Six reasons why industry must end slavery in cobalt supply chains

Dr. James McQuilken is a Senior Program Officer at Pact. Amayèle Dia is a Protection Senior Program Officer at Pact.

The Democratic Republic of Congo supplies almost three-quarters of the world’s cobalt, with about 20-30% extracted by an estimated 200,000 to 250,000 artisanal and small-scale miners who toil under arduous conditions.

Cobalt is critically important to the global economy and the Green Industrial Revolution, as it is a key component in rechargeable batteries, such as those used in electric vehicles. Unfortunately, given its often hazardous, exploitative and informal working conditions, DRC’s artisanal and small-scale mining (ASM) cobalt sector is also particularly vulnerable to modern slavery. Across DRC, approximately one million people are estimated to be living as modern slaves, with many of the working practices in ASM – and in some cases large cobalt mines – falling under this umbrella.

Although there isn’t a universal definition for modern slavery, the term generally refers to the most extreme forms of exploitation, including forced labour, debt bondage, human trafficking and child labour – the last of which is especially present in DRC ASM cobalt supply chains. An estimated 35,000 children work in DRC’s cobalt mine sites.

For more than a decade, our organisation, Pact, has worked to stop child labour and other exploitative practices in mining. Industry has been a key partner in our efforts, although much more participation and resources are needed.

In this article, we present six reasons why industry must address modern slavery in DRC cobalt supply chains.

1. It’s morally right

Everyone everywhere should have the right to a life free from all forms of modern slavery. Industry can be a powerful force for positive change and is morally obligated to do its part to end forced labour, human trafficking, child labour and other kinds of modern slavery. Take for example child labour in mining: under international law it is considered one of the worst forms of child labour because of its extreme health, safety and developmental risks. Mining exposes children to dangerous and sometimes deadly conditions, physical injury, mental stress, disease and disenfranchisement.

2. Amid the Green Industrial Revolution, it’s good business

Cobalt’s use in electronic semi-conductors, circuits and lithium-ion rechargeable batteries makes it critical to the Green Industrial Revolution. Besides renewable energy storage, cobalt is used in powerful magnets found in wind turbines, as an additive to improve biogas production, and more. The move to decarbonise economies across the world is significantly boosting demand for clean energy minerals and metals and will require a massive increase in mining them. The World Bank, for example, estimates an additional 3 billion tons of minerals and metals will be needed for wind, solar and geothermal power generation and energy storage.

This demand will make the marginal deposits mined by artisanal and small-scale miners even more important to global mineral production. There is no question that many of the world’s biggest and most influential companies need clean energy minerals in order to operate and grow. For the bottom lines of so many, these materials must be reliably available, and therefore must come from stable, responsible supply chains free of modern slavery.

3. Responsible mineral legislation and expectations are becoming increasingly stringent

Modern slavery legislation over the past decade has included increasingly stricter due diligence and reporting requirements coupled with greater expectations for companies to be socially responsible and impactful. Laws enacted by the United States in 2010 and the European Union in 2017 and 2021, and likely soon to be replicated in the United Kingdom following the country’s exit from the EU, have added requirements that companies disclose the origins of tin, tungsten and tantalum (3T) and gold from conflict-affected and high-risk areas including DRC.

While there is currently no specific legislation for cobalt, other areas of international and national law including modern slavery legislation in the United Kingdom, Canada and Australia and legal provisions against slavery, forced labour and trafficking in the United States, do apply to the sector, and there are calls by some civil society groups to include cobalt ores as conflict minerals. Companies should prepare for even greater scrutiny by investing in activities that go beyond minimum reporting requirements to “future-proof” their business and spread costs over time. This could include developing material registers for their main products, working with suppliers to bolster traceability and engaging directly with ASM communities and suppliers to understand and improve working conditions and tackle modern slavery at various supply chain stages. A proactive and responsible industry-led approach such as this will help to clean up the sector’s image and ensure cobalt remains in demand as a clean energy metal.

4. It helps manage risk to business and mineral supplies

Addressing systemic issues such as modern slavery can help manage risk. By establishing business units charged with responsible sourcing and integrating clear principles, policies and procedures throughout procurement supply chains, companies can avoid costly remediation, such as crisis response or being temporarily or permanently blocked from contracts and markets. Ethical performance and supply chain auditing should not be seen as extra costs, but rather as a normal part of ongoing business to limit supply disruptions – especially important given that critical material assessments by the EU predict a large global supply deficit of cobalt by 2030.

5. Understanding supply chains can reveal opportunities for growth

By knowing their supply chains in full, companies can identify and unlock opportunities for action and growth. Such understanding can help identify strategic areas for risk reduction, efficiencies, upgrading, partnership and investment. For example, good community relations in and around mine sites enhances the social license to operate and can build the capacity of local service providers to supply food, equipment and highly trained labour, reducing import and expatriate staff and security costs. Intervention in supply chains to tackle modern slavery and associated issues is also key to improving the environmental, social and corporate governance (ESG) performance of business – factors that have become increasingly important for securing short and longer-term financial investment in current and future ventures.

6. It’s an entry point for addressing other critical issues

Tackling modern slavery should not be viewed in isolation. Working on the issue can provide an entry-point for business to meet other reporting requirements and contribute to achieving global and industry initiatives and expectations. This includes the UN Sustainable Development Goals (SDGs), target 8.7 – eradicating modern slavery. Stopping modern slavery in artisanal and small-scale mining can serve as a platform for achieving gender equality (SDG5), decent work and economic growth (SDG8), responsible consumption and production (SDG12) and climate action (SDG13). By aligning with global business, industry and development initiatives through tackling modern slavery in ASM supply chains, companies can help to truly deliver on the Green Industrial Revolution and ensure the transformation also delivers for DRC and its ASM communities.