María Teresa Nieto, Blockchain Technological Specialist at Telefónica

The Brazilian textile industry represents 10% of the nation’s industrial GDP, and it is also the second-largest employer in the country. Despite its importance, fashion is ranked second as the industry with most cases of forced labor or conditions similar to slavery.

As an effort to fight this problem, in recent years, brands and manufacturers in the textile industry have been auditing production sites. Because of the lack of integration between the actors of this production chain, auditings is still very inefficient, as it involves high costs and offers a vast scope of error. 

There are three main problems in the current audit model.

Because workers and auditors have a strictly professional, non-anonymous, and punctual relationship, there is no way to guarantee the veracity of the worker’s account. Moreover, in most cases, only a few workers are interviewed by the auditor, which makes the picture incomplete since it does not reflect the overarching reality of the production process.

Besides the possibility of human error and fraud, the current model has low auditing frequency (once a year), depends on third party institutions, and is very expensive. This scenario translates into inefficiency and generates doubts for the stakeholders since the benefits become unclear.

The third and most critical problem with this type of auditing is the lack of interface between the market and society. Since the whole process, from production to consumption, is not available and transparent for end consumers, key actors do not have adequate information to demand better conditions for workers or to make better consumption choices.

In addition, the fashion industry involves many intermediaries: seamstresses, workshops, factories, suppliers, brands. This amount of people makes it difficult to monitor all business productivity in a clear, integrated, and efficient manner.

Addressing this situation means taking on a number of challenges: How to connect actors in the supply chain, bringing business efficiency, predictability of delivery, and inventory? How to offer visibility to the production processes, and therefore give voice to the last mile of the chain? How to empower seamstresses and improve their working conditions?

To solve these problems and reverse this scenario, Blockforce – a Brazilian blockchain researcher and builder and general member of Hyperledger –  in partnership with C&A Foundation, Instituto E and COPPEAD-UFRJ, developed a blockchain-based solution called Fair Fashion. Designed using the Hyperledger Fabric framework, this solution promotes visibility and accountability in the fashion supply chain, with the goal of improving working conditions and the efficiency of processes in the production chain. 

This is done through the publication of indexes that explain correlations between demographics, working conditions, and stability in the supply chain based on traceability of order matching with a monthly census with workers at the end of the production chain.

The Fair Fashion solution works on three fronts:

Firstly, Fair Fashion offers workers an app to report their work conditions. By answering a monthly questionnaire, the respective workers involved anonymously provide an update on the working conditions behind all orders placed during the month. 

The second tool is an app for the actors on the business side to trace orders status and conditions. The orders placed by brands are captured by suppliers and then by factories, providing visibility to all production processes as well as the accurate and transparent order status for the entire chain.

Finally, a Dashboard that integrates the data obtained by the two sources of Fair Fashion’s apps provides an overview of all available data. On the Dashboard, each stakeholder – brands, suppliers, or workshops – has its customized visualization. 

Chained and dependent, the solution consists of two interfaces, the business interface and the social responsibility interface. Together they offer the cross view of data necessary to establish the interdependence between flows, and therefore accuracy in verifying the exposed indexes.

The business interface integrates the flow between brands, suppliers, and workshops. It allows the organization to monitor the order status – the number of products produced and delivered, current order status, and its immutable history. It may check, in an organized manner, all documentation of the establishment, including whether it is up to date or pending, and, finally, monitor the current situation of employees.

On the other hand, the social responsibility interface is a reflection of the survey answered by workers through the app. It provides the workshop’s evaluation according to the workers’ perspective, considering the following segments: physical space, health, safety, labor relations, and working conditions.

All information in both interfaces can be viewed on the Hyperledger Fabric-powered blockchain.

The Fair Fashion solution provides benefits for all stakeholders in the chain and, ultimately, for the sector in general since it is based on efficiency and social impact. By collecting data with higher frequency, greater accuracy, and less cost, brands have visibility throughout the chain, enabling preventive actions and helping to predict deliverability and storage. Workshops and suppliers monitor their productivity and social indicators and can improve their dialogue with brands and society. Finally, by answering an anonymous and confidential survey about working conditions, workers can report their situations, guarantee job stability, and participate in a consolidated network that gives a voice to their needs and realities, which are not always assisted.

Fair Fashion is a project sector initiative along with C&A Foundation/ Laudes Foundation, E institute and COPPEAD-UFRJ.  It is released in its first version. We’re facing the homologation phase for scale implementation. We are advancing tests on brands and actors that aim for this type of innovation in their chains. 

Let’s change the fashion industry together. Contact us to find out more details about the solution and how to be part of it here: https://blockforce.in/

Cover photo by Kris Atomic on Unsplash

Most of us can relate to wanting to know where our food comes from – if it is safe to eat, ethically sourced, and whether that commodity harms the environment or is produced in a sustainable way. The topics of food safety, recall, waste management and ethical sourcing are justifiably getting a lot of attention. Consumers are demanding a greater level of transparency and assurance.

What if we could empower consumers with more trusted information at their fingertips so they can directly reward and incentivize small scale suppliers around the world that are committed to following sustainable practices? Imagine a future where more people could fully participate in the growing value of the green economy. With a powerful combination of blockchain, digital identity, payments and Internet of Things (IoT) capabilities, we at Accenture believe this is possible and imperative.  

Leveraging these capabilities, we collaboratively developed a solution built on Hyperledger Fabric that generates a new kind of value for producers. We call this capability circular supply chain. 

Here’s how it works: Let’s imagine a coffee farmer, for example. Using an app on their phone, the producer creates a profile, entering basic details like their name, date of birth, and the name of their coffee farm. At their cooperative, their identity is validated, using multiple security protocols.

The farmer’s identifier is then recorded on the blockchain, which acts as an index with links to all applicable data—including things like their payment details so they can receive tips or add attestation that prove their farm’s inspection history and certification status (organic, etc.). This makes it easy to locate, access and share information without the farmer’s personal data being stored on the blockchain.  

The app on the farmer’s phone is multi-factored and authentication-secured; it allows the farmer to generate their own set of public and private keys seamlessly which the farmer can then use to sign data they send to others. 

The farmer is always in control of their data, determining which information is part of their public profile or what details will be linked to a particular product as it moves through the supply chain. They can also use the app as a management tool to keep track of product registrations, check their tip balance, renew certifications and prepare a harvest for shipment.  

When a shipment is ready and registered, a unique identifier is automatically generated, embedding information about the coffee, the farmer and their farm (like its organic certification), and then scanned, captured, and verified at the point of origin.

Sensors can then be added, and registered, to the product at the cooperative warehouse. These sensors can monitor temperature and humidity within the warehouse to ensure product quality. And if the conditions go out of the optimal range, an alert is generated, prompting the warehouse to take preventative actions before the product quality is compromised. 

These details, and each step the shipment takes along the journey, are scanned, added to the ledger and traceable as it moves across the supply chain—from farmers to processors to grocery store shelves and, finally, to end consumers. Now a simple scan not only tells consumers the story of their sustainably-sourced coffee and the farmers that grew it but empowers them to reward the farmer via a secure tip. 

The benefit is a circular supply chain that goes beyond where it started and creates a closer connection between consumers and small growers. Processors, distributors, wholesalers and retailers can trace product provenance, creating market differentiation for sustainability, food security and quality. The hope is that by aligning incentives through an immersive customer experience that fosters informed purchasing decisions, we can empower an inclusive economy that encourages the actions to mitigate environmental impact and benefit people. 

Accenture has created this capability, but it’s just a start. We invite organizations across industries and the globe to collaborate with us as we collectively build a more sustainable and inclusive world. 

Read our report on circular supply chain and learn how to collaborate with us. You may also be interested in joining the Hyperledger Identity WG or Supply Chain SIG to see how others in this space are approaching this digital transformation.

Cover image via Peakpx

In 2018 there were 315 natural disaster events recorded with 11,804 deaths, over 68 million people negatively impacted, and US$131.7 billion in economic losses across the world. Fast forward to 2020, and we can expect regular occurrence of hurricanes, tornados, forest fires and other natural disasters but now against a backdrop of  communities strained to the limit by a global pandemic. 

Regardless of when or where they happen, the impact of natural disasters is tremendous and affected communities require time, energy and resources to rebuild. During and after these natural disasters, companies, relief agencies, and non-governmental organizations collaborate with the local, state, and national governments, along with residents in the communities to manage the relief efforts. These stakeholders often face a range of operational challenges during the disaster management efforts.

Key Challenges During Relief Efforts

The key challenges faced by organization during relief efforts include:

• Lack of trust, transparency, and auditability of the relief efforts to ensure resources are used for the intended purpose(s)
• Cumbersome registration process for volunteers 
• Lack of coordination across organizations
• Lack of single channel or process for donors and agencies
• Difficult collection and distribution efforts leading to duplication of efforts and waste
• Missing or improper recording of activities and transactions associated with the relief efforts

Miracle Joins Hands with Chainyard 

The Miracle Relief Collaboration League (MRCL) is a 501(c)3 not-for-profit corporation,  registered in the state of Texas, with a focus to serve those impacted by disaster events. MRCL was looking for ways to address the above challenges in order to connect needs with resources in natural disaster relief efforts such as hurricanes and floods.  

Through common associations, Chainyard was introduced to MRCL and its mission.  After learning more about the mission, Chainyard joined the effort to address these challenges. 

A Closer Look at the Challenges Revealed Blockchain Potential

From the point of view of enterprise architecture, relief efforts involve collaboration between various parties, meeting demands and exchanging goods – this is a classical supply chain where broken logistics hamper progress.

“Rarely does a location struck by a natural disaster lack parties willing to donate aid, in the form of food, medicine, shelter and other essential supplies. The problem is one of logistics. Effective emergency response to a natural disaster requires rapid, coordinated action among multiple parties.”

– Robert J. Bowman, Supply Chain Brain

A blockchain solution was ideal to address the above challenges. Examples include the following:

• A common platform: Blockchain brings collaboration and coordination among all stakeholders involved in relief effort by having a single, trusted ledger.
• Immutable data: Once data is recorded, it cannot be easily changed, creating an audit trail and trusted system for collection and distribution of goods and services.
• Secure sharing & management: Documents and personally identifiable information (PII) can be securely managed and shared with need-to-know parties. This enables compliance with privacy regulations across different geographic regions.
• Demand reporting: Demand (needs) from different areas can be recorded on a single network by trusted participants and met by different agencies. This can avoid duplication and wastage.
• Improve trust with 3^rd party verification: Needs can be verified by 3^rd parties to increase the trust.
• Tracking and visibility: Inventory of supplies can be tracked from receipt into the warehouses until delivery to the end receiver. This improves transparency and facilitates logistics, leading to faster responses and avoidance of duplication of efforts across relief organizations.
• Honoring volunteer effort: Volunteers hours can be captured, tracked, rewarded and audited. Incentives, even if just recognition, can lead to more community engagement.
• Future Tokenization: Potential future tokenization and linkage to stable coin can be used to incentivize volunteers to help

Designing the Hyperledger Fabric Blockchain Solution 

The Chainyard team worked with MRCL leadership and volunteers to build a blockchain-based solution that replaced the old MS Access application. The architecture is based on Hyperledger Fabric and the solution is running in pilot on Google Cloud.

Primary design considerations for using Hyperledger Fabric were:

• Identity of members is a critical factor for creating trust in disaster relief efforts. Fabric platform provides permissioned membership with right data protection regulations.
• Privacy and anonymity of transactions is critical for some of the stakeholders involved in relief efforts. At the same time making this information available for audit and compliance reviews is also critical. Fabric provides support to make data on a need-to-know basis.
• Immutable distributed ledger that allows all stakeholders to verify and share demand & inventory of supplies, proximity to affected areas, and coordinated communication with end to end visibility. 
• Faster development cycle that leverages widespread programming language support, mature tool set, and community of skilled resources contributing to the open source project.

Solution Highlights 

The highlights of the pilot run on the Minimum Viable Product (MVP) are as follows:

• Anytime, anywhere access with a smartphone to record a request for help or any related communication. Please note existing MVP does not offer mobile interface.
• Successful registration of all stakeholders involved in the disaster relief efforts –inclusive of relief organizations, volunteers, government agencies, medical service providers, and support infrastructure providers (e.g., transportation, shelters and warehouses). Please note existing MVP has limited organizational function support.
• Successful recording of all donations on the ledger.
• Verification and management of assistance to impacted communities
• Successful coordination of volunteer efforts. 
• Successful recording of the distribution of good and relief services.
• Successful delivery of transparency, privacy and track & trace capabilities.

Figure: A sample screen from the application

Industry Recognition

The solution has been honored by Stevie Awards with a 2019 Silver Medal International Business Award for Community Engagement. 

Kathryn Ingerly, Lee Duncan of MRCL, and Sri Nidamarty of Chainyard with Stevie Award

Development Team

Chainyard had a team of five led by Mohan Venkataraman CTO of Chainyard who closely worked with Kathryn Ingerly, Derek Harrison and  Lee Duncan, each representing MRCL. The technical development of this project was sponsored by Sai Nidamarty, Co-Founder and CEO of Chainyard, as part of Chainyard’s Corporate Social Responsibility initiative.

Authors

Gigo Joseph, Vice President International Business Development, Chainyard
Isaac Kunkel, Sr. Vice President Blockchain Services, Chainyard

Featured image by Kevin Skow, NOAA Weather in Focus Photo Contest 2015 (CC BY 2.0)

Telekom Innovation Laboratories has built a solution, using Hyperledger Fabric, that simplifies and facilitates processes between telecommunications network providers for commercial use cases in the areas of wholesale roaming, wholesale voice and data on demand.

Network operators are facing big problems in handling increasing volumes of roaming traffic. They have hundreds of roaming agreements with other operators in place that need to be updated, implemented and settled, mostly on a yearly basis.

Due to lack of automation of interconnection agreements and complexity of current processes, operations are slow and require a lot of manual work. This leads to financial losses due to roaming transactions that cannot be properly tracked and charged. These days, agreements are to a large part analogue contracts on paper that need to be proofread multiple times by many people. The agreed commercial terms then need to be implemented into the software systems manually later on. Some network operators exploit the current process to their financial benefit by not implementing agreements at all or only with delays, leading to financial losses and disputes. Typos can also lead to disputes and financial losses. A holistic, analytic view on all agreements is impossible. At the end of the contract period, the contracts need to be settled, which means that volumes need to be compared, discrepancies clarified and fraud deducted, which is another lengthy and cumbersome undertaking

The processes in place are dated and are not fit for expected increase of roaming traffic, especially when IoT roaming and 5G will become more widespread. Current systems are hard to scale and lack flexibility.

We at Telekom Innovation Laboratories believe that, in the future, automated processes need to be in place in order to enable telecommunications providers to deliver even better services to customers and be ready for new technologies and services that are already evolving, for example 5G and IOT. The current processes are simply not suitable for handling the technologies of the future.

Using Hyperledger Fabric at its core, our solution will optimize the process and, more importantly, enhance the trust between telecommunications providers.

The solution has two main layers:

The application layer provides interfaces for the many different processes mentioned above (e.g.,  enabling commercial roaming teams to create, sign and implement wholesale roaming agreements in a fully digitized way). It also has a UI for the commercial managers to interact with.

The network layer provides a solution that enables telcos to install nodes in their own IT infrastructure and join the main network in a semi-automated and effortless way.

Between these layers, an API enables the flow of data and transactions.

The current version focuses on the digital creation and signing of wholesale roaming discount agreements. A digital solution immediately leads to more transparency across internal teams (e.g., finance, legal, commercial), reduction of third party dependencies, reduction of bad debts and a better cash flow situation and therefore increases the profitability of telecommunications providers.

One of the reasons to pick Hyperledger Fabric was the integrated certification authority (CA). With this component, we can ensure that transactions are linked to the legitimate actors, which is very important from a legal perspective. All network operators have signing regulations and processes in place, which ensure that only certain persons inside the organization can sign contracts, while others can only create or edit them. Being able to mirror this process in our solution was a key requirement.

Another reason for our choice was the fact that Hyperledger Fabric is a reliable open source solution backed by a large developer community. We at Telekom Innovation Laboratories believe that the decentralization of blockchain cannot just be a functional aspect but needs to extend to licensing as well. This is the only way to  ensure that code can be reviewed, changed, and improved by all participating parties in a blockchain network without having to tackle complex licensing issues. Licensing is challenging already when it comes to bilateral relationships, but is almost impossible to handle if there is a multitude of parties involved in the same system.

In order to ensure maximum control for each network operator joining our system, each operator runs its own full organization on the Hyperledger network. Every organisation entity consists of the following components: peer, frontend, database, certificate authority (CA). The components are packaged as docker components and groups as Pods in Kubernetes and can be installed on the premises of each client organisation that joins the network. There are several reasons for choosing this approach:

• Each participant in the network can have control over its data (contracts) as well as administrative rights to the technical components. Sensitive data can therefore be stored on premise or on private cloud or even dedicated hardware, managed by the organisation.
• Using the distributed blockchain architecture, a copy of the ledger is located on multiple organisations at the same time. Transactions flow is implemented by the orderer in the core network, where the consensus algorithm is implemented. This allows for much higher security, as there is no single point of failure and each organisation participates in the networks at the same level as all other organisations.
• Private certificate authority (CA) allows each organisation to issue cryptographic materials needed  to connect to the network, sign contracts and manage transactions. This allows for higher security and flexibility compared to a single centralized CA.

The system currently uses a single blockchain channel, which contains all transactions by all organisations. This means that all transactions are visible by all participants in the channel. However, no contractual data is stored on the ledger. It contains metadata for each transaction that has been executed (e.g., signing a contract by the other party and agreeing to its terms). The hash can be computed based on the raw contract data and therefore can be used as proof in case of dispute that the actual parameters in the contract have been agreed by both parties. A copy of the ledger is distributed in all organisations, but the actual sensitive data is located only at each of the organisations’ respective databases and is not visible to other parties in the network. This ensures that there is a high level of security due to the large amount of participating actors in each transaction, while at the same time keeping up the required confidentiality when it comes to actual commercial data.

The contract data is stored on MySQL server running within the bounds of each individual organisation. This database stores data only related to its own contracts, so there is no distributed contract storage within the network.

Contract data are synchronized only between participating organizations when a transaction occurs (e.g., when a new contract is being created). This synchronization takes place between the frontend components of each organisation. They use a separate API that uses TLS encryption and mutual authentication to secure the transport of data.

A major feature of our solution are installation packages and scripts that allow an easy on-premise creation of a new organization. Through this, we already managed to add major operators to our blockchain network.

Currently, we are also working on integrating the end of period settlements into our solution. As we approach production, we will move to using a RAFT ordering service.