What We Think
October 28, 2020
How blockchain can accelerate sustainable developments
Rising human populations and consumption rates are straining our planet’s resources. Worse still, industralisation and urbanisation are harming the environment and depleting natural resources at alarming rates. Apart from these rising concerns, there is also the pressing issue of climate change that one needs to bear in mind. Sustainability initiatives have never been more important, and a technology which could play a role in supporting such intiatives is blockchain.
Generally speaking, blockchain is probably best known as the principal technology behind digital currencies such as bitcoin. However, it has applications which go well beyond cryptocurrencies. With the ability to record information in a manner which makes it near impossible to alter or hack, it is considered to be the ideal platform to record information with the utmost transparency and traceability.
There are various opportunities for blockchain to remodel conventional approaches to sustainable development, even accelerating progress if utilised effectively. The UN’s Sustainable Development Goals (“SDG”) cover a broad range of social, economic and environmental issues. Research has shown that over two thirds of the 169 targets underpininng these goals, may be reinforced by technological innovation. Advancements in technology can certainly do more to accelerate progress towards the attainment of SDGs. We need to examine the degree to which this opportunity is being realised and what else needs to be done to unlock the potential and opportunities that emerging technologies, linked to the fourth industrial revolution present.
The International Union for Conservation of Nature (“IUCN”) equips public, private and non-governmental organisations with the necessary information and tools for economic development and nature conversation to take place together. The IUCN have stated that they are looking at utilising blockchain to administer their Green List of Global Conservation areas, which essentially encourages and supports the creation of new and protected conservation sites around the world. Having the relevant information relating to the Green List accessible by all necessary parties resultsin on-going transparency, increase in efficiency, reduction in overall costs and confirmation that any transactions are verified and settled automatically.
A programme currently in motion aimed at reducing world poverty is the World Food Programme’s Building Blocks. This programme was initiated in 2016 and it uses blockchain technology to effect cash transfers, ensuring they are more efficent and cost conscious. They manage to achieve a reduction in costs by completely eliminating the need for intermediaries. World Food Programme is not the only organisation utlising blockchain. The United Nations also encourages the use of this technology to address developmental issues in society. In view of this, the UN Climate Change sector asisted with establishing the Climate Chain Coalition (“CCC”). The CCC uses blockchain to promote cooperation among members and to enhance the monitoring, reporting and verification of climate action impacts.
Besides examining how organisations are utlising blockchain technology for their various programmes, there are a number of other uses for Blockchain to help advance SDGs. For example, with respect to SDG 7 (which revolves around affordable and non-pollutant energy), blockchain applications are being developed, that permit traceability to be achieved on the origin of energy, as well as enabling CO2 footprint management generated by companies, allowing to implement bonus programs using tokens. There is another important role which blockchain has, in that it can help restore trust. We are living through tough times, which are unfortunately characterised by corruption and scandal. Using blockchain allows for the preparation and development of budgets, which may be monitored in real time, with notifications triggered the second any deviation from the budget is detected. This makes the technology an appropriate mechanism to fight against prevarication and corruption, which is the main focus on SDG 16.
Whilst blockchain technology was initally seen as a money-driven industry which practically revolved solely around cryptocurrencies, organisations such as the United Nations, IUCN and WFP have shown us that technological innovation can and should be deployed for the benefit of underprivileged segments of society. Purposeful innovation and the creation of a new technology platform may be a valuable and much-needed step to continue working towards the attainment of the SDGs. Meaningful and decisive action, collaboration and coordination by organisations, investros and governments alike will be critical.