The power couple of ESG reporting

As a trio of trends, blockchain, cloud services and ESG couldn’t be more topical. The promise of blockchain’s traceability and the cloud’s connected IT ecosystem to achieve efficiencies is enticing to companies seeking sustainability.

But how are blockchain, cloud and ESG connected, and where should companies invest to capture value?

The building block of ESG frameworks is reporting. Without accurate data collection and consistent reporting, it is impossible to make progress on ESG targets or gain trust in sustainability claims. An emerging technology to capture these data points is blockchain. Blockchain creates traceable ‘tokens’ that can contain information gathered without human interaction - or interference. This chain of automated data collection makes blockchain a reliable, tamperproof source of ESG measurements. 

Blockchain alone cannot achieve sustainability and must be incorporated into the IT ecosystem through technologies such as cloud-based service SD-WAN. Enabling an ecosystem of technologies to achieve sustainability, SD-WAN ensures a consistent, reliable network at all times and enables the information gathered from blockchain tokens to flow without interruption. The same can also be said for sustainability-enabling technologies such as IoT, which, without SD-WAN, could not operate as efficiently or securely. 

Using a decentralised network, blockchain relies on cloud services to capture and share the information contained within the tokens.¹ This token contains a wealth of information about each transaction along the purchase chain and, from a sustainability perspective, means that suppliers can be monitored to ensure each one meets the same ESG standards as the enterprise purchaser.

Where cloud services come in is the storage of information contained in these tokens and associated data, such as cryptocurrency transactions. Though some providers offer blockchain cloud services as a combined product, enterprise-scale blockchain users often combine it with existing IT services, particularly to gain the increased cyber security benefit of having all IT services with one provider.

If the IT infrastructure provider integrates cyber security tightly with cloud and network services, blockchain can be included without adding security risk to the network as a whole. Since blockchain providers aren't cyber security specialists, they cannot guarantee data protection, which presents an untenable risk.

Storing blockchain data in a secure cloud is one piece of the corporate governance puzzle. This kind of security allows ambitious IT leaders to explore new technologies while protecting critical assets and adhering to governance frameworks. 

ESG describes a business-wide approach to sustainability, and the associated reporting shows evidence of those achievements. Without the data, sustainability activities cannot be recognised in ESG frameworks, and investors cannot be assured that targets are being met, something that 79% consider an essential factor in investment decision-making.²

This evidence-gathering can be time-consuming and complex, with many disparate data sets and sources needing to be included in the report. Automating the collection and storage of this data is essential to ensuring the data is accurate and reducing the time required to verify its accuracy.

That's why enabling free data flow between information sources can capture key metrics without laborious, manual intervention. SD-WAN, in particular, improves data flow by intelligently managing network traffic and redirecting away from bottlenecks.

Simplifying complexity in data collection and building sustainability are some of the key attributes of blockchain. Combined with cloud platforms' ability to collect, analyse and report on ESG-related data, this combination becomes the gateway to more comprehensive and transparent sustainability reporting. 

With blockchain and cloud, ESG reporting will enter a whole new era and enable more companies to meet sustainability targets. Talk to us about cloud services for your business.