How Blockchain Technology Could Help Prevent Child Labour
Blockchain technology can promote transparent, ethical supply chains, free from child labour.
Many global supply chains rely on millions of children working under adverse conditions. Companies and governments have, so far, been helpless to act against this highly problematic issue. Because of its decentralized and immutable nature, Blockchain has emerged as a promising solution in the fight against child labor. Elaborated in this blog post will be how blockchain can be used to prevent child labor within global supply chains, its possible benefits, and the implementation steps involved.
Understanding Blockchain Technology
What is Blockchain?
Blockchain is a decentralized, digital, and replicated ledger that maintains records of peer-to-peer transactions on different computers. Each block in this particular chain comprises a linked list of transactions. It is immutable, thus adding to the level of security and transparency of information available to all participants within a network.
Key Features of Blockchain
- Immutable: The immutability of blockchain storage of data gives it the characteristics that make it impossible to erase or modify, hence a perpetual and non-alterable record.
- Transparency: Every node in the network possesses all transactions that were recorded on the blockchain; thus, it gives accountability back to the end users.
- Decentralization: Blockchain works in a peer-to-peer network with no central authority controlling it.
How Blockchain Can Help End Child Labour
More Transparent Supply Chains
This will propel blockchain into special, transparent views of the entire supply chain—from the procurement of the raw material to the final product. Each product can be traced by origin and confirmed at each stage that ethical practices are followed, based on the recording of every transaction on the blockchain.
Immutable Records
The immutable nature of blockchain means that, once entered, data cannot be modified. Therefore, fraud cannot take place, and it thus provides an irrefutable record of compliance with labour standards—making it impossible to let unethical practices not come to the surface.
Smart Contracts
Smart contracts are self-executing contracts with which the agreement of the contractual terms and conditions is directly written into lines of code. They can automatically enforce compliance with the labour standards and trigger actions when violations are detected. For example, creation and verification of smart contracts withholding payments to suppliers in the event of detection of child labour.
Certification and Verification
The blockchain can be used to verify supplier certifications and audits. Certification bodies could thereby log their findings on the blockchain, then present a tamper-proof verification with no incidence of child labor. This increases credibility to certifications and helps companies make better, more informed decisions regarding the suppliers.
Effects of Blockchain in the Prevention of Child Labor
Enhanced Accountability
It makes companies and suppliers liable for their actions by providing a clear and immutable record of activities in the supply chain. This in turn creates a sense of responsibility, hence results in ethical behaviors.
Consumer Trust
Consumers are concerned about the ethical practices espoused by brands they use. Blockchain can attest to the fact that products are not made using child labor, thereby increasing customer trust and credibility of the brand.
Cost Efficiency
While blockchain technology setup is subjected to one-time investment, it can save money in the long run as continuous manual audits and investigating processes will not be required. For example, compliance checks can be automated, which helps in saving much time and hence saves money.
Empowerment of Workers
Blockchain is able to empower workers through a secure platform where they could report violations and trace their employment record that will help in protecting their rights and fair treatment.
Steps to Implement Blockchain in Supply Chains
1. Stakeholder Collaboration
Implementation of Blockchain involves the corporation of all stakeholders, and this includes companies, suppliers, certification bodies, and governments. Stakeholders have to agree with standards and protocols on how to record and verify data.
2. Building the Blockchain Network
A company has to develop a blockchain network where all of the participants in the supply chain are involved. Companies have to select a suitable platform for Blockchain and develop the infrastructure that goes into it.
3. Implementing Smart Contracts
Smart contracts have to be developed in order to automate compliance checking and enforcing labour standards. This will involve coding the terms of the agreement and integrating it into a blockchain network.
4. Ongoing Monitoring and Auditing
To ensure that the blockchain system works effectively, regular monitoring and auditing need to go on unabated. It could be verified by independent auditing firms whether data recorded in the ledger is correct and if the labour standards are complied with.
5. Training and Education
Blockchain literacy and the benefits of blockchain have to be driven through to the stakeholders. Multiple training programs would also increase knowledge of the participants regarding the use of the system and compliance therewith.
Conclusion
Blockchain technology has huge potential to help stem child labor in global supply chains with transparency, accountability, and efficiency. In fact, the implementation of blockchain requires collaboration and investment, but the benefits of ethical and transparent supply chains are invaluable in the long term. By working with blockchain, companies could be much better positioned to assume a leading role in the elimination of child labor and in guaranteeing not only fair but also ethical labor practices.
Stay tuned as we explore a host of innovative solutions for a world that is much fairer and more transparent!.
— Professor Mark Davis
Blockchain technology enables us to create
transparent supply chains where unethical practices
like child labour can be swiftly identified
and addressed.
