The fashion industry is notorious for having a negative impact on the environment. The textile sector has a high carbon footprint, from water pollution caused by dyeing to massive volumes of textile waste generated by fast fashion. Social sustainability, in addition to environmental sustainability, is a significant part of the fashion industry. The sector has been criticised for its harsh working conditions, low wages, and worker exploitation, especially in developing countries. However, blockchain technology has the ability to transform how fashion is made, consumed, and disposed of, as well as enhance social issues, resulting in a more sustainable future for the industry.
Blockchain technology is a distributed ledger technology that enables safe, transparent, and tamperproof transactions between parties in the absence of a centralised authority. It was first launched in 2008 as the underlying technology for Bitcoin, a decentralised digital currency, but has subsequently expanded to have a wide range of applications outside of cryptocurrencies.
Blockchain, at its heart, is a database that stores data in a series of blocks that are connected together using cryptographic processes. Each block includes a cryptographic hash of the preceding block, as well as a timestamp and a list of transactions. This generates a secure and tamper-proof record of every transaction on the blockchain.
One of the most important characteristics of blockchain is its decentralisation. The blockchain is dispersed among a network of nodes, each of which possesses a copy of the database, rather than being controlled by a single institution, such as a bank or government. Because any changes to the blockchain must be accepted by a consensus of the network’s nodes, it is resistant to manipulation and hacking.
Transparency is another crucial aspect of blockchain. While blockchain transactions are anonymous, the blockchain itself is open and accessible to anyone on the network. This means that anyone can inspect the blockchain’s transaction history and verify the validity of transactions.
The fashion sector may benefit from blockchain technology in two ways: traceability and transparency. Companies can use blockchain to construct a secure and transparent supply chain, allowing for increased product traceability and transparency in the manufacturing process.
Traceability refers to the ability to track products along the supply chain, from raw material procurement to finished product delivery. Blockchain can create a visible and verifiable record of each product’s journey by providing a secure and tamper-proof record of every step in the supply chain. This can assist businesses in identifying and addressing any supply chain difficulties or inefficiencies, such as delays or quality control issues.
The ability to provide open and accessible information about the manufacturing process is referred to as transparency. Blockchain can improve transparency by establishing a decentralised and secure platform for sharing information about the manufacturing process. This can contain details regarding the materials utilised, the manufacturing method, and the working conditions of those involved in the manufacturing process.
It has the ability to address a wide range of difficulties confronting the fashion industry, including material sustainability, transparency, supply chain management, circularity and addressing social issues.
Material Sustainability
Blockchain technology can be used to identify and verify sustainable materials in the fashion industry, thereby assisting in the development of a more sustainable and ecologically friendly supply chain.
Blockchain can improve supply chain traceability and accountability by creating a secure and transparent platform for tracking the origin and production of raw commodities. This can help to guarantee that resources are acquired and manufactured in a sustainable manner, and it can be used to verify certifications such as Fair Trade or Organic.
Blockchain, for example, can be used to monitor cotton from the farm to the finished garment, providing a tamper-proof record of each stage in the supply chain. This can assist ensure that the cotton was produced in a sustainable, ethical, and environmentally friendly manner.
Furthermore, blockchain can aid in the development of new sustainable materials. Blockchain can assist to bring together designers, scientists, and manufacturers to create and produce new sustainable materials, such as plant-based textiles or recycled fabrics, by providing a safe and decentralised platform for exchanging information and resources.
Transparency
The lack of transparency in the supply chain is one of the most serious challenges in the fashion business. Many businesses have no idea where their supplies came from, how they were manufactured, or who was engaged in the manufacturing process. Because of this lack of openness, it is impossible to ensure that environmental and social requirements are met.
By providing a secure and transparent mechanism to trace products along the supply chain, blockchain can help increase transparency in the fashion sector. Companies can use blockchain technology to trace the origin of raw materials, track product movement through the supply chain, and guarantee that ethical and sustainable practises are followed.
Supply chain administration
The fashion business is well-known for its complicated supply chain. There are numerous steps involved in the production and distribution of fashion items, from raw material production to final product delivery. This complexity makes effective and efficient supply chain management difficult.
Blockchain technology can help to simplify supply chain management by creating a single, transparent, and secure ledger that records all supply chain transactions and information. This results in increased efficiency, improved communication among stakeholders, and faster identification of bottlenecks and inefficiencies in the supply chain.
Circularity
The fashion industry also contributes significantly to textile waste. Every second, the equivalent of one garbage truck load of textiles is landfilled or burned, according to the Ellen MacArthur Foundation. However, blockchain technology can assist to build a more circular fashion sector by allowing products to be tracked and traced throughout their existence.
Companies can create a digital record of each product’s lifecycle, from raw material creation to final disposal, by utilising blockchain technology. This record may contain information about the materials used, the manufacturing process, and the end-of-life alternatives for the product. This data can be utilised to establish a closed-loop system in which things are recycled, repurposed, or reused rather than discarded.
In addition to tracking garment disposal, blockchain can help with clothes reuse and recycling. Blockchain can assist to reduce the amount of waste caused by the fashion industry by developing a decentralised platform for swapping and repurposing apparel. Clothing swaps, second-hand markets, and upcycling programmes are examples of such activities.
Furthermore, blockchain can be used to incentivize environmentally friendly disposal and recycling practises. Blockchain can incentivize individuals and organisations to dispose of clothing in a responsible and sustainable manner by introducing a secure and decentralised system of rewards and incentives.
Addressing Social Issues
This can be accomplished by using blockchain to track the movement of products from raw material production to final product delivery. Blockchain can also be used by businesses to track compliance with social and ethical criteria such as the United Nations Global Compact or Fair Trade certification.
Blockchain can also help to create equitable and transparent payment and reward systems for workers. Companies, for example, might use blockchain to build a secure, decentralised platform for workers to receive payments, removing the need for intermediaries and lowering the risk of fraud or corruption.
Furthermore, blockchain technology can improve transparency in the hiring and employment process. It can assist businesses in verifying the identification and credentials of job candidates as well as tracking workers’ employment history. This can aid in preventing exploitation and ensuring workers are treated properly and with dignity.
Trade-offs
Blockchain technology can also be utilised in the fashion sector to discover and manage trade-offs. In the fashion industry, there are frequently trade-offs between environmental sustainability, social responsibility, and commercial viability. A garment constructed with sustainable materials, for example, may be more expensive to make, reducing its economic viability.
By offering a transparent and decentralised platform for collecting and analysing data linked to sustainability and production, blockchain can assist in identifying these trade-offs. Blockchain can promote a more collaborative and data-driven approach to decision-making by producing a tamper-proof record of each transaction and offering a shared database available to all stakeholders in the supply chain.
Blockchain can also help to automate certain procedures connected to sustainability, such as carbon offsetting or fair labour practises, through the use of smart contracts. This can help to ensure that sustainability objectives are accomplished while minimising the economic expenses of putting these practises in place.
Furthermore, by increasing openness and accountability, blockchain can assist in identifying areas where trade-offs may exist and facilitating more informed decision-making. Blockchain, for example, can assist businesses in making more sustainable and ethical decisions by giving data on the environmental and social effect of various manufacturing techniques.
In conclusion, the fashion business has a large impact on the environment and society. Blockchain technology, on the other hand, has the ability to transform the way the sector operates, resulting in a more sustainable and ethical future. Blockchain can help the fashion sector decrease its environmental effect and build a more sustainable future by giving transparency, streamlining supply chain management, and enabling circularity.
