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Supply Chain Sustainability: Addressing Transparency in the Metals & Mining Sector

In the 21st century, society is increasingly aware of the environmental and social performance of supply chains and consumers.

Helping supply chains become more transparent and materials more sustainable
Twenty-two metals and mining companies and 32 national and regional mining associations and global commodity associations are members of the International Council on Metals and Mining (ICMM), which works to address core sustainable development challenges. The ICMM says on its website that it requires member companies to “make a public commitment to improve their sustainability performance and report against their progress on an annual basis.”

These sustainability reports should be in accordance with the Global Reporting Initiative (GRI) G4 Guidelines. The ICMM publishes an annual review to strengthen social and environmental performance in the mining and metals industry.

Product designers and decision makers in charge of purchasing metals used in product manufacturing should refer to the ICMM member list as they search for more sustainable materials in order to contribute to a more transparent and sustainable supply chain.

According to its website, five values guide the work of the ICMM and its members:

  • Care for the safety, health and well-being of workers, contractors, host communities and the use of the materials we produce.
  • Respect for people, the environment and the values of host societies.
  • Integrity as the basis for engagement with employees, communities, governments and others.
  • Accountability for upholding our commitments.
  • Collaboration as an important tool for addressing the challenges we jointly face and seizing opportunities.

According to a GreenBiz Group whitepaper authored by Josh Hendry and Jim Fava (registration required), three common approaches have been developed to address the transparency expectations of consumers, product manufacturers, regulators, and other interested groups.

  • Corporate reporting : Most of the corporate reporting has been achieved through the implementation of the GRI, which is internationally accepted by most of the major metals and mining companies for reporting on sustainability performance.
  • Product disclosure/transparency : The data in this type of disclosure is more standardized and specific to a given material than the information contained in sustainability reports.
  • Responsible sourcing schemes : These help to define what it means to manage the supply of a material or product, taking into account the environmental and social benefits and impacts. In the metals and mining sector, there are a number of schemes related to the conflict minerals (i.e. gold, tin, tantalum, and tungsten). Some of these approaches, typically focused on a particular issue within the supply chain, are Conflict Free Gold, Conflict Free Smelter, and the ITRI Tin Supply Chain Initiative.

According to Hendry and Fava, both product developers and broader society agree that product disclosure and responsible sourcing schemes are the way to address the increasing demand for data and information on material performance in the future.

Why transparency in supply chain and sustainable materials matter
Tantalum's unique properties are perfect for manufacturing capacitors used in electronics. Eighty percent of the global supply of tantalum comes from the Democratic Republic of Congo, a center of conflict minerals. Manufacturers need to take responsibility for what happens in their supply chains, supporting and using materials and minerals from metals and mining companies that are committed to transparency and sustainability.

The following video explains some facts about slave-mined conflict minerals from the DRC.

Increasing the demand for sustainability performance data in the metals and mining companies accelerates the trend toward a transparent and sustainable supply chain.

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9 comments on “Supply Chain Sustainability: Addressing Transparency in the Metals & Mining Sector

  1. apek
    September 24, 2014

    Only through macroeconomic reforms can conflict free materials become a reality for sustainable manufacturing. It needs supply chain decentralization to give more power to local economies as well as to boost domestic consumer purchasing power of local people in congo. Conflict free metals can become a reality when the procurement is closer to the mines. The present model of Globalization based on Free Trade is another major cause of problems in DRC region. Profound macroeconomic reforms towards a balanced economy will serve as solution to this crisis with minimal government intervention.

  2. prabhakar_deosthali
    September 25, 2014

    I would like to know what efforts are being made to find alternate sources of the conflict material ( such as Tantalum) from non conflict areas. Find alternatives either in terms of another source or alternate material use could automatically reduce the need to get the minerals from conflcit areas and once the demand reduces the forces that are controlling such mineral resources would automatically loose interest in controlling them.

     

    I know the problem is not that simple but somewhere effort should start the way we the world is concentrating efforts on alternate enegry sources to counter the monopoly of oil producing nations.

  3. Hailey Lynne McKeefry
    September 25, 2014

    @Apek, the other key in this is industry-wide cooperation in terms of sharing information. New services and platforms are emerging to help with the reporting rquired by Dodd-Frank.

  4. Hailey Lynne McKeefry
    September 25, 2014

    @Prabhakar, I believe that the Dodd-Frank reporting act is in itself working to encourage alternate sourcing. Many public companies will not want to publically admit that they are involved even peripherally with human rights violations. Hopefully, public opinion will carry weight.

  5. apek
    September 26, 2014

    @Hailey, The problem is that supply chains hav become so complicated that any claims made cannot be easily verified unless there is an independent and unbiased investigator. Supply chain decentralization would be a good remedy here and would not need any government intervention or any more laws to be passed.

  6. Hailey Lynne McKeefry
    September 27, 2014

    @Apek,  your points are well taken. In addition, there are auditing programs and systems being put in place. That's going to be critical, as it has been with any of the requirements that have gone before it.

  7. J.Hendry
    January 16, 2015

    Hi Susan – Thanks for reposting this story and adding your thoughts on tantalum.  The article is now availabe (without registering) on our blog where you can find a number of other articles that may be of interest.  http://www.pe-international.com/international/blog/blog-post/2014/07/01/addressing-transparency-expectations-in-the-metals-and-mining-sector/

    Cheers,

    Josh Hendry

  8. Hailey Lynne McKeefry
    January 16, 2015

    Thank you for letting us know J. Hendry.

  9. Susan Fourtané
    January 21, 2015

    Hi, Josh! How nice that you took a moment to come and visit us. 🙂 Thanks so much for the link and all the additional information on the topic. An update is always welcome. 🙂 -Susan

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