The issue of child labour exerts a significant impact on global supply chains, affecting the production of various everyday items such as electronic devices and food products like chocolate. Despite the efforts made by large corporations to enforce zero-tolerance policies, child labour continues to persist, as indicated by UN figures estimating the global number of child labourers at approximately 160 million.
Numerous initiatives have been deployed to tackle this issue, including audits and due diligence policies, although the success of these efforts has been somewhat inconsistent. Nevertheless, one potential solution that has attracted considerable attention is the utilization of blockchain technology.
Blockchain, a digital database commonly associated with cryptocurrency transactions, harbours the potential to revolutionize supply chain management by ensuring transparency and security. Through the allocation of a digital ID to products at their point of origin and the tracking of their journey through subsequent transactions, blockchain technology can establish an unambiguous trail of a product’s history, rendering it challenging to conceal unethical practices such as child labour.
Furthermore, in addition to monitoring product movement, blockchain can integrate “smart contracts” to verify compliance with labour standards and facilitate secure and transparent payment systems. This not only serves to hold companies accountable for fair wages but also prevents the exploitation of child labour.
Nevertheless, whilst blockchain technology presents a promising solution, its implementation may pose challenges, particularly for smaller suppliers and producers in developing economies. The absence of technological infrastructure, such as smartphones and reliable internet connections, may impede their ability to derive benefits from blockchain systems.
To address this issue, innovative solutions such as recording transactions via text messages have been proposed to enable participation in secure transactions and foster fair and accountable supply chains.
In summary, blockchain technology exhibits substantial promise in combating child labour in global supply chains by augmenting transparency, accountability, and equitable practices. Although challenges in implementation endure, exploring alternative avenues to facilitate the adoption of blockchain in developing economies can contribute to the establishment of a more ethical and responsible supply chain ecosystem.