Blockchain Transforms Supply Chain Emissions Tracking with Paid Solutions
Blockchain technology is poised to revolutionize how businesses track supply chain emissions, particularly Scope 3 emissions. These emissions arise from indirect activities throughout the supply chain, making them challenging to monitor accurately. Companies are increasingly pressured to report these emissions, which often surpass their direct emissions. According to a study by the World Economic Forum, eight supply chains are responsible for over half of the world’s emissions, highlighting significant challenges for global procurement networks.
Understanding Scope 3 Emissions
Scope 3 emissions encompass various factors, from supply chain logistics to product usage and transportation. The complexity in tracking these emissions frequently leads to disputes over data accuracy. There is a pressing need for improved clarity and accountability in emissions reporting.
Blockchain Technology as a Solution
Unlike its common association with cryptocurrency, blockchain has valuable applications in digital identity verification and emissions tracking. As a shared ledger, blockchain allows multiple stakeholders to access and validate records, reducing the risk of tampering. Major retailers like Walmart have adopted blockchain systems to enhance their food safety protocols. In their case, the time to trace products, such as U.S. mangoes, has improved tremendously, dropping from days to mere seconds.
Lessons from the Shipping Sector
The shipping industry has also sought to leverage blockchain technology for enhanced transparency. For instance, in 2019, Maersk’s Lars Kastrup advocated for the TradeLens platform as a means to improve transparency in shipping logistics. However, despite initial enthusiasm, participation from the industry was insufficient, resulting in the collaboration with IBM being halted.
Emerging Opportunities in Emissions Tracking
Recent discussions highlight blockchain’s potential to deliver real-time emissions data by integrating sensors and tracking devices. This could also benefit carbon credit markets that require advanced verification technologies. The capacity for immediate data capture makes blockchain a promising tool for companies looking to enhance their emissions tracking efforts.
Future of Blockchain Adoption
Experts believe that blockchain can serve as more than just a technological infrastructure. There is potential for revenue generation through verification processes, converting internal checks into marketable services. Nonetheless, effective governance and dispute resolution remain crucial for establishing trust in blockchain systems.
The future of blockchain in tracking supply chain emissions hinges on its development into a fundamental infrastructure rather than an experimental technology. Continued support from stakeholders and financial investments will be key to facilitating broader adoption of blockchain solutions in this critical area.
