South Korean auto giant Hyundai Motor Group is taking significant strides in tackling global climate change concerns by harnessing the power of blockchain technology.
Tracking carbon emissions
The SCEMS is designed to record and manage carbon footprints at every stage of the manufacturing process, starting from the extraction of raw materials to the production and delivery of parts and vehicles. This comprehensive approach allows Hyundai and Kia to gain better control over their carbon reduction initiatives.
The urgency of addressing climate change has made it essential for organizations of all sizes to manage and decrease their carbon emissions. However, calculating carbon footprints requires an understanding of complex standards and intricate mathematical processes.
Supply chain
To address these challenges, Hyundai Motor and Kia are providing the SCEMS to hundreds of their suppliers free of charge, offering them the necessary tools to effectively curb carbon emissions. The SCEMS employs artificial intelligence modeling, which automatically computes carbon emissions and predicts future projections as suppliers from various industries input their data into the system.
Previously, these suppliers had to rely on external experts to perform such calculations. By adopting Hyundai’s new system, suppliers can now independently set their carbon reduction goals and efficiently manage their activities, thereby cutting costs and enhancing their competencies.
Incorporating blockchain
Moreover, Hyundai Motor and Kia anticipate that the incorporation of blockchain technology into their operations will bolster the reliability of their data, increasing their credibility among global evaluators of environmental, social, and governance (ESG) management.
A Hyundai official emphasized that the scope of eco-friendly products now encompasses their entire lifecycles and supply chains. The company aims to lead the charge in building a sustainable and green supply chain.
In line with this commitment, Hyundai Motor and Kia in February joined the Carbon Disclosure Project’s (CDP) Supply Chain Program, a nonprofit organization that oversees a global disclosure system for investors, companies, and regions to manage their environmental impacts. As part of this initiative, the Hyundai affiliates have also provided education to their suppliers to aid them in achieving carbon neutrality.
Under the CDP’s Supply Chain Program, Hyundai affiliates’ suppliers need to submit data on energy consumption and greenhouse gas emissions, along with carbon neutrality strategies, sustainability objectives, and renewable energy transition plans to the nonprofit organization.