Trust Will Power Green Supply Chains

The shift to sustainability 

The good news is consumers increasingly want sustainable products. Simon-Kucher and Partners studied over 10,000 people across 17 countries and found that 86% have shifted purchasing towards more sustainability in the past 5 years. The Economist Intelligence Unit and WWF found a 71% increase in online searches for sustainable goods between 2015 and 2020. Edelman Trust barometer found 86% of customers expect brands to take actions beyond their business. Importantly, these studies found trends in both developing and developed countries.

Fraudulent promises 

The world’s big companies from tech to apparel have noticed, some aiming to be net-zero within 20 years. All this positive action, sadly, is still open to fraud. Most companies self-report their numbers and self-audit their practices. When regulated, some companies find creative ways to cheat. Volkswagen famously designed engines to reduce emissions, only during an EPA test. Some even bribe regulators to pass inspections, as in high-profile coal mining cases.

Limited control over suppliers

Even when a company acts in good faith, the bigger issue is the global supply chain. The US EPA estimates that for many products, 90% of emissions are from suppliers – the parts, materials, transportation, and embedded energy. 

Companies have less control of their suppliers and even less control of their supplier’s supplier. This has led to high-profile scandals for the world’s top brands.

Building trust

The key question becomes, how can private industry build faith, trust, and transparency in the environmental impact of global supply chains? Companies, NGOs, and governments are collaborating to establish standards, but those can be substandard and ambiguous to end consumers. ESG accounting practices, which have historically focused on a company’s direct impact, are learning to report these supply chain or “Scope 3” impacts.

Verifiable evidence has become necessary

But for consumers, investors, and regulators to have real faith in these supply chain metrics, they need the evidence to be verifiable. They need ways to confirm a bill of sale for green steel is authentic, that a power bill for solar was not photoshopped, etc. There is also a demand to go beyond a regulator’s spot check, which might assure the factory was clean on the day of inspection. 

Image authentication technology

Digital content provenance and image authentication technology gives each stakeholder a way to continuously monitor a factory, and elevated transparency to consumers. Imagine an environmental manager in a private industry verifying green materials arrived at a small supplier’s factory, waste was not dumped into a nearby river, and workers were treated well. Imagine that organization, say Apple or a major clothing manufacturer, being able to provide that info, for each individual product, to every customer, investor, and regulator.

If trust tech can increase our faith in the carbon impact of our economic choices, this faith can align consumers, producers, investors, and regulators to each do their part. Honest information is the key to a healthy planet.

Shouvik Banerjee is the Founder and CEO of AverPoint, a news product that promotes media literacy to counter disinformation. He spent 10 years in clean energy, including the Obama Administration, SolarCity, and McKinsey.