Tag Archives: Kimberly Process

Gold, Frankincense and Myrrh: Are your gifts conflict free?

gift

If you are engaged in seasonal gift giving during December, or at any other time of the year for that matter, have you thought about the origin of what lies inside the box? All gift givers might like to tune into this week’s events at the United Nations.

If you are lucky enough to ever receive a diamond (the way Naomi Campbell is reported to have done one night in South Africa in 1997), then there is a chance you will know, or can find out, the mine from which it was dug. “Diamonds are forever”, but perhaps “blood diamonds” are not – given the publicity generated by the film of that name, the International Criminal Court (especially when supermodels testify) and the Kimberley Process between states –which has tried to establish some certification from the mine for larger diamonds at least, albeit a flawed one according to the NGO Global Witness who left the Process in 2011.

However, conflict metals and minerals are a much broader issue than glamorous rocks alone. For most of us, a mobile phone is a much more likely gift: there as many phones as people on the planet now.  Three wise men bearing gifts these days are unlikely to bring Frankincense and Myrrh, but there will be Gold – in their phones that is – together with Aluminium and small amounts of Antimony, Barium, Beryllium, Cobalt, Copper, Chromium, Gallium, Indium, Lead, Manganese, Nickel, Palladium, Platinum, Ruthenium, Rare Earths and Silver. In the case of the Democratic Republic of Congo (DRC), known for its horrendous internal conflicts, it is Tin, Tantalum, Tungsten as well as Gold that are most associated with fuelling the conflict and which are the focus of Section 1502 of the Dodd Frank Act in the USA and now extended internationally through the OECD Due Diligence Guidance. You might like to hope that your electronic gift contains no conflict minerals but how do you know? You might like to ask your high street brands what precisely they are doing about it before making the purchase and hopefully there will be a coherent response. Some niche brands (such as “FairPhone”) make specific guarantees whilst helping to maintain trade with conflict-free miners in the DRC, many steps down the supply chain. For those only interested in the hard stuff, Fairtrade Gold is also available, where miners will receive a minimum price of 95 per cent of the London Bullion Market Association (LBMA) price for their gold.

For those of you who think it is just western governments think about this, think again. Global Witness does not often commend a government but it did on 24 October 2014 when the Chinese Chamber of Commerce of Metals, Minerals and Chemicals Imports and Exports, which is supervised by the Ministry of Commerce, launched its due diligence guidelines for Chinese mining companies operating abroad. These guidelines cover a range of environmental, labour and human rights considerations. This is part of a wider trend towards a stronger focus on companies disclosing payments to host governments in order to fight corruption, as highlighted by the Extractive Industries Transparency Initiative, as well as the reporting criteria of an increasing number of stock exchanges. In Switzerland, one of the leading global hubs in commodity trading, the Government has committed itself to bringing the industry and civil society around a table to agree standards and an implementing mechanism. It is a shame, at least to me, that the recent European Commission proposals stopped short of requiring companies to report on such issues, and that the American Petroleum Institute still fights mandatory disclosure of revenues as set out in Dodd Frank 1504.

On 2 December I have the privilege to moderate a discussion in the United Nations in Geneva (as part of the UN Annual Forum on Business and Human Rights) where representatives of both the US Government and China will elaborate further on their plans, as well as perspectives from key mining countries such as Chile and Myanmar.

There is much moving in the wrong direction in the world at the moment, but for those looking for stars to wish upon, here is one – that governments from all corners of the planet might increasingly cooperate to ensure global supply chains are free of conflict minerals and human rights violations. There are no awards to be given out, the domestic nature of mining in all these and other countries is still far too hazardous and communities all too often adversely impacted upon and inadequately consulted. But if we can all help to make state-state cooperation on such issues more normal, then there is a greater chance that business too will not compete on their social and environmental responsibilities. Conflict-free metals and minerals – what better gift could there be?