Circularise’s blockchain-based traceability software lands ISCC Plus certificate

20 Sep 2022 --- Circularise’s blockchain-based digital system has been tested with the ISCC Plus certification to make auditing of certified parties more efficient and to strengthen the integrity of certified data. 

“Digitizing certifications using blockchain means that the certificates are immutable, which means they cannot be edited or duplicated, therefore reducing the risk of error and fraud,” Igor Konstantinov, head of marketing at Circularise, tells PackagingInsights.  

“The technology also acts as a means of connecting members of the value chain to provide greater insight into the chain of custody.”  

The rules and framework of the certification can also be built into the logic of the contracts being used, ensuring conformity with the certification scheme structure. This makes it easier for companies to ensure compliance and for auditors to conduct their assessments, explains Konstantinov.

“We are excited to bring our knowledge in supply chain traceability and data management to project partners to test a public decentralized blockchain with the ISCC Plus mass balancing certification,” Mesbah Sabur, Circularise’s founder, tells us. 

Circularise say this is the first time that ten chemical industry players and appliance companies got together to test a blockchain-based digital system to complement a sustainability certification process of complex value chains. 

ISCC Mass Balance scheme pilot. Image Credit: Circularise. Data “revolutionization” 
Participants utilized a public blockchain enabling authentication, decentralization and encryption of data verifying material flows and related sustainability attributes. Circularise says the approach differs from other blockchain projects where companies use a private blockchain operated by pre-selected participants, such as members of a consortium. 

Instead, Circularise and its project partners used a public blockchain, making it virtually impossible for companies to appear more sustainable than they really are by reusing the proof of a sustainability claim across assets. This principle forms the foundation of trust in data integrity. 

The joint project includes material suppliers Asahi Kasei, Borealis, Neste, Trinseo and Shell, original equipment manufacturers, brands Arcelik, Philips Domestic Appliances and EVBox, as well as trading companies Marubeni and Itochu, in which partners tested a blockchain system to complement the ISCC Plus certification. These parties were brought together by Circularise and Marubeni. 

“Blockchain technology is revolutionizing how data is stored and shared. Now companies don’t need to individually keep a balance of goods and transactions in excel. Instead, they can use blockchain and smart contracts to store balances, record transactions, and apply mass balance rules. Every transaction is fully traceable. Auditors can therefore rely on the blockchain for parts of the audit,” says Sabur.

Mesbah Sabur, Circularise’s founder. Image Credit: Circularise. Material traceability and verification of data at individual sites and across the value chain were guaranteed by ISCC Plus certification of each site of the operators, requiring site-specific audits, certification and mass balance calculations to provide reassurance about the sustainable content. The data was uploaded to the Circularise software system to improve mass balance bookkeeping and reporting.

‍“Certification will become more digital in the future. It will allow certification schemes to simplify the auditing process of supply chain actors and reduce the risk of mistakes. Companies will have an easier way to show compliance and adhere to auditing rules,” says Jan Henke from ISCC. 

Mass balance system
Currently, the chemical sector is engaged in significant sustainability transformation efforts, including rethinking of raw materials use, circularity, and climate impact of operations and entire value chains. 

This transformation is largely built upon sourcing new, more sustainable feedstocks while maintaining efficient processes, a viable economy and high credibility.

Certification schemes providing an option to use the mass balance system can facilitate a gradual switch towards increasing the replacement of fossil feedstock and materials with renewable and recycled raw materials, while enabling the use of existing infrastructure and equipment instead of constructing parallel plants and value chains. 

In the mass balance system, data storage and data integrity are key elements in verifying sustainability and compliance with the certification requirements.

One of the greatest challenges the mass balance approach faces in the plastics and chemicals industries is awareness and understanding. Through this project, the collaborating partners managed to deepen their knowledge on the topic, align internal processes with ISCC Plus requirements, and test a new futureproof way for bookkeeping mass balance credits, while easily sharing them across organizations. 

Overall, the company concludes the project allowed value chain actors to substantiate sustainability claims better and improve collaboration. 

Beyond this project, blockchain technology will play a critical role in complementing supply chain certification to enable certification schemes to simplify the auditing process of supply chain actors, reduce the risk of mistakes and accelerate the sustainable transition. 

By Natalie Schwertheim

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