Blockchain traceability startup Circulor to help prevent and eliminate child labour in Africa.
Car manufacturing giants like Volvo and Tesla recently invested in the blockchain traceability startup.
Before the investment, Volvo was testing Circulor’s platform for over a year. Circulor was helping Volvo in verifying the origins of cobalt used in its batteries.
Cobalt like many other raw materials, is not always ethically sourced.
Meanwhile, Circulor also tracks the origins of mica, another raw material for car manufacturing, used for insulation.
Circulor CEO Doug Johnson-Poensgen discussed on these:
“The problem with mica is that just like cobalt, it’s got a whole plethora of charges around responsible sourcing like child labor, this time in Madagascar. So responsibly sourced mica comes from places like Russia, which is where we’re tracking it from. Yet you get stuff much more cheaply from Madagascar that’s dug up by kids in working conditions which were appalling. And clearly, those are unacceptable risks for a responsible car manufacturer.”
The investment will help Circulor improve its machine learning algorithms so that it will be able to distinguish between children and adults.
It would then be able to use aerial imagery to determine whether a company employs children in its mining operations.
Moreover, Circulor is also tracking the carbon footprint of car manufacturing too throughout the supply chain.
Johnson adds on this:
“Of course, the carbon footprint between a normal car and an electric vehicle even out. But the purpose of trying to attribute carbon is to enable the car manufacturer to better engage the supply chain in order to procure sustainably alongside price and quality. That’s why the press release from Volvo also talks about CO2, because it starts with a chain of custody of materials.”
Originally prototyping its solution on Ethereum (ETH), Circulor switched to Hyperledger Fabric.
Johnson explains on the switch:
“The reason we went with a private permissioned blockchain was partly because of prejudice by our target customers who are not used to transparency in supply chains, who have commercial sensitivities to consider between their relationship with their customers. And many of the potential customers we were speaking to certainly two and a half years ago or so, just didn’t see how a public blockchain could be configured in a way that would maintain their commercial confidentiality.”
Johnson admits that the possibility of the next few years where many of the first-generation solutions might have to be rebuilt on public blockchains.
Johnson believes that interoperability is the key as no single solution will prevail throughout the automotive industry.
On Circulor’s plans to expand its clientele to Tesla, Ford or GM, Johnson added:
“The short answer is all of that is yes, we have. So those car manufacturers that you’ve just named will be buying batteries from the sort of battery manufacturers we’re working with. We’re just about to start onboarding to other battery manufacturers. And we have a number of battery factories who have approached us because they know about the work that we’re doing.”