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In this technologically advanced world, several new practices and forms have emerged, which have set the bar pretty high, whether it’s dealing with customer interactions using AI chatbots or enhancing online commerce through augmented and virtual reality. But what truly provided a breakthrough across multiple sectors or industries is blockchain technology. Known as the most functional form of decentralized ledger technology, blockchain surprisingly eliminated the barriers set by traditional ledger systems and financial rails. Whether it’s enabling borderless transactions or automating transaction executions through smart contracts, it has opened channels for innovation and agility.
Although blockchain was first introduced to form the base of cryptocurrency transactions, it is now being used in several other ways to achieve transparency and immutability. One such applicable area where it has proven to be full of opportunities is making a business more sustainable and value-based. Whether it’s addressing social concerns by eliminating geographical barriers or environmental problems by reducing carbon footprints, blockchain can now be used to support and promote sustainable business practices. With this being said, below we have described a few ways in which you can make your business more sustainable, value-centric, and fair using blockchain’s decentralized ledger technology.
Why Do Sustainable Business Practices Matter In Today’s Time?
Before using blockchain to integrate sustainable practices with your business, let’s first understand its importance in today’s time. only then you will be able to accurately assess the areas or processes that need sustainability and proceed further with the complicated DLT implementation.
1. Reduced Environmental Impact: One of the major reasons why businesses from varied industries have started to integrate sustainability into their practices and workflows is to reduce carbon emissions and the negative impacts on the environment.
2. Meeting Consumer Demand: Since customers have become more aware and vigilant towards the deteriorating conditions of the environment, they have started to prefer sustainable products and services. Hence, to meet consumer demand and keep up with the pace, businesses and companies need to adopt sustainable practices at the earliest.
3. Brand Reputation: By adopting sustainable practices, businesses will be able to form an appealing brand reputation and reach out to more customers, thereby increasing their market penetration.
4. Regulatory Compliance: Several industry standards and compliance rules have been introduced across industries concerning social and environmental responsibilities, thereby forcing businesses and organizations to adopt sustainable practices.
What Are The Key Features Of Blockchain Technology?
Now that we have discussed the major reasons you need to integrate sustainable practices within your business, let’s get back to discussing blockchain. Learning about its salient features will help you recognize its true potential and make a well-informed decision before integrating the DLT with your business workflows for sustainability.
- Transparency: Blockchain is a shared network amongst multiple users rather than providing supreme control to a single person or entity. Hence, it enables end-to-end transparency of all data stored in the ledger, regardless of the type or time of addition to the ledger.
- Immutability: Blockchain is immutable, meaning once data is added to its ledger, it can’t be manipulated or forged by any means, even if the person trying to do so has the master control. Hence, it allows businesses to establish optimal transparency and credibility.
- Decentralized: As already mentioned above, blockchain is a decentralized ledger technology. In other words, its control is distributed amongst multiple users. No single authority or entity will have all the control.
- Cryptography: When any data has to be added to the blockchain’s ledger, it is thoroughly encrypted using top-rated cryptographic practices, thereby providing optimal security to businesses.
- Smart Contracts: Blockchain usually functions through smart contracts deployed to the global network. These are self-executable programs and can automate transaction execution with ease.
How Can Blockchain Help Boost Sustainable Business Practices?
Understanding blockchain’s ability to boost sustainable business practices is the key to making your company or organization future-ready and aligning the principles and workflows with the growing market trends. Besides, it will help you bear social and environmental responsibilities, which are necessary in today’s time. so, let’s have a look at how blockchain will support the implementation of sustainable business practices.
1. Increased Transparency Across Supply Chains
Supply chains can be made more transparent by leveraging the immutability feature of blockchain. In other words, once the product details are added to the ledger, they will become immune to any manipulation or forgery. Customers will have access to original information, straight from the point of origin or manufacturing to make well-informed decisions. If anyone wants to view a certain detail about the product, they can pull the data stored in the blockchain’s ledger without worrying about manipulated information.
2. Accessing Carbon Markets For Ecological Values
One of the best ways through which blockchain can be used globally to boost a company’s policies towards sustainable practices catering to environmental concerns is by granting carbon credits. These credits are usually given to companies that reduce carbon emissions by cutting down their fuel consumption, eliminating practices for improving economics at the cost of damaging nature, and improving waste disposal strategies. If these credits are granted in the form of NFTs or crypto tokens, companies can try a better way to integrate sustainable practices for incentives.
3. Limited Wastage Of Food And Related Products
One of the growing environmental concerns at the global platform is increased food waste or mishandling due to a lack of visibility into the supply chain. However, with blockchain, this hurdle can be easily eliminated as businesses will have complete transparency about the food products, from the point of their origin to customer’s usage. Tracking the movements of food-based products along the supply chain in real-time through blockchain will help businesses identify the causes leading to wastage, and thereby take appropriate actions.
4. Promotion Of Green Finance
Green finance has now leaped several businesses and organizations have started to adopt practices to promote this idea, whether by directing their finances toward sustainable development or reducing greenhouse gas emissions. Blockchain is likely to play a crucial role by enabling businesses to handle their finances for improving environmental conditions. Every transaction initiated can be tracked through this distributed ledger, thereby allowing companies and organizations to become socially and environmentally responsible.
Conclusion
In this article, we have discussed some of the major ways in which blockchain can be further utilized to boost sustainable practices and delineate responsibilities towards the environment and social values. However, since it is still in the novice stage with several potentials yet to be unlocked, businesses do need to plan blockchain development and usage properly and avoid concerns about authenticity.
