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The industrial sector is keen to curb carbon emissions and reach carbon neutrality, yet monitoring the origins of raw materials poses a substantial challenge. Consumers are now demanding supply chains that are not only sustainable but also ethically sound, which calls for complete visibility throughout the entire supply chain process.
Traceability provides insights into a product's lifecycle, from its inception to its disposal, enabling consumers to make more educated buying decisions and choose their suppliers wisely.
What are the challenges for businesses?
Supply chain complexity: The difficulty in tracking down the sources of raw materials can make it difficult to ensure ethical sourcing and responsible practices all the way through the supply chain.
Data management: gathering and managing data on product traceability can be complex and resource-intensive.
Consumer expectations: Today's consumers seek not only tailor-made products, fair costs, and ethical companies. They also want better visibility into their supply chain dealings, expecting clear information about a product's environmental and social impact.
Regulatory compliance: Businesses face growing demands to comprehend and handle risks within their supply chains. Incorporating ESG elements into the supply chain is essential to keep informed and loyal customers satisfied, as they are becoming more conscious of ESG issues.
In terms of ESG efforts, it's crucial to have secure, auditable, and transparent data to build trust. After monitoring, the most critical aspect is record-keeping. Monitoring, measuring, and reporting are vital to reaching the goal of net zero. However, these measures are too complex to handle manually. According to Deloitte’s Environmental, Social, and Governance Preparedness Survey Report, published in May 2023:
Product tracking fits well with the sustainable economy as people, authorities, and investors increasingly want clear information about a product's environmental and social impact. They're interested in the origins of materials, how products are made, and their fate after use.
Blockchain offers a reliable record of a product's environmental footprint, fostering transparency, accountability, and sustainability in supply chains. It provides a secure, tamper-proof platform for companies to share and view data, promoting collaboration and trust among stakeholders.
Furthermore, blockchain can track materials throughout the supply chain for recycling, reuse, or remanufacturing. This makes it a significant tool for the circular economy and ESG reporting.
Finboot's MARCO Track & Trace is a digital traceability solution powered by blockchain. MARCO Track & Trace enables trusted shared record-keeping between stakeholders in a supply chain. It empowers businesses to easily configure and create digital product passports and to manage their ESG and sustainability data through end-to-end traceability and visibility (from raw materials to finished products).
Digital Product Passport: is a digital tool leveraging blockchain technology to create secure, immutable records of materials and products. By tracking the complete lifecycle of a product—from origin to consumption end—it provides real-time insights into the supply chain journey of any product. This increased transparency can help businesses showcase the quality of their products and operations, thereby enhancing their sustainability credentials.
It can store, track, and share data regarding suppliers, quality control checks, production processes, sustainability claims, and much more.
(MARCO screenshot: Digital Product Passport)
Premium Tracking (Mass Balance and Carbon Footprint): essentially, the mass balance model mixes used materials with specific characteristics with other materials without the same characteristics, resulting in an output proportional to the input. Independent audits throughout the transition check the origin and quantity of renewable feedstock, enabling certification.
This approach also includes automated reporting of sustainability credits and mass balance ledgers, aligning bookkeeping with physical tracking. Moreover, it involves an automated calculation of a product's carbon footprint, which can be shared as part of the Digital Product Passport (DPP) to reflect a company's commitment to sustainability and compliance with regulations.
By accurately tracking and analyzing these flows, mass balance and carbon footprint can help verify the sustainability claims made by companies, thereby combating 'greenwashing'—a deceptive tactic where companies exaggerate or falsely claim environmental benefits.
(MARCO screenshot: Mass Balance)
Interoperability to legacy and emerging tech: traceability ecosystems do not live in isolation. Siloed solutions will only be adequate for niche use cases and very specific applications. To address the broader market opportunity vendors must have the capability to integrate and interoperate with legacy and emerging systems. Legacy systems include an enterprises’ ERP or other supply chain and productions software, while emerging systems will include the use of IoT devices and the connectivity to different underlying database structures including the many layer-1 blockchain technologies and frameworks.
MARCO was designed with interoperability at its core. MARCO can aggregate emerging technologies into our ecosystems, which strengthens our market position. We also have a proven track record of integrating to legacy systems, without the need for bespoke software development.
Do you want to see MARCO in Action? Read some of our Circular Economy Use Cases:
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