November 7, 2022 1:30 PM | 4 min read
Climate change is one of the most pressing issues of our time, and it is becoming increasingly clear that supply chain inefficiencies are damaging the environment. The transport of goods around the world requires a massive amount of energy, which is typically derived from fossil fuels. This results in a significant release of greenhouse gases into the atmosphere, contributing to climate change. In addition, the shipping industry is a major source of air pollution, and the construction of new shipping infrastructure can damage sensitive ecosystems. Inefficiencies in the supply chain also create a lot of waste. For example, food that spoils en route to its destination is a significant issue. All of these factors underscore the need for improved efficiency in the supply chain in order to protect the environment.
Sustaining the needs of supply chains across long distances and time zones is no easy task. The costs involved in maintaining these relationships are high, with an estimated $507 billion trapped within S&P 1500 company's global networks at year-end 2020--a new record high.
One-up/one-down partnerships seem unable to deliver on demand or resilience anymore —they are also powerless when it comes to providing visibility into authenticity, which supports increasingly ambitious ESG goals.
Encouraging multiparty collaboration has nothing to lose and everything to gain
The old ways of thinking about supply chain management are being phased out. While operationalizing a business's needs has been the norm for decades, these days it seems like there is a growing focus on strategic decisions - and they are right! Businesses need to take charge of their own data within these outdated models, so that we can have better visibility into the provenance and environmental footprint of products or services at all times; what good does having complete control over everything you do, when nobody knows how strong your product really is?
There are companies that are tackling this issue, one of which is Changeblock. “We enable the radical changes required to ensure environmental objectives can be met throughout the supply chain,” says Changeblock’s CEO and founder Billy B. Richards. “The Company’s end-to-end solution delivers environmental results for supply chains, while enabling the monetization of environmental assets and opportunities for institutions and corporations throughout those supply chains. The products of these monetization efforts can then be exchanged or traded on the Changeblock platform, which is at an exchange level in terms of security and functionality. Furthermore, our platform enables smart contracts and structured products, all based on the tokenization of assets, which promotes tradability and enables the generation of the liquidity required to make credit-incentivization and offsetting economically efficient.”
He continued, “Our trust-enhancing technology enables the move from a linear, highly environmentally-unfriendly supply chain, to a collaborative, many-to-many, net-zero promoting ecosystem that leverages blockchain to promote trust and transparency.”
It is all about trust and credibility
According to Richards, the company strongly believes in traditional and established methods of transparency. “We support regulation. Furthermore, we ensure that the credibility of activities, assets, contracts, and the markets associated with Changeblock are maintained at all times. By engaging closely with stakeholders in the environmental, audit, financial and governmental communities, we ensure that we meet all required standards and serve with best practices whilst also pursuing, where possible, innovation and new standards to enable increased market activity and liquidity.”
The impact of COVID-19
The three big issues that became apparent during 2021 included:
1) Global supply chains were thrown into chaos due to the COVID pandemic, which resulted in various countries implementing lockdowns. The impact of these restrictions varied in severity and timing; some were more strict than others, leading to significant shifts within industries that had been developing nicely without any issues pre-pandemic (such as online shopping).
2) The world is becoming more competitive and businesses are struggling to keep up. For example, in Europe there has been an increase in red tape, making it difficult for companies that operate across borders to handle supply chain pressures due to fluctuating exchange rates, inflation, and general financial turbulence. They are not able to build effective global management teams when they don't know what will happen next with currency values - all this without taking into account other factors such as trade agreements between countries and the war in Ukraine.
3) Logistics and supply chain activities are having a major impact on the environment. If countries around the world want to meet their emissions targets, it's important they develop sustainable practices for this area of business - and what better time than now with COP27 coming up?
A new decarbonized future
Richards believes in a future where traditional finance, artificial intelligence, autonomous sensing, and blockchain are perfectly harmonized to deliver better outcomes for environmental projects, their investors, corporations, institutions, and individuals. He concluded, “We use blockchain technology, market-expertise, traditional finance and advanced data analytics to deliver tools and products that improve profitability, quality and trust in businesses and their supply chains by offering a low friction path to net zero.”
Photo by Marcin Jozwiak on Unsplash
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