply Chain Awards 2023
Finboot wins Smart Solution Award 2023
Alvaro Llobet, Head of Product at Finboot at the Supply Chain Awards ceremony.
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain. Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: Bringing the future of the internet to business. MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
Supply chain management is one of the outstanding success factors for companies in industry, trade and the service sector. The Supply Chain Awards – i.e. the Supply Chain Management Award and the Smart Solution Award – focus on the paths companies should take when designing and managing supply chains. In 2023, for the 18th time, we will be presenting the Supply Chain Management Award to companies with outstanding value chains that have optimized their supply chains in a consistent or exceptional way.
This year the judging panel consisted of Armin Breitner, Group Logistics, AdolfWürth GmbH & Co KG; Ralf Busche, Senior Vice President European Site Logistics Operations, BASF SE; Daniel Küster, Supply Chain Director / Executive Board Member, Warsteiner Brauerei Haus Cramer KG; Douglas Kent, Executive Vice President, Association for Supply Chain Management (ASCM); Dr. Gregor Dudek, Vice President Supply Chain Management, Electrolux Europe; Johannes Giloth, Chief Operating Officer, GEA Group; Kerstin Gliniorz, Vice President, 1ADM Global Supply Chain and Operations Business lead, ADM WILD Europe GmbH & Co. KG; Prof. Dr. Michael Henke, Institute Director, Fraunhofer Institute for Material Flowand Logistics; Jan Axt, Vice President Automotive SCM – Strategy & Innovation Automotive Technologies, Continental; Michael Kadow, Managing Director, House of Logistics & Mobility (HOLM) GmbH; Matthias Pieringer, ChiefEditor LOGISTIK HEUTE, Moderator, HUSS-VERLAG GmbH; Stefan Schrauf, GlobalSupply Chain and EMEA Operations Lead, PwC Management Consulting; Dr. Patric Spethmann, Chairman / COO, MarcO'Polo AG; Thomas Rappl, Vice President Supply Chain & Service Operations (R/SC), Knorr-Bremse Systeme für Schienenfahrzeuge GmbHA
Food supply chains can be complicated and generally characterised by long shipment distances, lengthy processing times, a lack of transparency, and a lack of digitised documentation, resulting in little trust in the process and significant inefficiencies.
Pressures on global food supply chains
Climate change is leading to increased extreme weather events across the globe, which is having a negative impact on crop yields. Farmers are having to adapt and evolve their methods to try to build resilience into their practices to maintain yields, not to mention address global food security.
The emptying of supermarket shelves by panic buying from shoppers during the COVID pandemic demonstrated the chaos that disruption to a nation’s food supply can provoke.
Putin’s illegal invasion of Ukraine in February 2022 has led to disruptions in grain and other food stuff supplies, which in turn have resulted in global food inflation and once again empty food shelves. Just this summer, it was almost impossible to buy tomatoes in any UK supermarket.
The current instability in Israel and Gaza has given the global economy and its global supply chains further shocks and instability.
According to a recent report from Dyson School of AppliedEconomics and Management, Cornell University, covered by Forbes, logistics and product pricing are closely related, with transportation reflecting over 26 per cent of the cost of perishable food products, like fruit and vegetables, for wholesalers.
In addition, consumers demand is growing for produce sourced from local suppliers (at least as near as possible to cut down on “food miles”) that uses ethical and sustainable practices. More than ever, consumers want to know what they are eating, where it has come from and how it was treated. Let’s not forget the horsemeat scandal in the UK…
Allied to these consumer demands, regulators around the world have introduced more regulations, covering everything from animal husbandry to live animal transportation – with more animal welfare regulations on the horizon.
Faced with such pressures and disruptions, what can the food industry do to continue to feed the world while also giving them trusted information to enable them to make informed choices.
Digital tools such as blockchain based no-code/ low-code tracking solutions can significantly improve food traceability, and quickly and easily increase efficiency and transparency in the food supply chain.
Otherwise known as the “trust platform”, it uses a shared ledger to provide a single source of truth that is immutable and any change is digitally documented. Especially when it involves a large number of parties, blockchain-based track and trace solutions can streamline the food supply chain and uses data-backed evidence to build trust.
By digitising their processes, the food industry is able to leverage trustable means such as machinery or ‘digital product passports’ to validate food safety and environmental, social and governance compliance. Digital product passports can include all the information about a product, enabling long-term control and transparency.
Such digital tools can also lower instances of food fraud, boost operational efficiency and scalability, and ensure environmental, social and governance (ESG) objectives are met and reported upon accurately.
The pressure on the industry, from regulators and society, highlights a need for initiative and increasing trust between supplier and consumer. As demand for transparency increases, enterprises need to have tangible and reliable proof of a robust – and as local / ethical as possible – supply chain.
By using blockchain-powered solutions to back their operations, food manufacturers can map data on their supply chain and provide this data whenever they are required to. At its core, blockchain technology greatly improves supply chain management when several companies are involved by providing a shared system of record to manage the flow of data and enhancing traceability on a secure network. In a typical example for the food industry, a larger number of farmers / suppliers work with just a few processing, distribution, and marketing companies. The flow of multiple products and related financial transactions, as well as the controlled and intelligent processing of goods involved, and the documentation of regulatory and sustainability requirements and goals, needs to tracked, documented, shared in an easy and trustworthy way.
Finboot is a world-class enterprise blockchain platform supplier with a proven trackrecord. Finboot’s no-code / low-code blockchain based Track and Trace solution, MARCO, brings value to consumers and stakeholders by increasing traceability and transparency, and doing that in a very easy, fast and flexible way to implement, configure and use. By providing corporations with a reliable source of data, Finboot can provide real-time results and evidence for companies to verify and demonstrate accountability for their sustainable goals and future-proof them in an increasingly digital world.
In the latest installment of Finboot's interview series, Juan Miguel, the CEO and co-founder,welcomed Nicholas Myers, the CEO and co-founder of Phoenix Tailings. The conversation focused on the pivotal role of innovative sustainability initiatives in the metals industry.
Phoenix Tailings, a leader in the production of metals essential for rare earth magnets, is taking significant strides towards minimizing its environmental footprint with a commitment to zero waste and zero direct carbon emissions production.
You can watch the entire interview, which lasts about 20 minutes, or read the main takeaway from it below in this blog post.
Phoenix Tailings Journey Towards Zero Waste Operations
Phoenix Tailings was founded around five years ago whenNicholas Myers met Dr. Tomas Villalón, a PhD graduate with a background in materials science. They started discussing the significant problems in the world, particularly the production of raw materials needed for clean energy technology like wind turbines and electric vehicles.
These materials are often produced in areas that don't have the same environmental or societal standards as the United States. This leads to substantial waste, carbon emissions, and societal issues. These problems will only intensify as demand increases. Notably, Tesla alone is projected to consume 68% of the world's neodymium supply by 2028, illustrating the scale of demand for these metals.
To address this,Myers, Dr. Tomas Villalón, Michelle Chao, and Anthony Ballad on pooled their life savings —all $7000 — and built the first prototype in a Cambridge, Massachusetts backyard. This marked the start of their mission to build the world's first fully clean mining and metals production company with zero waste and zero direct carbon emissions.
The company, now at the Series B stage with 22 full-time employees, primarily produces metal and metal alloys, processing the metals from tailings, the waste product of mining. As the sole producer of final-stage rare earth metals in North America, their products contribute to the manufacturing of high-performance neodymium iron boron magnets, which power numerous technologies. Phoenix Tailings provides a sustainable alternative to the traditional process, which produces 2000 units of toxic waste for every unit of rare earths. The goal is ambitious — eliminating waste and carbon emissions entirely, not just reducing them.
Tackling Challenges Head-On: Sustainability and Supply Chain Management in the Metal Production Industry
Nicholas Myers of Phoenix Tailings discusses the challenges faced by the metal production industry due to China's near-total monopoly, which leads to predatory pricing and environmental disregard. He emphasizes Phoenix Tailings' commitment to responsible operation, environmental protection, and societal respect. Myers Underscores the need for US-made innovative technology, government aid, andpartner support to manage price volatility and investor risk.
Embracing the Digital Revolution: Overcoming Industry Challenges Through Innovation at Phoenix Tailings
Nicholas Myers,co-founder of Phoenix Tailings, advocates for the use of digital technologies in the industry to address challenges such as price clarity for key metals,market transparency, and traceability. He cites digital advancements in the diamond and cobalt sectors as examples. He also emphasizes the role of digital tools in enhancing process automation, optimizing production, and reducing emissions, as exemplified by Phoenix Tailings' use of machine learning algorithms.
Juan, considering his experience, acknowledges the dual role of digital technologies in improving operational efficiency and providing transparency and traceability, reflecting the trend of businesses embracing digital transformation for sustainable operations.
In the interview conclusion, Nicholas stresses the importance of innovation in achieving net-zero emissions in the metals industry. He urges companies to be forward thinking, embrace new technologies, and depart from conventional methods. He insists that all employees, irrespective of their position, play a crucial role in driving this transformative shift towards sustainability by endorsing and applying sustainable practices.
Stay tuned for more on Phoenix Tailings' sustainability journey by visiting their website and following their social media channels.
As you can imagine, to comply with the CSRD, it is necessary not only to present the data but also to provide comprehensive details about the data collection and analysis process.
High-quality, reliable data is essential for integrating ESG and sustainability into business operations. Trusted data enables companies to gain valuable insights, make informed decisions, and track their progress toward sustainability goals. Accurate, real-time data empowers businesses to enhance decision-making, ensure transparent reporting, and facilitate benchmarking and goal setting.
Industrial markets like energy, steel, chemicals, and cement, which have intricate supply chains, are adopting new technologies to enhance the efficiency of their value chains. Companies like Finboot are at the forefront of this digital transformation, leveraging blockchain technology to track and trace increasingly complex and interconnected supply chains.
We recognize the challenges faced by businesses in digitally transforming their supply chains and transitioning towards transparency and sustainability. We believe blockchain technology is the solution to making businesses more sustainable and efficient, both in terms of ESG factors and cost savings.
Through blockchain technology, we are driving a circular economy and helping our international client base in traditional sectors (energy, chemicals, plastic, mining, metals, and construction) achieve Net Zero emissions by bringing traceability, transparency, and compliance to their increasingly complex and interconnected supply chains.
¨Finboot’s innovative SaaS platform, MARCO, significantly improves value chain management and drives digitalization, sustainability, and ESG agendas. MARCO securely connects blockchain technologies under one roof, transforming data into trusted digital assets and accelerating the path to interoperability. The technology helps companies understand where and how their operations and products contribute to climate degradation, so they can respond appropriately to consumer and regulatory pressure.¨
PwC regarding Finboot's nomination for the Supply Chain Awards 2023
Embracing Blockchain for a Sustainable Future
Blockchain technology, with its decentralized, unalterable, and transparent nature, offers a robust solution to addressing ESG reporting. It allows for the creation of a digital twin, or TOKEN, of a physical asset that can be tracked throughout its lifecycle. This token can record all transaction-related data, from simple attributes like weight and quantity to complex details such as responsible sourcing certificates and environmental impact information, offering comprehensive visibility and traceability.
The technology's potential for environmental sustainability reporting is immense, extending to fields like energy consumption, carbon credits, water usage tracking, and plastic production.
The three major blockchain applications you should be aware of:
DPP is a key component of the Ecodesign for Sustainable Products Regulation (ESPR) proposed by the European Commission. This initiative aims to enhance product and component traceability, with plans to introduce a digital product passport in at least three major industrial sectors by 2024. The DPP uses blockchain technology to record product lifecycle data, making it unalterable, transparent, and therefore trustworthy. This promotes accountability and sustainability in supply chains, helping combat climate change.
#2 - Mass Balance: Traceability of circularity and renewables, including management of sustainability credits to help substantiate ESG claims.
This approach, one of the five common Chain of Custody Models (COCs), encourages the use of recycled materials, thereby reducing environmental strain. This method mixes used materials with specific characteristics with other materials, creating an output consistent with the input.
The goal is to help manufacturers gradually replace fossil materials with eco-friendly alternatives, thereby reducing their carbon footprint. By adopting the Mass Balance approach, companies can ensure responsible sourcing, promoting a circular economy and product sustainability.
#3 - Smart contracts: Invoice reconciliation for supplier communications and automated business rule validation
These self-executing contracts, coded with pre-defined terms, are mutually agreed upon by the blockchain network participants. They automate the execution of transactions, such as payments or data exchange, eliminating the need for interference.
This aspect of blockchain can significantly reduce risks associated with double accounting or greenwashing. For example, a supplier cannot overstate the renewable content in a product beyond what's registered on the blockchain ledger, as the system enforces the "no double accounting" rule.
The execution of smart contracts through code, rather than humans, removes the risk of human error and automates tasks traditionally requiring human intervention. This advantage, coupled with the absence of intermediaries and the time-saving, dispute-minimizing nature of the decentralized system, makes blockchain an extremely efficient and trustworthy tool for ESG data reporting and sustainability initiatives.
Conclusion
As businesses navigate the dynamic and complex landscape of ESG and sustainability, integrating trusted data, DLT, ecosystem thinking, and responsible AI becomes crucial. By embracing these concepts and technologies, businesses can create value for all stakeholders and contribute to a more sustainable future.
Moreover, fostering a culture of innovation and collaboration is key. Organizations can harness the transformative power of data and technology to address environmental, social, and governance challenges. As a business and society, we must continuously explore new ways of working together and leveraging these powerful tools as we move closer to realizing a world where companies can thrive financially and positively impact the well-being of people, society, and the planet.
Finboot is a technology company that provides digital traceability solutions to enterprise customers across multiple industries, enhancing supply chain traceability, transparency, compliance, operational efficiencies, and cost savings through process automation and streamlining, while promoting sustainability and ESG.
Starting on January5, 2023, the EU introduced the Corporate Sustainability Reporting Directive (CSRD) to replace the existing reporting framework of SFDR and broaden the scope of companies covered, from 11,000 initially to now 50,000 companies in the EU to follow new sustainability reporting rules, corresponding to 75% of all EU companies turnover.
The CSRD, established by the European Commission, offers a unified framework for non-financial data reporting. This significantly alters the depth and nature of companies' sustainability reports. The goal is to ensure consistent and comparable reporting of companies' environmental, social, and governance (ESG) activities. Hence, all companies under CSRD must follow the European Sustainability Reporting Standards (ESRS).
The ESRS is a set of 12 guidelines covering different ESG areas. Most have passed the drafting stage. Notably, these guidelines streamline the necessary data, modify mandatory disclosures, and are more aligned with other regulations like the Sustainable Finance Disclosure Regulation (SFDR), the International Sustainability Standards Board (ISSB), and the Task Force on Climate-Related Financial Disclosures (TCFD).
Who Needs to Comply and When?
The first group of companies earning €150 million (US$166) a year and having listed securities on the bloc’s regulated market must submit their CSRD-compliant report on January 1, 2025, for the fiscal year 2024, so planning should begin now.
Below, we have listed the key CSRD requirements you should know about:
CSRD necessitates a holistic approach to sustainability management and disclosure, taking into account impacts both before and after your operations.
CSRD calls for a "double materiality" reporting method, which might be broader than what some U.S. firms are used to, based on SEC or ISSB materiality definitions.
An independent third party must audit all reports (mandatory assurance is required).
The annual management reports should encompass both financial and non-financial (sustainability/ESG) data.
Reports must comply with the twelve European Sustainability Reporting Standards (ESRS) that have been established so far.
Information reported must be marked and presented in a standard digital format (ESEF/XBRL) to facilitate machine readability.
Reports must account for Scope 3 emissions, which are indirect emissions resulting from a company's activities across the supply chain.
CSRD timeline
CSRD compliance is expected to be mandatory for more than 50,000 companies over the next few years:
Listed companies: companies publicly listed on a stock exchange, except for micro-undertakings.
Listed SMEs.
Non-EU firms with a net turnover of €150 million and at least one significant subsidiary or branch in the EU.
Subsidiaries of global non-EU firms are only exempt from having to report when their non-financial information is included in the parent company’s consolidated management report.
Large enterprises: companies that meet at least two of the following criteria: employ a minimum of 250 staff members, generate an annual turnover exceeding €40 million, and possess a balance sheet total exceeding €20 million in assets.
This graphic illustrates the timeline for the rollout of the European Sustainability Reporting Standards (ESRS).
Early compliance has benefits
There are 12 ESRS drafts available at the moment, including 2 cross-cutting drafts and 11 drafts addressing particular topics. Depending on your operations, size, and industry, you will need to adhere to certain standards. However, according to the EU's most recent changes in July 2023, the "General disclosures" standard is the only one that everyone must follow. For example, data points related to product design or packaging lifecycle would be relevant only to companies that manufacture physical goods, but not to service providers. Another example: biodiversity and ecosystems/deforestation would apply to businesses that use raw materials extracted from forests and other ecosystems (e.g., cotton, cattle, soy, palm oil).
Companies that proactively address and integrate ESG factors unlock significant value and lay the groundwork for long-term success:
Improve risk management: By addressing ESG-related risks, businesses safeguard their operations, minimize costs, and bolster their reputation.
Enhance efficiency and cost savings: Sustainable business practices often lead to more efficient use of resources, resulting in significant cost savings.
Boost brand reputation: A strong commitment to ESG and sustainability can elevate a company's brand image, attracting new customers and fostering loyalty among existing ones.
Attract top talent: A focus on ESG and sustainability helps businesses attract and retain top talent.
Gain better access to capital: Companies with robust ESG performance can attract investment and benefit from lower borrowing costs due to reduced perceived risk.
What does the ESRS cover?
Although the ESRS are still drafts, the changes are unlikely to be significant, so there is no reason to wait until they are finalized. Early compliance with the Corporate Sustainability Reporting Directive (CSRD) has various advantages:
It allows companies to gain new insights into their non-financial indicators, leading to potential cost savings and innovations in production processes, such as energy reduction.
As the EU plans to introduce stricter legislation on environmental, social, and governance (ESG) factors, early compliance helps companies anticipate and minimize any negative impacts, making them more agile and future-proof.
Moreover, companies that actively focus on ESG reporting gain a competitive edge over those without reporting obligations.
Enables the streamlining of production and supply chains, facilitates strategic partnerships, and ensures continuity in the face of future directives.
What does the ESRS cover?
Embracing Technology for Compliance
To comply with the CSRD, you must collect data from suppliers, operators, and company partners. However, it can be challenging to convince these external companies to share their data. That's why it's important to create a secure, simple, and efficient process for collecting, sharing, and organizing data that benefits everyone involved.
The European Financial Reporting Advisory Group (EFRAG), the organization responsible for formulating the CSRD standards, issued its CSRD Implementation Guidance for value chains in August 2023. The group strongly encourages businesses to embark on this journey promptly and consider incorporating technological advancements into their strategies.
"They [companies] should consider an investment in technology, as well as clear processes and controls to collect data and report the information [...] and will also need time to set this up."
- EFRAG Implementation Guidance for value chains
To ensure effective compliance management, companies are leveraging modern technologies like blockchain. These tools help maintain transparency and traceability across complex supply chains and facilitate compliance with regulations.
Blockchain, or distributed ledger technology (DLT), provides a secure, tamper-proof record of transactions, enabling greater transparency and traceability across the entire value chain. This increased visibility helps businesses demonstrate their commitment to ESG principles and ensure the integrity of their supply chains.
Additionally, combining blockchain with DLT, artificial intelligence (AI) and machine learning technologies can identify compliance risks, detect patterns and trends in data, and automatically take action to prevent breaches, gain valuable insights, streamline processes, and foster innovation in the pursuit of sustainability goals.
Furthermore, companies are also embracing digital product passports to improve traceability. These digital tools store and manage data about a product's lifecycle, from production and use to recycling and disposal.
Conclusion
In essence, the CSRD and ESRS will compel companies to embed sustainability at the heart of their supply chain management, driving them to make data-driven decisions to reach their sustainability goals.
At Finboot, we understand the importance of embedding sustainability in your supply chain management. That's why we've created this insightful ebook that explores the role of the CSRD and ESRS in driving sustainability, the value of trusted data, and the transformative impact of emerging technologies like blockchain in facilitating ESG reporting.
If you want to stay ahead of the game and meet your CSRD reporting requirements, this ebook is a must-read:
Cardiff, UK - September 14, 2023 - Finboot, a leading technology company specialising in supply chain digitalisation announced today they have beenshortlisted for new three supply chain awards in 2023.
The new awards for which Finboot has been shortlisted are as follows:
1. Supply Chain Excellence Awards 2023
2. Supply Chain Awards 2023
3. Economic Innovator of the Year Awards 2023
This follows Finboot being finalists in three other respected tech awards earlier this year.
Finboot has been shortlisted for these latest three awards as a result of its collaborative work with its clients and partners to improve supply chain efficiency, promote circularity, and accelerate the journey towards a net-zero future.
One notable collaboration is their partnership with SABIC, the chemical giant. Finboot has been working with SABIC since 2021. In SABIC's Q3 2022 highlights report, states that Finboot's no code / low code blockchain platform, MARCO, offers "reduced costs, time, and improved data integration for all value chain partners."
The Supply Chain Excellence Awards, now in their 26th year, are recognised as the benchmark for supply chain best practices. The awards attract entries from across the UK and Europe.
The Logistik Heute, PwC, and Strategy & Supply Chain Awards 2023 highlight companies that have optimised their supply chains or demonstrated innovative approaches to enhancing supply chain efficiency.
Finboot's shortlisting for The Spectator Innovator of the Year Awards recognises Finboot innovation in making supply chains more efficient and “greener”.
According to Finboot's CEO, Juan Miguel Pérez Rosas, ¨Industrial sectors like energy, steel, chemicals, and cement, which have intricate supply chains, are adopting new technologies to enhance the efficiency of their value chains. Finboot recognizes the challenges faced by businesses in digitally transforming their supply chains and transitioning towards transparency and sustainability¨.
“We passionately believe blockchain technology is the solution to making businesses more sustainable and efficient, both in terms of environmental, social, and governance (ESG) factors as well as cost savings.
“The entire Finboot team is delighted and honored to be shortlisted for these prestigious awards. The nominations serve as a significant morale boost, further motivating the team to continue to push the boundaries of supply chain innovation to accelerate the journey to net-zero”.
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For media inquiries, please contact:
nicola@impactandinfluence.global or chris@impactandinfluence.global
About Finboot: Finboot is a leading technology company specializing in supply chain optimisation and economic innovation. With a focus on enhancing supply chain efficiency, promoting circularity, and driving sustainability, Finboot provides cutting-edge solutions that enable businesses to achieve their strategic goals. Through their no code/low code blockchain platform, MARCO, Finboot empowers organizations to streamline operations, reduce costs, and unlock new opportunities for growth. For more information, please visit www.finboot.com.
In the rapidly evolving business landscape, companies are required to rethink their traditional business models and supply chains. The focus is now on creating more satisfied and loyal customers while meeting Environmental, Social and Governance (ESG) goals. This article will explore the concept of Constellations of Value, its implications for supply chains, and how blockchain technology can empower these constellations.
The concept of Constellations of Value was presented by the Digital Supply Chain Institute (DSCI), an applied research and supply chain transformation organization that focuses on the development of enterprise supply chains in the digital economy in a live-streamed webinar today (Sep 12th, 2023) hosted by us. You can watch the recorded video on our social media (Linkedin and Youtube).
The Paradigm Shift: From Supply Chains to Constellations of Value
Traditionally, firms have relied on rigid supply and sales channels. However, the current business environment demands a more flexible, customer-oriented approach. The Digital Supply Chain Institute (DSCI) proposes a novel concept known as Constellations of Value (CoV). These constellations are centered around customers, focusing on increasing the number of satisfied and loyal customers.
The CoV model represents a shift in mindset. Instead of seeing companies as rigid points in a chain, they become flexible stars in a constellation. In this model, a company could be a competitor in one constellation and a collaborator in another. This new outlook requires businesses to adapt and forge stronger, more flexible relationships with their partners.
The Guiding Star: Creating Happy and Loyal Customers
The ultimate goal of every company's transformation towards a direct-to-customer model is to generate more happy and loyal customers. This doesn't refer to higher customer satisfaction scores. A happy customer is one who is willing to pay the same or more for your product and then share their positive experience. Conversely, a loyal customer is one who always prefers your company for their purchases and related services.
The Constellation Approach: Benefits and Challenges
The CoV model offers several advantages beyond revenue growth. By fostering flexibility, resilience, and customer-centricity, constellations can enhance your supply chain's effectiveness. However, transitioning from traditional supply chains to CoV requires companies to design new approaches to business continuity and supply chain resiliency.
Recent global events, such as the COVID pandemic, the Suez Canal blockage, and the war in Ukraine, have highlighted the unpredictability of supply chains. Simultaneously, the increasing number of cyberattacks on software and physical goods supply chains has amplified the need for trusted constellations that ensure security alongside flexibility and resilience.
The Intersection of ESG and the New Customer
In recent years, customer expectations have significantly shifted. The "new customer" not only demands personalized products, transparent pricing, and adherence to social values but also expects more control over their supply chain experience. This transformation in customer behavior has necessitated changes in business models.
The increasing regulatory focus on ESG has further complicated this landscape. Companies are under increased pressure to understand and mitigate conflicting risks in their supply chains. The integration of ESG into the supply chain function is now critical for creating happy and loyal customers.
Technology and the New Customer
Technology plays a pivotal role in the evolving business landscape in two interconnected ways. First, customers now expect a seamless purchasing experience facilitated by technology. They demand visibility into their product's journey, its manufacturing conditions, and its environmental impact. Second, these expectations extend to the workplace, with employees seeking a high level of visibility and transparency from their employers and suppliers.
ESG-Driven Supply Chain Leadership: Building Constellations of Value
To accommodate new business models and evolving customer expectations, companies need to build new, secure external relationships. Instead of thinking in terms of rigid supply and sales channels, companies need to form flexible supply and sales constellations. In these constellations, a company could be a competitor in one context and a valuable partner in another.
One way to facilitate these relationships and build trusted constellations is through strategic data sharing. Companies need to identify what data they would share with other companies in their constellation that would provide mutual benefit. This process will require companies to understand that the value of data is relative and can change from company to company and from constellation to constellation.
The Role of Blockchain in Empowering Constellations
In this context, blockchain technology can play a pivotal role. By providing a comprehensive and trustworthy record of a product's environmental impact, blockchain promotes transparency, accountability, and sustainability in supply chains. It can facilitate strategic data sharing by creating a secure, tamper-proof platform where companies can share and access data.
Conclusion
The shift from traditional supply chains to Constellations of Value represents a paradigm shift in how companies approach their business models and supply chains. It requires companies to be flexible, adaptable, and open to new partnerships. With the integration of ESG into the supply chain function and the adoption of technologies like blockchain, companies can build stronger, more resilient constellations that drive customer satisfaction and loyalty while meeting their sustainable goals. The future of supply chains lies in embracing these constellations and leveraging their potential to gain a competitive advantage.
To know more about Constellation of Value, download the Whitepaper released by the DSCI:
Whitepaper: Supply Chains Need to Adjust Now to New Global Factors
In the pursuit of a more sustainable future, countries worldwide are taking significant strides in regulating landscape practices to foster circular economies. As economies shift towards circularity, the integration of Blockchain technology amplifies the impact by providing transparency and traceability across supply chains. This blog post explores notable initiatives in non-EU regions that showcase the dedication and innovation involved in achieving a more sustainable world. From China to India, each country's approach contributes to a global circular economy transformation. As we delve into these examples, it becomes evident how circularity, sustainability, and Blockchain intersect, paving the way for a greener future.
Examples of strides in Non-EU Regions:
China
China's circular economy approach has evolved significantly, encompassing various government agencies, recycling initiatives, and policy tools. Proactive state actors have drawn inspiration from the global community, driving the advancement of circular practices. However, the current policy framework emphasizes means over goals, relying on direct subsidies and incentives. The Law for the Promotion of the Circular Economy, enacted on January 1, 2009, is a pivotal strategy in China's economic and social development. It prioritizes resource efficiency, environmental protection, and sustainability. The State Council oversees circular economy promotion, ensuring alignment with new industrial policies. Industries are mandated to reduce resource use, waste generation, and enhance recycling.
Canada
Canada addresses single-use plastic waste. The Canadian Council of Ministers of the Environment (CCME), through the Canada-wide Action Plan for Extended Producer Responsibility, empowering local authorities to enhance waste management oversight. With a focus on mitigating plastic waste, EPR leverages the resources of companies to reduce the volume of discarded food packaging and other single-use plastics.
United States
The Inflation Reduction Act in the United States is a comprehensive strategy aimed at making the country a global leader in clean energy technology. With a $370 billion investment, the act promotes clean energy, enhances supply chains, and creates new job opportunities, fostering a more sustainable economy.
South Africa
South Africa's Economic Reconstruction and Recovery Plan prioritizes sustainable economic growth, covering energy stability, employment generation, infrastructure development, eco-friendly practices, and more. The plan aims to create a resilient and inclusive economy, tapping into the country's untapped potential.
Ecuador
Ecuador launched the Circular Economy Pact, bringing together stakeholders from industry and academia. The goal is to enhance recycling initiatives and reintegrate materials into production cycles, nurturing future industrial growth while reducing waste.
South Korea
South Korea's circular economy strategy centers around resource recycling in nine industries to achieve sustainable growth. The circular economy (CE) 9 project focuses on using fewer resources, prolonging product lifespans, and promoting resource recycling after use.
"The key is to use fewer resources to produce products, use them for a long time and recycle resources after use," said Motie (Ministry of Trade, Industry and Energy).
Japan
Japan demonstrates a strong commitment to circularity through the "Circular Economy Challenge" under the Platform for Accelerating the Circular Economy (PACE). The initiative recognizes businesses contributing to circular economy principles, encouraging active participation.
India
India's drive towards renewable energy aims to boost economic growth, enhance energy security, and combat climate change. Robust government support and favorable economic conditions have made India a prominent player in the renewable energy market. Notably, India has introduced a policy dedicated to solar-wind hybrid projects. Moreover, the Ministry actively promotes collaborative research and technology development ventures with the industry, extending substantial financial support. Government and non-profit research organizations can receive up to 100% funding, while Industry, Start-ups, and Private Institutes can access up to 50% support. This proactive approach underscores India's commitment to sustainable energy solutions.
From China's evolving circular economy approach to India's dedication to renewable energy, non-EU regions are making significant strides to regulate their landscape practices in the pursuit of a more sustainable world. These initiatives are pivotal in transforming global economies towards circularity. The integration of Blockchain technology further enhances transparency and traceability, bolstering sustainability efforts across supply chains. By acknowledging and learning from these diverse approaches, countries worldwide can collaboratively advance circular economies and contribute to a more eco-friendly and prosperous planet.
To dive deeper into the regulatory landscape and explore the intersection of Circular Economy and Blockchain, check out our ebook "Regulatory Landscape in the Circular Economy." Together, let's shape a greener future for generations to come.
This blog discusses the SEC's new climate rules, which have been implemented to help with environmental protection. These regulations are designed to reduce the potential impact of climate change on our planet.
The US Securities and Exchange Commission (SEC) is nearing the completion of regulations concerning climate-related declarations, yet some uncertainty remains about the proposed SEC ESG rules and who they affect.
What is the purpose of the SEC's new climate disclosure regulation?
The SEC's interest in ESG reporting has been spurred by the escalating importance of sustainable practices in the corporate world. A 2020 Harvard study demonstrated a positive correlation between ESG maturity and financial performance, highlighting the economic benefits of sustainable practices. As a result, investors are increasingly using ESG performance to assess potential investments, recognizing that superior ESG performance is indicative of greater profitability and risk management.
As per the SEC ESG rules which were issued in 2010, public companies must disclose information relating to climate that is material. According to the SEC's 2010 guidance, "a reasonable investor would likely consider it significant when determining whether to vote or invest in something," if the information is material.
It is evident that different companies have had varied understandings of the requirements for sustainability reports, resulting in flawed information being presented and a distorted view of a company's sustainability efforts. Particularly, GHG emissions reporting has had a long-standing issue of inaccuracy because organizations are using approximations instead of exact energy consumption figures.
A thorough investigation of Scope 1 and 2 corporate emissions revealed that of the thousands of companies that submitted emissions data voluntarily from 2010-2019, roughly one third had incorrect figures at some point. In numerous circumstances, companies reported a decrease in emissions in comparison to the preceding year when in reality they had increased.
The SEC's introduction of the climate disclosure rule, which has been strongly backed by the majority of investors, is intended to address the challenge of human beings' shared objective of cutting back on carbon dioxide emissions and to also aid investors in monitoring companies' sustainability initiatives over time or evaluating the performance of one company versus another. This is a crucial step for both humanity and investors who are more and more requiring transparency related to corporate climate risk mitigation.
What outcome could businesses potentially experience if the SEC climate disclosure rule is adopted?
The proposal would necessitate publicly-traded companies to submit statements related to environmental, social and governance activities in the same manner that their financial records are documented, calling for their carbon footprint accounting to be precise.
The new rule, which largely follows the frameworks set by the Task Force on Climate-Related Financial Disclosures and the GHG Protocol Corporate Accounting and Reporting Standard, necessitates public companies to reveal the absolute value and intensity of Scope 1 and 2 emissions. Moreover, large filers (ex. Fortune 500 firms) and companies that have specified a Scope 3 emissions goal must also disclose their Scope 3 emissions.
Under the terms of the SEC climate disclosure rule, public companies would be required to provide information on not only their emissions but also other aspects such as:
Examining the potential dangers that climate change can bring to a business
The system for governing and monitoring the risks from the highest level
Establishing a risk management plan to recognize, evaluate and reduce these risks
The objectives the business has set for sustainability and how they plan to reach them
Proof of their inner decarbonization attempts (like the figures used for carbon offsets)
What steps should my business take to be ready for the SEC's climate disclosure regulations?
It is a fact that certain features of the climate disclosure regulation are contingent upon a company's special conditions, taking into account both qualitative and quantitative components. It is imperative for many businesses to upgrade their internal procedures to ensure that they are delivering accurate data prior to when the new SEC ESG regulations become effective.
A large number of businesses have identified that reliable data is a key issue for them. Deloitte's 2022 Sustainability Action Report found that over half (57%) of senior executives are of the opinion that availability and quality of data are the key impediments that are preventing them from achieving their ESG disclosure objectives.
Businesses can now take proactive steps to accurately measure their energy consumption and carbon emissions prior to the introduction of new disclosure regulations by using data automation with direct utility access. This is the most effective way to ensure businesses are accurately and transparently reporting their carbon footprint.
Prominent ESG leaders have stated that the most heavily monitored piece of data, no matter the industry, is one's carbon footprint and is the most likely to be included in any regulatory environment. Executives preparing for the SEC rules are likely to be considering that the CFO signing off on this data wants to be sure that it is auditable.
Now is the time for firms to analyze their ESG data strategy in anticipation of the projected reporting timeline that is outlined in the SEC’s fact sheet.
A dependable ally for the fresh epoch of carbon accounting
Blockchain technology presents a viable solution for capturing, recording, and attesting carbon footprint data. By closely tracking emissions at each stage in the value chain, companies can provide a more accurate and inclusive picture of their true GHG emissions. This, in turn, enables them to build more realistic plans to mitigate their environmental impact.
Converting emissions into digital tokens on a blockchain allows supply chain partners to readily share primary emissions data. This capability is particularly beneficial for companies required to report Scope 3 emissions, as it facilitates access to emissions data from suppliers, thereby resulting in more comprehensive reporting.
Sustainability has become a megatrend that is shaping multiple industries worldwide, and the packaging industry is no exception. The European Union (EU) has recently unveiled its revolutionary regulations on packaging, which are poised to cause a significant shift in the industry. Understanding these regulations is crucial for companies to navigate the complex regulatory landscape and stay compliant.
The Emergence of Sustainability in Packaging
In response to increasing global concern about packaging leakage into the oceans and the environment, along with consumers becoming increasingly conscious of their environmental impact, sustainable-packaging regulations have seen a rapid increase beyond the initial focus on shopping bags and selective food-service items. These regulations are complex, with varying regulatory maturity across countries, differing terminology, varying scopes, early stages of development, and geographical intricacy.
To better understand this evolving landscape, it's essential to examine recent developments and map regulations across different countries.
The EU's Necessary Shift: From Directive to Regulation
The European Union (EU), a significant player in the global packaging industry, recently proposed a new EU Packaging Regulation, which will replace the previous Directive on Packaging. This new regulation aims to eliminate wasteful practices and streamline the circular economy within the European Customs area.
Unlike the Directive, the Regulation takes immediate effect in the member states without the need for implementing legislation. This new law expands the requirements for packaging and packaging waste in the EU and allows the EU to impose further restrictions and implement surveillance measures.
The New EU Packaging Regulation: A Deep Dive
The new EU Packaging Regulation expands the list of hazardous substances in packaging and aims to reduce the volume of packaging used in the EU currently. The ultimate goal is to ensure that all packaging in the EU is recyclable by 2030. This aligns with the EU's Circular Economy Action Plan, which aims to eliminate plastics from landfills.
The new law will also involve the implementation of a special labeling code that would describe chemical composition, recyclability, and waste stream category, harmonized across the EU.
Impact on Businesses: What to Prepare for?
The new EU Packaging Regulation will have significant consequences for businesses that place packaged products on the EU market.
One notable requirement is the mandatory reduction of packaging waste by 15% per person by 2040, compared to 2018 levels. This regulation also aims to decrease the use of plastic made from fossil fuels in EU plastic packaging. This would reduce overall EU waste by 35-40%. Businesses will also be required to offer reusable or refillable packaging for a certain percentage of their products. By 2030, EU plastic packaging must contain 10-35% recycled content, increasing to 50-65% by 2040.
The PPWR encompasses several important measures, including achieving recyclability and increased recycling, encouraging the use of recycled materials, promoting reuse and refill, banning specific packaging, and reducing packaging waste.
To meet the new regulations requirements, businesses will need to assess their current portfolio of packaging to ensure it meets the definition of waste minimization. Moreover, they will need to provide evidence of their progress and accomplishments.
Planning for the New Regulations: Questions to Ask
The constant evolution of regulation will require packaging value-chain companies to keep track of changes in order to remain compliant. They will also need to develop capabilities to acquire an understanding of regulatory measures, their scope, and application, as well as the implications for their own businesses and customers.
Here are three critical questions for packaging companies to consider:
Does our organization have a market intelligence team monitoring regulatory changes and competitor actions in our key markets?
Do we possess internal agile processes for prompt regulatory compliance and business model adaptability?
What technology-level investments should we make in packaging technology for product sustainability?
Regulatory compliance and digitalization: the role of blockchain
To keep pace with the evolving landscape, organizations must embrace digital transformation and innovative approaches now. Blockchain technology, in particular, could be instrumental in addressing these challenges.
The application of blockchain technology, renowned for its transparency, traceability, and efficiency, could prove to be a powerful resource for the packaging industry to transition towards sustainable practices and adhere to environmental regulations.
For example, they could:
Implement IoT devices and edge computing to collect and evaluate data to scrutinize their manufacturing processes
Integrate machine learning and AI to predict maintenance requirements and optimize production
Leverage blockchain technology to track the generation of waste and its subsequent utilization in products or services (recycled products).
Blockchain and Sustainability
Blockchain technology can offer a holistic understanding of a product's life journey. It has the capability to trace the ecological impact of packaging materials, and can be utilized to verify the authenticity of recyclable substances. This facilitates the promotion of a circular economy, and assists businesses in making knowledgeable and eco-friendly choices.
Blockchain for Regulatory Compliance
Blockchain offers a transparent, decentralized ledger that records transactions in real-time, ensuring that all layers along the value chain are accountable and ensuring compliance. By eliminating the need for third-party intermediaries, this technology fosters a heightened sense of trust among stakeholders and investors. It's a game-changing solution that not only streamlines operations but also fortifies the credibility of businesses.
Blockchain and efficiency
Blockchain technology holds the potential to facilitate processes within organizations. Through the implementation of smart contracts, businesses can automate their regulatory compliance procedures, enabling them to swiftly respond to changes in the regulatory landscape. This level of agility can also provide a platform for more efficient transactions. This means businesses will be able to streamline processes and reduce the cost and time associated with certain operations. Overall, this makes businesses more productive while reducing waste in the process.
Conclusion
The European Union's packaging regulations represent a significant shift in the global packaging industry. Companies operating in this sector must stay tuned to regulatory developments in sustainability packaging by tracking changes in their focus markets and implementing processes to address future requirements proactively. The new regulations, while posing challenges, also present opportunities for businesses to innovate and contribute to a sustainable, circular economy. As the packaging industry continues to evolve, its future undoubtedly lies in sustainable practices and compliance with environmental regulations.
Cardiff, 6 July 2023: Blockchain will now be used to improve rail possession planning for the first time in the UK. The news comes following a unique partnership between infrastructure consultancy Amey Consulting and tech firm Finboot. The technology will be pioneered by Amey alongside Transport for Wales on its transformation of the Core Valley Line rail network.
Blockchain, an immutable ledger which digitally records transactions, will be used to agree access times for engineers to safely access rail tracks for maintenance, renewals and enhancements.
Blockchain’s ability to securely and independently record decisions provides a marked improvement on traditional planning systems, which can be open to duplication and inconsistency. While improving accountability and security, Blockchain will also lead to greater automation of possession planning.
The impact will reduce costs, improve planning and operational efficiencies, while also improving safety.
Speaking on the announcement, Tom Kinnear, Partner, Amey Consulting said: “Safe, effective, and predictable possession planning is essential in keeping our engineers safe and our rail network running. Through partnering with Finboot, we will provide the rail industry a UK first, in using Blockchain to radically improve this process. Opening the rail industry to new technologies from other industries is essential if we are to innovate, and build a forward thinking, digital-first railway we can all be proud of.”
Juan Miguel Perez, CEO & Co-Founder, Finboot says: “At Finboot we've been thinking about how blockchain can provide a digital solution for the complex requirements of railway maintenance. To have this further opportunity to explore and develop this with Amey, a leader in the railway industry, it's a great. Blockchain is a key piece of industrial tech that will bring added transparency and real-time visibility to such an important process within the rail sector.”
Today’s news follows a Railway Industry Association (RIA) report launched in March 2023, outlining the challenges and opportunities facing the rail industry on data and digital technologies. Among its recommendations was the need for the industry ‘to open itself up to different ideas from new and experienced innovators in its own and other industries’.
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain.
Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: Bringing the future of the internet to business. MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
Amey is a leading infrastructure services and engineering company.
Amey is at the heart of modern Britain, helping the economy to grow by designing, maintaining and transforming the nation’s strategic assets. Amey’s 11,000 people are behind the critical services the country relies on every day and Amey takes personal pride in our public service. Amey’s unique engineering and operations experience, together with data driven insight from our consulting business, delivers better results for our clients.
Amey is a trusted partner of Government – both national and local – managing assets and complex projects that are vital to the sustainable growth of the country.
The concept of a circular economy is not new. It has been part of the sustainability discourse for decades, with Japan initiating early efforts in the 1990s. However, the drive towards adopting circular economy principles has gained significant momentum in recent years, particularly in the European Union (EU).
The EU has been at the forefront of this shift, advancing ambitious policies aimed at reducing raw material consumption and increasing resource efficiency. The EU's commitment to the circular economy is epitomized in the European Green Deal, an ambitious plan to become the first climate-neutral continent by 2050, with the circular economy as a cornerstone strategy.
What does this look like? Policies that enable tax breaks or subsidies are one way of rewarding companies that are making the right moves in their organization. Not only will they be incentivized to reduce their energy and waste consumption, but also to invest in renewable energy technology.
From subsidies for vehicle remanufacturing, to farmer training in regenerative food production, governments can use many different policy instruments to develop and scale circular economy solutions.
The European Green Deal: A Beacon for Circular Economy Regulation
The European Green Deal is a comprehensive roadmap for Europe's sustainable transition. It aims to achieve zero greenhouse gas emissions by 2050 while promoting a pollution-free environment. To realize this vision, the Green Deal encompasses extensive measures spanning transportation, agriculture, ecosystems, and biodiversity, with a particular emphasis on the circular economy.
This requires improvements in transportation, agriculture, ecosystems, and biodiversity, as well as promoting a circular economy for reuse and recycling. From 2021 to 2027, 35% of EU research funds will support eco-friendly technologies.
A critical part of the Green Deal is the European Commission's Circular Economy Action Plan (CEAP), which focuses on reducing the environmental footprint of products and promoting a culture of reuse and recycling. The plan also envisages the development of a Digital Product Passport (DPP), a tool to enhance product and component traceability in the circular economy.
Additionally, the EU introduced the Net-Zero Industry Act and the European Critical Raw Materials Act as part of the Green Deal Industrial Plan. These acts focus on lowering emissions, promoting green practices, and ensuring essential supplies for Europe's green and digital shift. They support climate action and a sustainable economy and help attract green technology investments in Europe, preventing companies from moving during the energy transition.
Take Note of these four more regulations:
Additional significant EU regulations on supply chain transparency and energy transformation have been put into effect.
While the EU leads the charge in circular economy regulation, other regions are also making significant strides. For instance, China enacted the Circular Economy Promotion Law in 2008, emphasizing waste reduction, reuse, and recycling.
In North America, Canada has implemented the Canada-wide Action Plan on Zero Plastic Waste, focusing on plastic waste management.
The United States has enacted what is widely regarded as the most comprehensive strategy to date in this area: the Inflation Reduction Act (commonly referred to as the IRA). This plan contemplates (among other initiatives) over $400 billion in new investments across the country, particularly targeting industries associated with green energy and the mitigation of harmful greenhouse gas emissions.
In Africa, South Africa's Economic Reconstruction and Recovery Plan outlines the country's commitment to green economic growth, including initiatives to promote waste management and recycling.
In South America, Ecuador's Circular Economy Pact highlights the country's commitment to sustainable production and consumption patterns.
Many Asian countries, including South Korea and Japan, have also introduced circular economy policies, focusing on green technology and sustainable resource management.
Similarly, India, another major Asian player, has concentrated its efforts on promoting the growth of green and renewable technologies within its borders, allocating over $600 million in an investment plan for solar energy infrastructure and related technologies (like batteries) across the nation.
The Role of Blockchain Technology in the Circular Economy
Blockchain technology has emerged as a powerful enabler for the circular economy, providing enhanced transparency and traceability across supply chains. It offers an immutable digital record of transaction data, authenticated each time a new transaction occurs. This transparency can be used to track materials throughout the manufacturing process, ensuring that products are reused, recycled, and remanufactured in the most efficient way possible (Creating a Digital Product Passport (DPP).
This game-changing passport provides real-time insights into the supply chain journey of any product, revealing how and where materials are sourced and used. Furthermore, businesses can use this technology to generate transparency reports, allowing them to showcase the quality of their products and operations.
One of the unique features of blockchain technology is 'smart contracts'. These are self-executing contracts with the terms of the agreement directly written into code. They can be programmed to automatically issue actions or contracts when specific conditions are met. This feature is particularly useful for tracking used materials and their inclusion in a specific supply chain.
Blockchain not only provides a means of tracking materials but also offers enhanced security. With blockchain, you'll have an immutable record of data transactions. This means no transaction can be changed or altered in any way. This provides an extra layer of reliability and trust.
Another benefit of blockchain in the circular economy is that it provides a platform for more efficient transactions. This means businesses will be able to streamline processes and reduce the cost and time associated with certain operations. Overall, this makes businesses more productive while reducing waste in the process.
Mass balance, also known as mass flow accounting or material flow analysis, is a critical concept within sustainability and the circular economy. By accurately tracking and analyzing these flows, mass balance can help verify the sustainability claims made by companies, thereby combating 'greenwashing' — a deceptive tactic where companies exaggerate or falsely claim environmental benefits.
ESG reporting also faces the risk of greenwashing, where companies exaggerate or falsely claim environmental benefits. This is where blockchain technology can play a crucial role by providing an immutable record of data transactions, thereby ensuring transparency and accountability. This data is invaluable for investors, allowing them to make more informed decisions.
Accelerate Digitalization with MARCO Track & Trace
The circular economy is already showing its effectiveness in several sectors (especially in high capital industries such as chemical, energy, agriculture, fashion, mining, and plastic), contributing to sustainability and the efficient use of resources. It is the path to a future with fewer gas emissions and a more sustainable world. For instance, a blockchain pilot project for circular plastic recycling by Finboot, SABIC, Plastic Energy, and Intraplás gained lots of recognition because it was a first of its kind in the industry. The project aims to support end-to-end digital traceability of circular feedstock in customer products throughout the recycling process. More recently, Finboot announced a new partnership with CRDC Global, a fast-growing firm that utilizes a proprietary process to convert any type of plastic waste into a construction aggregate, to help them ensure its RESIN8 production processes are even more transparent, efficient, and sustainable.
Conclusion: Regulation is essential for reaching net-zero
The circular economy represents a paradigm shift in how we produce, consume, and dispose of products. As this shift accelerates, regulatory landscapes are evolving to support sustainable practices and penalize unsustainable ones.
Blockchain technology is emerging as a powerful tool in this transition, offering enhanced supply chain transparency and traceability.
Ultimately, the transition to a circular economy is not just a regulatory requirement—it's a business imperative. By embracing circular economy principles, businesses can unlock new efficiencies, reduce their environmental impact, and build a net-zero future.
On JUNE 19, 2023, Finboot announced a new partnership with CRDC Global. CRDC Global is a fast-growing firm that utilizes a proprietary process to convert any type of plastic waste into a construction aggregate called RESIN8™, which can be then incorporated into to a wide variety of construction projects.
RESIN8, designed by and for the construction industry, is unique in that it can be used in structural and non-structural concrete applications, even improving its performance. For example, including up to 10% RESIN8 in dry-mix concrete applications maintains its ASTM standard strength while providing better insulation and lighter weight. In non-structural concrete applications RESIN8 in larger quantities can reduce weight and significantly improve insulation. RESIN8 is suitable for numerous applications including concrete blocks, pavers, grouts, mortars and even hot-mix asphalt.
In this new collaboration, Finboot will use its blockchain technology to help CRDC Global ensure its RESIN8 production processes are even more transparent, efficient, and sustainable.
Juan Miguel Perez, CEO and Co-Founder, says: “We are really excited to be working with CRDC Global. CRDC’s value proposition REAP – Recover, Enrich, Appreciate, Prosper – is very much aligned to Finboot’s. There are huge synergies between our platform based in blockchain and CRDC’s mission, which is to create value from the world’s plastic waste. This is inspiring – they are helping solve an environmental problem by adding value to another industry.
“Blockchain is the killer app when it comes to traceability and transparency. We are now in the process of supply chain mapping.”
Don Thomson, Founder and Chairman of CRDC, says: “Right from the beginning of CRDC’s journey, transparency and accountability have been key. We are committed to continuous improvement and to prove to the world that we can be the truly circular solution to end the global plastic waste crisis once and for all. For us to achieve this, we must be fully transparent and we’re grateful for the blockchain technology that Finboot provides that we believe will allow us to do this.
“I am excited about this new collaboration with Finboot, our shared future is bright!”
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain. Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: bringing the future of the internet to business. MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas. MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
CRDC Global is a disruptive building materials company that creates appreciating value from the world’s
plastic waste. CRDC Global’s patented process accepts any type of plastic waste and converts it into a range of climate-resilient concrete additives and eco-aggregates. Marketed and produced under the RESIN8™ name, these versatile construction products meet or exceed internationally accepted ASTM standards. Through its Recover-Enrich-Appreciate-Prosper (REAP) model, which includes innovative new programs like the ‘Bag that Builds’, CRDC is relentlessly focused on providing better economic, environmental, and societal value for all, in line with UN’s Sustainable Development Goals.
The Inflation Reduction Act (IRA) is a crucial piece of legislation that has put a spotlight on the role of blockchain in enhancing supply chain transparency and accountability, while accelerating the transition to clean energy. Blockchain technology is increasingly recognized as a pivotal tool in driving forward the global decarbonization agenda.
Introduction: The Inflation Reduction Act (IRA) and Its Impact
The IRA is a recent legislation that has garnered significant attention as a consequential climate policy. This Act has allocated an impressive $370 billion for climate and clean energy projects, marking a historic investment in the United States’ efforts towards decarbonization and climate resilience. It is projected that the IRA will reduce U.S. greenhouse gas emissions by approximately 40 percent by 2030.
The clean energy portion of the package affects almost every sector within the energy transition and requires around 270 billion in investment in the form of tax credits. Of these, approximately half will be for wind, solar, and storage energy.
The IRA: A Catalyst for Clean Energy Economy
Beyond its environmental implications, the IRA also signifies a major investment in American competitiveness and innovation. It aims to shape a new landscape for clean energy, fostering technological advancements and incentivizing domestic manufacturing. The goal is not just to reduce emissions, but to position the United States as a global leader in the clean energy industry.
The Act includes a number of measures to reduce emissions in all sectors of the economy, including electricity production, transportation, industrial manufacturing, buildings, and agriculture, as well as to promote clean energy. It proposes tax credits for clean electricity, grants for clean fuel and sustainable vehicles, and programs to reduce emissions from industrial emitters and natural gas production. For consumers, it offers rebates and credits for energy-efficient home improvements and the purchase of clean vehicles. The Act also includes provisions for fossil fuels, aiming to encourage efficiency improvements and carbon capture solutions, along with new fees for natural gas extraction and methane emissions. The legislation allocates over $60 billion to support green energy manufacturing in the U.S., including tax credits for the production of solar panels, wind turbines, and batteries, and grants for retrofitting automobile factories.
The Act has established a new Clean Energy and Sustainability Accelerator, which will fund state and local clean energy financing institutions. This will facilitate the deployment of zero-emission technologies such as heat-pumps, community solar, and electric vehicle charging. The Accelerator is also committed to investing more than half of its funds in disadvantaged communities, expanding opportunities for clean energy entrepreneurship.
Blockchain: Enhancing Supply Chain Transparency and Accountability
The IRA underscores the urgent need for transparency and accountability in supply chain management. It mandates manufacturers to provide verifiable evidence about their supply chains, including the origin of raw materials and the environmental impact of their production processes.
Certain incentives are contingent upon sourcing a specific amount of raw materials from within the U.S., constructing the end product domestically, or complying with worker rights and competitive wage benchmarks.
Similarly, in the European Union, the proposed Battery Regulation, puts the responsibility for supply chain accountability squarely on automotive manufacturers. As such, EV manufacturers will have to require that their suppliers provide evidence of their material sources and their compliance with the regulation all the way back to the mine. Supply chains, however, have proven extremely difficult to track and validate.
This is where blockchain technology steps in. A decentralized ledger, blockchain securely stores and shares information. It provides an unalterable record of transactions that can be accessed by stakeholders.
The Power of Digital Product Passports
One of the significant advantages of blockchain technology is its ability to track the movement of goods across the entire supply chain. By logging every transaction on the blockchain, companies can produce a transparent and auditable record of their supply chain activities. This can mitigate fraud and corruption, while enhancing trust between suppliers and customers.
Digital product passports (DPPs) are instrumental in increasing transparency and accountability. This digital record details a product's lifecycle, including its origin, composition, and environmental footprint. By utilizing blockchain technology, businesses can create secure and tamper-proof DPPs, ensuring the authenticity of the information contained.
The Role of Blockchain in Advancing Green and Clean Energy
The transition to green and clean energy is a critical step in achieving decarbonization and complying with the IRA.
Blockchain can facilitate the adoption of decentralized energy systems, such as microgrids, which rely on clean energy sources like solar and wind power. By providing a secure and transparent platform for energy trading, blockchain allows businesses and consumers to buy and sell clean energy directly, fostering a more sustainable energy market.
Blockchain: Promoting Sustainability and Circular Economy
Blockchain technology can also offer detailed insights about the environmental impact of production processes and promote the circular economy. By recording data related to energy consumption, water usage, and waste production on the blockchain, businesses can balance their carbon emissions and contribute to the energy transition. This not only ensures compliance with regulatory frameworks but also fosters consumer trust and confidence.
Blockchain: Facilitating Compliance with Regulatory Framework and Sustainable Practices
As businesses strive to comply with the IRA, they must adhere to a robust regulatory framework and adopt sustainable practices. Blockchain technology can support businesses in meeting these requirements by enhancing transparency and accountability in their operations.
For instance, blockchain can help businesses comply with environmental, social, and governance (ESG) standards, which are becoming increasingly important in the global business landscape. By providing an immutable record of ESG performance data and enabling the verification of sustainability claims, blockchain can help businesses demonstrate their commitment to sustainable practices and attract investment.
Conclusion: Embracing Blockchain for a Climate-Positive Future
As the global business landscape continues to evolve, it is crucial for businesses to embrace innovative technologies and sustainable practices to stay ahead of the curve. By embracing blockchain technology, businesses can pave the way for a climate-positive future, where transparency, accountability, and sustainability are the norm.
The adoption of blockchain technology can also have a positive impact on businesses' bottom lines by reducing costs, enhancing efficiency, and improving supply chain management. Furthermore, by demonstrating their commitment to sustainability and compliance, businesses can attract investment, improve their reputation, and gain a competitive edge in the market.
For more information on how blockchain can support your business's sustainability initiatives, visit www.finboot.com/contact.
As regulators, consumers, investors, and business partners become more focused on ESG issues, the need for accurate metrics and measurements becomes more essential. But what do these metrics actually look like? And why are they so important? As attention to sustainability and ESG matters continues to grow, there is a need for more and better ESG data, which includes both quantitative and qualitative ESG metrics that can be reliably compared. Digitalization is a vital part of this process.
Even though ESG initiatives are applicable to all parts of a business, the procurement team has an important role to play in the integration of ESG criteria such as those related to the environment (supply chain vs. climate change influence) and social (supplier variety) aspects for the way the corporate integrates with larger ecosystems of suppliers and consumers, and the impact of it
ESG data can and should also be incorporated into KPIs to evaluate its effect on a company's performance.
ESG metrics and investment decisions
ESG metrics have become increasingly important to investors as sustainability issues become more mainstream, increasing corporate transparency and enabling investors to better understand the risks and opportunities of investing in certain companies and industries.
The recent study published by Computex Taipei, called Equity Investment Highlights Observation, shows that in October 2022, the quantity of global investments in ESG related to energy/resources/environment had the highest number, showing that the fields of renewable energy, energy storage batteries, carbon capture and conversion, bio-based chemical products, charging infrastructure, and other areas were favored by investors, following the trend of global net-zero emission commitments and the Carbon Border Adjustment Mechanism (CBAM) in Europe and the United States.
ESG metrics incorporate aspects of sustainability that can be quantified, such as greenhouse gas emissions. These metrics are often a function of an organization’s business activities, such as the percentage of renewable energy used by the company.
Benefits of measuring ESG performance
The benefits of measuring ESG performance are manifold, including a more comprehensive and sophisticated view of company risk and opportunity, a more strategic approach to management and resource allocation, improved customer engagement, stronger relationships with employees and suppliers, reduced costs, and enhanced reputations as sustainable and responsible companies.
It is a continuous mechanism of improvement, market benchmarking, and analytic understanding of areas and ways to streamline processes and innovate.
The role of procurement teams in ESG initiatives
Due to their strategic role in sourcing and supplier management, procurement teams are uniquely qualified to support ESG initiatives. For example, in the context of climate change, procurement teams can help mitigate the risks associated with potential supply chain disruption by diversifying supplier locations and commodities and increasing overall supplier resilience.
They can also help identify and reduce risks associated with potential shortages in the availability of raw materials, and enhance opportunities such as increased access to renewable energy.
The design and implementation of robust sustainability metrics and an effective data management system to track and report on them are critical for measuring the progress of ESG initiatives and the success of sustainability KPIs. ESG reporting does mean the following:
Metrics or KPIs that can show the overall impact of ESG factors on your business
KPIs and metrics that show the effects your company has on governance, social, and environmental issues.
Examples of ESG KPIs
The International Sustainability Standards Board (ISSB) has been set up around October and November 2021, to lay down the sustainability standards based on which ESG reporting can be done. The following are some of the examples of ESG KPIs and metrics that become part of ESG reporting:
Greenhouse gas emissions: this metric measures the amount of CO 2 emitted in the production and/or transportation of goods from suppliers. It can be calculated by dividing the amount of CO 2 emitted by the amount of goods received for selling.
Employee working conditions: this metric tracks the satisfaction of employees at work and addresses factors such as the risk of occupational injury, the amount of time spent on break or the time spent commuting for example.
Workplace and leadership diversity: this metric identifies the level of representation of different segments of the population, such as gender or particular ethnicity groups, in the organization’s management.
Challenges of measuring ESG performance
In addition to the benefits mentioned above, measuring ESG performance can also bring about important advantages for companies, including a more comprehensive and sophisticated view of company risk and opportunity, a more strategic approach to management and resource allocation, improved customer engagement, stronger relationships with employees and suppliers, reduced costs, and enhanced reputations as sustainable and responsible companies. However, acquiring and managing data related to ESG metrics can be challenging and costly. For example, gathering and managing greenhouse gas emissions data can be difficult, given the need to measure emissions generated at suppliers’ facilities as well as include emissions generated as a result of the company’s own operations. Similarly, gathering and managing data related to employee working conditions is often time-consuming and resource-intensive.
Utilizing blockchain technology could be very beneficial for a reliable and traceable method of collecting metrics. To accomplish this, companies and suppliers would have to form a digital ecosystem for sharing information, or a consortium.
The importance of digitization and digitalization in measuring ESG performance
Digitization involves making analog information digital, whereas digitalization is all about transforming existing processes into digital ones. Both are essential to achieving the advantages of measuring ESG performance because they give businesses the capacity to collect and store information about ESG metrics in a location that can be accessed and used by internal stakeholders across departments as well as external stakeholders, such as investors and suppliers.
Blockchain is a distributed database that allows for secure, transparent, and tamper-proof transactions. The adoption of blockchain technology, a decentralized digital ledger where data is safely shared, improves the quality and reliability of the data and makes it easier for companies to track and report on progress against ESG initiatives. It also allows for the use of automated tools to facilitate data collection, analysis, and visualization, making it easier for businesses to manage this data, identify and mitigate risks associated with ESG factors, and maximize opportunities.
Measuring ESG Performance in Different Industries
The types and levels of data collected in relation to ESG metrics will depend on the nature of the industry and the specific business activities. For example: the aviation sector will have different requirements and data needs than the food and beverage sector. Airline companies will likely have to track emissions related to the transportation of passengers and cargo, while beverage companies will likely have to track emissions related to the production and transportation of raw materials. Similarly, the food and beverage sector will likely have to manage data related to the employee working conditions of the workers who produce and distribute these products, while the airline sector will likely have to manage the same type of data, but related to the pilots and the cabin crew. Looking at the issue of workplace and leadership diversity, airline companies will manage data related to the representation of women and other underrepresented groups in management positions, and in the case of food and beverage companies, they will likely have to manage data related to the representation of different ethnicities and nationalities company wide.
Understanding what measures matter to fulfill investors' ESG aspirations is a basic step, whether your organization is aiming to improve its KPI tracking capability or tracking ESG KPIs for the first time. The next stage is to figure out how to gather and report on that data.
General ESGs & Sector-specifics ESGs and their respective KPIs
Initially, DVFA offered sector-specific ESGs and KPIs for a select few industries. While various parties are currently defining additional sectors, DVFA encourages third parties to develop sets of ESGs and KPIs for additional industries.
In general, the sets to be created should have the following characteristics:
Not more than 10-15 ESGs for a specific sector;
Well balanced i.e. covering E, S and G;
In accordance with the Dow Jones Industry Classification Guide;
Quantifiable and clearly defined.
Third parties and groups composed of members from various stakeholder groups, such as individual investment professionals from the sell- or buy-side, brokers, investment firms, corporates, ESG assurance providers and advisors, academics, and so on, can define a set of proposed ESGs and KPIs.
Conclusion
The world has seen tremendous changes in recent years in terms of public and investor interest in sustainable business practices. The rise in social consciousness has meant that companies are now expected to take a more responsible approach to business and are being held accountable for their impacts on the environment and their communities.
Measuring sustainability performance and tracking progress against sustainability targets are critical to ensuring that companies are successfully managing these issues.
For the past few years, Finboot has been offering our services to corporations such as Repsol, Stahl, and Iberia to help them incorporate blockchain into their processes and meet their Environmental, Social, and Governance (ESG) agendas.
A fundamental, necessary step to understanding how blockchain can improve our lives is to recognize the significance of transparency and the trustworthiness of data in decreasing the environmental impact of business activities. An example is that a blockchain-fueled solution can reduce or even eliminate the need for on-site checks and assessments, which can bring economic and environmental gains.
Furthermore, blockchain technology can be used to guarantee transparency in an incomparable way, allowing companies to widely share the way they measure and declare their sustainability credentials.
Finboot, founded in 2016, aimed to bridge the gap between blockchain's potential and its complexity to simplify and accelerate adoption. Initially focusing on financial services, we soon uncovered a wider range of opportunities, particularly within supply chain management. Blockchain has the power to enhance operational efficiency, foster new business opportunities, and support ESG and sustainability initiatives through increased transparency. Acknowledging the necessity for a brand refresh, we have developed a new corporate brand that highlights our evolution and illustrates our alignment with clients' needs and company strategy.
As part of our brand launch communication strategy, we hosted a live streamed event on LinkedIn and Youtube channels on June 14th at 5 p.m. CEST to showcase our brand through a new video. In that online event, I interviewed Juan Miguel Perez, co-founder and CEO of Finboot, and asked him about the role of digital technologies in helping industries achieve net zero, the impact of blockchain on ESG initiatives, the connection between blockchain and cryptocurrencies, and the future of blockchain and Web3. Juan shared insights on how Finboot is helping businesses across various industry segments transform their supply chains and move towards a more circular model.
In case you missed it, you can watch the recording here and check below for the main highlights from that conversation and interaction with the audience.
Digital's Role in Achieving Net Zero
Juan highlighted the importance of companies setting net zero targets to drive a significant change in the global economy. With deadlines driven by market and regulatory changes, businesses need to adapt quickly to meet their goals. Monitoring, measuring, and reporting are crucial in the journey to net zero, and the complexity of these metrics makes them impossible to manage manually.
Digital initiatives, Juan explained, are already helping companies transform their monitoring and reporting processes, preparing them for full scalability. Digital technologies eliminate the limitations of manual processes and enable companies to accurately manage their net zero transformation.
Blockchain's Impact on ESG Initiatives
When it comes to ESG initiatives, data security, auditability, and transparency are essential to ensuring trust. Juan emphasized that after monitoring, the most critical aspect is record keeping. Blockchain technology, with its immutable, distributed, and cryptographically secure database, offers a perfect solution for secure and transparent data management.
Finboot's Contribution to Circular Models and Avoiding Greenwashing
Finboot is already helping companies across industry segments deploy and grow digital traceability ecosystems to transform their supply chains. Juan Miguel mentioned SABIC, one of the world's largest chemical manufacturers, as an example of a company implementing Finboot's technology. SABIC tracks the use of circular and renewable raw materials, such as plastic waste, and traces it down to the brands and eventually the consumer. The ultimate goal is to provide consumers with visibility into the origin and composition of plastic packaging.
In addition to SABIC, Finboot has clients like global multi-energy provider Repsol, which has similar initiatives across other energy products. Beyond oil, gas, and chemicals, Finboot has experience in mining, steel, and aviation industries, demonstrating the versatility and potential of their technology.
Blockchain Technology Beyond Cryptocurrencies
JM explains that cryptocurrencies were the first application of blockchain technology, but the market has since grown to understand that the two are decoupled. Finboot has always been focused on the potential of the underlying technology, driven by its potential for climate action, and believes it will result in long-term and resilient value.
The Relevance of Web3 and Future Applications
JM also discusses the relevance of Web3, which encompasses more than just blockchain and aims to integrate various digital technologies to enhance our digital experiences further. While supply chain management is currently the killer app for blockchain, Finboot is prepared to enable new applications powered by blockchain, and this is just the beginning of our journey.
What does the market want to know?
The audience was engaged and sent their comments and questions. We chose some of the questions that Juan Miguel replied to during the live event:
Which sectors are adopting blockchain the fastest?
Juan explained that the sectors that are adopting blockchain the fastest are supply chains in high-intensity capital industries with difficult to decarbonize and complex industrial segments, such as oil and gas, chemicals, construction, steel,and mining.
Is blockchain expensive? Do I need to have a big IT department to support it?
In terms of investment, he stated that implementing blockchain does not have to be expensive. Finboot has been assisting companies in implementing blockchain in a progressive manner, making it feasible for businesses of all sizes without the need for a large IT department and scaling it in accordance with the size of the company so that the value and impact of it on the business can be seen from an early stage of deployment.
Can blockchain be used to track things that are hard to track, like fluids and gases?
This question was very interesting; it came from one of our advisors, Geoffrey Cann, who is also a well-known book author and expert on the oil and gas industry. Juan gave us a big yes on that, saying that for complex industrial processes, blockchain can create a digital representation of those workflows to track any kind of asset. And he also highlighted that Finboot is already doing that within the oil and gas and chemical industries, for example.
Will blockchain create new, skilled, and well-paid jobs?
Juan believes that there will be a shift in job opportunities involving blockchain knowledge, with professionals moving into business areas rather than just the IT department, as is currently the case. Moreover, the growing demand for understanding how blockchain can impact businesses across sectors is an excellent hard skill and is paving the way for new, skilled, and well-paid job opportunities across diverse industries, resulting in a thriving employment landscape for professionals adept in this cutting-edge technology.
Conclusion
Finboot's approach to using blockchain technology is helping businesses around the world work towards achieving net zero and ESG initiatives. With secure, transparent, and auditable data, companies can effectively transition to more circular models and avoid accusations of greenwashing. By harnessing digital technologies and the power of blockchain transparency and traceability, Finboot is providing a vital tool for businesses to transform their supply chains and contribute positively to the global fight against climate change and social inequality.
In the third installment of our series "Initiatives creating value from plastic waste in a global landscape," Paris Dufrayer and Flavia Sales from Finboot caught up with Tom Jackson, the founder of Honest Ocean. The conversation delved into the origins of Honest Ocean, its environmental impact, and how the company is working towards achieving its ultimate goal.
Honest Ocean primarily operates in Indonesia, which is the second-worst country after China for waste flow into the ocean. They have also expanded into Thailand, Malaysia, and Vietnam and plan to enter the Philippines within the next three years. Tom Jackson, the founder of Honest Ocean, explains their approach to tackling plastic pollution in these regions.
The Birth of Honest Ocean
Tom Jackson was once a part of the private and commercial yacht industry, traveling around the world from 2011 to 2018. During that time, he witnessed the alarming increase in plastic waste in the ocean. A sighting of a massive plastic garbage patch in the Pacific Ocean became the turning point for Tom, who decided it was time for a change.
He initially started a pharmaceutical business that used plastic, but it did not align with his goals to combat plastic pollution. After discussing this with his suppliers, Tom decided to find a better source of plastic and an eco-friendly option for their customers. This led him to move to Indonesia, the second most affected country by plastic pollution after China, and establish the Honest Ocean.
Since its foundation in 2020, Honest Ocean has operated in Indonesia, empowering local communities to collect, clean, and shred plastic. The company works with numerous partners to create a better future for everyone by recycling ocean-bound plastic and turning it into reusable material for next-generation products.
Building Community Hubs for Plastic Recycling
Honest Ocean focuses on areas with little infrastructure and high unemployment rates. They collaborate with local leaders and respected families to identify ways they can help. One solution they've found effective is creating community hubs where people can bring plastic waste, sort it, and separate it. Honest Ocean then acts as a sales agent, taking the material away from the community and providing an ongoing incentive for residents to participate in the recycling process.
This approach creates a domino effect, with more people getting involved in the separation and recycling of plastics. Tom emphasizes that this kind of community-driven initiative is essential for lasting change.
¨I plan to remain in Southeast Asia until the problem is significantly reduced or completely resolved. The Honest Ocean approach involves working with local communities, brands, and middlemen, such as people who transport materials to recycling sites. They collaborate with off-takers who take plastic from communities and aggregators who sort, shred, and clean the plastic before it reaches recycling plants¨, he explains.
Honest Ocean works directly with these recycling plants to ensure the plastic meets high standards, despite potential contamination from saltwater, sunlight, and other factors. The plastic is categorized into five different categories of recycled waste, ranging from high-quality, food-grade plastic to low-value plastic with limited recycling potential, such as bin bags.
This meticulous classification process helps Honest Ocean create a reliable supply chain for companies seeking to adopt circular business models and ensures that local communities receive fair compensation for their efforts.
Challenges in Tackling Plastic Pollution in Southeast Asia
In the interview, Tom Jackson discusses the main challenges facing the industry, particularly in terms of sustainability and supply chain.
Education and Awareness
According to Jackson, the first major challenge is the education level among local communities. For years, people in these areas have been burning plastic waste on the side of the road or disposing of it in rivers. Introducing a new approach to waste management can be difficult for individuals who have been using these traditional methods for decades. Honest Ocean is working to raise awareness of the consequences of poor waste management systems and how they can lead to severe pollution, as seen in some areas with plastic waste piled up 7 meters deep.
Additionally, the political landscape presents an obstacle, as government positions are often temporary and focused on short-term wins. This makes it challenging to implement long-term solutions to the plastic waste problem.
Leveraging Digital Solutions to Overcome Industry Challenges
Jackson also acknowledges the challenges of dealing with plastics from various sources and the difficulties in tracking the mixing of recycled and new plastics. He highlights the need for developing digital solutions that can help monitor and manage these complexities within the supply chain. Honest Ocean is currently focused on sourcing and tracking the origin of materials, but Jackson sees potential for implementing digital tools to provide transparency throughout the entire manufacturing process.
Addressing the Lack of Waste Collection Infrastructure
In Southeast Asia, particularly in Indonesia and Thailand, there is a significant lack of household waste collection services. This absence contributes to the overwhelming amount of plastic waste entering the ocean. Tom mentions the island of Lombok, just east of Bali, where 700 tons of plastic are used every day. Honest Ocean is building the first recycling plant on this island, but the challenge remains immense, as Indonesia consists of 3,000 islands with plastic waste circulating in the ocean. Honest Ocean is working with the government to build 25 recycling plants over the next 10 years, but this requires significant investment and planning.
Environmental Impact and Progress Towards Company Goals
Honest Ocean addresses the plastic problem by creating micro-businesses and empowering communities. They work on land to prevent plastic from entering the ocean, focusing on coastal areas and river mouths. Tom acknowledges that the issue is vast and requires a scalable business model to make a significant impact.
Although still in the early stages, Honest Ocean has made progress. The company's metrics change monthly, making it challenging to maintain consistency. They currently work with various waste banks and manage to process around 100 to 200 tons of plastic per month. Most of the plastic comes from the coastline, and they refer to it as "ocean stock plastic."
Tom Jackson admits that it is currently difficult to provide specific metrics on the environmental impact of their efforts. However, the company is working on a platform that will enable them to track their progress and measure their success in stopping plastic waste. As Honest Ocean grows and gains more stability in the recycling market, they expect to provide more concrete data on their impact.
Market Diversification: Automotive, Food and Beverage, and Beyond
Honest Ocean is just beginning to enter the automotive world, which requires high-grade plastic for long-lasting products. They also work with the food and beverage industry, although it is not their primary focus due to the prevalence of single-use plastics. However, they acknowledge that it's better for these industries to use recycled plastic rather than new plastic. Fast-moving consumer goods are another major market for Honest Ocean.
The Future: Construction and Collaboration with Major Brands
Tom Jackson expresses a desire to expand into the construction industry but admits they have not yet established the right connections. Despite this, Honest Ocean has already collaborated with major brands like IKEA for packaging solutions and The Body Shop for incorporating recycled plastics into their products. These partnerships demonstrate the company's commitment to working with brands that share their mission of creating a sustainable future.
Expanding to Other Regions Affected by Plastic Pollution
Honest Ocean is also considering expanding into Africa and other regions severely affected by plastic waste. In these areas, the need for infrastructure, waste collection, and plastic recycling is immense. By centralizing locations where people can bring plastic and get paid directly for it, Honest Ocean aims to create incentives for waste collection and recycling, ultimately reducing the amount of plastic pollution entering the oceans.
Recommendations and Final Thoughts for the Industry
For those looking to create a sustainable business, Tom advises focusing on passion, viability, and social impact. He emphasizes the importance of balancing passion with financial incentives to ensure the longevity of the venture. Networking and learning from others in the industry, such as through LinkedIn, can help identify patterns and clarify the path to creating a socially impactful business. He also encourages others to be persistent and research extensively, as the journey towards sustainable businesses is not an easy one. For instance, before launching his business, he spent 2-3 years researching a viable solution to the plastic issue as well as the high unemployment in small communities in Indonesia.
Conclusion
Honest Ocean is a testament to the power of individual action in the face of global challenges. By establishing a scalable business model that empowers communities and addresses plastic pollution, Tom Jackson and his team are making a difference in Indonesia and beyond. Although still in its early stages, Honest Ocean's progress in tackling plastic waste and supporting local communities shows promise and offers hope for a cleaner, more sustainable future.
¨The greatest aspect of our 360 plastic supply chain is its ability to add value to waste plastic, ensuring a stable income for local residents and their families. That's why we're all about that social enterprise—to foster long-term employment opportunities within local communities rather than merely offering a temporary financial boost through donations¨, he concludes.
Welcome to the second interview in Finboot's "Initiatives Creating Value From Plastic Waste in a Global Landscape" series. As a company committed to promoting sustainability and digital transformation, we invited a few selected companies that are making significant strides in this area to talk about their projects and share insights. In our first interview, we had the pleasure of speaking with Donald Thomson, CEO of the Center for Regenerative Design and Collaboration (CRDC). In this second interview, we will be speaking with Carlos Monreal, Founder and CEO of Plastic Energy. Join us as we delve deeper into the efforts of Plastic Energy to tackle the issue of plastic waste and create value from it.
Plastic waste is a global problem that has far-reaching environmental impacts, and Plastic Energy is a company that aims to address this issue. Founded by Carlos Monreal more than a decade ago, the company has been developing its unique TAC™ process for plastic waste. ¨Our TAC™ process is a chemical recycling method that can prevent plastic waste from going to landfill or incineration, and its goal is to reduce pollution and the impacts of plastic waste¨, the executive explains.
According to Monreal, the industry faces significant challenges in collecting plastic waste, particularly in nations outside of Europe. ¨Lack of collection and the need for Extended Producer Responsibility (EPR) schemes and clarity on chemical recycling policy are some of the industry's challenges. In terms of the supply chain, demand for recycled content is higher than what can be supplied, which is why chemical recycling is needed¨, he clarifies.
In order to improve the collection and sorting of plastic waste for its chemical recycling process, they work with governments, local authorities, and various stakeholders in the plastics value chain. They work closely with petrochemical companies, converters, and well-known brands like Unilever, Tupperware, and Mondelez. By participating in several closed-loop collaborations, they have successfully proven that chemically recycled content can be used in food-grade packaging, which has a significant advantage over mechanical recycling. These collaborative efforts have resulted in commercialized products available to consumers on the European market.
Plastic Energy has two recycling plants in Spain that have been operational for the past seven years, and the company has projects in Europe, Asia, and the US. With three plants currently under construction in Europe, Plastic Energy aims to recycle 5 million tonnes of plastic waste by 2030. Carlos reveals that they have partnered with SABIC for a 20 kt facility in the Netherlands, set to launch by the end of this year. Two more plants are being built in France: a 15 kt joint venture with TotalEnergies and a 33 kt Plastic Energy facility with ExxonMobil as an offtaker, both expected to operate in 2024. Additional projects are located in Spain, the US (with TotalEnergies), Malaysia (with Petronas), Indonesia (with ExxonMobil and Indomobil Prima Energi), and Germany (with Ineos). They have also begun licensing their technology, securing deals with SK Geo Centric in South Korea and Qenos in Australia.
Digital technology also plays a crucial role in overcoming industry challenges and has been effectively integrated into Plastic Energy's business operations. The CEO affirms that digitalization is key to ensuring the smooth operation of Plastic Energy's technology and processes and for automation advancements in the future. ¨The company is looking into digital twin technology in order to streamline and increase the efficiency of its technology development. Plastic Energy also ran a blockchain pilot project to certify transparency and traceability in its process. ¨This project traced plastic waste from a sorting facility to our plant, where we recycled it into TACOIL™ (recycled oil from our process), to a petrochemical partner who processed our TACOIL™, to a converter who produced packaging with the recycled polymers, and all the way to the point that the product with this packaging was delivered to its final point of sale. This was a very interesting project that we believe could be repeated again in the future, and we believe that digitalization will become increasingly important in the recycling sector¨.
Plastic Energy recently carried out a lifecycle analysis of its recycling process that was verified by independent consultants, which showed that the TAC™ process has a lower climate change impact than incineration with energy recovery in Europe and that plastics made from the process also have a lower climate change impact than virgin plastics.
In conclusion, Plastic Energy is an example of a company that is addressing the issue of plastic waste through its TAC™ process, which is a chemical recycling method that aims to reduce pollution and the impacts of plastic waste. The company collaborates with the entire plastics value-chain and works with governments and local authorities to improve the collection and sortation of plastic waste. Plastic Energy also recognizes the importance of digitalization in the recycling sector and encourages the development of new technologies to reduce pollution and increase recycling of plastics.
European Green Deal and its main policy initiatives
The European Green Deal is a legislative package that is designed to help bring the European economy in line with its climate objectives, especially with the REPowerEU Plan to reduce reliance on imported Russian fossil fuels. This, together with the Circular Economy Action Plan, will provide the guidelines for transforming the EU's industry to meet the requirements of reducing net greenhouse gas emissions by 55% by 2030, in comparison to 1990 levels.
The ambitious goals of the deal are designed to have a positive impact on sustainable development, competitiveness, job opportunities, and the quality of life for all citizens.
Ursula von der Leyen, President of the European Commission, stated that in order to accelerate the transition to clean energy, a regulatory environment is necessary. The Net-Zero Industry Act will be able to provide the best conditions for the sectors that are necessary to reach net-zero emissions by 2050. She went on to say that demand is increasing all over Europe and the world, prompting them to act now and make sure they can meet the demand with European supply.
The EU Net-Zero Industry Act: Key Elements and Goals
The EU Net-Zero Industry Act is not just a legislative proposal, it's a bold move towards sustainable development and a better future, designed to have a positive impact on sustainable development, competitiveness, job opportunities, and the quality of life for all citizens.
It's a call for action for all industrial sectors to join the fight against climate change and achieve carbon neutrality by 2050. The act sets forth ambitious goals, including:
the establishment of a comprehensive EU-wide carbon pricing system,
promotion of energy efficiency and renewable energy sources, and development of innovative low-carbon technologies.
ensuring a level playing field for businesses operating within the EU by:
introducing binding targets for reducing greenhouse gas emissions.
providing financial incentives and support measures for businesses investing in low-carbon technologies and practices.
Another crucial aspect of the Net-Zero Industry Act is its focus on collaboration and stakeholder engagement. The act encourages public-private partnerships and the involvement of local and regional authorities in the development and implementation of sustainable industrial strategies. This collaborative approach ensures that the transition to a low-carbon economy is inclusive, economically viable, and socially acceptable.
The European Critical Raw Materials Act: Supporting Sustainable Resource Management
The European Critical Raw Materials Act aims to enhance the EU's resilience and competitiveness by promoting sustainable resource management and reducing dependency on imported raw materials. This legislation targets the responsible sourcing, processing, and recycling of critical raw materials, which are essential for the manufacturing of various high-tech products and renewable energy technologies.
The act establishes a list of critical raw materials that are subject to specific policy measures, such as research and development funding, strategic stockpiling, and investment in sustainable mining practices. It also sets forth guidelines for responsible sourcing, based on internationally recognized environmental and social standards, as well as transparency and traceability requirements for supply chains.
By encouraging a more circular and resource-efficient economy, the Critical Raw Materials Act not only supports the objectives of the European Green Deal but also contributes to the global efforts to achieve the United Nations Sustainable Development Goals.
The Role of the Circular Economy in Achieving the Green Deal Objectives
The circular economy is a pivotal concept within the European Green Deal, as it seeks to redefine the traditional linear model of production and consumption by promoting the efficient use and recycling of resources. This approach aims to minimize the generation of waste, reduce the extraction of raw materials, and maximize the value of products throughout their lifecycle.
The EU has adopted several policy initiatives to facilitate the transition to a circular economy, such as the Circular Economy Action Plan, the Ecodesign for Sustainable Products Regulation, and the Waste Framework Directive. These measures target various aspects of the production and consumption processes, including product design, manufacturing, distribution, and end-of-life management.
In addition to providing a great opportunity for companies to become more sustainable and profitable in the long run, embracing circular business models can also provide numerous economic benefits, such as reducing costs and increasing efficiency. A recent study by the Ellen MacArthur Foundation found that adopting circular economy principles could generate up to $4.5 trillion in additional economic growth by 2030.
By promoting circularity, the EU hopes to achieve a more resilient and competitive economy while also addressing today's pressing environmental challenges. The circular economy is, therefore, a key enabler for the successful implementation of the European Green Deal.
Blockchain Technology: Enhancing Traceability and Transparency
The Ecodesign for Sustainable Products Regulation (ESPR) is an integral part of the European Green Deal, as it seeks to establish EU-wide minimum requirements for the environmental performance of products. This legislation promotes sustainable production and consumption by encouraging manufacturers to design products that are durable, repairable, and recyclable, and by providing consumers with better information on the environmental performance of the goods they purchase.
The ESPR identifies a Digital Product Passport (DPP) as key to enhancing the traceability of products and their components in the circular economy.
Digital Product Passport
Blockchain brings with it a variety of unique features that enable material tracing. This is significant for circular economies. Through blockchain, you are able to identify and monitor materials throughout the supply chain. This enables users to more effectively reuse, recycle, and remanufacture products.
Key Blockchain Benefits
- Greater transparency
- Proof of transactions without the need for a central authority
- Permissions-based privacy and security
- Auditable, tamper-proof record-keeping
- Immutability
Digital Product Passports (DPP) is a digital record that contains information on the environmental performance, origin, and composition of a product, as well as information on its repairability, recyclability, and overall lifecycle.
Blockchain technology can play a significant role in the implementation of DPPs, by providing a secure and transparent platform for storing and sharing product information. This decentralized ledger technology can enhance traceability and transparency in supply chains, by enabling real-time tracking of goods and materials, as well as the verification of sustainability claims and certifications.
“Blockchain is a powerful tool that can provide breadth and depth to climate mitigation and adaptation efforts by democratizing ownership, improving transparency and integrity, and enabling real-time visibility into emissions reduction and sequestration efforts.”
The World Economic Forum White Paper emphasizes that digital technologies like blockchain can serve as an essential infrastructure for managing global climate action effectively and efficiently. It underlines four main advantages of using blockchain for climate initiatives:
1) fostering trust and ambition in climate negotiations,
2) improving market transparency and credibility,
3) channeling more funds towards project developers, and
4) making climate action opportunities accessible to all.
Conclusion: The Future of Sustainability
These regulations and frameworks promote sustainable development, foster innovation, and enhance competitiveness.
As businesses and governments seek to transition towards a more sustainable and circular economy, new opportunities will emerge for innovation, collaboration, and stakeholder engagement. By leveraging cutting-edge technologies, such as blockchain, businesses can not only comply with regulatory requirements but also gain a competitive advantage in the market, by offering sustainable and eco-friendly solutions.
Together, we can build a more sustainable and prosperous future, where economic growth is decoupled from environmental degradation and social and environmental considerations are integrated into business decision-making.
To learn more about how blockchain can help you with your sustainable initiatives, reach out to us at www.finboot.com/contact.
“Industrial sectors such energy, steel, chemical and cement, with complex supply chains are turning to new technologies to improve efficiency of their value chains”, writes Juan Miguel Pérez Rosas, CEO, Finboot
From speaking with its customers, Finboot understands how businesses are struggling with the digital transformation of their supply chains and the substantial changes they need to make in terms of becoming more transparent and sustainable – from both an ESG and cost saving standpoint. Blockchain holds the key to business becoming more sustainable and efficient.
Finboot is a member of New York based Digital Supply Chain Institute (DCSI). DSCI members have reported that blockchain is the ‘killer app’ when it comes to highlighting pressure points across their value chains.
The nature of blockchain as an immutable single source of truth means it is tamperproof and can help build trust – particularly when it comes to sourcing and tracking materials throughout supply chains. In the chemicals sector, for example, blockchain is being used to track processed chemicals and ensure product quality for customers. From raw materials to manufacturing to the arrival of the goods at the customer’s site – all supply chain data can be continuously tracked and this information made public.
Finboot customer, chemical giant SABIC, is using blockchain to increase the circularity of its supply chain, reduce emissions, increase efficiency and save money. So much so, it reports reduced costs, time and improved data integration for all value chain partners in its third quarter 2022 highlights and it 2022 Annual Report (pages 38 and 50).
We expect blockchain to be integrated into everyday business as usual for firms the world over. Blockchain’s ability to collect, store and measure data accurately and reliably means it can drive out human error while also giving companies the insights they need to progress both their digital and sustainability credentials.
“ChatGPT is a text generating Artificial Intelligence (AI) chatbot. It can search, analyse and present its response in any style or language of your choice. It is the first signs we have of a technology co-pilot to support us in our daily lives,” writes Nish Kotecha, Chair & Co-Founder, Finboot.
AI is truly a huge opportunity and human society altering technology. As those that have tried have found, it is very addictive and rapidly becomes a life “co-pilot.”
AI could address skills and labour shortages.
For example, a front-line worker who is not digitally savvy can now benefit from all the resources available on the internet, real-time, to support their decision making. This will greatly improve productivity and improve earning potential.
There is currently a worldwide shortage of software engineers. The answer is No-code and Low-code platforms. Low-code reduces programming efforts to a minimum, while no-code empowers anyone to create apps without any programming knowledge. The key driver for their growth is the ever-growing demand for digital solutions and the shortage of skilled developers to produce them. Combining generative AI with such platforms, can help us create digital applications for routine tasks quickly and efficiently and create a new paradigm for software development.
However, as well as the opportunities, it is important to agree as a human race, what the limits and threats are.
An open letter, from The Future of Life Institute, signed by Musk, Wozniak and around 30,000 others in Silicon Valley, warned “AI systems with human-competitive intelligence can pose profound risks to society and humanity,” it says. “Should we develop non-human minds that might eventually outnumber, outsmart, obsolete [sic] and replace us?” Many are concerned that we are unleashing a technology on the world that will impact every area of humanity including health, education, politics and even programming new code.
According to Goldman Sachs, Generative AI is set to affect 300 million jobs across major economies but at the same time technology could boost global GDP by seven per cent. It is estimated that about two-thirds of jobs in the US and Europe are ‘at risk’ to some degree of AI automation.
We need to agree AI’s limits and where the AI off button is and when to use it…
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To read the full version of this article, first published Companies Digest, on 2 May 2023, please see:
Businesses are constantly evolving and adapting to changing market needs. As new technologies emerge and are integrated into industrial processes, they can have a significant impact on industrial markets. Blockchain technology is one such technology that has the potential to revolutionize traceability in industrial sectors, including manufacturing, mining, construction, transportation, and energy, and enhance transparency and efficiency in supply chain operations. Achieving traceability, visibility, and provenance is critical for businesses in industrial markets as it allows them to track and trace their products across the entire value chain, from raw materials to the end consumer, and even post-consumer waste. In this blog post, we will explore how blockchain can help unlock traceability in industrial markets and drive digital transformation in the industrial sector.
A McKinsey research shows that achieving successful transformation across the whole industrial sector would be worth $0.8 trillion to $2 trillion in total return to shareholders, an increase of 9 to 22 percent. This value comes from two sources: an estimated $0.3 trillion to $0.9 trillion in revenue growth (an improvement of 3 to 10 percent), and $0.3 trillion to $0.7 trillion in margin expansion from efficiency gains (an improvement of 4 to 9 percent).
Source: The trillion-dollar opportunity for the industrial sector: How to extract full value from technology. McKinsey Digital (2018)
Moreover, the State of European Industrial Tech report found that the industrial technology sector has experienced significant growth, with its value tripling in just three years. It now receives nearly $6 billion in annual funding and has fostered startups worth over $100 billion. The corporate sector is also playing a bigger role in the industrial tech market, with corporate investment in European industrial tech exceeding $802 million in 2022, which was the amount invested in 2020 and exceeded that of 2021.
These numbers show that there is a great potential for growth and improvement in the industrial markets. By embracing new technologies like blockchain, businesses in the industrial sectors can enhance transparency, efficiency, and traceability in their supply chain operations, which can lead to significant revenue growth and margin expansion.
By using blockchain for creating a digital record of products, which includes information on the origin of raw materials, industrial processes at play, and the quality and compliance of the finished goods, industrial technology players can collectively create a digital product passport, which optimizes their supply chains by reducing lead times, improving inventory management, and increasing efficiency.
In short, blockchain and digital traceability have significant benefits in the context of industrial markets and are generating quantifiable business value in the form of increased profitability and operational efficiency.
Blockchain is transforming the way industrial sectors approach traceability
The rise of industrial technology has transformed the landscape of various sectors, from manufacturing to transportation, mining to energy production. The integration of cutting-edge technologies like blockchain has revolutionized supply chain management, bringing traceability, visibility, and provenance to the forefront. Combined with other rapidly maturing technologies like AI, industrial technology is driving efficiency, agility, and scalability, enabling businesses to meet customer demands and deliver high-quality products faster than ever before.
In manufacturing, blockchain enables the creation of digital product passports that capture critical information about the origin of raw materials, industrial processes, and compliance of finished goods. This allows manufacturers to have a single source of truth, ensuring product quality and meeting regulatory standards.
In mining, blockchain can be used to track the origin of minerals, ensuring responsible sourcing and ethical practices.
In construction, blockchain can enable digital record-keeping of materials and equipment, reducing the risk of counterfeit products and improving traceability in complex projects.
In transportation, blockchain can provide end-to-end visibility of goods in transit, reducing delays, improving logistics, and enhancing customer satisfaction.
In the energy sector, blockchain can enable the tracking of renewable energy certificates, ensuring the authenticity and sustainability of energy sources.
Furthermore, blockchain technology can automate processes and reduce costs by creating smart contracts. For instance, it can automate the verification of sustainability certifications, which saves time and money while ensuring compliance with regulations.
To further explore the potential of industrial technology and blockchain in driving digital transformation, we invite you to download our ebook titled "The Rise of Industrial Tech: Digital Transformation Lands in the Industrial Sector." In this comprehensive resource, you will gain insights into the latest trends, use cases, and best practices in leveraging blockchain for optimizing supply chains and achieving sustainable business outcomes.
Blockchain technology is revolutionizing many industries, and plastic recycling is no exception. Finboot, in collaboration with SABIC, Plastic Energy, and Intraplás, is at the forefront of this innovation with their pilot project that uses blockchain to promote traceability and transparency in plastic recycling.
The goal of the project is to enable end-to-end digital traceability of circular feedstock in customer products throughout the recycling process. The project is a first-of-its-kind in the industry and promises to provide valuable insights that can be used to enhance recycling processes in the future.
SABIC expressed their enthusiasm for the project on social media, noting that digitalization is key to ensuring the smooth operation of technology and recycling processes. They also shared a YouTube video that showcases the innovative nature of the project and how it can contribute to the advancement of plastic recycling.
They said:
Data is a powerful tool. We're partnering with technology company Finboot, advanced recycling pioneer Plastic Energy, and packaging specialist Intraplás to launch a #blockchain pilot program that tracks plastic recycling.A first of its kind in the industry, the project aims to support end-to-end digital traceability of circular feedstock in customer products throughout the recycling process. Find out more: https://bit.ly/3GtLNXi#SABIC
SABIC original post on LinkedIn
Plastic Energy echoed SABIC's sentiments and shared the video as well, highlighting the importance of promoting circularity in the plastic industry. The video provides a comprehensive overview of the project, showcasing its potential impact on the plastic recycling industry.
They said:
¨The role of #digitalisation 👩💻 is key to ensure the smooth operation of our #technology and #recyling process, and for advancements in the future. We partnered with SABIC, Finboot and Intraplás on a #blockchain technology pilot project for traceability and transparency for #recycled #plastics, demonstrating how #advancedrecycling ♻️ can play an important role for more #sustainable plastics.¨
Plastic Energy on LinkedIn
As individuals and organizations continue to focus on sustainability, it is critical to leverage technology to improve recycling processes. This blockchain pilot project is a testament to the power of innovation in promoting a sustainable future.
This collaboration between Finboot, SABIC, Plastic Energy, and Intraplás is a step in the right direction towards promoting circularity and sustainability in the plastic industry. The use of blockchain technology to foster traceability and transparency in plastic recycling will undoubtedly inspire other players in the industry to embrace innovation and contribute to a sustainable future.
The business benefits of blockchain are clear and are increasingly becoming a key part of business strategies.
The respected Forbes Technology Council recently listed 18 key blockchain business benefits. They were:
1. Managing Global Supply Chain Networks
2. Enabling Digital Goods Portability
3. Tracking Vehicle Ownership Records
4. Maintaining Software Bill of Materials (SBOM)
5. Tracking Production and Consumption of System AuthorisationFacility
6. ‘Owning’ One’s Own Personal Identification
7. Enhancing Customer Loyalty Programs
8. Tracking and Verifying Carbon Credits
9. Opening Up Opportunities In Real Estate Investment
10. Maintaining Land Ownership Records
11. Migrating Consumer-Owned Assets Between DigitalWorlds
12. Improving User Engagement Through Non-Fungible Tokensand Adding New Financial Services
13. Verifying Product Authenticity
14. Self-Reporting Data Usage
15. Boosting App Developers’ Productivity
16. Improving Safety and Security in the Food SupplyChain
17. Improving Accessibility and Exchange of EducationCredentials
18. Enabling Easy and Secure Storage and Sharing ofPatients’ Medical Records
At Finboot we have found in recent months that highcapital industries like chemicals, steel, oil and gas and cement, are investingin technologies, like blockchain, to increase transparency and increase efficacy– in terms of moving to net zero and saving time / money – of their complex andmultinational and mult-territory supply chains. Blockchain is the ‘killer app’ in this space as it spotlights pinch pointsand highlights where efficiencies can be made.
Blockchain holds the key tobusiness becoming more sustainable and efficient. It isextremely useful around ESG reporting as it provides untamperable data around thecircular systems businesses are moving towards and enables fully automated,greener, value chains. It also protectsagainst industrial espionage, safeguards intellectual property, and preventsmoney laundering and bribery. The latterbusiness benefits can be crucial in emerging markets.
Since 2021 Finboot has been veryproud to work with the chemical giant, SABIC, to increase the circularity of theirsupply chain, reduce emissions, increase efficiency and save money. In its third quarter 2022 report SABIC stated: ‘The [Finboot blockchain platform, MARCO] offers reduced costs, time and improved data integration for all value chain partners.’
Finboot is committed to promoting sustainable discussion and how digital transformation can make a positive impact. To further this mission, we are conducting a series of interviews called "Initiatives Creating Value From Plastic Waste in a Global Landscape¨, where we invited a few selected companies that are making significant strides in this area to talk about their projects and share insights.
Our first interview is with Donald Thomson, CEO of the Center for Regenerative Design and Collaboration (CRDC), a company whose approach is based on a collaborative net-zero circular economy model that views the plastic and construction industries as a connected system, where the plastic industry waste stream becomes the raw material and value stream for the construction and building industry.
Asked by Paris Dufrayer, CRO of Finboot, Donald described CRDC's innovative approach to tackling the plastic waste crisis and its impact on the environment. CRDC's story is just one example of how businesses are taking responsibility for addressing this global issue, and we hope that their insights will inspire others to take action. The company started as a small classical music school for underprivileged children on the beach that required students to help pick up plastic to earn their position in the class. After becoming focused on the plastic problem, the school became a volunteer beach cleanup program and later evolved into CRDC. The company takes plastic waste from levels 1 to 7 (the 7 types of recyclable plastics fall under the categories of PET, HDPE, PP, LDPE, PVC, PS, and Other) and transforms it into a concrete additive for the building industry.
Thomson highlights the ¨plastic dilemma¨, which refers to the global challenge of managing plastic waste effectively. With the ever-increasing demand for plastic products, there has been a significant increase in plastic waste generation, which poses a significant threat to the environment and human health. The plastic dilemma requires a multifaceted solution that involves reducing plastic waste generation, improving waste management systems, and promoting the transition towards a circular economy. It is a complex issue that requires a coordinated effort from different stakeholders, including governments, businesses, and individuals, to tackle it effectively.
The construction sector is very large, and the plastic industry has a very beneficial industrial symbiosis with it. McKinsey & Company published an article entitled ¨The circular cement value chain: Sustainable and profitable¨, stating that "concrete and cement circularity could allow industry to rein in costs and reduce emissions, adding untapped value to the built environment." According to the article, redesign, reduction, and repurposing of existing assets are crucial as decarbonization strategies. Donald's statement shows how CRDC is focused on that opportunity: "From our perspective, we often say if a plastic can be recycled, it should be recycled. If it can't, it should be transformed." He also highlights the importance of repurposing plastic waste and transforming it into another material that can have lasting value. This approach can be achieved through the development of innovative technologies that can convert plastic waste into high-value products, such as fuels, chemicals, and building materials. By repurposing plastic waste in this way, companies can reduce their reliance on raw materials, decrease their carbon footprint, and contribute to a more sustainable future. Additionally, repurposing plastic waste contributes to the development of circular economies. For instance, they work with some organizations to help solve the housing deficit, such as the Alliance to end Plastic Waste and Habitat for Humanity. The first one is helping CRDC scale up their production plant for RESIN8® in Costa Rica and expand their footprint in North America. RESIN8® is a concrete additive made from hard-to-recycle plastic that has already been used by Habitat for Humanity to build housing in Latin America.
CRDC has pilot facilities on almost all continents and is building full-size facilities in Pennsylvania - USA, San José - Costa Rica and South Africa. CRDC is a purpose-driven company that has specific goals. The company's mission is to make as big an impact as possible, and they spend a lot of time determining how to achieve this goal. The company's purpose is to transform plastic waste, and they believe that building smaller plants in multiple locations is the key to making a significant impact. They refer to this as the "Starbucks model" and plan to build plants wherever there are plastic consumers, construction, and concrete. Donald emphasizes that "if all the plastic produced every year, estimated to be around 400 million tons, were converted into the RESIN8 product, it would still only represent a small percentage, specifically 2.5%, of the overall aggregate market (all natural stone and sand materials used in construction). This means that the construction industry has the potential to use all the plastic produced, they can make a big difference in the plastic dilemma .¨
On the other hand, Donald mentioned that one of the biggest challenges facing the industry is that consumers have lost faith in recycling because they have seen a lot of plastic waste that has not been recycled, which leads them to believe that recycling is not working. He added that the plastic market needs to regain consumers' trust by ensuring that recycled plastic is actually being used in new products.
Donald believes that using technology to build trust and confidence in information is essential to getting the public to believe in recycling again. "Being able to engage the public with accurate information and results is probably one of the very most important things that we can do," he adds.
Paris, CRO at Finboot, highlights that by using blockchain technology, for example, consumers can see exactly where their recycled plastic came from and how it is being used. This level of transparency can help rebuild consumers' faith in recycling and encourage them to recycle more. Donald recognizes the significance of digitalization and its potential benefits for his industry. He acknowledges that there is a lot to learn in this area, as well as the growing importance of verification and tracking processes. He adds that the CRDC is currently analyzing the use of data as a priority to help stakeholders understand the impact of associating with CRDC. He also mentions that working with a company like Finboot is a big priority for them.
In his final remarks, Donald emphasized the value of understanding both sides of the plastic dilemma, including the issues and worries that the industry faces. He believes that bringing the two perspectives (from the Industry and the Consumer) to the center of the debate and seeking for a common sense and for practical initiatives is crucial for people to see the results and believe in the recycling industry. Donald sees this as one of the biggest challenges facing the recycling industry, and he believes that collaboration is the key to finding solutions. He expresses his excitement to collaborate with Finboot to effectively make a meaningful impact on the world's plastic waste crisis.
To learn how Finboot can help you implement a circular economy tracking solution by giving transparency to supply chain renewable feedstock processes, and, with it, ensuring environmental sustainability for a better future, download this free ebook: The importance of tracking renewable feedstock for supply chain integrity.
We are pleased to announce that since the start of 2023, Finboot has been shortlisted for not one, but three prestigious awards.
They are:
1)The Bold Awards
2)The EUTech SDG Awards
3)The Humber Awards
We see this as recognition to our commitment to innovation, sustainability and digital transformation for efficiency.
TheBold Awards for digital industries, recognises top companies, projects and individuals powering breakthroughs around the world. At the start of 2023, we were shortlisted for The Bold Awards, as one of the Boldest Blockchain and Non-Fungible Tokens (NFTs) and Boldest FinTech companies. This nomination reflects Finboot's expertise in innovative blockchain technology, and its no-code/low-code blockchain platform, MARCO, which is bringing traceability, transparency and compliance to supply chains; accelerating operational efficiency and producing cost savings by automating and streamlining processes while also driving sustainability and ESG.
For example, Finboot has been working with the chemical giant, SABIC, since 2021, to increase the circularity of their supply chain, reduce emissions, increase efficiency and save money. In its Q3 2022 highlights report, SABIC stated: ‘The [Finboot blockchain platform, MARCO] offers reduced costs, time and improved data integration for all value chain partners.’”
TheEUTech SDG Awards are presented to companies that excel in sustainability and provide pioneering solutions to solve the most relevant global challenges of our time, demonstrating a commitment to the United Nations' Sustainable Development Goals (SDGs). Finboot has been shortlisted in the "SDG 9: Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation" category, which recognises businesses and organizations which have developed innovative solutions to improve infrastructure, foster innovation and promote sustainable development.
TheHumber Awards are presented to businesses which have demonstrated excellence in various categories, including green innovation, sustainability and business growth. Finboot has been shortlisted in the "Green Innovation" category, which recognizes companies that use novel approaches to refine existing technologies, making them more sustainable. This nomination is a testament to the company's commitment to promote sustainable practices into all sectors of the economy (including the notoriously difficult to decarbonise, capital intensive industries like oil and gas, steel, concrete and chemical manufacture) by deploying their innovative blockchain technology solutions.
We are humbled and grateful to be recognised for our commitment to innovation, sustainability and digital transformation. These nominations reflect our values and are a reinforcement of our ability to enable our customers to accelerate their digital transformation, realizing increasing value while building trust through blockchain.
We are using resources faster than the Earth can replace them. This is because we have a linear economy, which means we take resources, use them once, and then throw them away. This is not sustainable, and the Earth can't keep up. In fact, the world's circular economy has gone from 9.1% in 2018 to 8.6% in 2020, compared to the linear economy's faster growth.
One of today's best known alternatives is to switch to a "circular" economy, where we use resources over and over again, to make sure we have enough for the future. One way to do this is by recycling more. If we recycle the most important things, we could save a lot of carbon dioxide and help the planet (increasing the recycling rates from their current rates of 25–35% to 80–90%, we can achieve CO2 savings of 40–50 billion tons by 2040).
Figure 1: EU initiatives relevant to the introduction of a Digital Product Passport (source: Taskforce for climate neutral and circular materials and products and Wuppertal Institute report)
The ESPR identifies a Digital Product Passport (DPP) as key, enhancing the traceability of products and their components. The aim of this initiative is to start the process of introducing a digital product passport in at least three major industrial sectors by 2024, such as textiles, construction, steel, cement, electronic waste, plastics, chemicals, and automotive.
The DPP leverages blockchain technology to enable digital asset traceability. Blockchain is a distributed digital ledger that allows for secure, transparent, and tamper-proof record keeping. By using blockchain, the DPP can show exactly where a product came from and where it goes after it's used (from raw material extraction to end-of-life disposal). This information can be shared with anyone, like customers, companies, or regulators. They can use it to make better choices that help the environment. For example, they can scan a QR code and see where the product came from and how it was made.
With our digital traceability solutions, SABIC has improved their management of circular feedstock, and now has a differentiated product that they can trace back to the waste source. This was applied as part of SABIC's TRUCIRCLE™ portfolio and services.
It is important to highlight that recycling is just one of many ways to improve the circularity of resources. It is also possible to improve resource efficiency by adopting better designs and business models, and by prolonging product life cycles through practices like repairing and reusing items. According to this Accenture study from 2021, circular strategies are expected to generate an additional $35 billion in consumer goods value by 2030 from reduced costs. However, achieving these goals requires accurate information about the products, including their manufacturing and disposal processes. Currently, we do not track and trace resources, lifecycle extension, and end-of-life (EoL) activities along global value chains (value chains). Unfortunately, we lack transparency and value chain collaborations to drive and monitor efforts that increase circularity. To address this issue, it is important to find solutions that foster greater transparency, traceability, and cooperation in resource management, such as DPPs. Studies show that using blockchain can lead to increased material circulation. In this study of 290 manufacturing firms in the China-Pakistan Economic Corridor, a 1% increase in blockchain use resulted in a 0.341% increase in remanufacturing and recycling.
The Center for Regenerative Design and Collaboration (CRDC) is another example of how a business whose approach is based on a collaborative net-zero circular economy model can generate real value. In their case, the plastic industry waste stream becomes the raw material and value stream for the construction and building industry by repurposing plastic waste and transforming it into another material that can have lasting value: CRDC’s product, RESIN8®, is a concrete additive made from hard-to-recycle plastic that has already been used by Habitat for Humanity to build housing in Latin America.
The crucial role of Digital Product Passports for a more sustainable world
I’ve already said that the DPP can provide a reliable and transparent record of a product's entire life cycle, from raw material extraction to end-of-life disposal. So, using digital product passports in value chains has several advantages for businesses:
Firstly, it can encourage sustainable product manufacturing, which can help develop a circular economy, increase energy and material efficiency, extend product lifespans, and optimize product usage.
Secondly, it can help businesses comply with legal requirements by acting as a record of product standards and provide auditors with necessary data for assessment.
Thirdly, digital product passports allow consumers to make informed purchasing decisions by providing them with information about the impact of their choices.
Finally, it can create value through circular economy practices by enabling companies to implement service and repair-based business models and showcase their environmental credentials as a unique selling point.
But which information should be collected and shared through a DPP?
Due to the complexity of various product supply chains, digital product passports (DPPs) can help with many data requirements for different products. The challenge is to know how to standardize this information for each sector, and although this process is specific to each industry, we are starting to visualize some trends in these data requirements.. We are discussing this with industries to decide on the specifications. The ESPR suggests some ways to make products more sustainable, including:
durability,
reliability,
reusability,
upgradability, e. reparability,
possibility of maintenance and refurbishment, g. presence of substances of concern,
energy use or energy efficiency,
resource use or resource efficiency,
recycled content,
possibility of remanufacturing and recycling,
possibility of recovery of materials,
environmental impacts, including carbon and environmental footprint, and
It’s clear that using digital product passports (DPPs) has some potential drawbacks and limitations to consider. One challenge is deciding what data to include in the DPP. This can be a complex process as there may be a large amount of data available, but not all of it may be relevant or useful for the intended purpose of the DPP. Additionally, there may be concerns about data privacy and security.
To address these challenges, it is important to have clear objectives and a well-defined scope for the DPP. This will help to ensure that the data collected is relevant and useful for the intended purpose. It is also important to have a robust data governance framework in place to ensure data privacy and security are maintained. Another challenge is ensuring that the DPP is accessible to all stakeholders.
Overall, the DPP aims to enhance traceability in this new circular economy by providing stakeholders with standardized information for clients and consumers about the products they use, sell, or regulate. By leveraging blockchain technology for digital asset traceability, the DPP can provide a reliable, transparent, and immutable record of a product's entire life cycle, helping to identify inefficiencies and opportunities for improvement. Finally, it is important to recognize that DPPs are not a silver bullet solution and should be seen as part of a broader set of policies and initiatives to promote a circular economy. DPPs can help identify opportunities for resource efficiency and waste reduction, but they need to be supported by other policies such as product design, extended producer responsibility schemes, and recycling infrastructure.
In recent years, there has been growing concern about the impact of human activities on the environment, particularly the carbon footprint generated by various industries. While efforts to reduce emissions and offset carbon footprints have been underway for some time, the emergence of blockchain technology has the potential to take these efforts to a whole new level.
With its unique properties of decentralization, transparency, and immutability, blockchain technology can provide full traceability of carbon emissions and facilitate the development of a robust, secure, and trustworthy carbon offset market. In this blog, we will explore the potential of blockchain technology to offset carbon footprints and provide a comprehensive overview of how this innovative technology can be leveraged to achieve a more sustainable future.
Carbon Offsets and Carbon Credit Explained
Carbon offsets and carbon credits are terms that are commonly used when discussing efforts to reduce carbon emissions and mitigate the impact of human activities on the environment. In essence, they represent a way to offset or neutralize the negative impact of carbon emissions by investing in initiatives that promote environmental sustainability.
Carbon credits are a tradable commodity that represent a certain amount of carbon dioxide (CO2) or other greenhouse gases that have been prevented from being released into the atmosphere. Each carbon credit typically represents one ton of CO2 that has been avoided, reduced, or removed from the atmosphere. Carbon credits can be earned through a variety of activities, such as investing in renewable energy projects, energy efficiency improvements, or reforestation efforts. Once earned, these credits can be traded on carbon markets or used by companies to offset their carbon footprint.
Carbon offsets, on the other hand, are a way to compensate for the carbon emissions that cannot be avoided or reduced by investing in projects that remove or prevent the release of carbon dioxide or other greenhouse gasses. Carbon offsets can be purchased by individuals, organizations, or governments to balance out their carbon footprint and achieve carbon neutrality. For example, a company may purchase carbon offsets to compensate for the emissions generated by its transportation, manufacturing, or other activities.
The idea behind carbon offsets and carbon credits is to create a financial incentive for reducing emissions and promoting sustainability. By creating a market for carbon credits, companies and individuals are encouraged to invest in projects that reduce carbon emissions, which in turn promotes the development of renewable energy, energy efficiency, and other sustainability initiatives.
What is Regulated Carbon Trading: Ethics & Compliance
Regulated carbon trading is a system of emissions trading that takes place between governments and regulated entities. Due to the fact that it enables businesses to comply with regulations while still reaping financial rewards from lowering their carbon footprint, it offers an ethical and legal way to address climate change. The profits made from selling these credits can be reinvested into further sustainability initiatives.
One of the key components of regulated carbon trading is the establishment of a compliance regime. This regime typically includes a set of rules and regulations that must be followed by participants in the market. These rules may cover issues such as reporting and verification requirements, penalties for non-compliance, and mechanisms for dispute resolution.
In addition to compliance requirements, regulated carbon trading frameworks may also include ethical guidelines. These guidelines may cover issues such as the protection of human rights, the prevention of corruption and bribery, and the promotion of social and environmental responsibility.
Shining the light on regulatory and compliance issues
Tracking carbon emissions and their associated trades requires a high degree of transparency. It also requires accuracy and security. To ensure compliance with regulations, organizations are turning to blockchain technology for its traceability capabilities.
Blockchain provides an immutable and secure ledger that can track the complete history of each transaction. At the same time, it ensures there is no double-counting or fraudulent activity. This allows governments, businesses, and individuals to easily verify the validity of emissions trades. They can then monitor whether they are in compliance with regulations.
Benefits of using Blockchain in Carbon Markets
The use of blockchain technology in carbon trading provides numerous benefits for businesses looking to reduce their emissions. These benefits include, among others:
Increased transparency and trust
The decentralized nature of blockchain means every participant has the same authority and influence over the data. All participants receive the same amount of data that is continually updated in real-time. It allows companies to securely store data related to their carbon offset or credit purchases and the information is available for verification. This provides greater visibility into the company’s emissions footprint.
Through the use of digital product passports, companies can securely store information about where their carbon credits or offsets come from. They can then track these transactions along the supply chain.
Faster transaction verification
The use of blockchain technology allows for faster processing and verification of carbon credits or offset purchases.
Blockchain also allows companies to use smart contracts to communicate with suppliers and validate business rules to ensure secure and transparent transactions between stakeholders. This means businesses can quickly validate their transactions. They can also reduce the time and cost associated with emissions trading.
Improved accuracy
With blockchain technology, companies are able to access accurate data related to emissions reductions achieved through their investments in carbon credits or offsets. This allows them to more accurately measure and report on the progress they have made in reducing their environmental impact. By verifying their sustainability credentials, it helps businesses ensure that they remain on target to achieve their ESG objectives.
Digitalisation trough blockchain as sustainability drivers across different industries
Blockchain technology has the potential to significantly help to reduce the carbon footprint of many sectors. Businesses can identify inefficiencies, reduce waste, and have a smaller environmental impact by promoting transparency, accountability, and sustainability with blockchain technology.
In the energy industry, for example, blockchain technology can help facilitate the adoption of renewable energy sources by enabling more efficient peer-to-peer energy trading and reducing reliance on centralized energy grids.
In the chemical industry and oil and gas sector, blockchain technology can be used to track the entire lifecycle of raw materials to end products on the supply chain, which can help identify areas where waste can be reduced, energy can be saved, and emissions can be minimized.
Similarly, in the mining industry and steel manufacturing, blockchain technology can be used to track and trace the supply chain of minerals and other raw materials, which can help promote sustainable mining practices and reduce the environmental impact of mining activities.
Blockchain technology can be applied to the food industry to encourage sustainability and lower food waste by giving a transparent view of the supply chain and facilitating more effective supply chain management.
Conclusion
In conclusion, blockchain technology has the potential to significantly enhance transparency and traceability in carbon trading. By providing a secure and decentralized platform for managing carbon credits and emissions reductions, blockchain-based systems can help to increase accountability, reduce fraud, and promote compliance with regulatory frameworks.
The transparency provided by blockchain technology can also help to foster trust and collaboration among stakeholders in the carbon trading market, which is critical for achieving the emissions reductions needed to mitigate the impacts of climate change.
In recent years, blockchain technology has been widely discussed and promoted as a game-changing technology with the potential to disrupt various industries. As the technology is still young and evolving, decision-makers in various industries, including telecom operators, are exploring its potential use cases and proofs-of-concept.
Blockchain technology offers various advantages for telecom operators, including security, transparency, data immutability, and control across the ecosystem at every point of transaction. One of the areas where blockchain can be particularly useful for telecom operators is in tackling roaming challenges.
Roaming partner settlements are currently controlled by intermediaries and issues can last up to two months. This structure often results in human errors, lack of transparency, fraud, and poor customer experience.
By using blockchain technology can lead to a series of benefits for telecom providers that may include:
Removing Intermediaries:Smart contracts on the blockchain can automate Service Level Agreement (SLA) agreements, providing transparency to all stakeholders and aiding in quick dispute resolution through tamper-proof verifiable transactions and real-time usage updates to the end consumer.
Roaming Fraud Prevention: Blockchain combined with smart contracts can reduce roaming fraud and improve ID management by automating processes. Currently, users have to provide a lot of personal information to sign up for different vendors and services. With blockchain, a shared ledger can store identity transactions creating a digital identity using the public key from the digital identity and creates a set of standard fields, such as names, addresses, etc. Finally, the CSP adds a digital signature using its private key.
Reducing Location Inaccuracy: A mobile terminal network localization method using blockchain technology can reduce inaccuracies in locating mobile terminals and verifying the authenticity of location broadcasts when GPS signals are weak.
Clearing the way for IoT: Blockchain technology can improve the security and efficiency of Internet of Things (IoT) networks by enabling secure, error-free peer-to-peer connectivity for multiple devices, and providing a secure way to inspect and track changes to data within a company's network.
Usage of Connectivity Passports for every customer: The management of customers is a major challenge for Telcos due to the high frequency of changes in operating models and service providers. Using a blockchain-powered connectivity passport, customers could share their information consensually, allowing Telcos to create personalized services and boost margins. Furthermore, actual usage data can then be shared with each network for accurate billing.
Better Collaboration: The consortium model using blockchain can improve collaboration among stakeholders by efficiently executing multiple business transactions. In the Telco ecosystem, it can help Communication Service Providers connect with other operators, partners and suppliers for better customer experience.
5G Facilitation: The implementation of 5G technology can benefit from the use of blockchain to streamline processes and enable a new generation mechanism for selecting the fastest access node for each user or machine, which is important for building sustainable solutions.
Blockchain technology has the potential to revolutionize the way telecom operators handle roaming challenges. By using smart contracts on the blockchain, it is possible to reduce and even eliminate intermediaries, leading to roaming fraud reduction, cost savings, and instant settlements. Additionally, blockchain technology can optimize ID management through automated processes which can provide more accurate location data.
MARCO Track & Trace enables the recording, certification, and sharing of environmental and social sustainability efficacy, which supports the demands for transparency and confirmation of ethical practices within mining and steel manufacturing supply chains.
The steel industry is a complex process involving multiple stakeholders. Because of the complexities of these processes, the stakeholders at the two ends of the chain struggle to interact efficiently, creating barriers to communication and loss of information across the chain. In times when customers and regulators are requiring more and more transparency of information.
The steel industry can improve visibility and traceability of its supply chain and drive sustainability and ESG agendas with blockchain technology.
Supply chain challenges faced by the Steel Industry: complex process and stakeholders communication gaps
The steel industry is one of the most important industries in the world. It is an integrated process that begins with the extraction and processing of raw materials and ends with the manufacturing of products. It involves multiple stakeholders, including miners, suppliers, manufacturers, retailers, and consumers.
The steel industry is facing several challenges in managing a sustainable supply chain. The complexity of the process and communication gaps between stakeholders can make it difficult to trace materials, products, and processes. This lack of traceability can lead to problems such as counterfeiting, illegal dumping, and environmental degradation.
In addition, the increasing complexity of the global supply chain and the need to adhere to stringent regulations have made it difficult to manage the steel supply chain. The lack of visibility and traceability can lead to inefficiencies in the production process and undermine the quality of the products.
Benefits of Blockchain for Supply Chain Traceability: trust, traceability, transparency
Blockchain is a distributed ledger technology that enables secure, transparent, and efficient data sharing between multiple stakeholders.
Companies can use blockchain technology to track the movement of materials and the end-to-end production process of steel products.
To digitize and trace products manufacturing lifecycle. Identify the relevant data and non-digital processes replacing them with the creation of digital twins.
Improve digitalization and documentation flows to stimulate trust and collaboration across multiple companies (scrap collectors, steelworks, cut and bend service, final product, etc)
To connect the value chain by sharing information on material provenance, material composition, material production process and sustainability.
Operational efficiencies (improve visibility, feedstock management, and audits resources)
Example of a Steel Manufacturing Digital Ecosystem using blockchain technology
Additionally, using smart contracts for supplier communications and automated business rules validation, companies can take advantage of blockchain to create trust between stakeholders and make sure that transactions are secure and transparent.
Unlocking the power of blockchain technology to drive sustainability and ESG agendas
Steel is one of the most common materials on Earth, and it is widely used in construction, manufacturing, and many other industries. However, the process of mining, refining, and producing new steel can have a significant impact on the environment, leading to high carbon emissions and other forms of pollution. By recycling steel, we can reduce the amount of energy and raw materials required to produce new steel, which in turn reduces the carbon footprint of the steel industry.
By using a secure and transparent blockchain network, stakeholders in the steel recycling process can be connected and have real-time visibility into the entire supply chain. This can help to prevent fraud and ensure that recycled steel is accurately tracked and traced throughout the entire process, further contributing to sustainability and ESG initiatives.
Blockchain technology helps drive sustainability and ESG initiatives by creating digital product passports to track the provenance of materials and products, enabling us to ensure that recycled steel is of high quality and meets the same standards as new steel, reducing the environmental impact of steel production. By gathering product data, enterprises can accurately report on their sustainability.
This also allows for real-time tracking of any materials and goods, letting all parties involved know where items are and what condition they are in. Furthermore, blockchain technology can also be utilized to guarantee accuracy and validity of data. This ensures that companies have a reliable and correct view of the entire supply chain.
By applying a mass balance approach, manufacturers can track the amount of recycled or renewable materials they are using and ensure that they are sourcing materials responsibly. This will enable companies to create a circular economy and ensure that their products are more sustainable.
Conclusion
The steel industry is facing several challenges in managing a sustainable supply chain. Steel recycling can play a significant role in reducing CO2 emissions and promoting a more sustainable and circular economy. This process involves monitoring and verifying the entire lifecycle of recycled steel, from collection to processing and distribution. Following the journey of feedstocks through the complex production chain is tricky. To improve this process and the delivery of its circular / recycled feedstock to customers, companies have turned to blockchain.
Blockchain allows businesses to measure supply chain efficiencies and empowers business with the only database technology that provides a time stamped immutable audit tracker. The data is recorded accurately, monitored, managed and audited precisely for consumers, regulators, shareholders and internal stakeholders.
MARCO Track & Trace enables end-to-end supply chain traceability
Finboot developed MARCO, the first no-code/low-code platform designed to simplify blockchain for business users. MARCO is a blockchain-agnostic platform and has been designed to empower users to rapidly experiment and validate the immediate benefits of using blockchain to efficiently move into live production - at scale.
Within MARCO there is Track & Trace, a solution that provides trusted connections between stakeholders in a supply chain, gathering and sharing data, creating digital product passports and supporting accurate reporting.
The solution also promotes collaboration insights providing near real time supply chain monitoring. Full communication with other stakeholders, helping you take the right decisions at the right time. Reduce lead time, improve stockage, receive early warning signs and improve your sustainability impact.
Perhaps what’s most important, is that MARCO Track & Trace has already been validated in a wide range of sectors, including Oil & Energy, Chemicals, Construction, Mining and Aviation, among others. Its strong customer base includes Repsol, SABIC, Iberia, Minnex, to name a few.
MARCO TRACK & TRACE, enables trusted shared record-keeping between stakeholders in a supply chain.
Digital product passports: end-to-end supply chain visibility, asset digitalisation and tracking (provenance, quality, and compliance data in a secure and easily shareable environment).
ESG and sustainability reporting: traceability of renewables including management of sustainability credits to help substantiate ESG claims (automated mass balance bookkeeping integrated to production and sales ops and systems).
Invoice reconciliation: using smart contracts for supplier communications and automated business rules validation.
To know more about MARCO Track & Trace, download for free our ebook:
The smart grid is a vital component of our modern economy's digital infrastructure. However, it is also an energy system that is ready for change.
In response to climate-related extreme weather events, utilities and power producers are developing new strategies for modernizing the electric grid.
With the economy electrifying and decarbonizing, grid modernization technologies can also assist utilities in managing increased loads and bringing new centralized generation and storage online.
In this piece, we'll look at how blockchain technology may be applied to build a smarter, more sustainable grid.
What is the Smart Grid?
The smart grid is a digital network that enables communication between utilities and consumers. It is a complex system that includes grid-connected devices and sensors, as well as software that can monitor and control the flow of electricity. The smart grid has the potential to transform the way we generate, distribute, and use energy. It can help us move away from fossil fuels and towards renewable energy sources and make the power system more efficient and reliable.
smart grid illustration
The Center for Climate and Energy Solutions hosted a webinar in October 2022 to discuss how grid modernization can withstand increasingly intense conditions. The panelists also discussed how technology can assist in addressing climate challenges and barriers blocking its implementation.
Here are key points for stakeholders in the grid transformation:
The electric grid needs to be modernized to deal with the consequences of climate change and increasing demand from electric vehicles.
Innovation is happening at the boundaries of power grids, including distributed power resources and energy storages, user-end gadgets, and automation. This will give utilities control over the grid, benefiting them in extreme climate conditions.
Utility industry partners and services are increasing, including tech and car firms. Grid operators and utilities must collaborate to prepare for EVs' high demand for power.
Utilities now need to finance and deploy advanced technologies across their distribution networks in a timely manner and to help them move forward with innovation and climate-resilient solutions.
Financing grid upgrades is difficult, as the technology becomes obsolete quickly and more investments may be needed. Utilities must develop new economic models, raise awareness, and secure funding.
Main Problems of the Renewable Energy Sector
A major barrier to the adoption of renewable energy technologies is their high upfront costs. But other challenges need to be addressed for renewables to scale.
The intermittency of wind and solar power is one of the main challenges facing the renewable energy sector. Because the sun doesn't always shine and the wind doesn't always blow, renewable energy sources can't always meet our energy needs. This is why we need a reliable backup source of power, such as natural gas, to supplement renewables.
Another challenge facing renewables is the fact that they often require more land than traditional energy sources. For example, a wind farm needs a large area of land to generate enough power to meet our needs. This can be a challenge in places where land is already in high demand, such as densely populated areas.
Finally, the environmental impacts of renewable energy technologies need to be considered. Although renewables are often considered “green," some technologies, such as large-scale solar farms, can significantly impact the environment.
Despite these challenges, the potential of renewable energy is huge. With the right policies in place, renewables can play a major role in our transition to a low-carbon future.
Benefits of Digital Transformation In the Renewable Energy Sector
The renewable energy sector is in the midst of a digital transformation. This shift is driven by the need to increase the efficiency and reliability of the power grid, as well as reduce the environmental impact of energy production.
The ability to collect and analyze data more effectively is one of the main benefits of digital transformation. By collecting data on everything from weather patterns to the output of individual solar panels, we can gain a better understanding of how the renewable energy system is performing. The data can then be used to improve the system's efficiency.
The digital transformation is also helping us move away from traditional centralized models of power generation and towards a more decentralized system, generating power closer to where it is needed and reducing the environmental impact of the renewable energy sector.
Renewable Energy for a Decentralized, People-Centered Energy Transition
The renewable energy transition is often seen as a centralized, top-down process, with utilities and governments driving the shift from fossil fuels to clean renewables. However, this doesn't have to be the case.
A decentralized, people-centered approach to the energy transition can provide many benefits:
Engage people in the transition process and to build a sense of ownership over the energy system.
Can make use of local knowledge and resources and be tailored to the specific needs of a community.
Can aid in creating a more fair and just energy system. This is because it gives people more control over their energy usage and can help address the issue of energy poverty.
Impact of Blockchain Technology on Smart Grids
Energy use is changing on a global scale due to the emergence of renewable energy, the growing electrification of transportation, and the demand for a more efficient and reliable power grid.
One technology that is often seen as key to this transition is blockchain, a distributed database that allows secure, transparent, and tamper-proof transactions.
Blockchain can also help us improve the efficiency of the smart grid. For example, it can create smart contracts that execute transactions automatically. By doing so, data can be shared instantly, and transactions can be executed without manual intervention.
Blockchain can also help us create a more secure smart grid by creating a decentralized network that is not controlled by any one central authority. This makes it an ideal technology for managing the smart grid.
Blockchain seems to be ideally suited to make the transition to a sustainable energy system, increasing grid efficiency and reducing the environmental impact of energy production.
MARCO Track & Trace enables end-to-end supply chain traceability
Finboot developed MARCO, the first no-code/low-code platform designed to simplify blockchain for business users. MARCO is a blockchain-agnostic platform and has been designed to empower users to rapidly experiment and validate the immediate benefits of using blockchain to efficiently move into live production - at scale.
Within MARCO there is Track & Trace, a solution that provides trusted connections between stakeholders in a supply chain, gathering and sharing data, creating digital product passports and supporting accurate reporting.
The solution also promotes collaboration insights providing near real time supply chain monitoring. Full communication with other stakeholders, helping you take the right decisions at the right time. Reduce lead time, improve stockage, receive early warning signs and improve your sustainability impact.
Perhaps what’s most important, is that MARCO Track & Trace has already been validated in a wide range of sectors, including Oil & Energy, Chemicals, Construction, Mining and Aviation, among others. Its strong customer base includes Repsol, SABIC, Iberia to name a few.
MARCO TRACK & TRACE, enables trusted shared record-keeping between stakeholders in a supply chain.
Digital product passports: end-to-end supply chain visibility, asset digitalisation and tracking (provenance, quality, and compliance data in a secure and easily shareable environment).
ESG and sustainability reporting: traceability of renewables including management of sustainability credits to help substantiate ESG claims (automated mass balance bookkeeping integrated to production and sales ops and systems).
Invoice reconciliation: using smart contracts for supplier communications and automated business rules validation.
To know more about MARCO Track & Trace, download for free our ebook:
CARDIFF, UK, WEDNESDAY 1 FEBRUARY 2023 – Finboot is announcing today it has appointed former Evonik Chief Information Officer and Head of Global IT Services, Dr Bettina Uhlich, as a Non-Executive Director on the board.
Evonik is a listed German chemical manufacturing company headquartered in Essen. It is one of the largest chemical companies in the world. Dr Uhlich enjoyed a 34-year career at Evonik – working in numerous roles across the business.
Her vast and senior-level experience encompasses an understanding of complex processes involved in chemical manufacture, including procurement, supply chains, distribution and supporting IT systems. This 360-degree view of complex chain processes means she was one of the early adopters when it comes to realising the value of blockchain, and how it can aid automation and efficiency.
Nish Kotecha, Chairman and Co-Founder of Finboot, says:
“We are really thrilled Dr Uhlich is joining the Finboot board. She is a blockchain for business pioneer who understands the importance of making technology easy to use, enabling hesitant enterprises to adopt it. Dr Uhlich understands the trust blockchain instils in the supply chain, which is a crucial unique selling point and that will maximise efficiency and growth. She literally wrote a book on it. I look forward to working more closely with her.”
Dr Uhlich says:
“I believe in IT with a purpose. Blockchain’s purpose is clear to entrench trust and truth so data can be shared between different parts of value chains – including different companies.
“Finboot’s Blockchain platform, MARCO, is a great solution. The key thing for me is that because it is a no code / low code application it is easy to use; and you do not need to have lots of training or be a coder to operate it.
“This is crucial for enterprises who do not have big IT departments or big pockets. SMEs are the key ‘engine rooms’ in modern industrialised economies, and Germany is no different. For this reason I see huge growth potential for Finboot in Germany and throughout Europe.
“I am looking forward to connecting Finboot with the blockchain community in Germany and beyond along with the Finboot team to achieve our goals.”
– ENDS –
Notes to Editors
For more information, please contact nicola@impactandinfluence.global or chris@impactandinfluence.global
Former CIO and Head of Global IT Services, Evonik AG: Since 2014 to 2022 Dr Bettina Uhlich was responsible for the IT of Evonik AG as Chief Information Officer and Head of Global IT Services as a recognised partner for the implementation of the digitisation goals in the group. In all she worked at Evonik for over 30 years.
Dr Uhlich began her career in finance and accounting at Degussa AG. From 2010 to 2014 she was the head of the group project PROVE (Process and Value Excellence) with the development of the strategic system platforms with standardised business processes, business models and data models in the group. Until 2016, Uhlich was also responsible for Global Financial Services. In addition, Bettina Uhlich achieved third place as CIO of the year for large companies in 2016.
Finboot is a technology company simplifying enterprise blockchain. We facilitate the core priorities of industry leaders to enable fast and easy adoption of digital ecosystems powered by blockchain.
Finboot created the first No-code / Low-code platform and ecosystem, MARCO, to enable Web3: Bringing the future of the internet to business.
MARCO greatly improves management of value chains and drives forward digitalisation, sustainability and ESG agendas.
MARCO connects blockchain technologies securely under one roof, turning data into trusted digital assets and accelerating the road towards interoperability.
Our purpose at Finboot is to enable Web3 and unlock its full value. Finboot is making blockchain accessible and understandable to business and delivering the leading No-code / Low-code platform and ecosystem for a decentralised world.
Over the last few years, the use of blockchain in business has become a hot topic.
But what exactly is blockchain? And how can it help in the marketing sphere?
What is Blockchain?
Blockchain technology enables the storage of information — including transactions and other data — in a secure, distributed ledger system that is accessible to everyone in the network. This ledger can be shared, in a secure way, with other companies too.
By using blockchain storage, companies no longer have to rely on centralised data storage systems or trust third-party organisations to securely store their data.
Blockchain technology records digital events in chronological order. Each transaction made on the blockchain is stored in an immutable ledger which can be viewed by all parties while remaining secure and private. This means that companies can use blockchain to keep track of customer data, purchases, payments and other transactions without fear of tampering or fraud. Companies can also use it to optimise their production and supply chain, create new products or even use it to help track, audit and validate their Environmental, Social and Governance (ESG) claims.
Taking crypto coins as payment is only one aspect of the blockchain technology application; it is much more than that.
How can Blockchain help in the Marketing Function?
I believe there are many ways in which blockchain technology can help with marketing campaigns for business. A prime example for me is that companies can use blockchain technology to track customer interactions across multiple channels and devices, making it easier to personalize and tailor messages and content for each user.
Businesses can also use blockchain technology to better understand how customers interact with their products or services, allowing them to improve their offerings and make sure they are meeting customer needs.
Smart Contracts Save Time and Money for Marketers
Businesses can also use blockchain-based smart contracts to automate certain processes, such as payment processing or data collection, not only with customers but also with suppliers and partners.
Blockchain technology can also provide valuable insights into their own production and supply chain process, which can help marketers develop more effective data lead campaigns.
Blockchain technology also has the ability to create new types of digital assets that can be used for marketing purposes. These assets could include anything from digital coupons and loyalty points to virtual currency tokens used for promotional campaigns or rewards programs. By leveraging the power of smart contracts, companies could create these assets quickly and easily with built-in security features that make them difficult (if not impossible) for hackers or malicious actors to exploit.
Smart contracts also could not only eliminate costs through improved operational efficiency and cutting conflict-associated costs in advertising campaigns, but also improve safety and customer satisfaction.
Boost Sustainable Campaigns with Digital Product Passports
Digital product passports are another key feature of blockchain technology that marketers can use. It creates a digital record of a product's journey from raw materials to finished goods, including information on the energy used, the emissions generated, and the waste produced. By tracking a product's value chain from manufacture to purchase to disposal, we can gain a much more comprehensive understanding of its environmental and social impacts. For example, consumers could learn how much of the product they are using contains recycled material, allowing them to calculate their environmental impact. This is really appealing for businesses with ESG commitments - and indeed those looking to increase their ESG undertakings. In this way, blockchain can support more sustainable and ethical consumption.
Engage Brand Loyalty by Offering Trust
Finally, using blockchain technology produces high quality data and feedback on advertising penetration. By using blockchain to track their ads, advertisers can receive improved data on how their ads are being received and adjust their strategy accordingly. This allows advertisers to create more targeted ad campaigns that are likely to gain better traction with target audiences. Customers may also feel reassured their personal information is securely stored, making them more likely to provide it.
Furthermore, in terms of social impact, businesses can track the number of jobs created by their products, either directly or indirectly. They can also track the diversity of their workforce, as well as any gender pay gaps. Finally, they are better able to track any investments they have made in the communities where their products are manufactured and the benefits those communities receive from those investments. Consumers today are very savvy and highly attuned to such issues, and a decentralised secure ledger can assist businesses to build and then protect key brand values.
Conclusion
As a marketing specialist at Finboot (an SME that makes the adoption of digital ecosystems powered by blockchain easier for enterprises), I know that the possibilities offered by blockchain technology are truly exciting — in my field of marketing as well as many others.
From increasing transparency with digital product passports and providing better customer insights to creating unique digital assets and automating processes with smart contracts, blockchain has the potential to transform how we “do marketing” to enhance connection between brands and customers and in turn increasing customer satisfaction.
As we move into 2023 and beyond, I expect more businesses across all sectors and disciplines — including marketing — to start leveraging this innovative new tech! And of course the elephant in the room is that there is no Web3 or Industry 4.0 without blockchain. Companies that want to stay ahead of the competition should consider integrating blockchain into their current strategy.
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Net Zero Ventures is a new venture fund that focuses on global decarbonisation opportunities and is highly committed to and focused on matters relating to Environmental, Social and Governance (ESG) – i.e. measuring a business's impact on society.
What is your connection with Finboot?
Finboot was one of the companies selected by the Repsol Entrepreneurs Fund in its annual accelerator programme. From there, as Corporate Venturing at Repsol we had the opportunity to mentor Finboot, helping to develop its low code / no code blockchain platform, MARCO.
After that, we decided to become an investor and strategic partner to Finboot.. In fact, we were so invested in Finboot’s solution that we decided to contract Finboot to provide a blockchain solution for Repsol Technology Lab. The partnership will help us improve the traceability of samples, which we have now rolled out across many of our facilities in Spain.
So Repsol is both an investor in Finboot and one of its customers!
Is climate change the biggest challenge the energy sector and indeed the world is facing today?
Without a doubt, it is the biggest challenge affecting us all! Climate change matters so much, at so many levels, not just because of the suffering and injustice it is already causing, but also because it will affect future generations.
Companies are reluctant to shift to green tech due to a belief that its infrastructure cost is expensive. What can blockchain and companies like Finboot do to change this mindset?
Energy companies are recognising the transformative impact of blockchain technology. For example, the World Economic Forum, Stanford Woods Institute for the Environment, and PwC released a joint report identifying more than 65 ways we can disrupt how we manage environmental resources, helping to drive sustainable growth and value creation. It also argues that new global platforms are urgently needed to incubate a responsible blockchain ecosystem rather than specific projects.
For example blockchain technology has the potential to improve efficiencies for utility providers by tracking the custody of grid materials. Beyond provenance tracking, blockchain offers solutions for renewable energy distribution.
It is clear we need companies such as Finboot to implement and roll out this innovative technology.
As the world goes digital, reliance on electricity has soared significantly. Meanwhile, electricity production generates the second-largest share of greenhouse gas emissions.
If adopting green tech is not yet affordable, what initiatives can companies adopt to balance their use of electricity?
Combining green technology solutions and strategies to decrease energy demand seems to offer the highest likelihood of long-term carbon reductions. Energy efficiency opportunities, such as lighting upgrades, HVAC improvements, on-site energy generation, controls and demand management strategies have the potential to deliver the most positive impact.
What next-gen green technologies, relatively low in terms of cost, can be adopted?
To name a few:
- Recycling and waste management, using smart containers, automated food waste tracking systems and automated optical scanning technologies can help sort mixed plastics by separating them from others.
- Waste-to-Energy. The generation of energy from waste such as material placed in rubbish bins and sewerage.
- Vertical gardens and farms. The installation of vertical gardens in buildings also helps save energy and creates oxygen from CO2 and new ecosystems for animals, birds and insects. Due to their installation along walls, vertical gardens reduce the intense noise pollution that comes from outside. They also help mitigate the high summer temperatures that come with climate change, resulting in significant savings in energy, heating and air conditioning.
- Net zero energy buildings. Buildings with net zero energy consumption, mean the total amount of energy used by the building on an annual basis is equal to the amount of renewable energy created on site or in other definitions by renewable energy sources offsite, using technology such as heat pumps, high efficiency windows and insulation, and solar panels.
Reskilling can be a great way to get non-STEM professionals involved in climate change initiatives, but what skills are actually in demand within renewable energy companies? What role can blockchain play in this?
With the transition to net zero underway, more and more companies will need a workforce with green skills, which will require support across a variety of industries. Two main green skillsets are required:
- Engineering skills for the design and production of technology
- Managerial skills for implementing and monitoring environmental organisational practices
One of the most relevant skills will be digital literacy. Executives, managers and leaders must have a comprehensive understanding of digital and a fluid digital mindset. They must understand data analytics, software development, cloud computing, blockchain, SaaS platforms, intelligent automation and cyber security.
Acquiring and pushing these skills will help shape a business strategy that will work towards the digital fabric of the future.
Natalia Ruiz and Carlos Gonzalez from Net Zero Ventures
Increased demand for, and use of, electricity and heat produced from fossil fuels, combined with a growing global population, have led to increasing amounts of CO2 in the atmosphere and rising temperatures.
Using energy more efficiently and moving to more renewable / low carbon sources is essential to reduce CO2 emissions, reach net zero and tackle climate change.
To minimise carbon emissions in the energy industry, innovative technologies are required. Increased investment in R&D is necessary, but they will not produce the desired outcomes in isolation.
Digital transformation is key to the future of business, and has a significant impact on both environmental and corporate sustainability. Increasingly advanced and indeed emerging economies are driven by data. At the same time, consumers desire simplicity, efficiency and convenience and businesses must provide these elements in order to remain competitive.
The Beginning: Energy Transition Advancing a Lower Carbon Future
Energy transition refers to a shift away from carbon-based fuels to low / no carbon and net zero alternatives. To achieve it, businesses and organisations must reduce their carbon footprint and take action to address climate change. It also means that organisations need to embrace digital transformation in order to maintain customer satisfaction, product production, and growth while meeting sustainability goals.
“Green technology” can cover any technology aimed at achieving net zero. Examples include electric transport, wind turbines and solar panels.
Energy storage is also seen as crucial to aid the further deployment of renewable technologies on the power grid. Battery storage allows energy grid managers to smooth demand surges and cover any intermittency of supply from renewable sources. Green and innovative technologies are essential for the energy transition. Combined with other energy efficiency measures, they are necessary to shift to a net zero future.
Technical advancement is crucial for the energy transition - as is tracking and recording its progress.
The importance of data, tracking, and data security
Any plan to meet global climate and sustainable development goals must use technology and data. However, data is useless unless it is accurate, up to date, and secure. That is why data integrity is so critical.
The use of digital solutions can facilitate the control of renewable energy sources. Initiatives like these may save downtime by managing maintenance with an innovative method to modernise manufacturing processes, making them more competitive and energy-efficient.
The introduction of 'smart factories' combines the best engineering practices and the latest technology, for example, blockchain, virtual reality, the Internet of Things (IoT), robotics, and artificial intelligence.
Smart factories employ advanced software, sensors, and robots to gather and scrutinise the data before making important decisions. In power plants, sensors collect data from a dam, turbine or pipe and forward it to control monitoring rooms. Adopting new software allows the operators to point out any abnormal patterns in machine operation and curb potential risks before they occur (predictive maintenance). This enables faster repairs, controlled gas emissions, and non-interference with production.
The adoption of blockchain technology, a decentralised digital ledger where data is safely shared, allows the tracking of renewable energy from its source to the consumer and generates insights into the amount of carbon released into the atmosphere. Data such as location and time are also included.
Innovation: Driving the Energy Transition
NASA has been monitoring greenhouse gas emissions for many years. They can capture specific gas emission rates and data, leading to better understanding, control and plans to curb gas emissions. When using blockchain to track, record, and manage data, you introduce trust, security, transparency and accountability into the system.
This is because companies can access and share information with third parties such as trading partners. All parties involved get a record of each transaction in a decentralised recording mechanism that cannot be interfered with by anyone. Having one source of truth builds trust among the companies involved and makes new collaborations a possibility.
Innovation is driving progress, and we have begun to see small shifts in the right direction.
In transportation, there have been shifts to electric vehicles, but there is still a long way to go.
Heating and cooling of buildings still account for a significant portion of global energy use, and while there have been some developments in this area, we need to see much more to come close to achieving climate goals.
How Blockchain Technology Helps
Perhaps the most exciting innovations of late have come about in blockchain technology. Blockchain has the potential to revolutionise the energy market by providing a more efficient way of allocating energy to specific channels. It can even be used to establish a needs-basis hierarchy. This would quicken the certification of renewable energy and improve traceability.
A blockchain asset comes with a history that can be verified, ensuring authenticity. Within a blockchain, both parties can access the record simultaneously without needing additional authentication.
Blockchain technology allows direct engagement between energy producers and consumers. A direct line of communication will lead to greater understanding between parties, for example, solar panel companies battery system suppliers.
With blockchain platforms transparency can be improved in energy exchange, at all levels, including the use of:
Digital product passports: End-to-end supply chain visibility, asset digitalisation, and tracking.
Many electrical and electronic products often have a short life span as components wear out and designs are improved. . This leads to e-waste. This has led to the introduction of digital product passports. The primary purpose of passports is to gather and store data concerning a product and its supply chain and make the data available to all stakeholders and consumers to facilitate a better understanding of a product and its impact on the environment.
Sustainability data: Traceability of circular plastics and renewable fuels, including management of sustainability credits to help substantiate ESG claims.
Blockchain provides a transparent and secure platform for tracing renewable fuels such as solar and circular plastics through the creation of a distributed ledger that facilitates reliable and secure tracking of data.
Invoice reconciliation: Using Smart Contracts for supplier communications and automated business rule validation.
Blockchain technology can improve efficiency within climate and energy markets through communication between suppliers, improved invoice reconciliation and the validation of automated business rules. Also, blockchain significantly reduces the cost and time associated with each process while improving transparency within the climate and energy markets, ensuring all participants act responsibly.
Growing the Trend: Lower Carbon Business Opportunities
With an increasing awareness of the importance of sustainability, many businesses are looking for ways to lower their carbon footprint. One way to do this is to switch to renewable energy sources including solar, green hydrogen, wind power (off and on shore) , and hydro .
Solar energy uses photovoltaic cells to transform sunlight into electricity. Solar energy can also be used for the cooling and heating of buildings and desalinating water.
Green hydrogen is flexible in that it can be transported and stored easily. When used in fuel cells, it can generate electricity and also produce hot water. Wind turbines convert wind energy into electricity, and are currently the cheapest form of renewable energy.
Another way businesses are reducing their carbon footprint is by adopting new consumer services. Smart grids, for example, help businesses automatically adjust their energy use according to off peak demand, preventing blackouts and reducing energy waste. This not only saves businesses money but also helps to reduce emissions.
Consumers are also demanding more renewable / sustainable energy. The energy sector must meet this demand or risk losing customers and revenue.
Blockchain applications for sustainable energy
The First European Platform to Trade Energy
In May 2017, the German software company Ponton launched the first platform to trade energy products over the counter using blockchain. Participants in the gas and electricity generation markets can validate and certify transactions without the involvement of a third party, reducing transaction costs, increasing the efficiency of the value chain, and ensuring safe and fast transactions. In the initial (pilot) version, 39 German power and gas generators participated. In May 2019, the platform was officially launched, allowing its use throughout Europe. Participating companies include Iberdrola (a Spanish energy company), Total (a French oil company), RWE (a German energy company), and Enel (an Italian energy company).
A Case Study in Chile
An example of the real-world application of blockchain in energy was set up in Chile, in 2014. Chile's Ministry of Energy started a Public Solar Roof Program (PTSP) to facilitate the installation of PV systems in public buildings. This project showed what can happen when the public and private sectors work together, using a blockchain platform that promotes integrity and transparency of data. This project was able to reduce CO2 emissions by 800 tons/yr. and saved a quarter of a million dollars in the process.
A Spanish Use Case
ACCIONA Energía, a Spanish renewable energy company, launched ablockchain project to improve the traceability of renewable energy generated worldwide. It allows consumers to check, in real time, the origin of the renewable energy they are consuming. Five hydroelectric and wind generators in Spain and four corporate clients in Portugal are piloting the project, which will then be scaled up to countries such as Mexico and Chile.
Sun Exchange
The business model involves the purchase of photovoltaic cells and then the leases of them to schools and businesses in emerging markets. People from around the world can buy panels and lease them to recipients and receive dividends for doing so. In this way many households in developing economies are accessing electricity whilst not having to be connected to the grid.
This article was originally published in AGBI Arabian Gulf Business Insight on December 1, 2022.
And can be also be found here: https://www.agbi.com/opinion/ftx-one-step-back-for-crypto-two-steps-forward-for-blockchain/
In 1998, when FTX founder Sam Bankman-Fried was only six years old, Long Term Capital Management (LTCM) was bailed out by a group of 14 banks in a deal put together by the US Federal Reserve.
The brainchild of infamous Salomon Brothers bond trader John Meriwether, LTCM had been established in 1994, bringing together heavyweights from academia and trading and leading economists including Myron Scholes and Robert Merton.
LTCM attracted over $1.3 billion at inception and a $3.4 billion bailout just four years later.
So, what went wrong? Answer: A liquidity crisis.
I recall during my time at JP Morgan working on the structuring of the LTCM bailout. Our focus was the potential market disruption and the related market implications.
The parallels are clear to the sudden meltdown of FTX.
Credits: Jonathan Raa/NurPhoto
In the absence of regulation, the crypto world should have adopted a higher operational threshold and financial discipline. The crypto market is embryonic and lacks strong institutions that could step in and prevent a wider market impact.
At the start of the year FTX raised $400 million, setting a new peak valuation of $32 billion. In the beginning of November, rumours suggested it may be undercapitalised. This drove over $650 million in withdrawals, after which FTX closed its doors, further confirming it was in a liquidity crisis.
This shattered the price of FTT (the token issued by FTX) by over 90 percent and in turn impacted the price of all other crypto currencies.
Could this have been avoided? Yes.
And what’s ironic is that FTX was sitting on the technology that could have made it transparent and resilient: Blockchain.
Before we start it’s important to separate crypto, which is a single application of blockchain technology, and the role of a crypto trader, which was FTX’s model. Crypto is to blockchain what email is to the internet – it’s one of many possible applications.
While the curtain is being drawn back on the true operations of FTX, it is clear that the true assets of FTX were unknown and lacked transparency, and therefore trust.
This compares with the traditional banking and financial sector, which rely on regulators to set the threshold for transparency through reporting and independent auditors and apply standard assessment rules.
The challenge with a lack of transparency is that the value you can apply to your assets is capped, particularly when the market for those assets is very small. This is why we have external audits to independently ascertain the true picture.
Consider, FTX, whose balance sheet was reported to consist of large holdings of the digital token FTT. As the value of FTT fell, so did FTX’s capitalisation. I can now see why transparency could be an impediment.
Remember the Neil Woodford (a celebrated London ‘superstar’ fund manager) scandal in 2019?
A £10 billion-plus fund collapsing overnight because the assets it claimed to have included large investments in unlisted and illiquid stocks whose value was self-determined rather than externally validated.
Ultimately trust (which leads to confidence) requires transparency to validate integrity.
Had blockchain been used to underpin the accounting framework of FTX, it is likely that false entries would never have been approved by the distributed ledger technology.
The time-stamped links of blocks could reveal alterations or tampering to the recorded transactions, as well as providing an immediate insight into the performance of the company at any given time.
And if investors had been fully aware of the hyped assets of FTX, would they have trusted the platform?
Adopting technologies such as blockchain into the reporting and audit framework of a fund could provide a fresh approach so that investors can avoid being caught out. More validated, immutable information will generate trust in the crypto market and audit industry as a whole.
There is a clear argument for an automated blockchain that can act as a single source of truth for the benefit of investors, on whose trust the share price of listed entities partially depends.
At the time of writing, incoming FTX CEO John Ray (appointed to manage the bankruptcy, having previously performed the same role at the $23 billion winddown of Enron) said he had never seen such a “complete failure of corporate controls and trustworthy financial information”.
FTX had a unique opportunity to establish itself as the gold standard underpinning the crypto markets, but this required a different mindset at the start – not just to praise the virtues of blockchain technology, but to also use it to build a transparent, trustworthy platform for all.
It’s ironic that the very technology that enabled crypto could have addressed FTX’s transparency and custody challenges.
The blow-up will undoubtedly set back crypto progression, but it should not affect Blockchain’s advancement.
The contagion has started as other crypto exchanges are restricting or suspending withdrawals and unfortunately, many will be caught in the tsunami.
The silver lining is that even the hardened protagonists against the need for regulation may now recognise its importance. This, along with greater transparency, could support the growth of a trusted safer crypto market.
Unfortunately, given the current lack of regulation and self-certification in this embryonic market, I fear this will not be the last crypto blow-up (even with an alleged fraud).
This market quickly needs more and better regulation, and supervision, to prevent this and to start to r-build trust.
Blockchain can play a crucial part in this. And if it does not happen, then as the philosopher George Santayana put it: “Those who fail to learn the lessons of history are doomed to repeat it.”
In this short video Finboot’s Alvaro Llobet, Head of Product and Oscar Gomez Manresa, Tech Lead, discuss the future of blockchain - specifically how the use of blockchain is increasing and how blockchain-agnostic solutions (that is software and hardware that are compatible with many different blockchain networks), will work and help shape the future.
Finboot are pioneers of blockchain-agnostic solutions. The key strands of their thinking, to date, as you will see in the video are:
There will be more standards: Currently all different blockchains are using different ways to interact. Eventually, these different methods will converge into common standards. This will make it easier for blockchain databases to communicate with each other.
There will be less need for different blockchains;: the focus will be on a few large scale blockchains that will offer all the features needed. There will be no need for numerous smaller chains.
Blockchain will become more user-friendly and easier to use
Increasingly business will be built with blockchain being integral from the start. There will be more connectivity between different applications. There will be increased collaboration.
Watch this video to get full insights from industry insiders to understand the rapidly evolving blockchain marketplace.
Most current applications are built for use with a specific blockchain technology and often a single blockchain network. This makes them rigid and ill equipped to adapt to changes that constantly occur in such a nascent ecosystem. It also hinders their ability to scale.
While full interoperability between different blockchain frameworks is still a work in progress, a blockchain agnostic solution will take an organisation one step forward in that direction, allowing flexibility of usage and interaction between different ledger technologies among the applications.
By using MARCO, organisations are able to work with different ledger and blockchain technologies seamlessly, by using the same enterprise software application. Our middleware facilitates - uniquely - interactions between those technologies without the need for further and extensive technical development, reducing (or even removing) the pain of having to migrate from one ledger technology to the other.
Being agnostic gives the company the freedom to choose the best blockchain technology for their needs without losing compatibility.
Future-proofing blockchain development is deeply enshrined in our mission: being an emerging technology, blockchain is continuously evolving and, as a result, shortsighted solutions are at risk of becoming obsolete in the near future. However, with MARCO, enterprises are provided with the necessary flexibility to avoid becoming outdated and ensure that their solutions are able to evolve, migrate and adapt to what is ahead.
Technology company Finboot, whose purpose is to unlock the full value of enterprise Web3, announces the launch of the MARCO Academy and MARCO Docs. Two brand new spaces aimed at strengthening Finboot’s mission to make blockchain accessible and understandable to business users.
Finboot is known for creating the first no-code/low-code blockchain platform and ecosystem MARCO; their flagship product that enables companies to adapt blockchain without writing a single line of code. MARCO has already made a huge impact in the market by bringing the value of the underlying technology to companies like SABIC, one of the world’s largest chemical manufacturers, Global multi-energy provider Repsol, and the leader in responsible chemicals for leather solutions and coatings, Stahl. All of whom have been using MARCO’s no-code and low-code capabilities to accelerate the time-to-value of their digital initiatives. They are using blockchain to redefine the way they manage their supply chains, drive forward digital transformation, and accelerate their ESG and sustainability agendas.
More recently, with the intention of expanding their global footprint, Finboot launched their Global Partnership Program. The program is designed to work with System Integrators (SIs) and Independent Software Vendors (ISVs) to maximise the reach of the MARCO platform. Finboot is already working with digital transformation consultancy Quantion and digital engineering company Nitor Infotech as the first comers to MARCO’s partner ecosystem. Working with both their technical and commercial teams to accelerate the adoption of blockchain worldwide.
In this line, Finboot is now launching two new channels to help fulfil their vision to democratise access to enterprise Web3. Providing any developer and citizen developer the tools they need to build and configure no-code/low-code solutions powered by blockchain.
The MARCO Academy (https://academy.finboot.com/) aimed at transforming the way users learn about blockchain, the use cases of the technology, and how to easily configure and deploy solutions with MARCO. The Academy includes courses from high-level use cases of the technology and specific customer case studies, to more technical and practical courses on how to use the MARCO platform and its no-code applications. All resources are open to the public, with the objective of arming visitors with valuable and trusted content on enterprise blockchain and MARCO..
MARCO Docs (https://docs.marco.finboot.com/) opens the doors to MARCO's low-code capabilities and SDK. Our documentation site is built to enable MARCO developers with basic technical knowledge to unlock the value of blockchain and enterprise web3. Content includes documentation on our APIs to drive users on integrations with our existing no-code applications. We also cover the specifics of our broader set of APIs and SDK to create new applications powered by MARCO.
With these new channels, Finboot intends to grow the community of developers and citizen developers around MARCO. Very much aligned with our Global Partnership Program which we expect to scale throughout 2023. We are now taking on new applications to join our Global Partnership program opened for SIs, ISVs, and any others interested in accelerating the adoption of blockchain. Reach out to us and join us in our mission to make blockchain accessible and understandable to business users:
Github is one of the most famous code hosting and collaboration platforms. It has built an ecosystem of nearly 100 million developers and over 300 million code repositories. Very safely, anyone would assume that the company is all about coding. Interestingly enough, on the company’s 10th anniversary, Chris Wanstrath, Github’s co-founder and then CEO said to his team: “The future of coding is no coding at all”. His whole vision was that coding was not going to continue to be the “main event” anymore; building software was.
Five years later, I think his vision was pretty spot on. You look at the way software is being built, and it's all about leveraging the value of what others have built to make your own building experience easier, more scalable and more secure. Undoubtedly, Software Development Kits (SDKs) play a critical role in building software today. That is why in this article, I want to provide a quick overview on what SDKs are, their benefits, and what role they play to help us at Finboot unlock the value of enterprise Web3.
What is an SDK?
A software development kit (SDK) is a set of software tools and programs provided by software vendors that developers can use to build applications for specific platforms. SDKs help developers easily integrate their apps with a vendor's services.
SDKs include documentation, application programming interfaces (APIs), code samples, libraries and processes, as well as guides that developers can use and integrate into their apps. Developers can use SDKs to build and maintain specific functionalities in their applications without having to code everything from scratch.
What are the Benefits of SDKs?
Numerous programming languages and mobile applications can use different types of SDKs. SDKs streamline common procedures and increase programme functionality by gathering the necessary set of tools in one place bringing to the table the following advantages:
- Simple integration: Think of Stripe. Stripe is a payment processing platform. They created several SDKs so that developers can easily integrate online payments in their applications.
- Time and cost savings: Think of Shopify. If anyone is in need of easy development and fast deployment of their e-commerce site, they should look at Shopify’s SDKs for an accelerated time to value.
- Enhanced performance: Think of Twilio. Their SDKs are designed to bring text, chat, voice and video messaging to your applications.
In come MARCO’s SDKs
With the same view of enabling simple integrations, minimising resources and enhancing functionality and user experience, Finboot has introduced MARCO, a platform and ecosystem with SDKs that will simplify blockchain for business and quickly unlock the value of enterprise Web3. What Stripe did to payments, Shopify to e-commerce, and Twilio to communications, MARCO is doing to enterprise Web3.
Building blockchain applications from scratch is complex and therefore costly. It is a huge challenge and you may end up facing issues with scalability, performance and interoperability. MARCO’s low-code capabilities and SDKs can reduce development time and mitigate risks. Giving you time to focus on the specifics of your application and its business case; not on the ins-and-outs of blockchain.
Moreover, MARCO’s no-code/low-code approach is a more visual and intuitive software development environment. Allowing enterprise and citizen developers to drag and drop application components, connect them together and build their own blockchain powered digital ecosystems.
With MARCO’s no-code capabilities, companies can start using blockchain without writing a single line of code. While our low-code capabilities and SDKs can be used to build new applications focused on easy deployment and fast development. Both approaches (no-code/low-code) can be easily integrated into existing systems architecture through standard integrations.
Sticking to Chris’ idea of building software as the main event. You can think of MARCO as your blockchain LEGOⓇ set; arming you with all the building blocks to construct the digital ecosystems of the future.
If you would like to know more about MARCO look at our Dev Portal or contact us.
There are various types of blockchain technology on the market now. In this blog post, we'll examine a consortium blockchain's fundamental components and explain how it operates.
A new market and business system started to grow around the blockchain as soon as it emerged as the new tech trend. Federated or Blockchain consortium is one of them.
What is a Blockchain Consortium?
- Public blockchains or open blockchains are accessible to anyone with an internet connection.
- Private blockchains generally serve an enterprise for corporate software solutions and resolve business cases.
A hybrid of the former two blockchains is the consortium blockchain, which is more of a permissioned type of distributed ledger.
A consortium blockchain's main goal is to increase cooperation in order to tackle an industry's ongoing difficulties. Consortium blockchain can be used by organisations with shared objectives to restructure workflow, transparency, and accountability. According to the Deloitte analysis, 74% of firms are choosing blockchain consortiums.
Instead of beginning from scratch, consortium blockchain allows newcomers to join the established framework and share information. With the aid of this technology, businesses may work together to find answers while reducing development costs and time. Federated blockchains are another name for consortium blockchains.
Therefore, the network is not ruled by a single entity, and all the other organisations contribute to that. It can be considered a platform where various businesses can gather and, if necessary, share information. It is a collaborative environment in which there is no room for abuse on the platform.
There are three types of blockchain consortium on the market at present.
Technology-centered: These provide solutions based on technical standards as well as reusable blockchain platforms. Furthermore, this particular blockchain industry consortium operates only to aid blockchain in gaining awareness on a global scale.
Business-centered: These usually create blockchain solutions for a particular business problem. In practice, this blockchain consortium design would concentrate on a particular blockchain use case, such as banking, supply chain management, healthcare, etc.
Dual-focused: When providing a platform or solution, they concentrate on both technology and business. So, in a way, they would provide an open-source platform appropriate for any kind of solution while also providing commercial products.
Benefits of Blockchain Consortium
There are certain benefits that you should expect from the federated blockchain.
● Cost Savings: By building on the established structures in each blockchain, solutions can be developed in a shorter amount of time with shared resources. In this way, fewer development costs are required through economies of scale. There is also no service or transaction fee for dealings within a consortium blockchain.
● Accelerate Learning: If you want to advance in the blockchain industry, you'll need complete learning support. Thus, anticipating an acceleration of learning processes would be advantageous. Many consortiums provide training and dev support. This is one of the reasons for why Finboot create MARCO, a Low-code/No-code platform designed to enable blockchain for business users, who can immediately adopt the technology without writing a single line of code by selecting one of our No-code apps.
● Sharing Risk: all businesses share the risk in the event of a new blockchain solution. There are many hazards in the industry. MARCO is a blockchain-agnostic platform, which ensures compatibility, provides flexibility and future-proofs your blockchain strategy. You can work with any combination of blockchain networks across the spectrum from private-permissioned networks to public-permissionless ecosystems.
● Build Critical Mass of Adoption: For a federated blockchain, there shouldn't be just one solution built. Achieving mass adoption would make it simple for your business to soar to new heights. Reaching the worldwide market would be difficult without mass adoption.
● Securing Relevance /Lifespan: It is very difficult to stay current in the area as technology is always evolving.
● Influencing Standards: The market predicted that Blockchain will quickly achieve interoperability. To establish yourself in a market worth a trillion dollars, you would need to influence standards.
Disadvantages of Consortium Blockchain
We also can point out a few disadvantages related with blockchain consortiums:
A consortium blockchain can get bureaucratic since you must get more than one enterprise to agree to a communication protocol, set up the rules and standards
Upgrading the blockchain is a long and tedious task requiring every member’s permission.
There are chances of frequent disputes between the member organisations.
The Potential of Consortium and Federated Blockchains
The use of a consortium blockchain makes sense for companies looking for member-to-member operations and communication. Coordination between participants on the blockchain platform makes problem-solving simple and quicker. This can be developed by any organisation using open source platforms in accordance with the objectives they have specified. Organisations are allowed to decide on their own standards and requirements, however working with experienced blockchain developers can yield better results.
Some of the industries where a consortium blockchain could be a interesting option:
Finance and Banking
Since banks require credit scores, KYC, and other information from time to time, they can come together and form a consortium. This consortium can have its data stored over one blockchain that can be accessed by all the banks. It would help understand the cases of defaulters and stay up to date with the credit score and other details.
Logistics
In the case of logistics, where it is crucial having multiple partners synced to keep track of the packages, having their own consortium blockchain with a smart contract could automatically update the data at every centre when a product is shipped.
Healthcare and Insurance
Hospitals, medical clinics and insurance companies have to manage a huge amount of data. Having a consortium blockchain for companies in the same region would allow fast and better collaboration to update these records of various patients occasionally. Meaning, no need in keeping files and other records to check a patient’s history or current health conditions.
Why MARCO is perfect for Blockchain Consortiums
While full interoperability between different blockchain frameworks is still a work in progress, a blockchain agnostic solution will take an organisation one step forward in that direction, allowing flexibility of usage and interaction between different ledger technologies among the applications.
Being agnostic, MARCO gives the company the freedom to choose the best blockchain technology for their needs without losing compatibility, regardless of the type of blockchain, which is perfect for everyone who wants to work with blockchain, especially those who have chosen a consortium to start with.
The scientific consensus is that we have reached a crunch point. We have a rapidly closing window of the next few years or so where if the world works together, cuts emissions, switches to renewables and adopts and implements net zero plans - in line with the 2015 Paris Agreement - we can limit global temperature increase to 1.5 degrees centigrade.
Official peer reviewed data published by the United Nations is quite simply frightening.
Blockchain can help by accurately recording each company’s carbon footprint. Blockchain technology has the capacity to measure carbon footprints through intelligent sensors compatible with the Internet of Things (IoT).
The Internet of things (IoT) describes physical objects (or groups of such objects) with sensors, processing ability, software, and other technologies that connect and exchange data with other devices and systems over the Internet or other communications network.
Incidentally the Internet of Things or IoT is considered, by many, to be a bit of a misnomer as devices do not need to be connected to the public internet, they only need to be connected to a network and be individually addressable.
Blockchain + IoT combined make it possible to calculate energy consumption and generate data that can be analysed in the blockchain.
So how blockchain technology help companies reduce their carbon footprint and help fight climate change?
Restructuring ESG
One source of market friction is overwhelming demand. Zero net corporate commitments mean global demand for voluntary carbon offsets is projected to grow from USD$1 billion in 2021 to USD$50 billion by 2030.
The first thing blockchain has changed in how ESG markets operate, is improving market efficiencies. Market structure is a constant problem, even with ESG product standardisation. According to Sussex Research Online, “at the most fundamental level, carbon markets are problematic because they often presume that the relationship between emissions and climate change is a linear one, that a one-to-one tradeoff is present between emissions and offsets, and that a carbon credit is “homogenous” or “equally valuable” independent of when and where carbon dioxide was emitted. Each of these assumptions is wrong.”.
However, the implementation of blockchain into carbon markets has made three major improvements. First, decentralisation is reducing the difficulty of registering, managing, and trading carbon credits. For example, the ESG1 platform is already generating public chain offsets from energy measurement software such as Corda and Smart Contracts. This type of automated credit validation system is simplifying markets and consequently increases quota utilisation. A great example of this is Air Carbon in Abu Dhabi. It will be the first fully regulated carbon trading and clearing centre in the world.
Blockchain is helping drive the environmental, social, and governance (ESG) agenda.
Many greentech discussions focus on the environmental problems of blockchain supported mining. But it should not be forgotten that this technology was invented to democratise social policy and financial governance.
Blockchain, Satellites, and ESG
NASA and other space agencies have been monitoring greenhouse gas emissions for years. However, with the new generation of private satellite operators, like Spire Global and GHGSat, it is now possible to focus on individual facilities and detect specific emission rates. Better, specific data, means a clearer understanding, more control, and more effective plans to reduce emissions.
Oil and gas corporations are the largest industrial source of emissions worldwide and are the leading users of these services. Other industrial sectors which produce a large amount of carbon dioxide include electricity generation, coal mining, steel manufacturing, cement production, agriculture and waste management.
Large amounts of high quality satellite data has produced data analytics companies such as Descartes Labs, Enverus, Kayrros and SatSense etc. These specialised companies help emission generators, regulators and market analysts by providing them with high quality data. This data is then used by investors and fundraisers to better understand whether a company’s claims are pure greenwashing.
But where does blockchain fit in?
The lack of transparency in the unregulated carbon offset marketplaces, and the lack of proof re offsets, is where blockchain can make a positive difference.
Blockchain can provide an auditable and standardised recording system, without the need for centralised management. It records, tracks and manages data that is critical for ESG environmental reports.
When environmental data is recorded by satellites and IoT devices, real-time evaluations are transferred to the blockchain by intermediaries. This way, automatic transactions can be made (smart contracts), because they are based on actual numbers, not just speculation.
Can Blockchain Help With Recycling?
In this information age, brands cannot and should not escape their stakeholders' watchful eyes. Hence, a new material revolution is needed to fight the global waste crisis and climate change.
The chemical industry for one seems to be in the lead in the race for net zero. Moreover, it is contributing to circular society technologies, as chemicals are prevalent in almost all manufactured goods.
Material procurement and traceability are more important than ever, but circular systems and economies cannot exist without traceability.
So, is there any solution on the horizon?
We call it the “Mass Balance” approach. This system allows manufacturers to know what percentage of their product is sustainable. The approach encourages recycled and renewable materials accountability. This is where our blockchain ecosystem, MARCO, comes in.
Due to its decentralised nature, blockchain technology can help with the certification of sustainable material uses, mass balance concepts, trust and visibility. Physical assets can be digitised into tokens. As the physical assets shift, so do the tokens. Every transaction or mineral is attached to the previous one, which makes the process tamper/proof, visible, and traceable.
The decentralised nature of blockchain gives all participants the same level of control, and jurisdiction over data. Data is shared with all participants equally, and it is synchronised in real-real time. When it comes to the chemical industry, members would have full transparency over the entire supply chain.
Regenerative agriculture programmes
Smart contracts can empower regenerative agriculture programmes including rewarding (and thus incentivising) raw material providers for reducing their carbon footprint. This is usually done through land-based practices such as tree planting and conservation.
A great example of this is the Green World Campaign. They are building smart contracts using satellite data and are automatically depositing rewards to individuals that successfully regenerate land by planting trees and improving top soils and drainage, etc.
Payouts are made when trusted intermediaries acquire data from satellite images that trigger smart contracts on the blockchain. This guarantees people earn rewards fairly and transparently. This generates trust.
Digital product passport
The implementation of technology in the food supply chain can improve traceability and can have a positive impact on the food industry. Many operations, such as safety control, are still managed manually and are vulnerable to human error. If the food industry decides to digitise its manufacturing process, it would be able to leverage digital methods such as “Digital Product Passports', to validate food safety and ESG compliance. A digital product passport would store all the information about the components of certain products, which would enable long-term control and production transparency.
Sustainability credentials
Transparency and trust are not only important to consumers. In the B2B sector, certification for sustainable procurement of chemicals and environmentally friendly and socially responsible production conditions is essential.
When communicating their favourable outcomes, businesses need to be confident that they have an undeniable record that verifies their message. By adopting a transparent digital agenda, including using blockchain technology to demonstrate transparency in ways not possible with other digital technologies, businesses can improve their sustainability credentials and reports.
Energy Grid Decentralisation
Giant facilities are usually centralised and often cause sustainability issues. On the other hand, distributed grid aggregates distributed energy generation from distributed energy sources. These are typically renewable energy sources such as wind, solar and hydroelectric power. A decentralised grid is the best solution for communities and individuals to become owners of energy distribution and generation.
A distributed energy grid would give consumers more control over their energy supply, offering flexibility, customisation and convenience. Decentralisation of energy generation, transmission and distribution, from microgrids serving small communities to grids serving entire urban areas, cities or countries, would result in more autonomy in terms of electricity supply. Furthermore, it would provide much more resilience and reliability.
Conclusion
Climate change and carbon footprints are real, and the clock is ticking.
The most important thing to remember when introducing blockchain and smart contracts into your business model is that individual, isolated efforts can become networks - that can then identify everyone's contribution to helping combat climate change.
Aside from the usual frisson of seeing Finboot’s name in print in SABIC’s public quarter three 2022 quarterly earnings report, I think it illustrates blockchain is increasingly seen as a hard-edged commercial “must have” lever to drive cost savings in supply chains whilst at the same time turbo charging the circular economy.
In its Q3 report SABIC states: “SABIC has launched a pilot project with technology company Finboot, advanced recycling pioneer Plastic Energy, and packaging specialist Intraplás to investigate the possibilities of blockchain technology to support end-to-end digital traceability of certified circular TRUCIRCLE™ feedstock in customer products. Tracing the journey of feedstock through the complex petrochemical value chain is currently a difficult undertaking and SABIC’s pilot is the first of its kind in the industry to trace the product from feedstock production to converter, going further than previous industry applications of blockchain in end-to-end tracing. The platform offers reduced costs, time and improved data integration for all value chain partners.” SABIC, third quarter 2022 highlights, page 3
SABIC’s blockchain pilot project, which started at the beginning of the third quarter of 2021, in July, is a collaborative effort involving Finboot, recycling pioneer Plastic Energy and packaging specialist Intraplás. Blockchain is bringing streamlined delivery processes, improved inventory management, increased transparency and traceability for certified circular plastic pellet feedstock used in customer products.
Following the journey of feedstocks through the complex production chain is tricky. To improve this process and the delivery of its circular / recycled feedstock to customers, SABIC has turned to blockchain.
“If you cannot measure it, you cannot change it” as mathematician Lord [absolute] Kelvin once said. Blockchain allows businesses to measure supply chain efficiencies and provides business with the only database technology that provides a time stamped immutable audit tracker. Every solution needs data – and data recorded accurately, monitored, managed and audited precisely for consumers, regulators, shareholders and internal stakeholders.
As with SABIC, Finboot effectively simplifies blockchain – the ultimate audit tracker – for business.
Juan Miguel Pérez Rosas, CEO at Finboot, 3 November 2022
Blockchain and Industry 4.0 are buzzwords around start-ups as well as established industries for some time. They are more than buzzwords now - both are real business solutions that have the potential to drive efficiencies, cost savings and increased profits. Here we take a closer look at how blockchain technology is helping to the development of Industry 4.0.
What is Industry 4.0? Put simply Industry 4.0 is the digitisation of manufacturing.
The term Industry 4.0 is actually not new! Representatives of different industries coined it in 2011 during the Hanover Fair in Germany. Two years later, the German Government adopted “Industry 4.0” as the name for its strategic initiative to revolutionise manufacturing across Germany.
Industry 4.0 is shorthand the “fourth industrial revolution.
The Fourth Industrial Revolution is the current and developing environment in which disruptive technologies and trends such as the Internet of Things (IoT), robotics, virtual reality (VR) and artificial intelligence (AI) are changing the way modern people live and work.
Industry 4.0 / The Fourth Industrial Revolution will drive an integration of digital technologies into manufacturing. The approach of combining new technologies with engineering best practices, is resulting in “smart factories”.
Smart factories use robotics, sensors, and sophisticated software to collect and analyse data that becomes the basis of the leadership team’s decision-making. Applying technologies in this way does not negate human experience however. This technology supplements human experience with data from all aspects of the manufacturing process.
Cross-referencing this information with insights from enterprise resource planning (ERP) platforms, supply chain information, as well as customer service feedback creates a multi-layered picture for company decision makers. The smart factories approach puts an end to silos of information by connecting departments and delivering greater visibility across the organisation.
What Technologies are Driving Industry 4.0?
Apart from the blockchain, the main technologies driving industry 4.0 are artificial intelligence (AI), the Internet of Things (IoT), autonomous robotics, additive manufacturing and cloud computing. Some of these technologies, like AI, started life several decades ago. Today, significant advances in computing and the development of digital technologies are enabling them to influence all aspects of our professional and personal lives.
Artificial intelligence (AI) refers to a form of intelligence shown by machines - particularly computers. Whilst researchers previously thought of AI as a technology that is mimicking human intelligence, current definitions tend to stress a computer’s ability to make rational n responses to various situations and inputs. Machine learning is a key part of AI and another technology driving industry 4.0. Machine learning is the capacity of machines such as computers to learn and refine how they apply algorithms without human intervention.
The IoT is integral to the progress of Industry 4.0 from a theoretical concept into reality. The term refers to devices with the processing power and capability of exchanging data with each other. The IoT also includes the technology that makes connections and the exchange of data between devices possible.
Autonomous robotics and additive manufacturing are likely to have the most visible impact on industry 4.0. Additive manufacturing uses technologies like 3-D printing to minimise the cost and time it takes to produce a prototype of a new product or start manufacturing. Autonomous robotics refers to a scenario in which machines learn to interact with each other. For manufacturing, that would mean introducing previously unidentified efficiencies into the production process.
Cloud computing has revolutionised how companies and organisations think about and run their IT resources and departments. A few years ago, supporting large IT demands meant maintaining large servers, providing storage, hosting databases and installing networking capability with physical cables. Cloud computing has made it possible for all these resources to be delivered via the internet.
The last of the main technologies driving Industry 4.0 is the blockchain. Blockchain is changing how organisations and individuals store data. Rather than keeping the information in one single place, blockchain is a decentralised ledger or database that stores data off-site. Once created, a record can no longer be altered or removed. Information is stored in blocks. As blocks fill up, they are sealed and connected to the previous block, creating a blockchain.
None of these exciting technologies, that are driving Industry 4.0 have been developed in isolation. r. And despite their individual benefits when they are used together they collectively drive huge efficiencies and advances. .
Bringing Blockchain Technology into Industry 4.0
The concept of industry 4.0 is aiming to change the way the world produces things, looking for faster, more efficient manufacturing. Blockchain technology can help underpin this fourth revolution by creating a transparent record of production processes that can be accessed from anywhere. The blockchain also opens up a real-time communications channel that can be shared by manufacturers around the globe.
As a result, implementing changes, updating algorithms and manufacturing processes become far more straightforward. Because of its secure ledger or database, the blockchain enables manufacturers to manage intellectual property rights and store proprietary product information safely. It also helps the creation of global supply chains, - a key issue facing all economies across the world at the moment.
Applications of Blockchain in Industry 4.0: a Review
Blockchain gained notoriety as a tool to facilitate secure transactions of cryptocurrency. Whilst the technology continues to transform the financial sector, other applications are also gaining ground:
· Manufacturing data protection
· Resolution of quality issues
· Supply chain development
This is not an exhaustive list - just the most pertinent examples of blockchain applications for the benefit of Industry 4.0.
1. Manufacturing Data Protection
As businesses (and individuals) worldwide are producing more data, data protection has become a key concern. In the manufacturing sector, companies need to secure the integrity of commercial data whilst also sharing it with the appropriate partners.
Blockchain provides the ideal vehicle to support sharing between a specific group of people whilst limiting unwanted access through encryption. Sensitive, valuable data is protected from potential cyberattacks. Encryption also makes blockchain safer for the transfer of information than many alternatives.
In addition, permanently retained records are ideal for avoiding disputes about copyright, distribution rights and delivery timings for products and processes.
2. Resolution of Quality Issues
Product recalls and dealing with other quality issues are normal parts of manufacturing. Blockchain technology makes recalls more efficient. Because permanent digital purchase records exist, manufacturers can recall faulty products in a targeted manner.
Rather than asking thousands of customers to return a product, manufacturers can identify problems more specifically and resolve them by working with specific customers. Permanent records of manufacturing processes make it easier to identify quality issues and resolve them quickly too.
Blockchain also helps drive recycling rates up by showing which parts can be recycled and how. In this way blockchain is driving the circular economy.
3. Supply Chain Development
Supply chain bottlenecks have made headlines for the past few years. As blockchain applications evolve, they will allow companies to predict and prevent bottlenecks through real-time updates and greater control of in-house processes and activities.
In many cases, blockchain technology will be implemented jointly with an organisation’s existing ERP platforms and strengthen them.
Why should blockchain be implemented to support Industry 4.0?
Blockchain technology and Industry 4.0 continue to evolve. As these technologies develop, new applications will become apparent. Neither is looking to replace human intelligence and expertise in manufacturing. The goal of Industry 4.0 is to improve the way the world produces goods through technology.
Blockchain technology is ideally placed to support companies looking to embrace digital transformation and become Industry 4.0 leaders.
BARCELONA, SPAIN, NOVEMBER 4, 2022 – Blockchain tech firm Finboot and digital transformation services consultancy Quantion have entered into a partnership agreement, enabling large companies in the European market to benefit from blockchain technology particularly in terms of making their processes more efficient.
Paris Dufrayer, Chief Revenue Officer, Finboot, says:
“This partnership between Finboot and Quantion is very exciting. We are a perfect match! Quantion has the same vision as Finboot: It wants to help accelerate companies’ digital transformation to make them more efficient, saving time and money, while making them greener as well.
Quantion complements Finboot’s wealth of knowledge and expertise on supply chains. Together, with Finboot’s innovative and proven ‘low-code’ platform – MARCO, Quantion can streamline the complex supply chains of their clients. We are already working on projects together and working towards securing joint new customers.``
Carme Pellicero, General Manager of Quantion, says:
"Blockchain technology has extraordinary potential to provide greater transparency, security, and more efficiently in managing the traceability of processes. Therefore, it allows a collaborative framework of trust between parties in a distributed ecosystem.
This collaboration with Finboot will allow us to help companies that want to incorporate Blockchain technology with end-to-end support. That means, delivering services from the setup to any integration required.¨
Finboot has developed MARCO, a 'low-code' platform that simplifies digital transformation by enabling companies to develop and deploy digital solutions with minimum efforts and resources. This ‘low-code’ platform accelerates the 'time to value' - the time it takes to deliver an application to market.
Quantion provides a key bridge between tech start-ups and larger companies. Like Finboot, Quantion strives to help companies accelerate their digital transformation. This alliance will help companies wanting and / or needing to innovate and optimise complex processes.
Finboot is a technology company that gives its world class customers a competitive edge through accelerating their digital transformation, realising value and building trust through blockchain.
Finboot has developed MARCO, a 'low-code' platform that simplifies digital transformation by enabling companies to develop and deploy digital solutions with minimum efforts and resources. This ‘low-code’ platform accelerates the 'time to value' - the time it takes to deliver an application to market.
MARCO brings together blockchain technologies in one place, connecting multiple ledgers simultaneously
It also powers 'no-code' applications which helps businesses realise value
It enables companies to incorporate blockchain within their value and supply chains, which increases traceability, transparency and compliance which, in turn, helps them meet sustainability and ESG requirements while also increasing operational efficiency
Finboot is headquartered in the UK with a base in Spain.
Quantion is a digital factory. We combine our teams in cutting-edge technologies and digital deep experiences with the innovation ecosystem, to ensure that we can provide the best solution to face business challenges, from its concept to its implementation.
Quantion was born in mid-2015 with the aim of being a bridge between the world of new generation companies and traditional markets. Our continuous growth is based on an outstanding and attractive value proposition.
Quantion works with the leading companies in Spain across different vertical markets including utilities, consumer health technologies, media, financial services, insurance and public administration.
Digital transformation tech firm Finboot and digital engineering company Nitor Infotech Pvt. Ltd have entered into a partnership agreement, enabling Nitor Infotech to benefit from Finboot’s innovative blockchain MARCO platform to help its clients improve their supply chains and processes as well to support their sustainability initiatives.
Finboot has developed MARCO, a 'low-code' platform that simplifies digital transformation by enabling companies to develop and deploy digital solutions based in blockchain technology with minimum efforts and resources. This ‘low-code’ platform accelerates the 'time to value' - the time it takes to deliver an application to market.
Nitor Infotech brings supply chain, consultancy and IT services expertise enabling rapid rollout of Finboot’s MARCO platform to its current customers – specifically a number of India and US projects where the blockchain platform will help shape and implement impactful digital transformation. Nitor Infotech joined forces with Finboot to strengthen its customer service and extend their current offering with the MARCO platform to North Americas.
Finboot and Nitor Infotech are offering a blockchain solution that can be deployed, at pace, bringing short term return on investment in highly regulated sectors - where supply chain processes are complex but vital to business success.
Nitor Infotech is well-established in the manufacturing, healthcare and retail markets and Finboot expands Nitor Infotech’s solution offering with its leading digitalisation solutions to address supply chain, business processes and environment, safety and health goals. This new joint Finboot-Nitor Infotech offer will also increase transparency, make collaboration and team working easier, and increase trust in data with a blockchain agnostic platform.
Paris Dufrayer, Chief Revenue Officer, Finboot, says:
“Our partnership will bring to the North American and Indian markets a complete digitalisation solution by covering business consulting expertise on supply chain and enterprise processes, also offering the next step of implementation and system integration services to the licensing and management of Finboot Software as a Service (SaaS) platform.”
Sanjeev Fadnavis, CEO, Nitor Infotech, says:
“We are very excited to be working with Finboot. Nitor Infotech and Finboot have similar values and approaches. We both want to work together with our customers to create a better world through accelerating digital transformation and leveraging tech solutions to the issues humanity faces. For example, improving manufacturing supply chains will increase efficiency and help them on their journey to net zero.”
Finboot recently announced expanding its presence in America by announcing new customers and a local Partnerships & Business Advisor for the United States and Canada, Thomas Iseler, who has joined the Finboot team to be responsible for initiating and establishing new businesses and managing existing partnerships.
The move reflects the technology firm’s growth plans and expands to other sectors and geographies. This partnership agreement is part of a bigger platform growth plan which will be announced in the coming month.
Finboot is a technology company that gives its world class customers a competitive edge through accelerating their digital transformation, realising value and building trust through blockchain.
Finboot has developed MARCO, a 'low-code' platform that simplifies digital transformation by enabling companies to develop and deploy digital solutions with minimum efforts and resources. This ‘low-code’ platform accelerates the 'time to value' - the time it takes to deliver an application to market.
MARCO brings together blockchain technologies in one place, connecting multiple ledgers simultaneously
It also powers 'no-code' applications which helps businesses realise value
It enables companies to incorporate blockchain within their value and supply chains, which increases traceability, transparency and compliance which, in turn, helps them meet sustainability and ESG requirements while also increasing operational efficiency
Finboot is headquartered in the UK with a base in Spain.
Since 2006, Nitor Infotech has garnered experience in handling multiple technology projects across industries and gained strong expertise in areas of technology consulting, solutioning and product engineering.
With a robust team of technology and domain experts, we have helped leading Enterprises and ISVs in the realm of supply chain management, manufacturing, healthcare, retail, and BFSI with modern-day products and top-notch services. Digitisation being our key strategy, we digitally assess their operational capabilities in order to help them achieve their end-goals.
We’re excited to announce that Cassarah James has joined the Finboot sales team as our new Business Development Manager based in the UK.
Cassarah brings more than 10 years of experience in sales, working with companies like Jaguar Land Rover, Hyundai and Aexus. For nearly eight of those 10 years, Cassarah lived and worked in mid-Wales after gaining her law degree from Aberystwyth University.
Across her previous roles, Cassarah has created, developed and maintained excellent client relationships; so much so that she is no stranger to Finboot! Cassarah worked for Finboot in the past as part of the Sales Development Representative (SDR) team.
In her new role, she will be responsible for identifying new markets and customer needs, building and nourishing long-term relationships with existing clients and creating new business with new customer acquisitions.
Cassarah says: “I am so excited to rejoin the Finboot team, it’s great to be part of such a vibrant and progressive company! MARCO’s unique and cutting edge digital ecosystem is leading the way in supporting ESG standards, supply chain traceability and much more. I very much look forward to helping Finboot grow its client network in the UK and beyond”.
Paris Dufrayer, Finboot’s Chief Revenue Officer, commented: “We are delighted to welcome Cassarah to the team, she will be a key member of the international Finboot team as we continue to grow and target other sectors and expand into new geographies.”
Please join us in welcoming Cassarah James to Finboot!
The Digital Product Passport – Transparent and Sustainable Supply Chains Powered by Blockchain
The Circular Economy Action Plan constitutes the Sustainable Products Initiative, which aims to implement a digital product passport. The passport is meant to facilitate supply chain traceability by collecting data about the value chain of the products.
The digital product passport (DPP) will bolster sustainability by ensuring products are manufactured with renewable energy and are devoid of hazardous chemicals. This passport will also facilitate a circular economy, simplifying the process to recycle products when they reach the end of their lifecycle.
Powered by blockchain technology, the digital product passport enhances transparency and ensures traceability across the supply chain. Let's delve into the dynamics of how digital product passports function.
What is a Digital Product Passport?
A digital product passport is a comprehensive digital record that captures a product's value chain, documenting its journey from raw materials to the final product. It includes details on the energy used, emissions generated, and strategies for waste reduction.
The data within a digital product passport is securely stored on a blockchain, ensuring data security and providing a transparent, tamper-proof method for sharing information. This passport can authenticate a product's sustainability and confirm its compliance with environmental and social standards.
Why Should We Start Using Digital Product Passports?
By monitoring a product's complete lifecycle, from manufacturing to disposal, digital product passports offer a more thorough insight into the environmental impact and social implications of products, underscoring the importance of sustainability.
1. Increased Transparency for both Consumers and Businesses
At the moment, there's rampant mislabeling and de-facto greenwashing in the marketplace. It happens when companies make claims about their products that are not accurate or they downplay the environmental impacts of their product.
Digital product passports would enhance transparency, obliging businesses to disclose precise information and empowering consumers with easy access to this data to make informed choices.
2. Improved Sustainable Practices in a Product's Lifestyle
Furthermore, digital product passports would advance product recycling and waste reduction. By tracking products through their entire lifecycle, we can pinpoint opportunities to recycle or repurpose them, thereby promoting sustainability and ecodesign.
● Carbon Footprint: With an average carbon footprint of 13 tonnes of CO2-e per person, the UK is one of the worst offenders when it comes to greenhouse gas emissions, significantly contributing to the environmental impact. Moreover, the EU produces a substantial amount of emissions, further highlighting the need for measures to reduce the carbon footprint and mitigate greenhouse gas emissions.2.5 billion tonnes of waste annually. A digital product passport would help businesses and consumers understand the carbon footprint of a product and make better choices about their purchases. Consumers can learn how much of the product they're using contains recycled material, allowing them to calculate their environmental impact.
● Water Footprint: By understanding the water footprint of a product, it will be possible to quantify one's environmental impact more accurately. A product with a large water footprint might be made with an excessive amount of cotton. To offset the environmental impact of this product, the consumer might choose to purchase products made with recycled materials, thereby promoting sustainability.
● Material Grades: With greater access to information about raw materials, it will be easier to improve the quality of recyclable materials within sustainable supply chains. Moreover, it might be possible to choose products made with certified sustainable products, ensuring that the materials used are in line with environmental standards.
3. Boost the Circular Economy
Digital Product Passports (DPPs) would also contribute to the development of a circular economy, in which waste is designed out of the system, and products are made to be reused, repaired, or recycled back into the manufacturing process. This approach to sustainability emphasizes the importance of the recycle and reuse principles in achieving a circular economy.
Digital Product Passports (DPPs) enable businesses to track their products throughout the entire lifecycle, fostering sustainable supply chains. It would allow businesses to identify opportunities to close the loop and keep materials in use for as long as possible within a circular economy, and more importantly, it would allow businesses to sell products as a service rather than as physical objects.
The benefits of a circular economy are numerous, and digital product passports would be a key step in implementing it. For instance, a report shows that a circular economy will create up to 700,000 jobs in the EU by 2030.
4. Centralised Information Flow
Digital Product Passports (DPPs) provide a centralised platform for all of the information, enhancing transparency. By mandating that businesses report certain information about their products, it will be simpler for the end-users to make informed decisions about their purchases and recycling habits.
Moreover, the use of Digital Product Passports (DPPs) will allow businesses to share data about their products with each other and develop new ways to improve the efficiency of the manufacturing process, thereby optimizing operations and fostering collaboration.
Why Use Blockchain for Digital Product Passports?
Blockchain technology, a form of digital ledger technology (DLT), is revolutionizing how transactions are recorded and shared across a network of computers. Utilizing blockchain, companies can create digital product passports that offer a secure and tamper-proof method to trace a product's lifecycle from its origin to the consumer and ultimately to its end of life.
Blockchain technology holds vast potential for the food industry, enhancing supply chain transparency, bolstering food safety, and improving quality control. These compelling reasons underscore the value of integrating blockchain into supply chain management and the broader application of digital product passports.
● Supply Chain Traceability
● Reduces Compliance Costs
● Accelerate Data Transfer Processing
Blockchain technology is becoming increasingly relevant in various industries, including the food, fashion, and automotive sectors, which all depend on the efficient sharing of product information. In these fields, blockchain can significantly speed up data transfer and streamline processing.
As blockchain technology uses cryptographic techniques, it would be very difficult for anyone to tamper with the data stored on the blockchain. Thus, it will help ensure the accuracy and integrity of product information - in short it provides immutable truth.
Final Words
A digital product passport provides numerous advantages, such as bolstering supply chain sustainability, informing consumers about the sustainability claims of products, and facilitating ethical consumption by shedding light on environmental and social impacts.
Although digital product passports are in the early stages of development, there are ongoing initiatives aimed at leveraging them for greater supply chain transparency. As DLT blockchain technology continues to advance, the adoption of digital product passports is expected to expand.
Digital product passports are poised to be particularly useful in the fashion, food, and electronics sectors, where they can empower consumers with the necessary information to make informed choices about their purchases.
Juan Miguel Pérez Rosas, CEO at Finboot, recently gave an interview for the Digital Supply Chain podcast by Tom Raftery talking about the adoption and use cases of blockchain for supply chain. Finboot is also going to participate in the Logistic and Automation event in Madrid later this month (26&27 of October). These initiatives are not random, they are coordinated efforts aligned with Finboot’s strategy. Initiatives that have been timed just right, as we see more and more companies are making investments in this emerging technology, with supply chain and logistics being a hotspot for blockchain implementations.
Blockchain is growing in popularity as more companies learn more about how it may enhance their business operations and financial outcomes and use their human and financial resources to invest in it. And over time, businesses that do not implement this technology run the risk of being left out of the market.
Logistics, on the other hand, is one of the fundamental components of modern industry and is on the rise. According to a Transparency Market Research (TMR) report, the market is currently worth $8.1T, but by 2023 it will be worth $15.5T. Volumes, estimated to be 54.6B tonnes in 2015, are likely to reach 92.1B tonnes by 2024.
Blockchain is empowering businesses in this market to improve routing, expedite production processes and ensure transparency to the entire supply chain.
Let’s find out why logistics companies should consider blосkchain implementаtion, use cases included.
Digging deeper into the application of blockchain technology in logistics
Let's focus on the use of blockchain in suррlу chains аnd potential challenges that this technology can encounter in logistics. Lack of transparency between buyers and manufacturers is the industry’s key problem, including miscommunication and difficulties tracing each delivery stage.
Juan Miguel, in his interview, stated: ¨blockchain is a technology that in spite of not being designed initially for supply chains it does address many of the data driven pain points of the industry. I come back to immutable shared record keeping, automated reconciliation and settlement, end to end workflow visibility.
For supply chain professionals this is amazing because how often do they need to go out on the hunt in search of information they should have access to, but they never got? How often do they enter disputes over mismatched records?¨
Primarily, blockchain improves:
- Shipping and freight in lоgistiсs: Blockchain саn bе usеd tо boost both international and local shipping processes, forcing manufacturers and transport companies to enhance their production capacity and the efficiency of their production processes.
- Inventory tracking: The technology offers thе ability to manage each company’s products not оnlу at thе mаcro lеvеl, but also at the micro level. Disputes can be resolved much fаstеr with immutаblе dаtа аnd rеаl-timе саrgо information. Thanks to automation, mаnу disрutеs саn be resolved in minutes with just reliable dаtа.
- Transportation: the carrier and the consignee often interpret the delivery time differently, which reduces the on-time delivery rate. Using blockchain this can be avoided since all participants in the supply chain have access to the same version of all shipping documents. Additionally, the entire exchange of data is stored in blocks, so it is not feasible to erase or modify this data and it is much simpler to identify the cause of a conflict.
Finboot experience in blockchain and logistics
According to Juan, ¨Finboot has created a Low-code platform called MARCO. MARCO’s low-code capabilities our team has built a supply chain solution called Track & Trace. Which is all about supply chain digitalization and traceability. The power of Track & Trace is that it is fully configurable from a front-end interface. Clients can build their own workflows, define the assets in their value chains and the data they want to capture. All of this without writing a single line of code.
SABIC is one of Finboot's interesting success stories. They are using the MARCO Track & Trace application to improve the management of sustainability credits in the production of circular polymers. They are building an ecosystem in which we are able to trace the final packaging all the way back to the plastic waste of origin. And they are doing so at a level of granularity and visibility that is unlike anything else out there in the circular economy of plastics.
Iberia airlines is another client, in their case they are using a different MARCO app, which helps them with supplier communications. This was specifically deployed in the refueling process so that they will receive delivery notes from refueling, validate those automatically based on pre-agreed business rules and once everything’s been reconciled send the data directly from blockchain into their financial systems. It’s an incredible improvement in visibility, giving them great capabilities to forecast what the biggest cost for any airline.¨
When it comes to the adoption of blockchain technology, one of the biggest challenges is the implementation into the current ecosystem. However, Juan believes ¨the solution is combining blockchain with another digital trend: Low-code and No-code platforms, in which, in some cases, you need very little software background or training.¨
He also pointed out that three key takeaways for those who was listing to the podcast (or reading this article):
One, blockchain is not as mysterious as many make it look and can do a lot more than the whole crypto world, it has huge potential use cases for different industries and purposes.
Two, supply chain is a killer use case for blockchain, so any enterprise out there struggling with their supply chain data or digitalization, should be looking into blockchain to increase traceability, transparency and compliance which, in turn, helps them meet sustainability and ESG requirements while also increasing operational efficiency.
And three, it’s a lot easier than you think. Reach out to us, and we’ll show how adopting this emerging technology with a low-code approach can save you a lot of time and money and accelerate your time to value.
The construction industry is always under pressure to be more efficient (ie producing more, with less waste and as quickly as safely possible). For instance, in the UK, 75% of capital projects go over budget, and 20% of cost overruns are caused by poor project administration and management.
A smart contract is a self-executing, coded contract with pre-defined terms. It facilitates the execution of a contract through automation and without interference. Lots of research is going into how to create smart contracts, how to make smart contracts safe, maintainable or updateable.
OK, so where do smart contracts exist? Where are they executed? And how do they work?
Smart contracts are verified, executed and enforced by a non biased computer program that runs on a blockchain network. The program starts running once the smart contract's terms have been accepted by all parties. As the contract is verified and enforced by the blockchain network, a third party is no longer needed.
The fact is that smart contracts can be executed by code rather than people, removing the possibility of human error and automating tasks that would traditionally require human interaction.
One of the best aspects of the blockchain is that there is no need to pay middlemen (intermediaries) and that it saves time and dispute because it is a decentralised system that exists between all permitted participants.
Blockchains unquestionably operate faster, cheaper, and more securely than conventional systems, this explains why more smart contracts are being used to conduct transactions on various blockchain networks, such as Ethereum, Solana, Tezos, Hyperledger, etc.
Use Cases of Smart Contracts
Construction
Contractors in the UK have talked about "the golden thread" for a while now, but what exactly is it? The Golden Thread is the idea of having an exhaustive audit trail that spans the whole lifecycle of a construction project, from sourcing materials to project completion and maintenance.
Essentially the golden thread is both:
the information about a building that allows someone to understand a building and keep it safe, and
the information management to ensure the information is accurate, easily understandable, can be accessed by those who need it and is up to date.
It will be the duty of the people responsible for a building to put in place and maintain a golden thread of information. Having a golden thread will mean that those people responsible will have easily accessible, reliable, up to date and accurate information. Without this information, it is very difficult to manage and maintain buildings safely.
Blockchain technology can provide a solution that not only brings together all of the relevant information but can ensure regulatory compliance.
If you wanted to rent out your flat, you would have to pay a middleman like Craigslist or a newspaper or site to advertise, and you would also have to pay someone to verify that the tenant paid rent and followed through.
You can reduce costs by using a decentralised solution. You simply encode your contract on a smart contract. Smart contracts are revolutionary in terms of transforming the current real estate practices, replacing traditional contracts as the sole agreement between seller and buyer. It automatically executes the requirements as soon as specific conditions of the contract are met.
All parties including the bank, the agent, and the mortgage lender can sign an agreement via smart contracts and transactions are kept on a blockchain.
Healthcare
Personal health records can now be encoded and stored on a blockchain platform with a private key which would grant access only to specific individuals.
Patients’ records could be securely stored on a blockchain system and automatically sent to insurance providers - so they have a record of what treatments have been administered and paid for. Smart contracts, too, could be used for general healthcare management, such as supervising drugs, regulation compliance, testing results, and managing healthcare supplies - speaking of which, you can download and read further on how this process is improved through blockchain in Finboot’s ebook on ‘Blockchain technology in the pharmaceutical industry: Fostering Transparency and Traceability’
Non-Fungible Tokens (NFTs)
NFTs have gained enormous market traction in recent years. Data from DappRadar, a firm that tracks sales, showed that trading in NFTs reached $22bn in 2021, compared with just $100m in 2020, and that the floor market cap of the top 100 NFTs ever issued – a measure of their collective value – was $16.7bn as they turned out to be the most successful use-case of smart contracts. To learn more on the explosion of these, check our most recent blog post on NFTs.
NFTs are created through a minting process that requires the use of smart contracts set up on the blockchain.
A smart contract is a tool that allows implementing a sale agreement between the NFT owner and the buyer. The smart contract contains information on the NFT, such as the work’s creator, other parties who are entitled to royalties each time the NFT is sold, and the work’s ownership history. Smart contracts frequently include a link to the work they represent, which can be viewed by only the owner.
Finboot’s expertise on Smart Contracts
Although smart contracts are native to blockchain itself, at Finboot we have abstracted the deployment, configuration and access to them through our Low-code platform and ecosystem MARCO. We’ve taken this complex blockchain feature and have turned it into something that business users can understand and use without becoming a blockchain expert. Some of customers like Iberia and the London Chamber of Arbitration and Mediation are already seamlessly using smart contracts on some of their daily ops.
Our solution BLOCKSTAMP enables the configuration of business logic into smart contracts, allowing the automatization of processes and dramatically reducing the back-office workload. With our implementations, we automatically reconcile invoices between different stakeholders, minimising disputes and reducing time to settlement, better cash flows for all the involved stakeholders.
The term — “web 3.0” or “web3” — seems to be on everyone’s lips at the moment. But what is it? And what does it mean?
Web 3.0 or web3 is a new kind of internet service built upon decentralised blockchains, the shared ledger systems also used by cryptocurrencies like Bitcoin and Ether.
Although the phrase has been in use for some time, it has just recently become more widely used.
The term was originally coined by Ethereum co-founder and Polygon founder GavinWood in 2014.
As envisioned by the Web 3.0 Foundation, Web3 will be a public world wide web of computers where data and content are registered in blockchains, tokenised or managed and accessed on peer-to-peer distributed networks.
Web3 advocates expect it to assume a number of different shapes, including decentralised social networks, "play-to-earn" video games that give players cryptocurrency tokens and NFT marketplaces that let users purchase and sell bits of digital culture. We believe that web3 will revolutionise the internet as we currently know it, overthrowing current gatekeepers and bringing a brand-new, middleman-free, digital economy.
How did we get from Web 2.0 to Web 3?
The legacy of the internet as we know it is undeniable, because thanks to it, democracy gained a new meaning, giving voice to everyone who wanted space, from consumers, small businesses and even non-profit communities and associations. The digital revolution provided by the Internet 2.0 has also ensured a never-before-seen democratisation of information, in business and in human relationships. Even though the internet still serves as the primary driver of digital transformation, the technology goes much far further than it used to. Everything we currently know as Web2 should be improved by the third stage of the Web's evolution. This version will invite us into virtual reality settings so we can visit a museum, a concert, or far-off places without leaving the comfort of our homes. In a world where we can use custom settings and preferences to modify our reality, we can expand the boundaries of our creativity.
Web3 is a group of associated technologies aiming to make the Web and the internet more decentralised, verifiable, and secure. In order to safeguard us in the digital sphere when our privacy or even life safety may be at risk, it strives to give us the opportunity to engage and create freely on the internet.
Users constantly serve as commodities in the modern internet environment, creating value along with their data. Large organisations having control over our personal information has been for years a cause for concern.
The Web 3.0 movement is fueled in part by this sentiment. Although the movement may have its roots in blockchain technology, it has a broader agenda. Building this much needed decentralised infrastructure that safeguards personal property and privacy is key to Web 3.0.
But what exactly does Web 3.0 or Web3 look like and what are the technical implications?
The Evolution of Web Infrastructure:
The internet was born with simple "read-only" technology, which meant that users could essentially read and search for information. The primary function of this Web 1.0 environment, which served as an extension of actual physical storefronts, was advertising.
Later on, the arrival of Web 2.0 gave users the ability to produce their own content and engage with the internet on a deeper level, thanks to the introduction of a "read-write" functionality. This infrastructure continues to guide international business models by enabling the rapid expansion of blogs, social media platforms, and online reviews.
This period of strong growth has come with drawbacks and challenges that Web 3.0 seeks to address.
Web3 aims to put power and control back into the hands of users and enter a “read-write-own” era.
An understanding of the unique features of Web 3.0 will help this process be rolled out. .
Most of us find it difficult to define in exact terms, but it can be effectively broken down into unique components.
Semantic Web
The semantic web enhances the capabilities of the current online infrastructure by producing and connecting content based on a comprehension of words. Context is key and used in search and analysis instead of keywords and numbers.
Thanks to semantic metadata, Web 3.0 achieves greater connectivity. By leveraging all available data, the user experience improves.
Artificial Intelligence: Web 3.0 technology has the ability to process information similarly to how humans do. Platforms can better meet user needs as a result of ongoing learning
3D Capabilities: Many Web 3.0 platforms are already using three-dimensional design. For now, only a few potential use cases include computer games, e-commerce applications, and mapping software
Ubiquitous: Every device connects to the web, all content is accessible by multiple apps and associated services are available everywhere in the decentralised Web 3.0 ecosystem
The role of blockchain in Web3
From simple observations regarding web 3.0, it becomes apparent how important blockchain technology will be. Blockchain entered the scene as a powerful force, and its unique characteristics revolutionised traditional business operations. Decentralisation, however, is the key characteristic of blockchain that makes it a perfect basis for web 3.0. A new type of internet is required because of the prevalent problems associated with web 2.0, particularly centralised management and data integrity worries.
Web 3.0 or web3 will allow consumers access to a more free and open internet.
Recently, blockchain technology and the usage of smart contracts is being considered as a solution for creating, maintaining, and sharing built assets.
Alongside safety, countries globally are also considering climate change by applying building emissions regulations within building guidelines. Design and construction regulations that improve the energy efficiency of buildings are crucial to limit global warming to 1.5°C before the end of the century if we are to achieve net-zero. Some of the regulations that have been promised by governments in China, across Europe and the United States are quite ambitious.
How are different countries taking action?
China, the largest global emitter of CO2, has pledged to reach peak emissions by 2030 and achieve net zero by 2060. According to the Green Buildings Performance Network (GBPN), ¨China’s central and local governments have recognized the urgent need to improve building energy efficiency, through the adoption of both regulatory policies (i.e., building codes) and market-based and financial policies (i.e., building energy labels and incentives)”.
The Energy Performance of Buildings Directive (EPBD), which is focused on Europe, is the foundation of the EU’s building energy regulations. It includes the “development of national Long-Term Renovation Strategies (LTRS) for the decarbonization of building stock by 2050, setting minimum performance requirements at cost-optimal levels for buildings undergoing major renovation and meeting the Nearly-Zero Energy Buildings (NZEB).”
State and local governments in the US have the option to adopt one of the national model energy codes, which establish the minimum standards for the energy-efficient design and construction of new buildings as well as for renovations. In the US, buildings account for 39 per cent of energy use and two-thirds of electricity.
The goal of these regulations is to work toward carbon neutrality while fostering climate awareness and encouraging investment in clean technologies and data collection.
Our ebook about Blockchain and regulations explains how blockchain will play a role in design and construction regulations, and how it will power and maintain the safety of residents over time, as well as help to tackle climate change.
What is a Green Building?
Any building or structure of any kind can be a structure of green construction, better called green building.
Green buildings typically include efficient use of energy particularly renewable energy, such as solar energy, water, and other resources, measures to reduce pollution and waste, the ability to reuse and recycle, good environmental air quality indoor, use of non-toxic and sustainable materials, environmentally friendly design, construction and operation methods that enable adaptation to a changing environment and last but not least the quality of life of building’s occupants.
The construction industry is known for being conservative. It’s among the least digitised sectors, but also one of the most wasteful, generating 35 per cent of the global landfill mass. However, the need for new buildings is more urgent than ever due to the rise of urbanisation and population growth.
Construction is vulnerable to disruption as a result of these challenges and the urgent need for innovation and digital transformation. Blockchain can help.
More Ethical, Greener, and Cheaper Buildings
Even though people are becoming more conscious of environmentally friendly techniques, sustainable construction has yet to become mainstream, and blockchain can contribute to a global acceleration of this process.
Blockchain has the potential to serve as the building materials passport. Developers will be able to better address sustainability issues by using the information about each construction product to estimate a building's life cycle, reduce its environmental impact, or recycle materials.
Project managers will also be able to determine whether raw materials or products come from ethical sources. Blockchain can therefore be a powerful factor in driving the circular economy in construction and encouraging positive behaviour change.
Digital transformation as a necessary next step
The need for a more digitalised model in the construction industry has been extensively documented, acknowledging that while the industry is aware of a shift towards digitalisation, implementation remains complicated.
Less than six per cent of construction companies take advantage of digital tools, and 100 per cent of companies that deal with building materials believe that they have not yet reached their full digital potential, according to a Roland Berger report on digitalization in the European construction industry. This is a reality despite the fact that 93% of industry participants believe that digital solutions will eventually affect every step of the process.
Another report on Digitalisation of the Construction Industry published by Oliver Wyman, an international management consulting firm, affirms that digitalisation offers various ways to increase operational efficiency, and “provides a great opportunity to reduce the environmental impact of construction projects.”
The UNE’s 2020 report, “BIM: Standardisation of digital information for the planning, construction and management of buildings and civil engineering projects,” outlines the advantages of implementing digital processes and technologies in the construction sector, including:
● optimising goals and improving the quality of the end product
● enhancing competitiveness
● allowing new functionalities that improve infrastructure
● ensuring consistency and interoperability between organisations
● lowering costs
● reducing environmental impact
It is obvious that digital transformation is an important strategy that helps construction organisations reduce their environmental impact while also streamlining their operations and boosting productivity. In this way, administrative digitalisation technologies can assist businesses to optimise internal operations, manage construction contracts more efficiently, and reduce or completely eliminate paper processes.
Accelerating digital information and building through Blockchain, the golden thread of information will speed up the culture change needed in the construction sector. Digital transformation will help drive accountability, transparency and compliance in the industry, which in turn, will help it to meet sustainability and environmental, social and governance (ESG) requirements while increasing operational efficiency.
The UK Government’s review of Building Regulations and Fire Safety (Hackitt, 2018) identified a series of failings in the construction sector including ambiguous and inconsistent regulations and standards; lack of clarity of roles, responsibilities and enforcement of regulations and standards; poor product testing; and failure to address building occupants’ concerns around health and safety. This thorough review resulted in two major recommendations: the need for far greater traceability and a digital record to provide the golden thread of information.
The ability to ensure availability and access to the right information in the right format at the right time is crucial for successful operations within the construction sector. Information quality is as important as information traceability as this is the information that drives decision-making.
Understanding “The Golden Thread”
Contractors in the UK have talked about "the golden thread" for a while now, but what exactly is it? It is the idea of having an exhaustive audit trail that spans the whole lifecycle of a construction project, from sourcing materials to project completion and maintenance.
Identification, collaboration and clarity before, during and after a project are key to the golden thread being successful.
Going further, the Golden Thread report from the UK Government talks about the need for a ‘Single source of truth’ by bringing all information together in a single place and recording changes in full. Blockchain technology can address this need for good.
Blockchain technology can provide a solution that not only brings together all of the relevant information but can ensure regulatory compliance.
How does blockchain apply?
Firstly, all information should be stored digitally to achieve the golden thread. Contractors, subcontractors and asset owners have long kept records and copies of relevant safety, supplier, and project information. However, the disconnect between a main contractor and its subcontractor’s supplier, for example, would mean that these audit trails are rendered useless when retrospective action is needed.
To ensure a golden thread, all information needs to be stored digitally. Long-standing records and copies of safety, supplier, and project data are preserved by contractors, subcontractors, and asset owners. Moving this information to digital formats and connected workflows via blockchain, allows information to easily be updated and viewed as necessary.
The more transparent, real-time and collaborative a project can be, the more beneficial the golden thread can be for everyone. Using the golden thread can, in turn reap benefits beyond increased safety and quality - such as time and cost-saving.
What can organisations do now to prepare themselves for the changes ahead?
Given the way information is now stored and used, the golden thread concept—data flowing through the many stages of a building's life and acquiring more related data along the way—seems challenging to implement. When data is organised and stored separately and independently, it does not flow so easily between parties - making it difficult for all to have clear visibility.
Due to the fact that there are different tools for various stages of the development lifecycle, it makes it arduous for the software or system supplier to export data. Or the party that created the data, and hence was likely the owner of the data at that time, might desire to retain that data for commercial reasons.
Managing such a high supply chain, keeping track of work, schedules, costs and payments takes enormous effort and requires enormous resources. Construction projects have to deal with different forms of mistakes, delays, and accidents at different stages.
These key points are areas where blockchain can make a difference and make these processes more efficient, transparent and accountable for all parties involved in the project.
At Finboot we are committed to the adoption of DLT (Distributed Ledger Technology) to support digitalisation in the construction industry and enable solutions to many of its challenges.
The Sixth Annual Blockchain in Oil and Gas Conference, Houston, Texas at the Hilton Americas was a big event in a big state!
Many companies – including all the big players – were represented here. Finboot’s client Repsol was one of large oil and gas companies which had representatives here:
some companies
It has been great to be at the Sixth Annual Blockchain in Oil and Gas Conference, Houston, Texas the past two days (Sep 14 - 15).
A key focus of this year’s conference was how blockchain technology can enable carbon tracking and mitigation – which is a huge driver for oil and gas companies today. This driver comes from consumer, political and regulatory pressure and the desire of the industry to do the right thing to help fight climate change.
Blockchain technology is helping to supercharge the oil and gas industry’s digital transformation. Blockchain helps maximise company efficiencies and puts downward pressure on costs and a time of rising costs elsewhere in the supply chain.
Me (Paris) and others Finboot colleagues (Juan, CEO and Noslen, Business Development Manager) had good conversations with a range of attendees about the benefits and advantages that blockchain brings.
From some of these conversations and from what I saw these 2 days in the event,it becomes clear that the oil and gas sector is under huge pressure to be greener and reduce its prices in the face of global inflation. Blockchain is a large part of the solution but we still found some barriers for adoption of blockchain to address some of the challenges of the oil and gas industry, such as streamline their operations, reduce costs, and enhance development opportunities through sustainable practices.
I will summarise the main barriers for adoption into 3 main challenges:
1- ¨Education¨ which has to do with the fact that many recent problems in the ¨crypto¨ world gave a bad reputation to the technology, but it really has nothing to do with the technology solution itself, but how some people use it.
2- ¨Legacy systems¨, there is a natural resistance into substituting the old known ERPs and supply chain systems technologies out there to this new concept of distributed data.
3 - ¨Willingness¨, and last but not least the point would be, who are the early adopters and how different players and stakeholders get into the same ecosystem to share and work together.
But we can see the industry and companies evolving and leading into this new digital era.
From what I saw in the Lone Star State the industry is willing to embrace this technology. This gives me hope for a cleaner, greener, more efficient and lower priced, energy future.
If you want to know more about how blockchain can help the energy industry overcome the fundamental challenges of Energy transition, Decarbonization and Net-zero Emissions, please contact us.
I leave you readers with some great pics from this event!
The world’s only Blockchain-focused event in oil and gas is returning to Houston for the sixth consecutive year. It’s an opportunity to join hundreds of thought leaders, executives, and researchers from across the industry and will gather operators, service companies, EPCs, and industry stakeholders invested in transforming the future of oil and gas through Blockchain technology. The conference will highlight opportunities to create industry solutions and guidelines, leveraging blockchain technology to reduce costs, improve timelines and eliminate disputes in any given process.
A key focus of the 2022 conference will be blockchain as an enabler for carbon tracking and mitigation - the key generational driver for oil and gas companies today.
Advancing toward a net zero emissions future is one of the biggest challenges — if not the biggest — facing humanity today and the clock is ticking loudly. The oil and gas industry must take a leadership role by not only reducing its own carbon footprint but transforming the global energy systems.
Different oil and gas companies will decarbonise at different speeds. Digitalisation will not only accelerate the passage, but also provide proof of the quality of their transition.
Juan Miguel Perez Rosas, CEO, Finboot, will share his thoughts on the future of the #blockchain in the #oil and gas industry on Day 2 at the “Blockchain, Cleantech and the road to Net Zero”, session.
Our team will be attending the event to catch up with clients and exchange ideas on solving ESG challenges with #blockchain solutions. We will also count with our Advisor Geoffrey Cann attending our booth, who will be signing some of his books. Geoffrey is a highly regarded author, publisher, broadcaster and independent adviser for digital transformation in the oil and gas sector.
Please come and say hello at #BlockchainHouston22 and we can discuss the exciting future of the oil and gas industry.
We’re excited to announce that Thomas Iseler has joined the Finboot family as our new North America Partnerships & Business Advisor for the United States and Canada.
Thomas brings 30 years of experience leading marketing, product management and business development organisations for multimillion-dollar, global organisations across diverse customer communities and industries. Thomas is an expert in developing new businesses, alliances and partner ecosystems utilising multi-channel programs across global geographies and varied product mixes.
In his new role, he will be responsible for initiating and forming new partnerships, managing existing partnerships and maintaining relationships with local, regional, and national stakeholders. His responsibilities will also include planning and executing business strategies, advising on projects and marketing and performing risk analysis.
He will be a key member of the international Finboot team as it continues its growth plans and targets other sectors and global geographies. Finboot recently added SABIC to its growing list of world class customers, which includes Amey, Iberia, Repsol and Stahl.
Thomas says: “I am delighted to be joining Finboot at this exciting time as it expands further, into new continents. I was attracted to the company’s ambition, mission and world class clients. I look forward to growing Finboot’s network, partners and customer base across the United States and Canada”.
Paris Dufrayer, Finboot’s Chief Revenue Officer, commented: “We are excited to not only expand our team by welcoming Thomas, but also our international footprint. It has been a very positive year and we are pleased to be accelerating our growth plans to explore opportunities in new markets. Thomas brings fantastic experience and network to enable us to do this.”
Please join us in welcoming Thomas Iseler to the Finboot family!
CARDIFF, UK, Tuesday August 9th, 2022 – Amey Consulting has entered into a partnership with Finboot to develop a blockchain solution using its MARCO platform to cut conflict-associated costs in the rail industry.
Conflicts cost the rail industry billions of pounds each year. A successful blockchain solution could not only eliminate costs through improved operational efficiency but also improve safety and customer satisfaction. There are also likely environmental benefits with improved railway reliability leading to less emissions.
Juan Miguel Perez, CEO, Finboot says: "At Finboot we've been looking at how blockchain can act as the backbone of a digital solution for the complex requirements of Access Planning. To have the opportunity to explore and develop this with Amey, a leader in the railway industry, it's a great opportunity for us.
“We are excited by the potential of how we can bring added transparency and real-time visibility to such an important process within the sector. We look forward to where this goes next, and we are convinced that the potential is huge."
Tom Kinnear, Partner at Amey Strategic Consulting, said: “Blockchain has the potential to unlock collaboration across our industry, something which is really needed in our sector.
“The work we have done with Finboot has enabled us to explore the benefits and also demonstrated the safety and efficiency case behind the technology. We’re excited about the value it can provide in the future.”
Technology Connected, a Welsh Government funded organisation which unifies and promotes Welsh technology across the world, is supporting the project. The Finboot MARCO blockchain solution has been tested and verified with subject matter experts, with the next stage being the live test of a minimum viable product on Wales’ railways.
With pressure from all stakeholders scrutinizing brands on sustainability and environmentalism a material revolution is required to combat the global waste crisis and climate change.
The chemical industry has long been a contributor and responsible for carbon-neutral targets, in addition to circular society technologies due to chemical prevalence in almost all manufactured goods.
Material procurement and traceability are becoming ever more important. Circular economies cannot be created without traceability.
The Solution for the Chemical Industry?.... The ‘’Mass Balance’’ approach.
The mass balance approach allows manufacturers to know what percentage of their product is sustainable.
What are the drawbacks?
Scepticism as to whether the mass balance approach promotes circularity due to a lack of standardization and overly complicated systems has made it complicated to ensure that renewables are being used.
Can the blockchain help us prove sourced materials are really circular and certified sustainable?
The mass balance approach alone promotes recycled/renewable material accountability. However, blockchain technology aids with the certification of sustainable material uses, mass balance principles and trust/visibility due to its decentralized nature and immutability.
What is circularity and why is it so important in the chemical industry?
Whilst climate change, waste and pollution are purely environmental issues; a circular economy aims to benefit business, society and the environment as a whole; splitting growth from the consumption of finite resources.
How a circular economy can reduce greenhouse gas emissions:
● Extending the lifespan of existing materials.
● Reducing waste.
● Boosting economic growth.
Pressure from The UN’s Sustainable Development Goals (SDGs) has resulted in companies exploring methods of waste and carbon reduction via loop-closing
environmentally friendly materials. Chemical companies are adopting circular economy business models in collaboration with universities and startups, accelerating circularity.
What’s the catch?
Many chemical businesses site expense as a primary concern. A result of challenges posed from such a dramatic shift. Already tight profit margins would be squeezed further, as every aspect of production would have to be altered.
Other factors ‘out of the hands’ of any one chemical business include a dependency on appropriate recycling/emissions-capture facilities, as well as the nature of the product itself.
How can we ease the transition to circularity? Mass Balance
The mass balance approach is one of five common Chain of Custody Models (COCs), developed to incentivize the adoption of recycled feedstock, while easing the strain on profit margins.
Essentially, the Mass Balance model mixes used materials with specified characteristics with other materials without the same characteristics, resulting in output proportional to the input.
The purpose is to allow chemical manufacturers to gradually phase out fossil materials for more environmentally friendly alternatives.
Independent audits throughout the transition check the origin and quantity of renewable feedstock, enabling certification.
What are the benefits?
An estimation must firstly be made as to the amount of waste generated by any one business. The quantity calculated is based on inputs, outputs and stock levels. A key benefit is how easily the calculations can be made, so long as the data is provided in common units.
Other benefits include:
● Ease of implementation and the negation of new factories/plants. ● The Mass balance approach benefits from genuine CO2 emission savings. ● An assurance that the new materials are of an equal quality.
● The data required is available through national statistics and invoices, amongst others.
Is this all just greenwashing?
Although one of the key features of the mass balance approach is to allow traceability, it struggles to deal with the demand for proof, due to;
Lack of standardization:
The fact that there is no requirement for segregation machinery allows organizations flexibility in the amount of renewable feedstock reported throughout the process.
Lack of digitalization:
As most of the processes used for mass balance have been developed in house, they are open to errors, and are cumbersome.
Said systems were not designed to be scaled and implemented throughout the supply chain, leading to issues with confidentiality and security
Traceability challenges:
The mass balance approach doesn’t track chemicals themselves, rather volumes in and volumes out.
Can new technologies be leveraged to ensure reliability, efficiency and transparency? BLOCKCHAIN TECHNOLOGY POWERING MASS BALANCE But what is blockchain?
Blockchain is a digital database that records all transactions.
Blockchain uniquely links (or chains) new transactions to the previous one, making tamper and falsification impossible.
What are the benefits of a blockchain-based COC for chemical businesses? Increased traceability with tokens:
Tokens are a way to digitalize a physical asset. As a physical product moves the token will move along with it. Each transaction or mineral is attached to the previous, making the process completely tamper-proof, visible and traceable.
Transparency through decentralization and distribution type:
The decentralized nature of blockchain means that all participants have the same control, and power over the data.
The distribution of data is shared with all participants identically, synchronized in real-time. In the case of the chemical industry members have full transparency across the entire supply chain.
Smart contracts eradicate greenwashing:
Smart contracts are digital contracts that self-execute under specific conditions, mutually agreed upon by participants.
Smart contracts limit the risk of double accounting. Suppliers in the chemical industry would not be able to claim a specific amount of renewable feedstock different to records previously registered.
Learn more about implementing the mass balance approach through blockchain here!
Be sure to follow FinbootTech on Twitter and LinkedIn for updates on new technology promoting transparent circularity in the chemical industry.
In the past year and a half, the global COVID-19 pandemic put a stress test on many industries like never before. Digital transformation has been underway for quite some time, particularly in the food industry, but certainly skyrocketed during a period of lockdowns and consumer shift.
The impact of consumer behaviour
In response to the growing consumer demand, suppliers and manufacturers are starting to follow ethical and sustainable practices. The demand for organic food has been increasing in recent years, mainly due to health benefits. Other factors such as an improved distribution chain and increased consumer income has led to this growth. Moreover, the onset of the pandemic has given the organic food industry a significant boost. A global health crisis not only puts a spotlight on consumer health, it has increased the accessibility to online delivery platforms.
Much more than that, the food industry has long been plagued with issues such as wastage, unethical agricultural and labour practices and corruption. As national conversations shed light on these issues, consumers are now demanding more from their suppliers than just food.
From here, we find a rise in regulations, with more on the horizon, for ensuring that the industry is held to a societal standard. Along with safety precautions being a key area of focus, a reduced workforce also poses challenges in production and management.
New systems and business models have to be put in place to ensure continuity and survival of food suppliers under the watchful eyes of consumers and the law. Many key players in manufacturing have also established a set of sustainable goals to work towards a better future. This brings about the question: in this new environment, what’s keeping businesses accountable and close to their goals?
Digital transformation in the food industry
Across the globe, digitisation accelerated seven years faster than predicted before. B2B and B2C businesses were ramping up their digital operations and pivoting to online channels faster than ever. The food industry was not spared from this tremendous upheaval. From working on sustainable sourcing and farming, to implementing digital tools and ensuring that all stakeholders are better connected, this change of mind came as a result of a large paradigm shift in the food industry.
The implementation of technology and digital tools for improving traceability and positively impacted efficiency in the food supply chain. Much of these operations, like safety control, are traditionally conducted manually and prone to human error. By digitising the manufacturing process, the food industry is able to leverage digital means such as machinery or ‘digital product passports’ to validate food safety and ESG compliance. For one, digital product passports include all the information about the components of a product and additional information, enabling long-term control and transparency in production.
Leveraging on new concepts and digital tools, the food industry can lower instances of food fraud, boost operational efficiency and scalability, and stick to ESG objectives.
Realising value and building trust through blockchain
It is time that the burgeoning food industry takes the steps towards sustainable agriculture, reducing carbon footprint and its impact on the environment. The pressure on the industry, from regulators and society, highlights a need for initiative and building trust between supplier and consumer. As the demand for transparency increases, enterprises need to have tangible and reliable proof of an ethical supply chain.
By using blockchain-powered solutions to back their operations, food manufacturers can map and trace data on their supply chain, and provide this data whenever they are required to. At its core, blockchain technology greatly improves supply chain management by centralizing the flow of data and enhancing traceability on a secure network.
Otherwise known as the “trust platform”, it uses a shared ledger to provide a single source of truth that cannot be duplicated or edited elsewhere. Especially when it involves a large number of parties, blockchain essentially streamlines the food supply chain and uses data-backed evidence to build trust.
Amidst a paradigm shift in the food industry, there are new opportunities to tap into to improve the industry and its macro-environment. With new technologies such as blockchain, agricultural suppliers now have a highly-scalable, cost-efficient solution to enhance their supply chain.
Finboot is a world-class blockchain application for enterprises to boost transparency and traceability, bringing value to consumers and stakeholders. By providing corporations with a reliable source of data, Finboot can bring real-time results and evidence for companies to verify and be accountable to their sustainable goals and future-proof them against an increasingly digital world.
To truly make the transition to a low carbon economy enterprises must change their operations, helped in part by setting and implementing goals around ESG to not only minimize risk but also create business value. There is a strong business case for investment in sustainability practices and it is now expected for investors, consumers, and employees.
However, ESG goals are only meaningful both to the individual company and to the global effort to move to net zero if they are backed by data from the outset and they can be reported on consistently over time. Not only by the leading companies, but the majority of companies. Not only in their immediate operations, but through their entire supply chain.
If a company wishes to implement ESG goals, it must consider its approach to data, tools and transparency as enablers that will work for them, that can extend through their supply chain, and that will work today and tomorrow.
Data first
More often that we’d like, companies set goals before knowing the details of what can they deliver and what would be aligned with their business strategy. To determine what goals to set, the company can draw a Venn Diagram of Climate Impacts: assess its operations broadly and decide what parts of its operations it can control change; where is it required to manage change; and which parts are important to change.
We know the latter from the IPCC reports, what we need to do to move to a climate friendly world. Clean energy and energy efficiency in manufacturing, inputs production and transportation; methane reduction in food systems and in fossil fuel use; waste reduction and circular value chains are important priorities aimed at getting after the most egregious GHG, methane, and then going for reducing carbon dioxide emissions, embedded carbon, or carbon generation through habitat change.
When areas are decided, don’t jump into collecting data, create your own approach or strategy. Take a step back and think ten years out. How will ESG data support your business growth and what data will you need then. One of the biggest insights in recent years is that ESG isn’t just about removing risk, it is about an opportunity to create business value, whether through building a new business that thrives on demand for renewable energy, or developing regenerative agriculture processes that both yield crops at the same time as tourism benefits, or creating product offerings to meet consumer demand for sustainability.
Over time, this link is likely to get stronger. So, build a data system that allows you to integrate your ESG data. And develop a data strategy or approach to integrating your data in a system that allows simple management, insight development from, and reporting based on the data.
Then figure out your tools. Use tools that are going to help you today and tomorrow. Like capital investments, data systems are hard to switch out, becoming ingrained in company culture and therefore are durable investments. Separate, arcane systems of data management on environmental or social compliance, relying on excels or pdfs in disparate computers or even information filled in on paper, won’t allow you you benefit from the ESG business opportunities and will severly hamper your reporting requirements. For companies early in this transition, there is a huge opportunity to leapfrog by thinking through your data strategy and tools. Investing in data tools and tech to collect and store the data will enable companies to accurately record and report on progress towards achieving their goals.
Try to make those tools fit for the increased transparency and responsibility requirements coming our way. Companies need to give consideration to how they implement systems that can be used across supply chains. Many farmers, mill managers, or factory leaders don’t have the digital capability or the tools today to enable big brands to report meaningfully and accurately on their supply chain. Yet investors are requiring insights into operations and banks are including reporting requirements as part of the terms of their loans. With the European Supply Chain Due Diligence Directive proposal adopted in February this year and the requirement of compliance with human rights and environmental standards, so are regulators.
Investors don’t want to lose big money due to ESG risk, so if companies can’t show their operations comply, they may be divested off. Soon, when we figure out how to leverage the growing interest – not just in word but in action now – of consumers in sustainable products, those with data systems that can allow insight into key ESG criteria will be able to catch the attention of consumers.
At the same time, there is significant distrust in the data by regulators, banks and investors, according to PwC. But here, emergcing tech like Blockchain can be part of the solution. Don’t think this is too new or too complicated. It’s a data repository with excellent functions. Digital acceleration and Blockchain specifically will be key in enabling data collection at all levels in the supply chain and in doing so, driving accountability. Investing in technology not only helps reduce emissions at a company level, but it also offers a trusted, traceable and reliable way to record and monitor data.
Don’t let perfection be the enemy of the good. While there are legitimate concerns over data now, if we can quickly amass data in tools that allow comparability quickly, over time we can see outliers and data collection can be improved across the entire supply chain. It will also allow us to standardize our data, so they can be comparable both over time and across a sector or sectors.
Eventually this information rolls up into the IPCCs accounting. Have we increased or decreased the amount of GHGs in the air. Governments are tracking this and they are relying upon corporates to track it, including in their supply chain. To minimize double counting, Article 6.2 of the IPCC report creates ITMOs. Many today are pushing for these transactions to be made on B lockchain (e.g., Blockchain for Climate Change).
Setting a precedent
At the same time, shining a light on supply chain practices and company operations leaves fewer places to hide for those companies doing more harm than good. Reliable data will not only offer a true and accurate reflection of a company’s practices, but it also sifts out those involved in greenwashing and jumping on the sustainability bandwagon as a marketing tool.
Over time, exposure, expectations and universally accepted standards will force high standards and qualities – which can only be a good thing.
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