IPI leads companies tracking sustainable actions on blockchain
A new blockchain-based register is tracking business actions with positive carbon, water, soil, biodiversity and socio-economic impacts.
Nespresso France has become the first company to record its climate-positive actions on a new blockchain-based register. The coffee brand had its Agroforestry Insetting Program certified last year by Ecocert, and listed on the blockchain registry of the International Platform for Insetting (IPI), which supports companies to share positive social and environmental impacts with shareholders.
‘Insetting’ describes the actions taken by an organisation to fight climate change within its own value chain in a manner which generates multiple social, environmental and economic benefits, and also contributes directly to the business model. This means, for example, planting trees in agroforestry models, generating positive impacts on the wider ecosystem, such as enriching soils, managing the water cycle, and protecting biodiversity. Delivering a premium agricultural ingredient in stable quantity depends on a rich and resilient ecosystem. Trees not only protect crops, but help to diversify revenues, through timber, fruit and medicine.
A group of companies committed to ‘insetting’ has now invested in a common platform, the International Platform for Insetting (IPI), involving various NGOs, project developers, certification bodies and impact funds. The IPI has developed a standard to allow the certification of insetting practices, and a blockchain registry to track the engagements, claims and actual impacts generated by insetting projects. IPI members, including AccorHotels, Chanel, Kering, Guerlain, L’Oreal, Nespresso and Parex, share the vision that Insetting is a key lever to shift climate action from a niche to a mainstream practice, due to its integration with the business model.
The blockchain registry allows the members of IPI to record their claims and track their impacts in a permanent, transparent and decentralised way. The IPI registers the certificate, its content and its date: once recorded, there is no possibility to change or add anything in the future. This ‘sets in stone’ the engagements and claims of companies. A second version of the blockchain registry, currently under development, will allow all stakeholders engaged in an insetting project (the funder, the developer, operator and even the beneficiaires) to sign the registration of the certificate with an encrypted key, making the claim and all related records traceable by all involved.
The initiative shows the potential of blockchain as a project transparency tool, recording both sources of funding and impact. It connects stakeholders to the impacts of a company’s activities on water, soil, biodiversity, socio-economic development, and other measurables.
Existing carbon registries managed by banks can only record the carbon benefit and are quite costly and rigid. The blockchain registry opens new perspectives on valuing in a transparent and permanent way, at negligible cost, the multiple impacts generated. Further than that, it can be used to provide transparency on supply chains and soon even to transfer funds directly from donors to Insetting projects without using banks or financial institutions. The perspective is that we can “Uberise” climate, environmental and social projects in the near future.
“To fight climate change and engage all companies, we need to develop such integrated climate standards and use new technologies to track their commitments. This is key for the public to trust and praise companies’ engagements and in turn, for companies to invest massively in climate integrated projects, because they will benefit from it and be rewarded for it,” says Arnaud Deschamps, CEO of Nespresso France. The vision of IPI members is to ultimately reconcile companies with the ecosystem they depend upon.
To find out more, visit www.insettingplatform.com
— By Tristan Lecomte
Tristan Lecomte is co-founder and president of Pur Projet, a partner of IPI.
This article was first published on the Futures Centre on 6 Mar 2017.