The potential of digital technology in supporting and even transforming the global sustainability transition has been long recognized but still under-exploited, especially in the climate mitigation and adaptation fields. From June 2nd to 4th, the Bank of International Settlements (BIS) hosted the 2021 Green Swan Conference, one of the most prominent global meetings coordinating the finance industry to address the pressing challenges from climate change and other environmental issues.
Dr. Long Chen represented Luohan Academy on a panel led by Dr. Benoît Cœuré, BIS Head of Innovation Hub and former Executive Board Member of the European Central Bank (ECB). The panel centered on consumer empowerment through carbon tracing, consumer incentives and the role of digital technologies in tackling these challenges. Dr. Cœuré's own efforts at BIS include Project Genesis, a pilot to tokenize green bonds and allow those new investors transparency in monitoring the results of the underlying green projects.
The panelists agreed that gathering and harmonizing carbon measures is a critical first step that presents immense challenges. Massamba Thioye of the UNFCCC detailed the complexities in measuring carbon footprint, in harmonizing multiple standards, in creating incentives and empowerment for consumers, and in coordination across diverse value chains. Brune Poirson of France's La République En Marche! shared experiences of the difficulty of arriving at common measuring standards without displeasing constituencies.
Dr. Chen presented the view from private industry on technology's real-world potential to help with these problems. As the Ant Group's Chief Strategy Officer in 2016, he was personally involved in the launch of Alipay Ant Forest program. Alipay customers using the program earn "green energy" for low-carbon activities which accumulate towards the planting of real trees across China. By demonstrating to the panel Ant Forest running on his own phone to show the program in action, he explained how Ant Forest succeeded through gamifications, being intuitive to consumers, offering a "game" interface with clear measures and rewards. It also could leverage a user's friends to socialize the carbon emission reduction efforts. These features created a powerful ecosystem of 550+ million users and institutional partners, showing the unique scalability of well-designed digital tools. Learning from this success, attempts have been made to replicate these experiences recently and over a dozen similar projects have been initiated in major urban centers around China.
This example of positive incentives for consumers, compared to the usual taxes and prohibitions, was well received. Dr. Chen emphasized other examples of technology's role in carbon-reducing efficiencies including:
· Idle Fish, a new e-commerce platform that trades second hand goods.
· Cloud computing that allow more companies to optimize their data storage and processing.
· Smarter routing that reduces inefficiencies in logistics and supply chains.
After several rounds of discussion, the panel concluded with some key areas of consensus. First, consistently and transparently measuring carbon footprints is critical. Second, consumers and citizens are a key component of any climate solutions and allowing them measures and incentives for better choices is important. Third, digital technologies have a key role in implementing those measures and incentives in a scalable way. And finally, digital data will grow in daily life and being able to coordinate and share this data among many different players will be vital. Addressing these areas hold great promise for meeting the world's climate goals but will require immense global coordination and effort.
In a follow-up communication, Prof. Patrick Bolton, a co-organizer of GreenSwan and an academic committee member of the Luohan Academy, strongly echoed "the importance of design in using digital technology to get better measurement of carbon footprints".