Why Blockchain Can Be An Effective Tool For Fighting Environmental Crime
This article is the first of a five-part series with David Luna, CEO and President of Luna Global Networks & Convergence Strategies LLC.
The effects of environmental crime and illicit trade are vast and often irreversible.
For illustration, look no further than the recent death of the last male northern white rhino, a species that was ruthlessly hunted to the brink of extinction in pursuit of its horn.
The illegal trade in animal parts — rhino horn, ivory, pangolin, and many more — is still thriving in many parts of the world.
Individual species are not the only things suffering.
Illegal logging and agricultural demands have led to massive deforestation and loss of habitat around the globe. In particular, the palm oil industry has devastated forests in the past through unscrupulous slash-and-burn techniques for clearing land. Such deforestation further accelerates the extinction of several endangered species.
Given the booming global illegal economy, more holistic solutions are needed.
In the long-run, protecting the environment is going to take efforts from consumers, businesses, and governments.
The good news is that the international community is taking action on many fronts. Consumers are also demanding greater transparency in the products they buy — from timber and fish to products containing palm oil. They want to know that their purchases were manufactured responsibly. They want to know that the fish they picked up from the market was caught in a sustainable manner.
Many corporations and governments are increasingly realizing that fighting environmental crime isn’t just an issue of conservation.
“It’s also a smart business practice to adopt sensible, pragmatic solutions to protect our environment. A lot of companies recognize it relates to their bottom line from an economic perspective and from a broader market reputation. They want to ensure that their products are not financing illegality or instability,” says Luna — a former President of the OECD Task Force on Countering Illicit Trade.
To effectively combat environmental crime, communities and market stakeholders need to not only fight illicit trade and related corruption, but to harness and develop innovative tools and technologies.
While blockchain is not a panacea for what ails the planet, it can be an extremely powerful tool for battling environmental issues, securing global supply chains, and rewarding good behavior.
Environmental issues are complex issues to solve.
The World Wildlife Fund has estimated that populations of vertebrate animals on earth declined 58% from 1970 to 2012. In freshwater species, the rate of decline was an even more precipitous 81%.
And many of the problems facing the environment are interconnected.
When palm oil isn’t sustainably sourced, the result is the destruction of vast swaths of rainforest. That deforestation doesn’t happen in a vacuum.
The loss of habitat affects the animals living in those rainforests. It affects humanity’s ability to create new medicines. It affects the planet’s ability to deal with the massive amounts of carbon dioxide humans are sending into the atmosphere.
All of these environmental problems are serious issues in their own right.
The trouble is, environmental issues are never just about the damage to the environment.
When millions of acres of rainforest are being illegally logged in places like Brazil, Southeast Asia and sub-Saharan Africa, who profits?
Unfortunately, the answer is often complicit corrupt officials, criminal elements or reckless business interests. Mining, illegal logging, and the poaching and trafficking of endangered wildlife help fuel greater insecurity and instability around the world.
Most people have heard about conflict minerals like “blood diamonds,” but those are not the only illicit commodities used to fuel violence and prop up criminals around the world.
Illegal logging of timbers, for example, has become a booming and dangerous business in many developing countries. Illegally-mined gold also presents numerous security challenges: fueling corruption and organized crime, creating health hazards from mercury-contaminated waters, exacerbating deforestation, and promoting the exploitation of men, women, and children.
As a witness to the impact of these acts, Luna says, “Environmental crime is both a cost to the environment and a cause to economic and financial insecurity. It results in many harms that really impact the economy, markets and communities.”
Fortunately, blockchain is particularly suited for combating environmental crime.
Tackling environmental challenges has to be undertaken in an interdisciplinary manner.
Consumers, businesses, and governments will all need to come together to solve these problems. But as a tool in the right hands, blockchain can be a powerful weapon to fight for our environment and the communities who depend on safe and sustainable business practices.
Blockchain works well in situations with multiple parties that all need to participate in a system. It may be a technological system, or a social contract like the UN Sustainable Development Goals. But whatever the case, blockchain helps create trust between parties that otherwise would not have existed.
Because of the immutable, decentralized nature of a blockchain, parties can trust the information registered on it is not being tampered with.
For example, the data from a pollution air sensor that shows a country is complying with clean air standards can be trusted, because no government official could surreptitiously alter the data before presenting it.
Blockchain also provides far greater transparency into supply chains.
Using either serial numbers or tamper-proof crypto seals, individual shipments and products can be tracked from the supplier to the manufacturer, and then on to wholesalers and retailers.
That visibility into the chain of custody works to squeeze out illicit trade by preventing illegal products (timber, fish, natural resources) from entering the supply chain in the first place.
And when those products can’t be sold, the value of extracting them is lowered, and the criminal elements profiting from them lose their sources of income. By intelligently leveraging tools like blockchain, governments and businesses can not only fight environmental issues — they can fight other transnational threats like corruption and organized crime.
At the end of the day, it’s about ensuring the quality, safety, and authentic products are being placed in consumers’ hands.
Blockchain isn’t the complete answer to protecting the environment, but it can be part of the solution.
This article originally appeared on Forbes.com.
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