Regenerative Finance: A New Era of Sustainability in the Financial Industry
- Media Manager
- Dec 13, 2023
- 1 min read
Updated: Dec 14, 2023
Medium - Towards Finance
Written By: Tinz Twins
Published: December 13th, 2023
Climate change poses significant challenges for humanity. Every economic sector is affected by climate change. In the financial industry, environmental issues (Environment), social aspects (Social), and responsible corporate governance (Governance) have played a central role for several years. These topics are anchored in the so-called ESG criteria. The ESG criteria are used to assess the sustainability of a company and can be taken into account when making investment decisions.
The concept of Regenerative Finance (ReFi) goes a step further. In addition to the ESG criteria, this concept also focuses on technologies such as blockchain, artificial intelligence (AI), and the Internet of Things (IoT). By using these technologies, the financial system could become more transparent, trustworthy, and efficient. We present the concept of “Regenerative Finance” in detail. We also show you a specific example of how the concept can be implemented.
What is ReFi?
The core goal of regenerative economics is to give back more than is taken. For years, resources have been overused. ReFi aims to contribute to such an economic system. To achieve this, financial companies must develop and utilize regenerative financial models. The essence is to structure the capital market in such a way that there are no losers. Currently, it is frequently observed that primarily in the southern countries, animals, and the environment suffer losses. ReFi seeks to create decentralized structures with profitable incentives to achieve a sustainable future for both humans and nature. At the heart of a regenerative financial system, alongside ESG criteria, are technologies such as Artificial Intelligence (AI), blockchain, and the Internet of Things (IoT).
