As organizations come under pressure to ramp up climate change policies, accounting giant KPMG has launched a new blockchain-based solution.
International accounting firm KPMG has unveiled its blockchain based Climate Accounting Infrastructure (CAI) solution to help organizations measure, report, and offset their greenhouse gas emissions.
CAI uses blockchain to securely store environmental data in a financial system as part of organizations’ climate risk assessments and asset valuations. It aims to help companies meet environmental, social, and corporate governance (ESG) targets.
The solution integrates an organization's existing systems, including IoT sensors, with external data sources to establish a verifiable trail of emissions and offsets recorded on blockchain.
The accounting giant collaborated with data provenance and tracking providers Context Labs and Prescriptive Data, and blockchain firm Allinfra, on the product. Context Labs enriches emissions data provided by organizations with environmental context, before recording and certifying environmental, operational, and financial information.
According to KPMG’s U.S. blockchain leader Arun Ghosh the use of blockchain means data reports will be disclosed in a transparent and trustworthy manner in order “to meet stakeholder expectations and to comply with emerging regulations.”
“As investors broaden their focus beyond financial factors to include ESG practices, organizations are increasing efforts to reducing carbon footprints, alongside transparent disclosure of progress.”
Organizations will also be able to model the impact of climate risks on business operations and financial performance through real-time environmental data and advanced analytics.
Earlier this year, KPMG predicted that blockchain, in conjunction with Internet-of-Things (IoT), would lead the development of neclimate change solutions around the world.
Other large corporations are also exploring how blockchain can improve reporting capabilities of solutions that track greenhouse gas emissions. Earlier this year, Mercedes-Benz partnered with blockchain startup Circulor to track CO2 emissions. Volvo has also partnered with the startup to develop its own project, tackling the same problem.
Carbonblock has also developed a solution to increase transparency of climate related factors in the Porsche supply chain .