Introduction of Palm GreenChain, a blockchain-based framework for enhanced traceability, transparency and accountable green bond financing in Malaysia

Abstract

This study employs a theoretical, system design–based methodology to propose the Palm GreenChain framework—a blockchain-based platform aimed at enhancing traceability, transparency, financial coverage, and accountability in green bond financing for sustainable palm oil production in Malaysia. The methodology integrates Ethereum-compatible smart contracts, ESG oracles, IPFS-based data storage, and DAO (Decentralized Autonomous Organization) governance to structure a digital green bond lifecycle. Rather than relying on empirical data collection, the framework is conceptualized through the development of a multi-layered blockchain architecture and validated via comparative analysis with analogous blockchain applications in agriculture. The proposed system is designed to enable real-time traceability of green bond disbursements, automate ESG compliance verification using satellite and IoT data, and strengthen accountability and access to climate finance for smallholder farmers. By embedding performance-based returns within smart contracts, the model aligns financial incentives with conservation goals. Leveraging Malaysia’s advanced land administration infrastructure and digital capabilities, the framework presents a scalable, open-source solution to reduce greenwashing, expand financial inclusion in underserved agricultural communities, and enhance transparency and investor confidence in sustainable agricultural finance. By directly linking green finance to verifiable sustainability outcomes, Palm GreenChain addresses key limitations in conventional green bond mechanisms. Its applicability across diverse agricultural sectors positions it as a replicable blueprint for broader sustainable development. The framework is openly available via its GitHub repository.