Blockchain and AI to Support ESG Agenda: Latest Trends & Use-Cases

AI usage must balance optimization benefits against computational/energy costs to avoid pyrrhic victories when addressing ESG goals

Standards and regulations like the EU AI Act will be crucial for high-risk AI systems, requiring conformity assessments similar to KYC processes (“KYAI”)

Decentralized energy markets and peer-to-peer trading enable local renewable energy sharing, providing both environmental and social benefits while reducing grid congestion

Combining blockchain and AI can help address greenwashing through improved tracking, verification and reporting of ESG metrics and claims

Current ESG rating standards face challenges with inconsistency and detachment from real-world impacts - AI and blockchain could help standardize and validate reporting

The growing compute demands of AI represent a major energy challenge that requires innovative solutions like distributed compute networks and efficiency optimization

Public-private partnerships and industry collaboration are essential for developing effective standards and regulations around AI/blockchain sustainability

Blockchain provides transparency and permanent record-keeping while AI offers analytical capabilities - these complementary technologies can enhance ESG initiatives

Localization and regional context matter for ESG standards implementation - requirements may vary between developed and developing markets

Data availability and standardization remain key challenges - incentive systems and reputation frameworks could help drive better data sharing and verification