Taking action to stem the trade in conflict minerals
Last week the Swedish Ministry of Foreign Affairs arranged a meeting with several members of Teknikföretagen (the Association of Swedish Engineering Industries) to discuss the new EU regulations that apply to conflict minerals and provide a forum for knowledge sharing. I was at the meeting to represent Ericsson, listen to the other participants’ perspectives, and offer Ericsson’s point of view based on our experience of working to address the issue of conflict minerals in our own supply chain over the past several years.
For those who aren’t so familiar with the topic, tin, tantalum, tungsten and gold are the minerals that are usually referred to as conflict minerals. All four are commonly used in the manufacturing of a wide variety of consumer products, as well as in many of the electronic and electromechanic components used in heavy industry.
New EU regulations in brief
The new EU regulations on conflict minerals were passed in May 2017. They require EU-based companies to ensure that they only import certain minerals and metals (those defined as potential conflict minerals) from responsible sources. The regulations will come into effect on January 1, 2021, so that companies have sufficient time to adapt their operations.
The new regulations focus on direct importers of raw materials into the European Union, and target not only minerals that come from the Democratic Republic of the Congo and its neighboring countries (as earlier regulations have tended to do) but rather from any country in the world that is involved in an armed conflict. The reason for this is that there is evidence that armed groups in other parts of the world are also using forced labor to mine minerals that they can sell to buy weapons.
What the regulations mean for Ericsson
While Ericsson does not directly import minerals into the EU, we do purchase a substantial amount of electronic and electromechanic components, and we are well aware of the risk that they could potentially contain conflict minerals. There are several tiers of suppliers between us and smelters or refiners of minerals, though; even more when tracing a mineral all the way back to the mines. We are part of a complex ICT supply chain, as opposed to having a direct purchasing relationship with mines and smelters. Despite this complexity, we are determined to do everything we can to avoid supporting the trade in conflict minerals.
We look forward to continued collaboration and knowledge sharing with the Ministry of Foreign Affairs and our peers in Teknikföretagen. A follow-up meeting is planned for the autumn.
Our approach to conflict minerals
Our current due diligence process for conflict minerals follows the five steps of the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. We deliver our findings annually in our Conflict Minerals Report, the latest version of which was published just last week.
In line with the OECD DD Guidance, we work continuously with our suppliers to increase transparency by identifying smelters and refiners in our supply chain. We also offer our suppliers and other interested stakeholders a training on conflict minerals, and in 2017 we updated our Code of Conduct to include responsible sourcing of raw materials.
As a member of the Responsible Minerals Initiative, we support the system for certification of smelters and refiners, which is known as the Responsible Minerals Assurance Process (RMAP). We aim to increase the number of smelters certified in accordance with the RMAP in our supply chain.
We recognize that there are other raw materials beyond the four that we currently include in our conflict minerals program that also pose potential risks in terms of armed conflict, human rights violations and negative environmental impact. Cobalt, which is commonly used in lithium ion batteries, is one of these. We recently investigated the use of cobalt in the batteries we purchase and we intend to follow up with our suppliers about this topic on a regular basis.
As a first step in our continued journey towards more responsible use of raw materials we have scheduled a strategic workshop with the support of external experts to discuss how the new regulations affect our business specifically and how best to handle the broadened scope.
If you would like to find out more about our approach to conflict minerals, I encourage you to take a look at our latest Conflict Minerals Report.
To learn more about Ericsson’s sustainability work, check out our Sustainability and Corporate Responsibility Report 2017 at: www.ericsson.com/sustainability-report