One of the most compelling benefits of blockchain in food supply chains is its ability to provide real-time tracking of products from their source to the consumer.
This capability supports sustainability efforts by ensuring compliance with environmental, social and governance (ESG) standards and helps producers receive fair compensation.
As the WEF report highlights: “To become more sustainable, firms now need to consider how they operate as part of an extensive multi-tiered supply network with multiple supply and demand links, reverse loops, multi-way interactions and exchanges with numerous actors and non-linear dynamics.”
The transparency offered by blockchain is particularly crucial in overcoming the challenges associated with Scope 3 emissions, which originate from a business’s supply and value chains.
These emissions are notoriously difficult to manage, especially when suppliers are located in countries with weaker environmental regulations.
By providing a clear and immutable record of every transaction and process within the supply chain, blockchain helps companies better monitor and reduce their carbon footprint, even across multiple tiers of suppliers.
Blockchain also addresses the issue of visibility, a common problem in traditional supply chains where companies often struggle to see beyond their first-tier suppliers. This lack of visibility weakens supply chain resilience and makes it difficult to anticipate disruptions.
Blockchain’s distributed ledger system ensures that all participants in the supply chain have access to the same information, improving communication and trust.
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