Where do “blood minerals” stand today?

May 31, 2011: Last week, political leaders met in Paris to finalize a plan to limit the use of conflict minerals, as well as address separate guidelines on corporate responsibility for multinational enterprises.  The sale of conflict minerals, such as diamonds and gold, as well as those commonly used in the production of electronics, including tin ore, tungsten, casserite, and coltan, continues to finance the war between the Congolese National Army and various armed rebel groups in the Democratic Republic of Congo. Over the past 14 years, atrocious crimes have been committed resulting in the deaths of an estimated six million people.

The initial guidelines, drafted in late 2010 by the Organization for Economic Cooperation and Development (OECD), call for due diligence in the supply chain of minerals, particularly those being sourced in conflict-ridden regions.  This innovative approach is a way for companies to assess how vulnerable their supply chains are to exploitation in terms of potential complicity in supporting armed groups, as well as promoting corruption and labor abuses.  The lack of insight and transparency into the use of conflict minerals has long been an issue of international concern.  The website and mobile phone tool, Free2Work, provides an “A” to “F” grade evaluation based on the disclosure and transparency of companies’ supply chains, some of which might be connected to conflict minerals.

When companies turn a blind eye to where they source their minerals, they may unknowingly perpetuate conflict.  The tin ore industry, one of the primary components of cell phones, has launched its own certification process in an effort to address the sourcing of tin from the DRC’s North Kivu province, the largest supplier of tin ore in Africa.  According to a recent Bloomberg report, since the launch of this process a year ago, sales of tin ore from this region have fallen more than 90 percent as companies, in an effort to retain their good public image, have actively stopped buying conflict minerals.

Greogry Mthembu-Salter, author of the UN’s due diligence guidelines, explains, “For the moment, companies appear to have decided it’s easier not to buy from Congo than risk damaging their reputations.”

The consumer resource Free2Work (Free2Work.org ), has rated several jewelry and electronics companies based on how they address issues in their sourcing of raw minerals.  Companies such as Hewlett Packard, Amazon Kindle , Signet Jewelers , and Zales Corporation have all been rated and provided with clear steps they can take to improve their policies.  Given encroaching legislation and shifting industry standards, companies in the extractive industry are hard-pressed to pay closer attention to their supply chain, lest they develop a reputation for sourcing “blood minerals”.

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