ESG & Sustainability News South Africa

How AI and blockchain can shape sustainability

The convergence of technological advancements such as AI, blockchain technologies, and digital currencies with the global shift towards decentralisation presents a powerful opportunity to drive positive environmental, social, and governance (ESG) impact.
Chris Blair, CEO at 21st Century
Chris Blair, CEO at 21st Century

These innovations, combined with the principles of decentralisation, can revolutionise how businesses approach sustainability and create lasting value for all stakeholders. This article will explore how embracing AI and blockchain technologies can lead to significant advancements in ESG practices, fostering a more sustainable and responsible future.

Artificial intelligence (AI) has the potential to revolutionise ESG practices, enabling companies to analyse vast amounts of data, optimise resource utilisation, and make informed decisions that benefit the environment and society. By leveraging AI-driven algorithms, businesses can identify and address environmental risks, reduce energy consumption, and enhance operational efficiency.

AI-powered predictive analytics can facilitate early detection and mitigation of environmental impacts, enabling companies to proactively address climate change, resource depletion, and pollution. Moreover, AI can support social impact initiatives by enabling organisations to analyse social trends, identify areas of inequality, and develop targeted solutions that uplift marginalised communities.

Image source: Kyryl Gorlov –
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Impact on ESG in agriculture

In Africa, the agriculture sector has witnessed the transformative impact of AI on ESG practices. Companies like FarmDrive, based in Kenya, utilise AI algorithms to assess smallholder farmers' creditworthiness. By analysing various data points such as weather patterns, crop yields, and market prices, FarmDrive enables financial institutions to provide affordable loans to farmers, empowering them economically and promoting sustainable agricultural practices.

In South Africa, the mining industry faces significant environmental and social challenges. However, organisations like Gold Fields, a mining company, have leveraged AI to improve their ESG performance. Gold Fields can track and manage their environmental impact using AI-powered sensors and monitoring systems, ensuring compliance with regulations and minimising harm to local ecosystems.

By incorporating AI into their ESG strategies, companies can enhance transparency, improve decision-making processes, and drive positive social and environmental outcomes.

Blockchain technologies offer a decentralised and transparent framework that can significantly enhance ESG transparency and accountability. Through blockchain-based platforms, companies can track and verify their sustainability efforts, supply chain activities, and adherence to ethical standards.

This level of transparency ensures that ESG claims are backed by verifiable data, building trust among stakeholders and driving responsible business practices. Blockchain can also facilitate supply chain traceability, allowing consumers to make informed choices about the products they purchase. By utilising blockchain, companies can provide:

  • Real-time visibility into their supply chains.
  • Ensuring responsible sourcing.
  • Fair labour practices.
  • Reduced environmental impact.

This transparency fosters consumer trust and empowers them to support businesses that align with their values.

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Sustainable fashion

The fashion industry has witnessed the transformative power of blockchain technologies in promoting ESG transparency. VeChain, a blockchain platform, has partnered with fashion brands like ASOS and H&M to trace and verify the authenticity and sustainability of products. By utilising blockchain, these companies can give consumers real-time visibility into their supply chains, ensuring responsible sourcing, fair labour practices, and reduced environmental impact.

Food journey

In the food industry, IBM Food Trust, a blockchain-based platform, has enabled companies like Walmart and Nestle to enhance traceability and transparency in their supply chains. This technology allows consumers to trace the journey of food products from farm to table, ensuring ethical practices, reducing food waste, and supporting sustainable agriculture.

In Africa, the cocoa industry has embraced blockchain technologies to enhance transparency and accountability in supply chains. Companies like Kuapa Kokoo, a cooperative of cocoa farmers in Ghana, partnered with the blockchain platform Provenance to trace the journey of cocoa beans from farm to consumer. This ensures that ethical and sustainable practices are followed, empowering farmers and providing consumers with assurance about the origin and sustainability of their cocoa products.

Diamond tracing

In South Africa, the diamond industry has utilised blockchain to address ethical sourcing and fair trade concerns. De Beers, a leading diamond company, implemented a blockchain-based platform called Tracr to track the Provenance of diamonds, ensuring responsible mining practices and combating the trade of conflict diamonds. This transparency enhances trust among stakeholders and promotes ethical standards within the industry.”

The next article will explore how digital currencies, particularly decentralised ones, can play a transformative role in promoting sustainable finance and economic inclusion - key aspects of ESG.

About Chris Blair

Chris Blair, Chief Executive Officer of 21st Century Pay Solutions Group (Pty) Ltd, has consulted to over 500 organisations - both in Southern Africa and internationally. Chris holds a BSC Chem. Eng. and MBA in Leadership & Sustainability and is registered as a Chartered Human Resource (CHR) Practitioner with the South African Board for Personnel Practice (SABPP). He is also accredited as a Master Reward Specialist through the South African Reward Association (SARA).

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