Blockchain’s Renewed Pitch: Tracking Supply Chain Emissions

LONDON (Azat TV) – Blockchain technology is undergoing a strategic re-evaluation by its proponents, who are now shifting focus from cryptocurrency trading to its potential in fostering “trust” and enhancing data integrity, particularly for tracking notoriously complex supply-chain emissions. This pivot comes as companies globally face escalating pressure to accurately measure and report their “Scope 3” greenhouse gas emissions, presenting blockchain as a novel solution for a persistent environmental and regulatory challenge.

Blockchain’s Shifting Focus to Emissions Data

In recent industry discussions, blockchain advocates have deliberately steered conversations towards the technology’s capacity for building trust and managing critical data, moving away from its more volatile associations with crypto trading. This strategic repositioning highlights new use cases such as supply-chain tracking, digital identity verification, and automated data authentication. The shift is not coincidental; it directly addresses the escalating demands on businesses to meticulously map out their “Scope 3” emissions.

Scope 3 emissions encompass all indirect greenhouse gases generated across a company’s value chain, from raw material sourcing and manufacturing to product transport and end-of-life disposal. These emissions often significantly outweigh a company’s direct operational output but fall outside its immediate control, making them notoriously difficult to quantify and verify. The World Economic Forum has underscored the urgency of this challenge, noting that just eight global supply chains are responsible for more than half of all worldwide emissions.

The Challenge of Scope 3 Emissions Tracking

Accurately tracking Scope 3 emissions presents a formidable hurdle for businesses, as it requires coordination and data exchange across numerous independent entities within a sprawling supply network. Companies frequently dispute these figures, pointing to the inherent difficulties in obtaining reliable, comprehensive data from disparate partners. Deloitte has identified blockchain as a promising tool to enhance transparency and traceability within these complex supply chains, particularly for environmental, social, and governance (ESG) reporting requirements tied to Scope 3 emissions. The technology’s distributed ledger system, which allows multiple parties to add and review tamper-resistant entries, is seen as key to creating an unalterable audit trail for emissions data.

The concept of using blockchain for supply chain transparency is not entirely new. Retail giants, including Walmart, have previously explored its application in food safety. A Hyperledger Fabric system implemented in Walmart’s pilots demonstrated a dramatic reduction in the time required to trace U.S. mangoes from days to mere seconds. Frank Yiannas, Walmart’s former food safety chief, emphasized that the “food supply chain” is a complex network, not a simple chain, highlighting the need for robust, interconnected data systems.

Past Hurdles and Future Prospects for Blockchain

Despite promising pilot programs, widespread adoption of blockchain in supply chains has faced significant obstacles. A notable example is TradeLens, a joint venture between shipping giant Maersk and IBM, launched in 2019 with the aim of creating an unprecedented level of transparency in global shipping. Lars Kastrup of Maersk had envisioned TradeLens enabling supply chain operators to react more swiftly to disruptions. However, Maersk and IBM eventually discontinued the platform, citing insufficient participation from industry partners as the primary reason for its commercial non-viability.

The current renewed pitch for blockchain-based emissions tracking seeks to learn from these past challenges. Developers are now proposing solutions that could capture emissions data almost instantaneously by integrating sensors and tracking equipment with tamper-resistant blockchain records. This approach could also extend to carbon credit markets, providing a more reliable verification mechanism for offsets, an area that has faced integrity questions, as research from the Australia Institute has highlighted regarding doubts over genuine emissions reduction.

Beyond the Code: Building Trust in Blockchain Applications

Beyond merely providing technical infrastructure, developers are also positioning blockchain as a potential revenue stream. The PixelPlex Team, in a piece for Morocco World News, suggested that companies could “productize” their internal verification and reconciliation processes, offering them as services to others. They also discussed “tokenization,” where digital tokens represent fractional ownership of physical assets, creating new financial models within supply chains.

However, the inherent risks associated with blockchain adoption have not vanished. Kevin Werbach, a professor at Wharton, describes blockchain as a “new structure of trust” but cautions that true trust requires more than just code. He emphasizes the necessity of robust governance frameworks, effective dispute resolution mechanisms, and overall faith in the entire system, not solely the underlying technology. A shared ledger, he notes, is ultimately only as reliable as the data and rules upon which it is built.

The current iteration of blockchain’s utility is focused on more grounded applications: permissioned blockchains, which limit access to vetted users, are being deployed for specific functions like traceability, audit trails, and document verification. The ultimate success of this latest push hinges on whether these targeted efforts can evolve into fundamental infrastructure for global supply chains or merely fade as another cycle of pilot projects, a distinction that will largely depend on the commitment of key backers and the willingness of stakeholders to invest in shared solutions.