Tuesday

19th Jun 2018

Opinion

Conflict minerals: EU can save lives and boost profits

It’s not always fashionable to talk about Brussels wielding power. To many, the inner workings of the European Union seem far-removed from day-to-day life, and in particular, corporate power.

But on Thursday (4 December) in the first European Parliament hearing on trade in “conflict minerals”, MEPs will be discussing landmark legislation that could impact European businesses and some of the most fragile and conflict-affected states in the world.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... our join as a group

As a former business leader at the second biggest mining company in the world, I feel like I have no choice but to make sure that at this critical juncture, an industry voice is heard.

Europe is a key player in the trade in minerals - responsible for almost a quarter of the global trade in tin, tantalum, tungsten, and gold. These minerals - worth over €123 billion - end up in products like mobile phones, laptops, cars and aeroplanes.

But the world’s largest economy has no legislation in place to make sure this trade is not inadvertently funding conflicts, human rights abuses, and modern-day slavery.

We know this isn’t just a risk: In countries, such as the Democratic Republic of Congo, Colombia, and the Central African Republic, the trade in minerals has helped fund conflicts that have killed tens of thousands of people and displaced millions of others.

The US and a dozen African countries have responded by drawing up measures that require companies to investigate and clean up their supply chains. Big US-listed brands, such as Tiffany’s, Intel and Apple, all have to comply.

This makes good business sense. As a former senior executive in the resources sector, I know that supply chain due diligence - whereby companies identify, mitigate, and report on risks along their supply chains - is vital to any successful and sustainable business.

It helps companies discover previously unknown risks, learn more about their supply chains and build in innovations. It also enables them to position themselves as ethical brands to consumers and investors alike.

And of course, companies don’t have to do it on their own.

When companies together commit to due diligence, by sharing information and ideas, it creates new business opportunities in many of the regions that need sustainable and responsible investment the most. This is an opportunity, not a challenge.

But don’t just take my word for it: At Walk Free, I now work with the world’s leading businesses to ensure their supply chains are slavery-free.

In the UK, at a recent parliamentary hearing on the draft Modern Slavery Bill, Swedish retailer Ikea said ethical supply chains are “absolutely” more profitable, while Tesco said a good reputation “more than pays for itself.”

Red tape is red herring

And yet, at the hearing in Brussels on Thursday, you will hear a different argument.

Some MEPs will defend the EU’s paltry conflict minerals proposal - which is not only voluntary, but also estimated to cover only a meagre 0.05 percent of European companies involved in the trade.

Some will even argue that Europe can’t handle mandatory regulation and speak of unnecessary “red tape”.

Conversely, binding legislation has proven to be an effective force in getting companies to take responsibility for their operations and supply chains. It is analogous to workplace safety - a process initiated by some leading brands and then encouraged upon laggards by legislation.

The mining industry had unbelievably high worker injury and mortality rates until the 1980s and 1990s, when companies recognised that looking after their workers had the potential to increase productivity and so profitability.

Now, it is unthinkable not to have health and safety precautions.

We know business can be boosted by doing the right thing.

I’m glad to hear that investors representing more than €855 billion in assets under management have joined the call for binding conflict minerals legislation - which is estimated initially to cost companies just 0.014 per cent of annual turnover, falling still further in subsequent years.

Brands must comply

But, we also need to be clear about who this proposal should cover: the brands that place the consumer products on the market need to comply, as well as those importing the minerals in the form of raw ores and metals.

This is about working together to ensure we are creating the strongest and most sustainable business relationships from source to store.

This brings us back to Brussels.

Right now, MEPs have a rare chance to shape the future of the trade in conflict minerals.

They can help companies source responsibly from some of the most fragile states on earth and ensure that the lives of millions of people are better off as a result.

Of course, there will be dissenting views and I welcome debate.

I just hope those talking on behalf of businesses remember one thing on Thursday: Strong conflict minerals legislation in Europe is a business opportunity that we can not afford to miss.

Peter Nicholls is a former vice-president in the Rio Tinto Group and the head global business authentication at Walk Free, a British-based foundation

MEPs divided on conflict minerals scheme

EU lawmakers have clashed over which businesses should be covered by new rules on the trade of conflict minerals used to fund civil wars.

The Baltic 'Big Sea' strategy

The Baltic Sea is almost an inland European lake - it borders Norway, Denmark, Germany, Sweden, Poland, Finland, Lithuania, Latvia, Estonia, Kaliningrad and Russia. It also has an EU strategy - and an action plan.

Is EU retail sector equipped for 21st century?

After a thorough analysis in cooperation with EU countries we have identified many regulatory restrictions that hamper innovation and investment in the retail sector.

Long-distance animal transport: unthinkable still happening

A complete overhaul of animal products' supply chains is needed, privileging local food chains including local slaughtering which is proven to benefit the environment, the resilience of our economy, food safety and animal welfare.

News in Brief

  1. EU court orders Le Pen to repay EU parliament
  2. Commission needs time to assess German Dieselgate fine
  3. Merkel and Macron meet over migration and eurozone
  4. Salvini plans census of Roma communities
  5. Slovenia to take Croatia to court in border row
  6. Parliamentary setback over corruption in Romania
  7. Lords force new vote for UK parliament to influence Brexit
  8. Report: Audi CEO arrested over Dieselgate

Stakeholders' Highlights

  1. Macedonian Human Rights MovementMHRMI Launches Lawsuits Against Individuals and Countries Involved in Changing Macedonia's Name
  2. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  3. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  4. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  5. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want
  6. Nordic Council of MinistersNordic Countries Take a Stand for Climate-Smart Energy Solutions
  7. Nordic Council of MinistersNordics Could Be First Carbon-Negative Region in World
  8. European Federation of Allergy and AirwaysLife Is Possible for Patients with Severe Asthma
  9. PKEE - Polish Energy AssociationCommon-Sense Approach Needed for EU Energy Reform
  10. Nordic Council of MinistersNordic Region to Lead in Developing and Rolling Out 5G Network
  11. Mission of China to the EUChina-EU Economic and Trade Relations Enjoy a Bright Future
  12. ACCAEmpowering Businesses to Engage with Sustainable Finance and the SDGs

Stakeholders' Highlights

  1. Nordic Council of MinistersCooperation in Nordic Electricity Market Considered World Class Model
  2. FIFAGreen Stadiums at the 2018 Fifa World Cup
  3. Mission of China to the EUChina and EU Work Together to Promote Sustainable Development
  4. Counter BalanceEuropean Ombudsman Requests More Lending Transparency from European Investment Bank
  5. FIFARecycling at the FIFA World Cup in Russia
  6. Nordic Council of MinistersOECD Report: Gender Equality Boosts GDP Growth in Nordic Region
  7. Centre Maurits Coppieters“Peace and Reconciliation Is a Process That Takes Decades” Dr. Anthony Soares on #Brexit and Northern Ireland
  8. Mission of China to the EUMEPs Positive on China’s New Measures of Opening Up
  9. Macedonian Human Rights MovementOld White Men are Destroying Macedonia by Romanticizing Greece
  10. Counter BalanceControversial EIB-Backed Project Under Fire at European Parliament
  11. Nordic Council of MinistersIncome Inequality Increasing in Nordic Countries
  12. European Jewish CongressEU Leaders to Cease Contact with Mahmoud Abbas Until He Apologizes for Antisemitic Comments

Join EUobserver

Support quality EU news

Join us