
We’re entering a world where businesses aren’t measured solely by their profits, but also by their impact on the planet.
And, in fact, a company’s environmental policies can result in higher profits. A recent study from McKinsey and NielsenIQ shows that companies selling products claiming to comply with ESG (environmental, social, and governance) standards have experienced an uptick in sales, with an average 28% growth compared to 20% growth for products that didn’t.
Moreover, an increasing number of people are interested in supporting ethical, environmentally-conscious brands. Research from Elopak showed that 75% of UK consumers considered a company’s environmental commitments important when shopping.
I know I definitely fall into this category.
But how can we be sure that a company is as good as it claims to be? The term “greenwashing” is getting thrown around quite a bit, making it hard to know who to trust. Especially considering that companies profit significantly more when making these claims, it’s even more important for consumers to know if they’re true or not. For example, in Germany, only 20% of people believe the claims companies make about their environmental or sustainability initiatives.
That’s why ESG and blockchain reporting have been creeping to the top of technology agendas for a while now. But what exactly do these terms mean and why should they matter to you?
Where we’re headed…
In short, it’s where cutting-edge technology meets the pressing need for corporate responsibility. In this article, we’ll explore what ESG reporting means, how blockchain can aid ESG reporting, and delve into how it coincides with existing and emerging governmental policies.
Table of Contents
- A Primer on ESG Reporting
- Blockchain & ESG Reporting
- EU Policies on ESG Reporting
- ESG & Blockchain Case Studies
- Conclusion
A Primer on ESG Reporting
As I mentioned, ESG reporting is meant to define the company’s good deeds beyond its profits. The main pillars of ESG reporting are in the name: environmental, social, and (corporate) governance.
Let’s start with environmental reporting, as it may be the most obvious pillar. As climate change remains front of mind for many consumers, they want assurance that companies care about it as much as they do. This pertains to things such as amount of emissions a company produces, use of recycled materials, or its responsible water and land use.
Next up is the social aspect of ESG. This relates to labour within supply chains, safe working conditions, and inclusivity. One really good example of this is when companies can genuinely report that their supply chains are free from modern slavery practices.
Lastly, we have (corporate) governance. This pertains to the way a company is run and how stakeholders are treated. Deloitte uses the example of whether executives’ pay is aligned with the company’s sustainability performance and free from corruption.
ESG is increasingly becoming a requirement for all companies. However, it’s also under scrutiny, especially when it comes to corporate greenwashing.
The Corporate Finance Institute defines greenwashing as:
“Greenwashing is when the management team within an organization makes false, unsubstantiated, or outright misleading statements or claims about the sustainability of a product or a service, or even about business operations more broadly. Some greenwashing is unintentional, due to a lack of knowledge or understanding on the part of management, but sometimes greenwashing is also carried out intentionally through marketing efforts.”
In theory, ESG reporting requirements are meant to eliminate instances of greenwashing, but a lot of oversight and auditing needs to take place to hold companies accountable.

Blockchain & ESG Reporting
Now, imagine a world where every transaction, every supply chain link, every carbon emission is transparent, traceable, and accountable. That’s exactly what blockchain brings to the table.
Through allowing automated reporting and providing immutability, companies can lean on blockchain to be more collaborative, honest, and straightforward so consumers know they can trust them.
mintBlue CEO Niels van den Bergh puts it this way:
“At present, each organization works in a silo and needs to maintain its records. This is what consumers distrust, as the respective companies can alter their data whenever they are inspected. Publishing encrypted records on the blockchain proves you stand in for the data, as it is secured and cannot be altered once written.”
This is more important than ever, as PwC reports that consumers and executives have very misaligned views on ESG investment. Through integrating blockchain, it can help consumers feel more confident in businesses doing the work behind the scenes.

When companies use blockchain for ESG reporting, they also don’t have to worry as much about the different aspects, such as collecting and publishing data within a certain timeframe. Humans don’t have to be involved at all, which will save time, money, and give peace of mind. And, in my opinion, when a company is forward-thinking and transparent with their impact, they’re far more trustworthy.

EU Policies on ESG Reporting
Now, not all companies are going to want to take that approach. That’s why governments are actively trying to increase ESG reporting and compel companies to be transparent. Specifically, the EU is setting the tone for what’s to come with mandatory ESG reporting and ambitious sustainability agendas.
There are several EU policies that help guide ESG standards and establish frameworks. I’ll cover a list of them here, starting with some of the most general policies down to more specific ones. My goal is to make this as digestible as possible and highlight how blockchain can be a major player in this space.
Corporate Sustainability Due Diligence Directive (CSDDD)
Governed by the European Commission, this new directive aims to “enhance the protection of the environment and human rights in the EU and globally”. It requires businesses to assess and address their environmental and human rights impacts, ensuring business models are compatible with the Paris Agreement. There are penalties for companies who choose not to comply.
Sustainable Finance Disclosure Regulation (SFDR)
This regulation mandates companies provide disclosure when selling finance products that are marketed as sustainable. An example of this would be if an investor wanted to invest in a green bond fund: The financial institution that is selling it must provide clear disclosures about the sustainability aspects of the investment. The institution must also highlight any environmental risks and allow access to up-to-date sustainable reporting.
Corporate Sustainability Reporting Directive (CSRD)
This directive builds on existing frameworks and requires companies to report on sustainability performance. It’s a major step forward when it comes to the EU’s ESG policies. So big in fact, that I’ve dedicated an entire separate article to go through what it means in more detail.
EU Taxonomy
This system has been set up to help facilitate informed sustainable investment decisions and combat corporate greenwashing. This means that large corporations can align bonds to the EU Taxonomy criteria to help attract investors who are prioritising sustainable investments.
Fit for 55 package
Part of the EU’s efforts to achieve its emissions targets, this package is a set of proposals aimed at reducing greenhouse gas emissions by 55% by 2030. There’s a lot in this, and it covers everything from renewable energy, to energy efficiency, to imposing a carbon price on certain imports. It also includes measures to decarbonise the transportation sector.
EU Green Claims Directive
This directive sets out rules to prevent greenwashing in marketing and advertising. It’s there to ensure accuracy and transparency when businesses make environmental claims.
EU regulation on deforestation-free products
This regulation aims to prevent products that are associated with deforestation from being imported into the EU and is part of a wider sustainable supply chain effort.
Revision of EU legislation on packaging and packaging waste
This is an effort to revise EU legislation and promote a circular economy through stricter packaging and waste regulations. Germany leads the way in this regulation with its VerpackG, which requires businesses to take responsibility and share disposal costs. The goal is to ensure packaging waste is reduced and the burden doesn’t fall solely on consumers.
Through all of these ESG policies and regulations, blockchain can provide the transparency, accountability, and immutability to ensure companies comply with these regulations.
Blockchain holds the potential for large corporations to be held to a high standard in the era of ESG reporting. With it, there are no backdoors, no fudging numbers, and no opportunities for greenwashing to take place.
And, by embracing blockchain, companies can signal to consumers that they are open and honest about their transactions and can really put their money where their mouth is.
ESG & Blockchain Case Studies
Plenty of companies have jumped on board and used blockchain to be transparent about sustainability initiatives. Below are a few examples of what using blockchain and ESG looks like in practice.
IBM Food Trust
The thinking behind this initiative is that most food is often available to consumers in the West, regardless of whether it’s in season or grown locally. To help build more trust in the industry and increase consumer trust on where their food comes from, the IBM Food Trust integrated blockchain technology.
“The solution provides authorised users with immediate access to actionable food supply chain data – from farm to store and ultimately the consumer. The complete history and current location of any food item along with its accompanying information (i.e. certifications, test data, temperature data) can be readily available in seconds.” – IBM Food Trust
FarmShare
Along the same lines, this is a new version of community-supported agriculture that uses blockchain to foster communities and connects farmers directly to consumers. Blockchain enables produce to be tracked from farm to table and ensures payment through smart contracts. Through eliminating several “middle men,” if you will, farmers can grow their relationship with consumers, while also ensuring everything is traceable and fair. Consumers can use FarmShare tokens that represent shares of a harvested crop.
“Farmshare utilizes blockchain currency to buy, sell and trade cryptographic tokens that can be exchanged for weekly deliveries of locally-produced organic food. The project is an evolution of the CSA model that has been around for decades, which takes advantage of the blockchain’s potential for creating new forms of community property ownership, collaborative labour relationships, and locally-oriented alternative economics.”
CoffeeChain
This is a company that has utilised blockchain technology in the coffee industry. It allows transparent tracking of beans, ensures fair trade, and verifies sustainability practices. It uses Carbon Credit Tokens, tokens that are backed by a regulated carbon credit, for investors to buy and sell ownership in the business.
“We believe that consumers are becoming more concerned about the ethical and environmental impact of their purchases, and we believe that blockchain technology can help. Coffee shops, roasters, and consumers can all rest easy knowing exactly where their coffee comes from, how it was grown, and that farmers are adequately taken care of.”
CarbonX
CarbonX created a Zerofootprint programme that helps collect and analyse the carbon impact for businesses. It then balances the carbon emissions with offsets in a transparent way. If a business sets and achieves targets, they are awarded a Zerofootprint Certificate of Carbon Neutrality, signaling their environmental standards to consumers.
Blockchain’s Real-World Impact
The benefit of highlighting these case studies is two-fold. Not only do they highlight the amazing work that’s already taking place when it comes to integrating blockchain into ESG reporting, but they also offer a blueprint for future companies looking to do the same. These examples demonstrate how blockchain technology enhances transparency, traceability, and accountability in various sectors.
Blockchain’s inherent qualities make it uniquely placed to aid companies in navigating this space. Its decentralised and immutable characteristic means that it can help companies maintain accurate records, adhere to social responsibility initiatives, and conduct business with integrity.
As I’ve alluded to above, regulatory pressures are growing — there are many policies already out there, and likely to be several more over the coming years. It’s therefore crucial for businesses to embrace forward-thinking approaches to ESG reporting.
The best way for organisations to keep their finger on the pulse and ensure they are compliant and future-focused is to take the innovative approach of harnessing blockchain to navigate the ever-growing complexities.
Conclusion
It’s no doubt an exciting time for blockchain and ESG reporting. The two compliment each other well: ESG reporting requires trust and transparency, and blockchain can offer just that.
However, integrating blockchain isn’t without its difficulties. When asked what the biggest challenges were when it comes to implementing blockchain technology, 600 executives said that it was uncertain regulations and lack of trust among users.

While awareness about blockchain is still growing, much of the audience is still quite niche. It’s essential that governments work closely with the private sector to understand the main pain points of integrating blockchain so regulations don’t feel out of touch and thus disincentivise uptake.
However, I also believe that while blockchain still remains an abstract topic for some, ESG reporting could be the way to get many outsiders interested in what the technology has to offer. Relating blockchain to ESG is a surefire way to make the topic more relatable and digestible. At least that was the case for me.
Blockchain and ESG reporting will only become more and more integrated and it’s important for businesses and government to see it as a key player to achieve the best outcomes. Hopefully, through greater transparency and innovation, we can build more sustainable practices for the future together.