The excited chatter surrounding blockchain technology is unmistakable. Tipped as the next quantum leap in technology since the internet, its promise and potential to revolutionize whole industries and drive social impact is enticing. It is expected to increase efficiency, reduce cost, and promote transparency — much welcomed in the global social sector, especially in the aftermath of reports in recent years of increased public mistrust in light of unsettling incidences of unethical behavior and misuse of funds by a number of high-profile and well-known socially-driven organizations around the world.
As more than half of social-good blockchain initiatives are still in their early stages, they are expected to impact beneficiaries earliest in early 2019. Initiatives categorized under ‘Democracy and Governance’ may even begin demonstrating impact as early as end 2017, which is unsurprising given that blockchain technology’s most popular primary benefit to date is its ability to reduce risk and fraud or increase integrity and transparency. If it reaches its full potential and adoption in the next few years, blockchain technology is set to affect many other areas within the sector including, ‘Land Rights’, ‘Philanthropy, Aid and Donors’, ‘Health’, ‘Agriculture’, ‘Financial Inclusion’, and ‘Energy, Climate and Environment’.
As more than half of social-good blockchain initiatives are still in their early-stages, they are expected to impact beneficiaries earliest in early 2019.
How can we do it better?
Even in these early stages of development, blockchain technology has, in fact, effected social impact. It has effectively sparked much-needed dialogue in the social sector about gaps and shortcomings that currently exist, and how to address them. It has renewed interest in the search for solutions that will increase overall social impact in many areas within the sector.
It has highlighted inadequacies in the current structure of our agricultural supply chains that result in costly operational management and a high potential for food fraud and contamination. It has revealed the gaps in current security and logistical practices of government data exchange. It has uncovered the potential of decentralized or micro energy grids in reducing inefficiencies in the sector and increasing benefit to users. It has highlighted the failings of traditional banking/financial systems in the provision of access to the currently unbanked and suggested areas for opportunity. It has presented how digital health records exchange and pharmaceutical supply chain management can be improved to drive medical innovation. It has brought to attention the plight of local communities and indigenous people living in countries where poor recordkeeping or land fraud can result in displacement and exploitation. It has affirmed the diminished trust the public have of global development organizations and the urgent need for greater transparency in the use of aid funds.
It has effectively sparked much-needed dialogue in the social sector about gaps and shortcomings that currently exist, and how to address them.
The skeptics are right
Amidst the excited chatter that surrounds blockchain technology for social impact, there persists much skepticism in the general society — that the new technology is a hype that will not deliver on its promises. And they are not entirely wrong.
This is because technology alone is not enough. For the social sector to succeed in harnessing the benefits of blockchain technology to effect social impact, it will require collaboration and partnerships across the sector and even between industries. It will necessitate changes in processes, resource allocation, and organization. It also requires a deep understanding of the problem to be solved and how blockchain would be a fit, and if it even is. As Sheldon Himelfarb, President and CEO of Peace Tech Lab pointed out at the recent Blockchain for Social Impact Conference, “When policy-makers are talking to policy-makers, and technologists are talking to technologists, data scientists to data scientists, conflict experts to conflict experts, then we will never move the needle on our shared goal of creating a more peaceful and more prosperous planet.”
Enabling future solutions
For the social sector to reap the benefits of blockchain technology, it is crucial that people move beyond the hype, seek to understand more about the new technology as it is being harnessed across industries, and work together to innovate applications that effect social impact. According to a recent report published by the Stanford Graduate School of Business’ Centre for Social Innovation, 20% of blockchain initiatives researched will provide solutions to problems that could otherwise not have been solved without blockchain.
As Nancy Thinbar of the US Institute of Peace concluded, “As we look at what are the technology solutions entering into the world, it is crucial that we look at not just what are the technology fixes for the incredible list of problem sets identified but how to do it in a way that ensures that the technology is within a framework of ethics and norms and commitments to do good.”