Blockchain-backed data – what is it and how does it help me make stronger claims?
Building Trust: The Power of Centralizing Data for Farmers
We all see it: demands for transparency, responsible consumption, and trusted data are on the rise, particularly within supply chains. The EU's Deforestation-Free Products Regulation (EUDR), along with the accelerating number of compliance needs within destination countries, underscores the necessity for companies to possess reliable data, not just to show, but to prove that their supply chains are ethical and sustainable. Centralizing information around value chains main actors (or data subjects), particularly the crucial farmer, guarantees precision and cultivates a dependable, cooperative data ecosystem within our agricultural value chains. This becomes vital when the data subject is a 'natural person'—an individual lacking the ability to operate with the safeguards afforded to a legal entity. This is especially relevant for the world's half-billion smallholder farmers.
The Farmer's Dilemma: Lack of Incentive
For farmers, incentives to continually contribute to data collection efforts are not always clear. Compliance with certifications or sustainability programs are burdensome and even when the premium payments arrive, they can take years to yield a return. As a result, farmers can become sceptical and often reluctant to participate especially when it requires upfront investment of their time or cash.
Furthermore, often multiple companies repetitively ask the same questions sometimes hundreds of times in one session. Smallholders do not often have robust record keeping leading to anecdotal responses that can be dependent on context or external factors like time of day, what part of the season they are in, who is asking the questions, and how they are asked. For example: can you recall what your food costs were last month? Even if you had access to your credit card statements etc to work it out, what exactly does the question even mean? Does this mean only at the supermarket? Including the kids lunch money? What about your coffee in the office? Do home staples toilet paper or laundry detergent count? Every year farmers give massive amounts of input, lots of data is recorded, spreadsheets are filled but what about the relevance, comparability and most importantly, value of it?
The worst part is that regardless of the effort and input year after year, often nothing changes for the farmer or their families. Tangible benefits such as increased income, yield, or improved livelihoods are the aims, but they are seldom achieved outside of well-funded pilot projects. Over time, when the funding dries up, the status quo returns, and just like that things go back to how they were, and farmers stop seeing the tangible benefits.
We believe there is a better way.
The Need for Collaboration and Trust
A collaborative approach to a trusted data ecosystem is the most effective path to supply chain impact and ESG (Environmental, Social, and Governance) compliance. Data is an asset that is curated, fostered, and grown. And we all know who is great at caring for and growing things when given the opportunity to do so: farmers!
Technologies such as Self-Sovereign Identity enables farmers to ‘centralize’ their information in a way that not only gives them visibility of their data but also control them. Instead of using resources to collect again and again, we can build decentralized trusted data systems to enable approved actors within the ecosystem the ability to issue backed claims (credentials). These claims can be anything, from the farmer being pesticide free to using anti deforestation practices and can be made by any approved authority within the ecosystem from a local independent agronomist to a multinational analysis body.
The farmer as the data subject will have full visibility of these credentials with the ability to validate them, share them with other actors (hopefully with some incentive), and even enhance the credentials over time to make them more valuable. The claims made can be shared throughout the ecosystem with confidence based on the trust triangle between the participants. More details on establishing trust can be read here: https://trinsic.id/introducing-trinsic-ecosystems/
There is always the challenge of technology, network, or education constraints. However, options are available to provide incremental value back to the farmers based on their specific constraints.
The accelerating requirement for more data and improved data across value chains is clear. Regardless of the precise use case, increased engagement in a trusted collaborative data ecosystem allows all actors within the ecosystem to participate, to focus on areas that drive benefit for themselves, and benefit their partners.
We have the ability to share the value more uniformly throughout the value chain, finally giving farmers and their rural communities the participation incentive. Providing the opportunity to support certification or ESG goals in a way that is understandable, lasting, locally beneficial, and in their control can help increase willingness to actively participate in such programs and help change lives and the climate for the better.
Implementation and Outcomes
farmer connect recently completed a project with earth observation experts Trade In Space, analyzing farmer plots remotely for signs of deforestation or forest degradation, and issuing a credential in the form of a ‘deforestation trust rating’ to farmers as a precursor to EUDR needs that could be linked directly to product traceability on the blockchain, ensuring compliance with regulatory requirements.
Digitalized Farmer - A Path to Success
Digitalization empowers the farmer to become an integral part of the supply chain. With trusted data, farmers have a clearer understanding of their markets, products, and their role in the global solution. Digitalization fosters "digital proximity," creating a sense of closeness and connection between the farmer and the supply chain.
Centralizing data around the data subject, the farmer, offers significant benefits for both businesses and farmers. With increased visibility, autonomy, and an incentive to maintain accurate data, farmers become key players in building a trusted and sustainable collaborative data ecosystem. By embracing this approach, companies can streamline compliance right from the sources, enhance their supply chains, and make a positive impact on the environment and society.
Written by : Kristian Doolan, partnerships & innovation farmer connect
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