Blockchain-based Reporting System for Trust in Environmental Social Governance

Towards growing efforts to promote sustainable business practices, companies are required to publicly disclose their environmental, social, and governance (ESG) key performance indicators (KPIs). However, current reporting formats often lack the transparency and verifiability needed to meet legal requirements and build trust with responsible investors. To address these issues, we leverage blockchain technology, whose inherent properties of immutability and decentralization can foster institution-based trust in the context of ESG reporting and mitigate accusations of greenwashing. Following the design science research method, we conducted two design iterations to develop a system architecture and prototype. These iterations were guided by six design objectives & fifteen design requirements. The blockchain-based ESG KPI reporting system artefact was then evaluated through twelve semi-structured interviews with ESG experts from industry and academia. As a contribution to the theory of trust, we distilled a set of three design principles.