The role of trade finance in facilitating the trade of goods and services essential for climate change mitigation and adaptation is critical. As such, the two institutions issued the Reference Note: Sustainable Trade Finance as a step towards establishing a universally recognised definition of “sustainable/climate trade” finance.

ADB and IFC’s focus on trade as a key component of climate action highlights the role of trade finance in supporting sustainable development.

Sustainability is a vital aspect of the global trade industry. The global supply chain’s Scope 3 emissions account for nearly 80% of greenhouse gas emissions.

While it is a difficult problem to face, and one that will require collaboration across all levels, it is vital that the industry tackles the problem head-on.

TFG heard from IFC and ADB about the indispensable role of multilateral development banks (MDBs) in leading the industry towards more sustainable trade. By providing essential resources and support, MDBs not only assist businesses but often pioneer new market areas by creating a demonstration effect in various sectors and encouraging private capital engagement.

Motivations and objectives behind the Reference Note

The primary motivation behind the ADB and IFC Reference Note on sustainable trade finance is to standardise and promote sustainable trade practices across global markets. This initiative aims to facilitate access to financing programs and solutions linked to sustainable trade by setting clear criteria for what constitutes sustainable trade transactions.

The Reference Note is a response to the increasing need in the marketplace to standardise definitions and clarify which deals are classified as sustainable, therefore unlocking additional pools of financing.

Defining sustainable trade

The Reference Note defines sustainable trade as trade activities that have a positive environmental, social, and economic impact. This includes the promotion of low-carbon technologies, energy-efficient equipment, and sustainable agricultural practices.

Eligibility criteria

The eligibility criteria for sustainable trade deals include the following:

• Equipment that exclusively supports renewable energy generation.
• Energy efficient equipment and goods.
• Agricultural commodities with sustainability certifications.
• Goods and equipment that support circular economy.

Source: Reference Note: Sustainable Trade Finance

Support and resources

ADB and IFC offer various forms of support to businesses and financial institutions aiming to engage in sustainable trade. This includes financing options, technical assistance, and policy advice. The organisations also provide resources to help businesses demonstrate the sustainability of their trade activities and meet the established criteria.

Steven Beck, Head of Trade and Supply Chain Finance Asian Development Bank said, “With global trade and supply chains linked to 80% of global carbon emissions and facing a wide range of sustainability challenges, regulators, investors, and consumers increasingly demand businesses to develop trade that is sustainable.

This reference note will help financial institutions, manufacturers, producers and other stakeholders to better define sustainable trade and eligibility requirements for sustainable trade deals, subject to review of detailed circumstances by ADB or IFC.”

However, ADB’s support of sustainability for banks does not end here.

They are currently developing a pilot to assist banks in identifying sustainable transactions in their criteria based off of this paper, which will be completed in September 2024, with a goal to launch to the wider market by 2025.

Nathalie Louat, Global Director of Trade and Supply Chain Finance at International Finance Corporation, said, “MDBs play a crucial role in boosting trade by providing financing, technical expertise, and policy advice to support countries and financial institutions to overcome trade barriers, promote sustainable trade practices, and achieve their development objectives.

The standardized definitions and criteria for sustainable trade can support inclusive growth, ensuring the benefits of increased prosperity are shared broadly across societies. We hope other MDBs will joint this initiative.”

Though the Reference Note is a good starting point to continue to support sustainable growth, it was not the first, nor will it be the last initiative.

In fact, IFC introduced the concept of Sustainable Trade in 2010 as an incentive for participating banks in its Global Trade Finance Program (GTFP) to facilitate cross-border trade of sustainable equipment and raw materials that support climate change mitigation and resilience activities (e.g., renewable energy, energy efficiency, climate-smart agriculture, green transport, green buildings, etc.).

Since its inception, IFC has not only supported more than $7.5 billion in climate trade deals but has also expanded its climate-smart initiative to other trade programmes.

Now, the hope is that the join ADB and IFC Reference Note will continue to encourage the industry to continue the momentum for sustainability.

ADB and IFC’s support can serve as a case study for MDB’s success in facilitating sustainable trade.

ADB highlights how trade can drive climate action by promoting environmentally friendly practices and providing the necessary financial instruments to support these initiatives.

For instance, the use of green bonds and sustainability-linked loans can incentivise businesses to adopt sustainable practices.

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Finastra, a global provider of financial software applications and marketplaces, today announced its partnership with CredAble, a working capital finance platform. This partnership aims to enhance the functionality of Finastra Trade Innovation by integrating CredAble’s feature-rich platform, offering both new and existing customers a comprehensive supply chain finance solution. 

As a result, banks will be able to boost their revenue growth, expand their operations, and enhance customer satisfaction by providing corporates with a broader range of financial services through a single platform.

“In today’s tough economic climate, it is more important than ever that corporates optimize their working capital and maintain real-time liquidity for long-term growth,” said Satyam Agrawal, Global Head of Product & Retail Business Lending, MD ASEAN & ME at CredAble. 

“By combining our AI-powered supply chain finance platform with Finastra’s leading trade finance solution and global reach, we are delivering a holistic, front-to-back trade and supply chain finance offering to more banks worldwide. This enables them to broaden and enhance their operations to facilitate business growth, while ensuring the services they offer continue to meet the demands of corporates today.”

Trade Innovation is a trade services platform that leverages straight-through processing, digitalisation, and data analytics to foster intelligent trade growth while adapting to compliance, customer, and market demands. 

CredAble is a working capital platform that empowers banks to offer comprehensive supply chain financing solutions to a wide range of enterprises, including small and medium-sized businesses (SMEs), thereby unlocking valuable revenue opportunities. Together, the partnership delivers top-tier functionality, creating an improved, comprehensive solution for trade and supply chain finance.

“To facilitate truly innovative, relevant and open trade finance services, our partner ecosystem plays an important role,” said Anastasia McAlpine, Head of Product Management for Trade and Supply Chain Finance at Finastra. 

“By augmenting the functionality of Trade Innovation with CredAble’s feature-rich supply chain finance offering, we are giving our current and future customers access to a wider array of services that allow them to meet the growing needs of their customers. The partnership ensures institutions can continue to innovate at speed, decrease time to value and utilise data for decision making across the whole of their working capital and supply chain finance portfolio, ultimately supporting increased growth for both their business and that of their customers. It’s another example of how Finastra is harnessing the power of open finance and APIs to build powerful ecosystems that deliver additional value.”

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The initial transaction was conducted for BNP Paribas on 2 July 2024, showcasing ANZ’s capacity to complete the final stage of inward international AUD payments to eligible non-ANZ beneficiaries swiftly.

ANZ Managing Director Transaction Banking Lisa Vasic said, “We see this as a game changer, which will help make sending payments simpler and faster for our financial institution customers. It will significantly improve the customer experience by reducing wait times, improving cash flow and increasing operational efficiency. 

As the largest Australian dollar clearing bank in Australia, both individuals and businesses stand to benefit from receiving their international payments in near-real time. We’re particularly pleased that the infrastructure was built using in-house capability without relying on third party solutions.”

For the transaction, BNP Paribas transmitted an international payment to ANZ via SWIFT, which ANZ processed and cleared into the NPP network, enabling the recipient to access the funds almost immediately.

BNP Paribas’ Global Head of Cash Management, Payments, Trade Solutions and Factoring, Pierre Fersztand said, “This partnership marks a significant step in BNP Paribas’ strategy to achieve instant and frictionless international payments. By strengthening our relationship with an established local partner, we are leveraging the local instant clearing framework allowing cross-border payments to settle instantly in order to enhance our clients’ experience.

Our approach aligns fully with the G20 roadmap for improving cross-border payments. As we continue to expand, BNP Paribas is actively working to enable additional payment corridors, subject to the capabilities of local clearing systems.

This collaboration underscores our commitment to innovation in global transaction banking, ensuring we meet the evolving needs of our clients in an increasingly interconnected world.”

ANZ is committed to assisting multinationals and financial institutions in managing the global movement of money and goods. According to the latest FImetrix survey, ANZ Institutional has maintained its status as the foremost provider of AUD bank-to-bank clearing services worldwide for the 16th year in a row.

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In a positive step for trade digitalisation, BIMCO’s “25 by 25” campaign has surpassed its initial target within its first year. The campaign commits major shippers in the bulk sector to using electronic bills of lading (eBLs) for at least 25% of their annual seaborne trade volume for one commodity by 2025. The initial four participating shippers, BHP, Rio Tinto, Vale, and Anglo American have achieved an average adoption rate of 25.1% in their iron ore trade.

This early success represents an important advance in efforts to streamline supply chain processes and speed up the digital transformation of trade in the bulk sector. Electronic bills of lading provide many benefits, such as increased efficiency, cost reduction, and improved transparency and security. 

By contrast, paper bills of lading are slower, less efficient, and more vulnerable to fraud and human error, presenting legal and commercial risks like reliance on letters of indemnity or losses in transit.

Achieving our target with the participating iron ore shippers just a year into the campaign reflects the industry’s dedication to digital transformation. The quick progress to reach digitalisation is an encouraging step. According to BIMCO, the next step is to expand the campaign to include other bulk trades.

Hui Ling Chan, VP of Order-to-Cash Global Business Services at BHP, emphasised BHP’s dedication to supporting the shipping industry’s digital transformation.

Laure Baratgin, Head of Commercial Operations at Rio Tinto, reiterated the company’s commitment to enhancing trade flow security, traceability and efficiency through innovative digital solutions.

Wang Si, Iron Ore Sales Administration Manager at Vale, noted that hitting the 25% adoption rate for iron ore seaborne trade reflected Vale’s continuous efforts in digitalisation and innovation, benefiting the entire supply chain.

Demian Reed, Global Head of Sales Operations at Anglo American, said the campaign’s success was a key step towards driving efficiency and innovation in their supply chains.

BIMCO, a founding member of the FIT Alliance, continues to collaborate with the DCSA, ICC, SWIFT, and FIATA to develop and adopt standards that facilitate the widespread use of electronic bills of lading. The success of the “25 by 25 pledge” within its first year underscores the potential for achieving a fully digital trade future.

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WaveBL, a leading blockchain platform specialising in the digitalisation of trade documents, is expanding its international network to support the swift, effective, and economical distribution of eBLs across the globe. 

The platform integrates the Legal Entity Identifier (LEI) and its digital version, the verifiable LEI (vLEI), aiming to secure accurate and verified digital identity data for shippers, consignees, and other legal entities involved in global trade.

The initiative encourages companies to either utilise data from their existing LEI records or to acquire new LEIs. This effort enhances the reliability and accuracy of the data within WaveBL’s global network directory, thereby increasing transparency in the shipping sector and reinforcing trust among all stakeholders, including regulatory bodies.

An LEI is a distinct 20-character code, standardised by ISO, assigned to legal entities. Each LEI is connected to a verified identity record in the Global LEI Index, an openly accessible and globally recognised database, allowing the public verification of an organisation’s legitimacy. Currently, over 2.6 million LEIs have been issued worldwide. 

The vLEI serves as a digital counterpart to the traditional LEI, facilitating the automatic recognition of an entity’s LEI in digital transactions.

 WaveBL CEO Noam Rosenfeld said, “The integration of the LEIs into our platform represents a monumental step towards achieving a seamless digital trade environment. By ensuring the accuracy of digital identities, we are enhancing trust and transparency within our network and setting the stage for global interoperability. However, enabling automatic verification of digital credentials is a prerequisite in this regard. Currently, WaveBL handles verification processes on a platform level. As WaveBL is in search of a globally accepted standard, we have found that, the introduction of vLEIs could radically streamline this process by providing a trusted automated and universally accepted solution for verifying companies’ digital identities worldwide.”

Alexandre Kech, CEO of GLEIF, said, “By introducing LEIs and vLEIs into its platform, WaveBL is expected to enhanced the speed, accuracy, and reliability of its digital identity verification, fostering greater interoperability and security in global trade. By integrating the LEI into digital supply chain systems, enterprises are not only increasing efficiency and reducing the costs of paperwork but also equipping their industry with the tools needed to fight fraud and other forms of financial crime. I applaud WaveBL’s efforts and am excited to see our collaboration continue as the vLEI ecosystem continues to gather momentum around the world.”

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The International Chamber of Commerce (ICC) Digital Standards Initiative (DSI) and the United Nations Economic Commission for Europe (UNECE) have issued a joint call to action to expedite the adoption of globally interoperable standards, which are crucial for enabling digital trade across the world.

The call to action was made during the 42nd Forum of the United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT), hosted by UNECE in Geneva. This event emphasised the vital role of standardized digital trade processes in enhancing global trade efficiency, reducing costs, and fostering digital trust on a large scale. 

This follows the introduction of the ICC Key Trade Documents and Data Elements (KTDDE) framework and UNECE’s UN/CEFACT Buy-Ship-Pay Reference Data Model and Trade Finance initiative.

The ICC KTDDE framework is designed to serve as a reliable single source for data, promoting alignment, security, and efficiency as data is transferred throughout the supply chain. The UN/CEFACT Buy-Ship-Pay Reference Data Model provides a comprehensive semantic data model that spans the full international supply chain from trade, transport, and regulatory viewpoints. 

Together, they facilitate the digitalisation of complete supply chains through standardised semantics, helping to craft a more efficient, cost-effective, and interoperable global trade ecosystem.

Pamela Mar, Managing Director of ICC DSI said, “The KTDDE framework has demonstrated notable results from collaborative efforts between standards organisations, intergovernmental bodies, and industry leaders.”

“This joint call to action is the next vital step. It is crucial for both the public and private sectors to commit to these standards to advance the digitalisation of supply chains,” she added.

The ICC KTDDE framework and the UN/CEFACT Buy-Ship-Pay Reference Data Model and Trade Finance initiative are beneficial for entities involved in producing, transporting, or selling goods globally and offer value to governments and regulatory bodies exploring trade digitalisation laws.

Tom Shinya, IUMI Executive Committee Member and Member of the DSI Industry Advisory Board said, “From an industry perspective, businesses can begin to see advantages by employing the KTDDE toolset.”

“At the same time, we need to collaborate closely to develop digital data standards for remaining documents, including cargo insurance, which are currently less developed digitally. Ongoing education and alignment are essential to promote the broad adoption of digital standards across all sectors and economies,” he added.

The call to action encourages all stakeholders in digital trade to collaborate to align and promote data interoperability, ensuring seamless data movement using core data elements as connectors. Stakeholders are invited to make their commitments known and report them to the UN/CEFACT Plenary starting in 2025 and every two years thereafter.

The commitments should concentrate on implementing measures such as:

• creating policies favourable to digital trade and uniform regulations;
• aligning legal systems; adopting globally interoperable standards for national border processes; 
• aligning data definitions and cross-referencing common standards for global interoperability, among others.

Dmitry Mariyasin, Deputy Executive Secretary of UNECE said, “In the current inter-connected global economy, standardized digital trade processes are crucial to enhancing global trade efficiency, reducing costs, building digital trust, and ensuring seamless integration into global supply chains. This is particularly important for transition economies, which are still minimally integrated into global trade processes.”

“We are thrilled to announce several forthcoming projects that will expand upon the KTDDE framework,” announced Maria Teresa Pisani, Acting Chief of the Trade Facilitation Section at UNECE.

“These projects include updating the United Nations Trade Data Elements Directory (UNTDED) in cooperation with ISO and improving the Buy-Ship-Pay Data Exchange Structures for Trade Finance Facilitation. These initiatives are intended to further incorporate digital trade processes and make standards more effective for industry,” she added.

Over the years, UNECE, through various intergovernmental bodies, has been a leader in promoting the digitalisation of global trade processes.

UN/CEFACT has created approximately 950 e-business standards and guidelines, as well as nearly 50 global trade facilitation recommendations. These have provided standardised data models and frameworks to support efficient trade information exchange through tools like the Single Window Interoperability Framework and eCERT for electronic certification.

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Cleareye.ai, a leading provider of AI-powered document processing solutions for Trade Finance today announced a collaboration with Microsoft to use the combined power of Microsoft’s Azure AI platform and Generative AI (Gen AI) capabilities to tackle the most complex challenges within the Trade Finance industry.

A hybrid approach for breakthroughs:

This collaboration represents a significant shift in Trade Finance automation. Cleareye.ai’s Trade Finance platform, ClearTrade®, will work together with Microsoft Azure to enhance trade finance, by delivering solutions that offer accuracy, efficiency, and security. However, the true innovation lies in our relationship’s focus on building generative AI experiences. By carefully blending the strengths of prebuilt and curated models from Azure OpenAI Service with Cleareye’s domain and technical expertise, we bring advanced and comprehensive solutions for trade finance to the market.

A symphony of innovation: Cleareye.ai and Azure AI platform

This collaboration brings together the best of both worlds:

Azure provides Cleareye.ai with scalability, security, and access to a vast array of AI services via its platform. Azure’s robust compute, storage, and monitoring capabilities ensure seamless operation and reliable data management. 

Cleareye.ai’s proprietary AI models, honed through years of experience in Trade Finance, deliver accuracy and efficiency in document processing and data extraction. 

The Power of Hybrid AI:  Open and closed models 

Cleareye.ai and Microsoft are exploring a hybrid AI approach, strategically combining the strengths of closed and open models: 

Closed models: Cleareye.ai’s pre-trained AI models, optimised for specific Trade Finance tasks, ensure consistent performance and compliance. 

Open models: Microsoft’s Azure AI platform, including Azure OpenAI Service, brings flexibility and adaptability to address the ever-evolving complexities of Trade Finance. 

This hybrid approach allows Cleareye.ai to: 

Tackle complex use cases: By using the power of Azure AI Services Cleareye.ai can address previously intractable challenges in Trade Finance, such as nuanced document analysis and anomaly detection. 

Deliver accuracy: Cleareye.ai’s closed models ensure consistent high accuracy, while Azure OpenAI Service models continuously learn and refine, leading to ever-improving performance. 

Mariya George, Co-Founder & Chief Executive Officer at Cleareye.ai said, “This collaboration with Microsoft represents a paradigm shift for Trade Finance automation. By combining the power of Microsoft’s Azure AI platform with the potential of Gen AI, we are on the verge of achieving significant breakthroughs. This hybrid approach will unlock a new era of efficiency, accuracy, and innovation for the entire industry.” 

Peter Hazou, Director, Business Development, Financial Services at Microsoft sayid, “We are pleased to collaborate with Cleareye.ai to unlock the potential of AI in Trade Finance. By using the combined strengths of Microsoft’s Azure AI platform and Cleareye.ai’s expertise, we are committed to delivering a robust solution for our customers, enabling them to navigate the complex world of Trade Finance with greater confidence and agility.” 

This collaboration represents a significant leap forward for Trade Finance automation. By harnessing the power of AI and the robust capabilities of the Azure AI platform, Cleareye.ai and Microsoft are poised to deliver a future-proof solution that empowers businesses to operate in a more efficient, secure, and innovative trade landscape. 

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The Wolfsberg Group, a leading coalition of financial institutions focusing on regulatory compliance issues, has published its latest statement on “Effective Monitoring for Suspicious Activity” (MSA). This document outlines advanced strategies to refine anti-money laundering (AML) and counter-terrorist financing (CTF) efforts across the sector, moving beyond traditional transaction monitoring towards a comprehensive, risk-based approach.

The Wolfsberg Group, in its statement, emphasises that while compliance with AML and CTF regulations remains paramount, the effectiveness of financial institutions’ monitoring systems can be significantly enhanced by incorporating a broader range of customer behaviour analyses and attributes. This wider perspective is vital in identifying and reporting suspicious activities more accurately.

Strategic recommendations and examples

1. Risk-Based Approach (RBA): The Group urges financial institutions to adopt RBAs that focus on high-risk customers and transactions rather than applying uniform scrutiny across all activities. For instance, instead of using generic indicators for all customer transactions, FIs are encouraged to tailor their monitoring systems to focus on high-risk regions or sectors known for money laundering activities.

2. Integration of Advanced Technologies: The document suggests using artificial intelligence (AI) and machine learning (ML) to enhance the detection of suspicious activities. An example provided involves leveraging ML models to analyse transaction patterns and predict potential risks based on behavioural anomalies, significantly reducing false positives and improving the precision of detections.

3. Enhancing Data Quality: The Wolfsberg Group recommends improving the quality of data captured by financial institutions. It suggests incorporating more dynamic data points such as customer spending patterns and peer group analysis. This approach not only improves the accuracy of the monitoring systems but also allows for more targeted investigations.

4. Feedback Mechanisms: To improve the effectiveness of SARs/STRs, the Group proposes establishing stronger feedback loops between financial institutions and regulatory bodies. For instance, if a SAR filed by an institution results in a significant law enforcement action, the feedback can help refine the institution’s future reports, making them more valuable.

5. Public-Private Partnerships: The statement highlights the importance of collaboration between public authorities and private institutions. It suggests that sharing insights about typologies of financial crime and effective detection strategies can lead to more focused and effective monitoring efforts. For example, a partnership could develop shared databases of risk indicators, enhancing the ability of all participants to identify suspicious activities quickly.

6. Holistic Customer Reviews: Instead of isolating monitoring to specific transactions, the Group advises institutions to conduct comprehensive reviews of customer profiles. This includes examining the customer’s entire relationship and interaction with the institution, using data analytics to detect inconsistencies or changes in behaviour that may signal illicit activities.

These recommendations are designed to move financial institutions from a checkbox approach to a more dynamic, outcome-focused monitoring process. The Wolfsberg Group’s guidance is aimed at helping the financial sector become more proactive in identifying and combating financial crimes, thereby enhancing the integrity of the global financial system.

However, the Group also acknowledges the challenges associated with implementing these advanced technologies, such as the need for regulatory upskilling, managing the complexities of ‘black box’ solutions, and ensuring that technological innovations align with ethical standards and regulatory expectations.

The statement highlights the necessity of a collaborative approach to financial crime prevention, involving enhanced cooperation between financial institutions, regulators, and law enforcement. 

By sharing intelligence and feedback more effectively, all parties can better align their efforts with national and international priorities, leading to more successful outcomes in the fight against financial crime.

Read the report here.

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CredAble has announced the release of its latest whitepaper, “The Business Value of Working Capital Financing: A Working Capital Guide for the Corporate Treasurer.”

This whitepaper explores the essential concept of working capital, its role in the corporate environment, and the economic dynamics affecting working capital needs, focusing on treasury-specific issues and showing how strategic working capital solutions can deliver significant financial benefits, affecting both profit and loss.

The whitepaper presents important discoveries, such as the possibility of achieving a 6.8% increase in return on assets through effective cash flow management. It also examines the effects of escalating inflation, expected to reach 6%, and rising interest rates, currently at 6.5%, on working capital needs—emphasising a 20% increase in the interest service coverage ratio among listed companies recently. 

Moreover, the report underscores how a software-driven Cash Management System (CMS) can enhance cash flows by 10%.

Ram Kewalramani, Co-founder & Managing Director, CredAble, said, “The effective management of working capital is crucial for businesses, especially in today’s asset-light and uncertain economic environment. Our whitepaper provides corporate treasurers with the knowledge and tools they need to navigate these challenges and optimise their working capital strategies for sustained financial success.”

Key discoveries from the whitepaper:

Economic challenges affecting working capital needs:

Inflationary pressure: Inflation is expected to increase to nearly 6%, within the Reserve Bank of India’s (RBI) acceptable range. Cost-push inflation, driven by a 35% increase in brent crude prices and a 75% increase in coal prices over three years, has notably raised operational costs across sectors.

Interest rates: The RBI has lifted the prime lending rate by 2.5% over a year, now at 6.5%. This rise has heightened borrowing costs for businesses, putting additional strain on their working capital.

Debt market trends:

The differential in yields between corporate and government bonds has decreased over the last three years, suggesting reduced market liquidity. The inclusion of Indian government bonds in the JP Morgan emerging debt index is likely to cause government bond yields to rise further, potentially diminishing market liquidity.

Treasury-specific challenges and responses:

1. Cashflow management: Effective cash flow oversight is vital in a scenario where 82% of businesses risk insolvency due to extended financial hardships (SBA, 2021).

2. Debt management and risk reduction: The report details tactics for effective debt management and financial risk mitigation amid climbing interest rates and economic uncertainty.

3. Value addition through supply chain finance: Businesses focusing on cash flow management have seen a higher return on assets (6.8%). The report explores how supply chain finance can generate considerable financial value, influencing both profit and revenue and boosting overall financial health.

4. Working capital optimisation techniques: CredAble’s innovative programs are showcased, illustrating how automated and comprehensive working capital management initiatives can assist businesses in maximising their financial resources. Real-life examples and case studies provide evidence of successful strategy implementations.

5. Cash ratio comparison: Indian companies listed on the NSE have a cash ratio of 0.29 compared to 0.64 for companies on the S&P 500, underscoring liquidity variations between these markets.

6. Effects of short-term debt: From FY22 to FY23, excessive short-term debt has notably affected companies, leading to heightened financial strain. Implementing a software-driven Cash Management System (CMS) can enhance cash flows by 10%.

7. ISCR enhancement: A 20% increase in the Interest Service Coverage Ratio (ISCR) across listed service companies (excluding IT) and a 40% increase in ISCR across listed manufacturing companies demonstrate improved capacity to meet interest obligations due to enhanced working capital management.

8. Working capital days and revenue: The white paper features a graph from the PwC Working Capital Study 2022-2023 depicting the inverse relationship between working capital days and revenue growth. Effective working capital management can lead to improved financial outcomes.

9. Commercial paper yields: The document highlights a consistent rise in commercial paper yields over the past two years, reflecting increased costs for short-term corporate borrowing. This trend is likely to persist, influenced by the performance of sovereign bonds.

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CarbonChain, a leader in digital solutions for environmental compliance, announced three updates to its platform, designed to assist manufacturers in metals and energy sectors with enhanced, cost-effective carbon reporting capabilities. 

These three updates are part of CarbonChain’s continuous effort to empower companies to meet and exceed global carbon emissions disclosure requirements across Scope 1-3.

New features and enhancements:

1. CBAM: Europe’s complimentary self-service tool: Effortlessly measure, track, and submit data for the European Union’s Carbon Border Adjustment Mechanism (EU CBAM) using our automated tools. Access is free for a limited period.
2. Precision carbon footprints: Monitor, document, and establish objectives for your supply chain emissions, enhancing precision and transparency for essential metals.
3. Efficient and secure supplier interaction: Enable the upload of supplier Environmental Product Declarations and Lifecycle Assessments to our platform, ensuring the protection of sensitive data.

Start to finish CBAM tool

1. Automated CBAM Declaration Checks: Users can now directly upload their CBAM declaration data to CarbonChain. The platform automatically performs completeness checks to ensure data integrity for successful submissions.

2. Supplier Data Engagement: Users can initiate requests for installation data from their suppliers. The suppliers, in turn, can upload this data directly to CarbonChain. Automated checks are performed to guarantee the data’s completeness and accuracy, facilitating successful submissions.

3. Monitoring CBAM Reporting Progress: CarbonChain’s enhanced CBAM workflows allow users to track their progress in real-time as they engage with suppliers. The platform provides insights into the balance of primary and default data within each submission, ensuring users can optimise their reporting for the highest level of primary data accuracy.

4. Confident Submission of Declarations: After completing the necessary customs declaration and supplier data integration, users can securely download a .ZIP file from CarbonChain. This file includes the completed XML declaration and all associated installation data templates, ready for submission.

Adam Hearne, CEO of CarbonChain, said, “As regulatory pressures tighten, sustainability leaders need tailored tools for their complex supply chains. Our Summer release aims to provide sustainability leaders with the clearest picture yet of supply chain emissions, combining robust independent data with direct inputs from suppliers for unmatched precision and reliability in carbon reporting.”

Enhanced accuracy in supply chain emissions

• Inclusion of upstream energy production: CarbonChain have incorporated emissions from upstream energy production, offering a more comprehensive view of overall emissions.

• Detailed asset-level emissions tracking: By disaggregating emissions data at each step of the supply chain where asset-level data is available, users can now view individual assets within upstream metal supply chains. This approach avoids aggregating emissions into a single factor and enhances the identification of emission hotspots.

Robust supplier engagement

• Many of our clients seek to directly upload primary supply data to CarbonChain, whether it is an Environmental Product Declaration (EPD), a Product Carbon Footprint (PCF), or a Life Cycle Assessment (LCA). Recognising the need for data security, especially for sensitive information, CarbonChain have implemented measures to ensure that such data is only used for the customer’s specific emissions calculations and is safeguarded against access by other platform users.

• Enhanced data integration for EPDs, PCFs, and LCAs: The new enhancements to CarbonChain’s platform have expanded the emissions database to include primary supplier data from these key reporting formats.

• Controlled use of emission factors: When required, CarbonChain can restrict the use of specific emission factors to only the customer who provided them, ensuring data privacy and integrity.

Community and environmental impact

These updates are not only a response to regulatory demands but also an effort to reduce the overall carbon footprint of the manufacturing and energy sectors. By providing tools that simplify and improve the accuracy of carbon reporting, CarbonChain is helping to foster a more sustainable industrial environment.

The new features are now live and available to all existing and new customers of CarbonChain. Companies interested in utilising the free CBAM tool or exploring other new functionalities can request access via the CarbonChain website.

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