| Picture Credit: Oxfam |
In this article, Fred Robarts and Greg Mthembu-Salter from the Group of Experts on the DRCargue that resource-fueled conflicts could be significantly reduced if countries decreased the opacity of mineral global commodity chains by enforcing existing due diligence legislation. Through embedding due diligence reports in the business culture of mineral supply, the industry could reduce the ability of violent groups to utilize the resource, while at the same time providing income and development for local communities detached from the conflict.
By Fred Robarts and Greg Mthembu-Salter
A recent EU Trade and Development Communication contains some welcome news: a commitment to make company supply chains more transparent. This provides an excellent basis for an EU strategy to help prevent natural resource-fuelled conflict in countries like the Democratic Republic of Congo (DRC).
For more than a decade companies have bought minerals from the DRC without checking whether their purchases are financing conflict. Even when faced with evidence from numerous UN and NGO reports, some companies continued doing business with armed groups, including criminal networks in the Congolese army, who use this trade to fund their fight.
In the absence of laws requiring companies to do due diligence on their supply chains, business as usual prevails, to the benefit of the men with guns and the detriment of ordinary Congolese. In the course of our research last year (the December 2011 UN Group of Experts report on the DRC), one company admitted that their idea of due diligence was to check whether they could land a plane at the supply site.
Critics have argued that the only way for companies to ensure their purchases do not fund armed groups is simply to stop buying from the DRC. This is not the case: there are many opportunities for ‘conflict free’ sourcing from the DRC. For example, a credible validation team – comprising Congolese officials, NGOs and companies – that monitored South Kivu Province throughout 2011 identified at least twenty sites free of conflict. Meanwhile, our research in neighbouring Katanga province showed no evidence of armed groups. At these sites, the military (mostly) obeyed instructions to keep out of the mines, mineral sales were tagged, diligently recorded by officials and bought by a company investing in the mines and social projects.
The truth is that due diligence works. Even in difficult, high-risk environments like the DRC. Our latest report clearly shows that in more peaceful and stable areas in the DRC where companies are carrying following this approach, mining governance is improving and mineral exports are rising.
The EU needn’t start from scratch. There is international consensus around due diligence guidelines developed by the Group of Experts and supported by the UN Security Council in 2010. In a rare moment of international harmonisation, almost identical standards were produced by the Organisation for Economic Cooperation and Development (OECD), and have subsequently been endorsed by a group of Central African countries (the International Conference on the Great Lakes region). These guidelines provide the ideal basis for EU supply chain transparency regulations.
The US Congress has already recognised the need for legislation to this effect. The conflict minerals provision in the 2010 Dodd Frank Act requires companies sourcing minerals from DRC to do due diligence in order to determine whether their products contain ‘conflict minerals’, to publish the results and have them independently audited. Even the Congolese government has taken action: last September they issued a directive requiring companies operating in the DRC to conform to the OECD and UN due diligence standards. As international momentum builds, the EU should not be left behind.
Significant challenges remain. Our report shows that parts of the minerals trade have fallen into the hands of military criminal networks and smugglers. At the same time, legitimate public and private players often lack the resources to implement the traceability requirements necessary for access to the international market. EU strategy on mineral supply chain due diligence should include regulation, coupled with practical measures to support transparency, traceability and law enforcement in high-risk and conflict areas. That way, EU companies and consumers can ensure that their purchases are promoting better governance and economic development in eastern DRC, rather than fuelling war.
