Blockchain technology gained buzz-worthy status when it became associated with the famed cryptocurrency Bitcoin. In essence, blockchain is an open and digitally distributed public ledger that records transactions between multiple parties in a verifiable and tamper-proof way. But how could the fashion industry stand to benefit from this technology?
The State of Fashion 2019 report by McKinsey & Co. claimed that consumers’ trust in brands had been eroding. Since greenwashing has become increasingly prevalent, it’s getting harder for the consumer to distinguish what a genuinely sustainable product may be and what is just a product of marketing trickery. Right from the point where the fabrics are sourced, to how they are processed and finished, where they are sewn and what materials are used in its packaging. Every item of clothing ever purchased has changed several hands through its journey — the details of which are lost on the consumer. This is where blockchain technology comes in.
Blockchain is valuable because it provides a completely trustworthy and tamper-proof audit trail of the key activities in a supply chain. When blockchain technology is integrated into a brand’s supply chain, it can help give credit to all the people involved in the process of making their creations. Consumers will be able to scan a code on an item of clothing and know exactly how much the garment worker was paid and if that is a fair wage, or the specific location of the mill that produced the yarn and if it’s sustainable.
Image credit: Provenance.org
Transparency has become an important issue further up in the supply chain, with consumers increasingly concerned about issues including fair labour, sustainable resourcing, and the environment. Consumers want to support brands that are doing good in the world, with 66 percent willing to pay more for sustainable goods. By design, blockchain enforces transparency, security, authenticity, and auditability — all the key factors that are necessary to make tracing the chain of custody and attributes of products possible, which in turn allows customers to derive the high-quality information needed to make more informed choices.
In effect, blockchain makes room for the decentralisation of trust. With key data being cataloged and made public, the consumer will be armed with enough knowledge to make informed choices about their sustainable purchases, effectively leaving no room to feel greenwashed.
Published by: Vibhuti Vazirani/ 2020-10-07