WEF: Exploring Traceability in the Waste Supply Chain

A paper from The World Economic Forum (WEF), in partnership with Accenture, explores how innovations in traceability can be scaled to unlock the value of informal waste management.

The research, Scaling Traceability Innovation to Unlock the Value of Informal Waste Management, uses insights from experts across the waste ecosystem to show how traceability can support a circular economy and create a more sustainable supply chain.

For many businesses, a lack of supply chain visibility is a major risk management issue. According to the report, this is a concern for 60% of businesses, particularly within waste management.

The paper evaluates a framework to help leaders assess solutions, and a roadmap for implementing digital infrastructure to help with transformation.

ESG concerns and supply chain risk

Rapid urbanisation, insufficient financing and limited infrastructure have led to waste being piled up, or disposed of incorrectly, creating numerous health environmental and economic consequences.

For emerging countries the risk is higher. WEF estimates that low-income countries are dumping or burning 93% of their waste. It is estimated that developing comprehensive waste management systems in emerging markets will cost US$680bn.

An informal waste management system has been able to recover more than 88 million tonnes of recyclables every year, but a gap in traceability means it has not been able to scale across global supply chains.

As emerging traceability innovations like digital tools, blockchain platforms and AI analytics – informal waste workers become visible, providing a guideline for effective policy and strategic insights into waste management.

"How we source trace and manage waste responsibly is central to the future of circularity climate action and corporate responsibility," says Wesley Spindler Managing Director for Sustainability at Accenture.

"This is not just a question of how we track waste but also its accountability human rights environmental impact and return on investment. If we address these priorities through emerging technologies such as digital product passports blockchain and AI-driven analytics we can gain access to new transformative solutions."

Trends advancing traceability

Developments in traceability have been spearheaded by several trends with innovation accelerating due to their convergence.

Post-consumer recycled (PCR) feedstock, a recycled plastic material from post-consumer sources, is becoming more viable as it gains market value. Its circular nature helps corporates meet sustainability goals and governments are incentivising its use through mandates and taxation.

Other trends include:

• Technology - digital payment systems, AI-driven analytics and blockchain platforms are being used within waste management
• Capacity - decades of NGO work has created foundations and models for the application of these technologies
• Policy - commitments to sustainability have become part of international and national law, with a growing demand for traceability
• Corporate accountability - businesses are now assessing the impact of their supply chains on the environment and surrounding communities, increasing their understanding of traceability
• Public-sector transparency - Governments are demonstrating where their funding for waste management is going, in order to display effective and fair operations
• Consumer expectations - consumers are becoming more conscious of sustainability, with 25% reporting zero tolerance for unethical practices

The path to a circular supply chain

While traceability has helped advance sustainable waste collection and the creation of circular supply chains, data fragmentation remains a major barrier to scaling.

Unlocking the value of waste management innovation requires more data cross-industry collaboration data-sharing technologies and shared standards or regulations.

"An effective transition to more sustainable and resilient industries cannot leave anyone behind even when the change needed is so substantial that it requires the ‘leapfrogging’ of intermediate and outdated models," adds Pedro Gomez, Head of Industry Agenda at World Economic Forum.

"Early-stage innovations can support this transition but they require collaboration investment and trust. When society invests in ideas as a collective, economic models can advance rapidly not only becoming more resilient but also positively impacting all who depend on them."

By implementing further traceability technologies and encouraging collaboration, reliable and resilient supply chains could be built, offering real cost-saving and sustainable opportunities.

This may allow these waste management systems to grow to scale ensuring circularity can be implemented globally.