Food is at the heart of our lives. Yet, our food system is not in great shape. We have exorbitant waste levels, production is damaging our resources and today’s food makes people heavy instead of healthy. Trucost, part of the S&P market intelligence, shows that industrialised farming causes a $3 trillion environmental impact each year4. Our food system is slow in adopting solutions to mitigate these challenges. Food is the least digitised industry of all. We lose billions each year just because of that, because we do not have a reliable data infrastructure.
ESG and Agriculture
ESG, one of the current labels for sustainability, has been part and parcel of agriculture since its very emergence, hunting and gathering. Yet, supply chains have become so long and complex, with so many players in different jurisdictions, that sustainability superseed a conundrum. Governments aim to ensure food security, food safety and now also ESG by prohibiting deforestation, enforcing laws for supply chain due diligence and for example regulating labour conditions. Additionally, there is a minefield of so-called voluntary standards. More than 500 private ESG certificates cover less than 10% of food, aimed at crops like coffee, tea, cacao and bananas.
For companies, ESG compliance has become very challenging. CSR managers, CFOs, CPOs, CEOs, seek solutions that can help them deal with ESG issues in their supply chains.
What is the role of the internet and AI in ESG compliance
The new internet and AI will bring more trust, transparency and traceability to the entire food system. The new internet (Web3) and Artificial Intelligence (AI) are fundamentally transforming agriculture. The new internet is building a reliable data infrastructure, with verifiable data and data producers as data owners. Think of farmers earning when capturing carbon. AI is making many – unimaginably many – processes easier and better. Think of ESG reporting based on immutable farm management data. Both are critical for the ESG agenda.
ESG on steroids
Technology is key for getting results on the ESG agenda. The new internet, renowned for its secure and immutable nature, is revolutionising supply chain management. Its decentralised ledger systems ensure that every step, from planting to buying, can be recorded transparently and verifiably. This enhances accountability, mitigates risks of fraud and foodborne illnesses and strengthens the position of producers and consumers. However, the most important impact of Web3 (Blockchain) on ESG is supply chain optimisation. There is ample proof that Web3 will reduce operational costs.
Synergies between Web3 and AI amplify positive impact on ESG goals. With transparency promoting fair practices and accountable resource management, and AI’s data-driven insights fostering sustainable farming practices, the agriculture sector moves closer to achieving ambitious ESG targets.
Open Food Chainís Pioneering Solutions
Open Food Chain (OFC) is on a mission to transform our food system. Globally, we lose over €2,5 trillion per year in supply chains, due to a lack of a solid data infrastructure. Recognising the potential of Blockchain and AI, OFC offers an affordable infrastructure for the entire agrifood supply chain to report and manage ESG claims. The platform guarantees end-to-end data traceability, ensuring supply chain efficiency, consumer trust, and the possibility to back up ESG claims. OFC’s emphasis on reliable data is a game-changer for ESG compliance.
OFC’s platform is an industry-owned public infrastructure that streamlines the compliance process. Every participant can instantly and automatically publish ESG claims related to batches, eliminating the need for traditional communication methods like emails and calls. Moreover, OFC’s digital infrastructure is compatible with emerging technologies like AI, quantum computing and tokenisation, ensuring that businesses remain at the forefront of innovation. As food is 10% of our economy, we are on a mission to save the world 250 billion a year.
