By Hannah Koep-Andrieu, OECD Centre for Responsible Business Conduct
When descending the soft slope of the open pit cobalt mine by foot, it is the bright red earth and the sound of pickaxes chipping away at contoured slabs of ore that register. We are in the Democratic Republic of Congo’s (DRC) Copperbelt, a region rich in copper and cobalt mined by both industrial operators and artisanal and small-scale miners. Not quite a typical day in the office, we are here to engage with stakeholders on the conditions in which copper and cobalt are mined and traded. These materials are crucial for the green revolution as they are important components of the batteries used in electric vehicles and mobile telecommunications. An electric car, for example, contains four times more copper than a comparable internal combustion engine car and about 10kg of cobalt.
Much media and NGO attention to date has focused on the risk of child labour, but risks related to sourcing copper and cobalt from the DRC can be much broader. Although the Copperbelt does not experience endemic conflict, security forces have become involved in the minerals trade in many instances. The involvement of politically exposed persons and corruption have resulted in the alleged sale of DRC mines at a fraction of their market value, depriving the Congolese State of much needed revenue. Recent prominent court cases show that companies expose themselves to legal liability when they become involved in transactions where little or no due diligence is in place on the use of intermediaries and sub-contractors.
The OECD team visited the DRC for two main reasons:
- To hold a series of training workshops on due diligence for responsible mineral supply chains based on OECD guidance.
- To launch a report on due diligence challenges and opportunities when sourcing cobalt and copper from the DRC.
These meetings brought together stakeholders from around the globe and all segments of these supply chains: artisanal miners, cooperatives, industrial miners and exporters from the DRC, international traders, refiners and smelters and component manufacturers from China and companies producing end products such as phones, computers or cars made in Asia, the United States and Europe in the room with investors, the DRC government and civil society.
While this engagement builds on years of work in responsible mineral supply chains, progress in addressing risks in the cobalt supply chain is coming about slowly. Bringing stakeholders together in the DRC was an opportunity to build bridges between global and local actors and share a more nuanced narrative of the challenges in cobalt and copper mining, and to define the next steps for addressing the most persistent challenges.
A key finding in the report was that to improve conditions for artisanal miners and their communities, engagement instead of indifference will be critical. To a large extent, success will depend on industrial miners finding ways to cooperate more with artisanal miners so that the latter’s work can be made safer and more transparent. A lawsuit recently filed in the United States relating to the deaths and injuries of children in cobalt mines in the DRC makes the stakes abundantly clear. Whatever the final outcome of the case may be, it highlights the acute risks of indifference to artisanal miners working on industrial concessions and the potential consequences of not constructively engaging them.
Although discussions on challenges in carrying out due diligence and promoting responsible mineral supply chains during the stakeholder meeting were heated at times, consensus was reached on a number of concrete next steps. The DRC government envisages setting up a working group to identify viable areas for formal cooperation between artisanal miners and industrial operators, and better accommodating such cooperation through the regulatory framework. The DRC ministry of mines committed to explore strengthening mine site inspections and monitoring and to extending the OECD reporting requirements in DRC law to cover cobalt and copper (tin, tungsten, tantalum and gold are already covered). Companies from across the supply chain signalled they heard the call not only to conduct more comprehensive due diligence and engage in risk mitigation, but also to recognise the role of artisanal mining in local economies through their sourcing and risk mitigation practices.
The pressure is mounting on supply chain actors and governments to deliver on these commitments and bring about tangible change. The DRC’s plan to set up a central cobalt buying scheme for ASM sources, announced by the state-owned Gecamines in December 2019, can be an opportunity if the government takes increasing transparency in the supply chain and formalising documentation systems and risk assessments seriously. The next cobalt stakeholder meeting taking place in April 2020 during the OECD Forum on Responsible Mineral Supply Chains will provide an opportunity to review activities and results.
Interconnected supply chains: a comprehensive look at due diligence challenges and opportunities sourcing cobalt and copper from the Democratic Republic of the Congo
OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas