2019-12-09 Meeting – Greenfiling

Business Register, Madrid
List of attendees

Alex Lopez Teruel – Alastria – Seven Row
Amparo Marín – Alastria – Universidad Politécnica Madrid
Cristina Martínez Laburta – Alastria
Daniel Cardelús – Alastria – Suez -Techbizdesign
Daniela Corredor – Alastria
Eva Esteban – Bank of Spain
Ignacio Boixo – CEN/Eurofiling
Ismael Arribas – Alastria – KUNFUD
Jorge Salazar – College of Registrars
José Lindo – Alastria – Climate Chain Coalition
Juan Carlos Boixo – College of Veterinarians
Maria Mora – AECA/XBRL
Montse Guardia – Alastria
Natividad Pérez – Bank of Spain
Paula Fernández-Castell – IGME (Mines)
Rocio Arnal Lorenzo – Alastria
Stefan Junestrand – Tecma Red SL Group
Teresa Alarcos – WStartupC

Business Register, institutional representation

Rocío Perteguer. Registrars Board. Director of the Environment, Consumers and Users Service
Jorge Salazar. Registrars Board. Director of the Service of Coordination of Mercantile Registries.
José Meléndez. Director of the Centre for Statistical Processes

Background:

Directive 2014/95/EU (Spanish Law 11/2018) on non-financial information and diversity, establishes for certain entities the obligation to present non-financial information statements to medium and large companies. (See Annex II)

The objective of non-financial disclosure is to identify risks in order to improve sustainability and increase the confidence of investors, consumers and society in general. However, the Law does not indicate how the fulfilment of reporting duties should be carried out, which results in a multiplicity of formats that are not very homogeneous or not at all, making their subsequent analysis difficult.

Basically, in financial reporting, the formats are established respectively by the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA), and each institution’s periodic financial report is published by the national Officially Appointed Mechanism (OAM). There is no equivalent, with that degree of concreteness, in the area of non-financial reporting.

The ideal thing would be to be able to align the processes, formats and publication models of financial and non-financial reporting.

The climate challenge requires an open, transparent, global and decentralised information reporting model. Greenfiling is the Open Metric Ecosystem of Green Reporting, whose objective is the massive adoption of environmental data and indicators in non-financial reports: an environmental reporting model based on methods and techniques of financial reporting, which makes special use of the experience gained in the development of European Banking and Insurance reports, with a very broad model that will link multiple metrics, breakdowns and different disaggregations.

It is a relevant cross-cutting model for multiple stakeholders. The Greenfiling model is being designed as a public good, open and free, for different cases of use: public institutions, the business sector, the third sector, academia and citizens themselves.

And it uses XBRL (eXtensible Business Reporting Language) is the language, of free use, based on XML standards, which allows interoperability and analysis of any type of financial and business information over the Internet. It is used by EBA, EIOPA, ESMA, Financial Authorities and a large community of professionals and organizations, public and private. The XBRL standard is managed by the XBRL International non-profit Consortium, coordinating a large number of countries, companies and institutions, including the College of Registrars of Spain and the Bank of Spain.

Challenge:

Consolidate XBRL for non-financial reporting by adding the integrity and non-repudiation provided by Blockchain.

The hope is that markets and regulators will be able to use the information now reported. Our objective would be, therefore:

Establish a taxonomy for climate change following the XBRL methodology.
Establish a publication method: an self-sovereign model based on blockchain that guarantees integrity and non-repudiation in the absence of a regulator/authority in charge. It is necessary to promote the accessibility of data with quality.
Develop a proof of concept.

Documents for possible reference cited during the meeting:

Paula Fdez Castell explains her experience with contaminated soils and water, suggesting that we take into account the content of the National Plan for Adaptation to Climate Change (https://www.miteco.gob.es/es/cambio-climatico/temas/impactos-vulnerabilidad-y-adaptacion/plan-nacional-adaptacion-cambio-climatico/).

Juan Carlos Boixo (Veterinarian) explains the situation in the field of agriculture and the carbon footprint and GHGs (greenhouse gases), distinguishing direct emissions, indirect emissions related to electricity and “other indirect emissions” (scope 3) for which there are no official metrics. It suggests taking into account the content of Recommendation 2013/179 and starting work on Scope 3.

See the European Commission’s Guidelines on Non-Financial Reporting and several other references at https://greenfiling.info/references/

Solution

The solution would be to build a tool for environmental reporting that facilitates the work of obligated companies and allows later analysis. Involving not only companies and obligated producers, but also regulators and public authorities.

The value proposition is clear: it facilitates compliance with a legal duty, saves costs and facilitates subsequent analysis.

SWOT analysis

*STRENGTHS*	WEAKNESSES
Scalable/ Extensible XBRL Experience Collaborative environment Local Support High Reputation Inherent strengths of Blockchain (traceability, immutability, ownership) Integrity and non-repudiation Bottom-up model => born with more seat Foundational layer => there is a layer that already exists and this solution improves what already exists	Lack of resources (money/people) Absence of Governance Local level => yet mainly Spain Domain Experts Not minor complexity
OPPORTUNITIES	*THREATS*
Lack of homogeneity => we can give it To be the first in the execution => to give continuity to something that already has thought many, to break the glass ceiling Environmental awareness, which can facilitate adoption Climate Pact Agenda 2030	Resistance to Transparency Environment too open Malevolence/expropriation Certain reluctance of companies that do not want to report