Knowledge Share
New Normal, Digital Transformation, Industry 4.0
Trust | Transparency | Traceability
Ethical Sourcing and Blockchain
13 October 2020 | Traceability
According to a recent 2019 study by Nielsen, the majority (73%) of global consumers say they would definitely or probably change their consumption habits to reduce their impact on the environment. By focusing on conservation and sustainable sourcing to improve supply chains, companies can help ensure that those resources will still be available in the future. Essentially, ethical sourcing is a critical step for companies that want to be more socially conscious and connected with their consumers and the world around them.
Ethical sourcing is still a developing area, but it is here to stay. As conscious consumers join the call for greater social responsibility and environmental protection from manufacturers, blockchain helps companies answer that call. With a blockchain-powered supply chain, companies can not only promote good ethics but profitable business. Ethical sourcing of blockchain technology has three pillars
- 1. Building resilient and transparent supply chains
- 2. Creating more robust and more accountable public institutions
- 3. Spurring responsible sourcing and consumption.
Blockchain works from the bottom of the supply chain up to the finished product, tracking each component or asset. It helps in the provenance of parts, ingredients, and other elements that go into the supply chain process. According to the World Economic Forum, streamlining information through blockchain has the potential to increase trade by 15%. And as a result:
- Manufacturers can see a complete and immutable audit trail;
- And, in return retailers can share that firm proof to show consumers (and regulators) that they’re meeting the demand for ethical and sustainable practices
In a recent report, AT Kearney said that over 70% of those surveyed by the company in India said they are looking for brands that are sustainable and trustworthy, much higher than their global counterparts. Indian shoppers are becoming more aware and conscious of what they are buying and as a result, willing to buy into brands that follow ethical and sustainable practices, according to a CII-AT Kearney report on sustainable retail.
2019 Edelman Trust Barometer reports (based on an online survey in 27 markets covering over 33,000 respondents) India is among the most trusted nations globally when it comes to government, business, NGOs and media but the country’s brands are among the least-trusted. The report also noted that there is a growing feeling of pessimism about the future, with only one-in-three mass population respondents in the selected significant economies of the world believing his or her family would be sustainable in the next five years. While companies or brands are recognising the need to act on sustainability and it is not to say that businesses do not have the intention, however, including sustainability into long term strategy needs organisational ambition, holistic thinking, ecosystem approach and focused execution.
Share Blog on: