Attributes of Commodity Supply Chains: Feasibility of Blockchain Technology for Responsible Sourcing
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Date
2020-06-22
Authors
Mathew, Betsy Tesy
Journal Title
Journal ISSN
Volume Title
Publisher
University of Waterloo
Abstract
Assuring the credibility of information on sourcing of raw materials is a major challenge in sustainable supply chain management. Enhancing the reliability and transparency increase the trust of stakeholders and help mitigate sustainability risks that may cause reputational harm to firms. Blockchain is an emerging digital technology that has gained interest as a tool for assurance of supply chains. This research explores the potential for blockchain technology to contribute to the domain of sustainability, looking at the feasibility of blockchain technology for responsible sourcing. The study employed a qualitative approach, drawing on data from expert consultations, academic literature, industry reports and media reports to evaluate the attributes of commodity supply chains that could influence their assurance and alignment with blockchain. A framework was developed to analyze the attributes of commodity supply chains relevant to blockchain technology. A major contribution of this study is the development of a decision tree tool that was then used to assess twelve different commodity supply chains for seven biotic commodities (cocoa, coffee, cotton, fish, palm oil, oranges, and rubber) and five abiotic commodities (aluminum, cobalt, diamonds, mica, and tin). Significant sustainability risks in these commodity supply chains were identified. The results found that there is commonly a lack of trust among actors in all the assessed commodity supply chains yet found variation in the willingness of different sectors to accept new technology. Two models (a hybrid model and a digital model) are proposed that could be used by companies interested in transitioning to a blockchain-based assurance system. The findings in the study provide new insights into the practicality of blockchain technology in sustainable supply chain management.