Blockchain has the potential to change mining supply chains for the better, but will it replace due diligence procedures?
Proving provenance in mining supply chains is not easy. With increasing concerns over conflict minerals, such as 3TG and Cobalt, reliable supply chain tracking is becoming more of a necessity.
Mining companies want to prove to their customers, investors and stakeholders that their supply chains are ethical, sustainable and cost efficient. This isn’t new. Supply chains are fundamentally built on trust, and this is a problem: you must trust that the information is correct, and that actors are acting responsibly.
What does blockchain have to do with supply chains?
Recently, blockchain has come into relevance in the mining sphere. Blockchain is a digital, decentralised ledger that records information. It is also resistant to tampering. Blockchain’s permanence and resistance to interference makes it a reliable option for companies – especially when it comes to tracking their supply chains. Blockchain allows companies (and consumers) to track a supply chain, confirm honest practices and pinpoint inefficiencies.
So, does this mean that blockchain could replace due diligence altogether?
Realistically? No.
Need for due diligence
Due diligence is still a necessity for mining companies. Blockchain just makes due diligence an easier process.
Blockchain means:
- Access to real-time data
- Reliable traceability
- Ensured transparency
Products like STAMP™ also allow easy integration with existing data, so that implementation doesn’t have to be difficult.
This means that, when it is time for auditing, all the data is right there. No compiling necessary. The data is easily accessible and up-to-date.
As with any technological advancement, auditors will be required to adapt to the different methods of auditing. This could mean learning how to use blockchain if blockchain becomes an integral part of due diligence.
So, blockchain won’t take away auditing jobs. It will just make them a whole lot easier.
Making supply chain management easier
Blockchain has the potential to reinvent supply chains. It can make them more ethical, sustainable and transparent. Blockchain could also add an aspect of traceability that has been absent in the past.
Blockchain and due diligence could together change the way companies manage their supply chains.
To find out more about how blockchain can help mining, click here.