The exacerbation of the climate crisis has brought ESG investment to the fore. Investing in ESG is deemed as a way to financially support companies that help fight climate change, in alignment with the UN Sustainable Development Goals. Recently, despite the market’s turbulence and declines, ESG investors have become interested in protocols and cryptocurrencies due to their potential role in a greener economy.
However, not all crypto protocols satisfy the ESG criteria. A crypto project must be socially and ecologically responsible while adhering to good governance procedures before an ESG investor will consider supporting it. With such considerations in mind, does MRHB satisfy the ESG criteria?
What Is ESG Investment?
ESG is a broad term that refers to the incorporation of Environmental, Social, and Governance (ESG) considerations into an investor’s portfolio decisions. This is also known as Sustainable Investing.
The environmental (E) component assesses a company’s influence on the environment, taking into account its emissions, the effective use of natural resources such as energy during manufacturing, pollution, and waste, as well as innovative initiatives to eco-design its products.
A company’s interactions with its staff, clients, and society are all included in the social (S) component. It entails making an effort to keep devoted employees, satisfy clients, and uphold civic virtues in the areas where it conducts business.
The governance (G) component captures the systems in place for management to act in the best interests of its long-term shareholders, which include safeguarding shareholder rights, having a functioning board (e.g., with experienced, diverse, and independent members), maintaining well-designed executive compensation policies, and avoiding illegal and unethical practices.
In cryptocurrency parlance, investors look at the following ESG factors to consider the impact of investment:
- Environmental: assesses a protocol’s commitment to environmental sustainability and energy use.
- Social: examines how a cryptocurrency demonstrates potential positive effects for people and communities.
- Governance: deals with a cryptocurrency’s ability to expand the reach of capital markets through decentralized and permissionless delivery of financial goods and services.
What Is MRHB?
MRHB (pronounced ‘Marhaba’) is a web3 ecosystem that offers inclusive and ethical decentralized finance (DeFi) solutions for faith-based communities. The MRHB token ($MRHB) is a utility token minted on the BNB Chain that will have a total supply of 1 billion.
The Environmental Impact of MRHB
Some cryptocurrency protocols consume a lot of energy when mining, which may worsen climate change. However, this is not always the case as different protocols use different types of consensus mechanisms that determine energy use. The two most common are the Proof of Work (PoW) and the Proof of Stake (PoS) mechanisms.
A cryptocurrency that uses PoW consumes a huge amount of energy. However, many crypto mining companies using PoW have switched to renewable sources of power thus reducing the negative impact on the climate.
On the other hand, the PoS mechanism is considered an environmentally sustainable consensus model that is less energy intensive.
Having adopted the PoS mechanism, MRHB is committed to being carbon neutral and has become a signatory of the Crypto Climate Accord. The major aim of the Crypto Climate Accord is to achieve net-zero emissions from electricity consumption associated with all their respective crypto-related operations by 2030.
The Social Impact of MRHB
MRHB upholds financial inclusion for faith-based communities. Decentralized currencies like $MRHB have the potential to positively impact society by making finance easy, open, and accessible.
Furthermore, interacting with the MRHB ecosystem means not participating in unethical activities such as gambling and lending based on interest. Essentially, the MRHB ecosystem offers peace of mind to the faith-based and ethically-conscious community when they engage in web3.
MRHB Governance
The MRHB Governance Board (MGB) is implemented to ensure that MRHB operates to the highest ideals set by the halal and inclusive vision. The MGB consists of individuals with institutional finance, crypto, and Shariah backgrounds, focused primarily on ethics. This would help ensure that MRHB products are developed according to the ethical guidelines determined by the Shariah Scholars.
By building halal crypto products on the decentralized ledger technology, MRHB maintains transparency in its operations while prioritizing the interests of users and investors.
MRHB Satisfies The ESG Investment Criteria
With the analysis above, it is clear that MRHB is ESG-friendly and has a promising future. MRHB is committed to net zero goals set forth by the Crypto Climate Accord and is also devoted to providing accessibility to faith-based and unbanked communities.
For ESG investors, MRHB provides a unique opportunity to support inclusivity in web3 by offering the world’s first halal decentralized finance ecosystem.
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