25 January 2023

On 25 January, EIF organised a debate hosted by Roza Thun MEP on the role of Sustainable Digitalisation with a focus on how technology can contribute to environmental goals. The MEP was joined by the following guest speakers:

Federico Menna, Interim Chief Executive Officer, Chief Operations and Finance Officer, EIT Digital
Dr. Katharina Lasota Heller, President of Swiss-Polish Blockchain Association; Founding Partner of LEXcellence–Swiss Law Firm
Phil Brown, VP Business Development & Strategy, Circularise
Shuchi Rana, Global Head of Whitespace Intelligence, ServiceNow

44:14
Sustainable Digitalisation: how technology can contribute to environmental goals

MEP Roza Thun in her opening remark stressed the important role of technology in contributing to environmental goals. Environmental issues will dominate most of the debates at the European Parliament, but also at the Council and Commission. The MEP mentioned the main challenges related to use of less and green energy, and of rare materials. She concluded by highlighting not only the role of sustainable digitalization, but also how environmental goals are crucial for us as well as for future generations.

Federico Menna affirmed that EIT Digital is part of the European Institute of Innovation and Technology. He presented the main findings of the EIT report on green digital technologies that was developed just before the energy crisis. The aim was to understand if digital transformation helps reduce non-green energy use in Europe. According to the report, there is not an agreed framework for measuring and modeling the impact of energy consumption in different sectors. As the consumption of digital technology represents the 10% of total energy consumption, it was recommended to explore how digitalization can improve it in other sectors. Mr. Menna stated that the saving achieved in one domain can be offset by the reuse of energy in other domains. In conclusion, he declared that behaviour is influenced by interventions on taxation and incentives; by applying incentives, behaviour can have an impact on energy consumption.

Dr. Katharina Lasota Heller provided an overview of what blockchain is and the issues related to blockchain and energy consumption. Blockchain is a decentralized database without a central party, where transactions are validated by nodes that have to agree on the transaction through a consensus process. As this process is energy-intensive, blockchain is not an environmental-friendly technology. Moreover, it is done by miners trying to solve a mathematical problem and are rewarded with cryptocurrency. Recognising that there is a change in the technology to minimize energy consumption, she explained the difference between Proof of Work and Proof of Stake. Dr. Lasota Heller emphasized that blockchain technology has many good use cases beyond just cryptocurrency, as it can create an electronic medical data system for patients. She concluded by stressing that technology is neither good nor bad, but it depends on its use.

Phil Brown affirmed that Circularise uses blockchain, but not cryptocurrencies, and explained how blockchain technology can be applied to the circular economy. He discussed the importance of end-to-end traceability and, specifically, how to bring data into a harmonized place. The challenge of traceability is the labor-intensive and reactive nature of current methods, such as email communication with suppliers, and the sensitivity of the data involved. In order to address these challenges, it is possible to use the digital product passports and to create a standardized list of data points entered by each actor in the supply chain. The information is stored on a public blockchain, with smart questioning protecting sensitive information. Additionally, he pointed out that the use of blockchain also enables a more transparent sourcing and chemical composition of materials, making it easier for companies to comply with regulations and reduce supply chain risks. According to him, interoperability represents another challenge, as companies need to communicate from different ends of the supply chain. According to him, with information stored on the blockchain, supply chain managers can get a chain of custody model and understand the specific nodes and data linked to each actor.

Shuchi Rana opened her speech by declaring that ServiceNow tries to simplify the processes of running a business, especially through measuring and monitoring impacts. Technology can be a great tool to run a business in a responsible way and to measure the climate and social impact. Mentioning the ESG management product that ServiceNow developed and used to publish its own sustainability report, Ms. Rana recognised the importance of getting data to analyse all the aspects of a business and calculate the footprint. Furthermore, she affirmed that ‘we cannot change what we cannot measure’. However, the human factor is crucial in adopting and using technology to achieve responsible business practices. According to her, efforts must be intentional in a business, stakeholders must be engaged, and incentives must be aligned. Since we live in an era of great reprioritization, it is pivotal that companies and regulators come together, to guarantee greater security, transparency and efficiency within industries.

 

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