How do companies assure stakeholders that their products do not contain any primary commodities that are linked to the funding of conflict?

The dilemma for responsible businesses is how to ensure that their procurement of minerals through their supply chains does not profit armed groups in producer countries – or provide such groups with incentives to control strategic mining areas and trading routes through violent means.

Conflict minerals

The concept of ‘conflict minerals' builds upon the experience of the diamond industry in the 1990s, when ‘conflict diamonds' came to prominence. This was as a result of their role in helping fund civil wars against legitimate governments in countries, such as Angola, DR Congo and Sierra Leone. These conflicts were often characterised by severe human rights abuses, including those relating to unlawful killing, sexual violence, torture, forced labour, including the use of child soldiers, and many others. Conflict diamonds have largely been excluded from international diamond flows as a result of concerted international action and national compliance by rough diamond exporting and importing countries (in the form of the Kimberley Process Certification Scheme), as well as the subsidence of conflict in diamond-producing areas – although the risk of their re-emergence is ever-present and diamonds are still associated with violence in parts of the Ivory Coast, Venezuela, DRC and Zimbabwe.

Other minerals such as tin, tantalum, tungsten, coltan and gold extracted from conflict zones, such as North and South Kivu in DR Congo, are now coming under particular scrutiny. In some instances, the illegal exploitation of these minerals is helping finance armed groups and directly contributes to the maintenance of conflict. Most notably, these minerals have also been associated with sexual violence against women and girls in the North and South Kivus.

According to a report from the United States Agency for International Development (USAID), Minerals & Conflict: A Toolkit for Intervention, the presence of valuable minerals in a conflict zone can have important impacts in terms of:

• Geographic focus: Whilst the control of mineral resources may not be the original cause of conflict, it has the potential to become the focus of fighting
• Duration: Revenues generated through the sale of minerals can help finance sustained fighting and provide disincentives for negotiation – thus lengthening conflict
• Intensity: Mineral revenues can also finance arms purchases that increase the intensity of conflict, whilst also becoming a "further point of antagonism"

In addition, the presence of conflict minerals can provide incentives for armed groups to deliberately undermine any legitimate regulation that would limit such groups' ability to enrich themselves – or help ensure these minerals contribute to broader socio-economic development (whether through legitimate private enterprise and/or the collection of resource revenues by the government).

Experience has shown that one of the key means by which armed groups access, control and exploit conflict minerals is through the deliberate terrorisation and exploitation of local populations – often through serious and systematic human rights abuses, such as rape, unlawful killings and forced labour. As a result, there is a real risk of complicity in those abuses on the part of multi-national companies (MNCs) buying such minerals or their derivatives or facilitating their entrance into legitimate flows of minerals in peaceful neighbouring countries, for example.

Growing public consciousness of these issues and the personal initiative of US Secretary of State Hilary Clinton has helped to prompt regulation in the US that requires companies to report annually on whether a range of relevant conflict minerals exist in their supply chains. If they do exist, companies must outline the steps taken to ensure they are not contributing to the on-going conflict.

Despite the obvious moral, reputational and now regulatory incentives for MNCs to avoid coming into contact with conflict minerals, lengthy, multi-layered and international supply chains mean this is rarely a straightforward task. This makes it relatively difficult for companies to say with total confidence that none of their products contain any mineral that has been associated with conflict or related human rights abuses.

Furthermore, it is likely that many companies will ultimately seek to exclude all minerals from countries in which there is even a possibility that they have been associated with conflict. This approach has the potential to remove one of the few sources of income available to otherwise legitimate artisanal miners (or other operators) who are in no way linked to conflict or related human rights abuses– and, indeed, who contribute to local development.

Indeed, there have already been claims that provisions in the US Dodd-Frank Act aimed at excluding conflict minerals from US supply chains (through increased transparency – see below) are already resulting in "a de facto embargo" on minerals from the region. This is because it is seen as easier to simply avoid DR Congo rather than navigate its complex political and human rights context – and instead focus on sourcing minerals from other countries. It is reported that this is already having an impact on artisanal mining communities. Indeed, the Stockholm International Peace Research Institute notes that a "narrow understanding" of what constitutes conflict resources "misses the crucial point that resources that are used to fund armed conflict at the same time provide livelihoods to many people who work in and around artisanal mines — albeit usually without licences—but are not directly involved in the conflict".

As a result, responsible MNCs ideally need to take a more nuanced approach that is not going to undermine the legitimate economic development of these countries, particularly economies like DRC that desperately need business investment to ensure post-conflict recovery. This arguably includes not only considering how to exclude conflict minerals from their supply chains, but also how they can improve the legitimate trade of minerals that have been extracted by artisanal diggers in small scale ad hoc and informal operations in areas of underdevelopment and instability.

See Conflict Minerals case studies

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The role of conflict minerals in global supply chains

The conflict minerals which are currently of particular focus have a wide variety of commercial applications. For example:

• Columbite-tantalite (or Coltan) is the ore from which tantalum is extracted. Tantalum is used in the production of capacitors, which are incorporated into a wide variety of electronic products. These range from, for example, laptop computers through to ignition systems for cars. In addition, its hard-wearing properties mean it is also used in products, such as blades in jet engine intakes and drill bits
• Cassiterite is the ore from which tin is extracted. Again, this is widely used in the electronics industry to solder circuit boards – as well as in the production of objects, such as food and drink cans. Tin is also used in the manufacture of certain chemical products such as paint and fungicides
• Wolframite is used for the extraction of tungsten. This is often used in the form of tungsten carbide, the hardness of which makes it suitable for application in, for example, drill bits, milling equipment and tools. There are other minor applications in the electronics sector, including the manufacture of mobile telephone devices
• Gold is used in the jewellery, electronics, bullion and dental sectors. As investors and societies lose faith in formal monetary systems there is a risk of flight to gold
• Diamonds are used both in jewellery, as well as in some industrial contexts (e.g. cutting and drilling)

The wide range of applications means that companies operating in different sectors are potentially exposed to conflict minerals in their supply chains. Particularly high-risk sectors include the following:

• Electronics
• Computing
• Mobile telephones
• Tool manufacturers
• Jewellery
• Automobiles
• Aerospace
• Defence
• Pharmaceuticals

The conflict mineral journey

According to the Provincial Division of Mines in North Kivu, the following countries are the main destinations for cassiterite, coltan and wolframite exported from conflict areas of eastern DR Congo:

• Malaysia: 42%
• Rwanda: 28% (With much of this likely to be re-exported to third countries)
• Belgium: 15%
• Canada: 7%
• India: 3%
• UK: 3%
• China: 2%

In its report, Do No Harm, Global Witness has outlined the process by which these conflict minerals make their way from mine sites in DR Congo into the end-products manufactured by MNCs. This is included for the purpose of illustration:

• Extraction from the ground: Extraction mainly takes place through the efforts of local artisanal miners under the supervision or control of armed groups. This extraction is often associated with forced labour or extreme exploitation, and conditions are often dangerous. Extracted ore is then sold to intermediaries at, or near, the site
• Ore – the raw material containing these minerals – is transported by a variety of means ranging from foot to aircraft to local trading centres. In DR Congo, for example, these include the cities of Goma and Bukavu in North Kivu and South Kivu, respectively. In addition to maintaining direct control of mining areas, some rebel groups and rogue army units extort money from intermediaries as minerals are transported within the country (for example, at illicit checkpoints, etc.)
• From Goma and Bukavu, the minerals are sold by the intermediaries to licenced dealers (known as comptoirs) and export companies. It is at this point that the minerals are often legally sold onwards to foreign companies
• A proportion of the minerals are also traded, and sometimes partially transformed, in neighbouring ‘transit' countries, such as Rwanda. Global Witness argues that weak due diligence in these countries often means conflict minerals are not identified by local buyers
• The minerals are sold by comptoirs or traders in the transit countries to international smelters. For example, Global Witness has alleged that the main smelters for cassiterite from eastern DR Congo in recent years have traditionally been the Malaysia Smelting Corporation and Thailand Smelting and Refining Co (Thaisarco)
• Once the minerals have been refined into final form, they are incorporated into product components by manufacturers. The refined minerals will often pass through multiple hands as components are incorporated into other components (e.g. alloy manufacturers, component manufacturers, device manufacturers). The end product is then sold on to consumers

In light of this process, it is important to note that the ‘downstream' end-manufacturers of specific goods are not the only companies that need to address conflict minerals. Other ‘upstream' companies that will need to pay particular attention to this issue include, for example:

• Metal trading companies
• Smelters
• Manufacturers of sub-components

Identifying ‘red flag' situations

The Organisation for Economic Co-operation and Development (OECD) has identified a series of ‘Red Flags', which should trigger companies to implement relevant due diligence standards and processes relating to cassiterite, tantalite and wolframite (see below). This guidance can be of use to companies trying to assess whether they are potentially exposed to conflict minerals in their supply chain.

‘Red Flags' with respect to "locations of origin and transit" include the following:

• Minerals that are sourced from or have been transported through a conflict-affected or high-risk area
• Minerals that are claimed to have originated from a country that has "limited known reserves, likely resources or expected production levels of the mineral in question"
• Minerals that are claimed to have originated from a country "in which minerals from conflict-affected and high-risk areas are known to transit"

‘Red Flags' with respect to suppliers include the following:

• Suppliers or other known upstream companies have shareholder or other interests in companies that supply minerals from or operate in one of the above-mentioned red flag locations of mineral origin and transit
• Suppliers' or other known upstream companies are known to have sourced minerals from a red flag location of mineral origin and transit in the last 12 months

The OECD notes that if a company is unable to determine whether minerals in its possession come from a "Red Flag location of mineral origin or transit", then it should still seek to apply initial due diligence.

NGO Global Witness says that ‘Red Flag' countries in this context include DR Congo, as well as its neighbouring states Angola, Burundi, the Central African Republic, and the Republic of the Congo, Rwanda, Sudan, Uganda, Tanzania and Zambia – as well as Kenya (known as the ‘Great Lakes Region'). This is due to the transit of conflict minerals through DR Congo's neighbours, the ‘mis-declaration' of conflict minerals as originating from these same countries and the trans-boundary nature of violence in eastern DR Congo. The NGO further notes that companies should carry out due diligence if:

• "The minerals used by the company originate from or have been transported via a country in the Great Lakes region"
• "The stated origins of the minerals in question are countries that have limited or no capacity to produce them, raising the possibility that the materials are in fact of Congolese origin"
• "The company or its suppliers have relationships or a history that links them to the Great Lakes region"
• "The minerals supplied to the company are recycled or part-refined")

See Conflict Minerals case studies

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Real-world examples

The Enough Project claims Canon, Nintendo and others ‘falling' behind in anti-conflict mineral efforts

The Enough Project – an NGO focused on tackling conflict in Africa – has surveyed the 21 largest electronics companies to assess their progress in achieving conflict-free supply chains. The survey was carried out with the aim of helping consumers make informed purchasing decisions.

Companies that the Enough Project identified as ‘falling behind' in this respect included:

• Canon
• Nintendo
• Panasonic
• SanDisk
• Sharp
• Toshiba

Retail Industry Leaders Association argues for exclusion of members from conflict mineral disclosure requirements in the Dodd-Frank Act

In December 2010, the Wall Street Journal reported that the Retail Industry Leaders Association (RILA), whose members include Wal-Mart and Target, wrote to the US government in relation to the application of relevant disclosure provisions of the Dodd-Frank Act around conflict minerals. RILA reportedly argued that some of its members should be exempt from these provisions by virtue of the fact that they do not exercise direct control over the manufacturing of goods carrying their brands. Two authors of the relevant provisions (Senator Richard Durbin and Representative Jim McDermott) are reported as saying that retailers who contract for the manufacture of goods should comply with the requirement. Otherwise, they argued in a letter to the Security and Exchanges Commission (which is responsible for the application of the Act), "a large, non-transparent use of the black market for DRC conflict minerals would remain, directly subverting the policy intention of the law".

Investors representing US$200bn in assets call on companies to take action on DR Congo conflict minerals

In April 2010, a group of investors representing US$200bn in assets issued a statement calling on companies to "acknowledge and address" the issue of conflict minerals originating in DR Congo "on a more systematic basis throughout their global supply chains". In particular, the group (which includes Calvert Asset Management, Boston Common Asset Management, Trillium Asset Management, F&C Management and others) recommended that companies:

• Explain the steps that they are taking to address the issue
• Develop policies and procedures to identify where minerals originate
• Ensure conflict minerals are not entering into their supply chain
• Work with suppliers to ensure internal policies on conflict minerals are adhered to
• Work with NGOs, industry associations, investors and other stakeholders to support strategies that will help end the root causes of the on-going conflict

Conflict minerals rules may have complex and undesirable effects on supply chains

While the US Dodd-Frank Act requiring companies to trace the origin of particular minerals in central Africa may seem only to apply to a relatively few number of enterprises (currently 6,000, directly, as identified by the Security and Exchange Commission (SEC)), the knock-on effect may be far wider-reaching. The National Association of Manufacturers (NAM) wrote to the SEC on 1 August 2012, before the Commission's release of the final rules on 22 August 2012, to highlight that each issuing company will have between 2,000 and 10,000 first-tier suppliers, with giants such as food manufacturer, Kraft, having as many as 100,000. These suppliers will have to report to partners on the source of certain materials, and whilst conscientious businesses will seek indemnification against potentially inaccurate information, there still exists the perhaps greater societal risk that suppliers will simply prefer to withdraw from such business rather than bear the costs of heightened regulatory demands. If this does occur, proactive steps towards ending the use of conflict materials in all supply chains may be markedly hindered.

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Dodd-Frank Act

The main piece of legislation likely to affect MNCs is section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) of the United States. The Act, which was signed into law in July 2010, applies to all companies that:

• Report to the Securities and Exchange Commission (SEC) (i.e. more than US$10 million in assets whose securities are held by more than 500 owners) – including foreign "issuers"
• Manufacture products using cassiterite, coltan, wolframite, gold or any other minerals subsequently designated conflict minerals (i.e. where "conflict minerals are necessary to the functionality or production" of the product

On 22 August 2012, the SEC issued a rule under Section 1502 implementing the disclosure requirements of the Act. According to the rule, certain companies must disclose their use of conflict minerals including tantalum, tin, gold, or tungsten, if those minerals are "necessary to the functionality or production of a product".

The draft regulations suggest that such companies will need to conduct reasonable due diligence around countries of origin to establish whether they come from DR Congo or its neighbours in the Great Lakes region of Africa (i.e. Angola, Burundi, Central African Republic, Congo (Brazzaville), Rwanda, Sudan, Tanzania, Uganda and Zambia).

If the minerals do not originate from this region, this fact must be included in the company's annual report and their website. In addition, they need to maintain relevant records of the enquiries that resulted in this conclusion.

If the minerals do originate from the region – or if it cannot be proven that they do not – then the company needs to:

• Disclose this fact in their annual report
• Provide an additional Conflict Minerals Report (setting out the measures taken to ensure the minerals have not directly or indirectly benefitted armed groups) as part of its annual report
• Post its Conflict Minerals Report on its website

A Conflict Minerals Report must currently include:

• Actions taken by the company to establish the source and chain of custody of the minerals
• A third-party, independent audit of the company's due diligence efforts
• Products produced by the company that are not ‘conflict free' (i.e. which cannot be shown to have not benefitted armed groups in DR Congo or its neighbouring countries)
• The facilities used to process the minerals in question
• The country of origin of these minerals
• Actions taken by the company to identify the mine or location of origin to the greatest level of accuracy possible

Having prepared their Conflict Minerals Report, relevant companies will need to describe those products that are not "DRC conflict free", where the relevant minerals are processed, the country of origin of these minerals, and efforts taken to identify the exact location of the source of such minerals.

The SEC estimates that more than 5,500 companies will need to make disclosures under the Act – with many of these concentrated in the electronics, communications, aerospace, car manufacturing, jewellery and industrial sectors. Of these, the SEC estimates that approximately 1,200 may currently source at least a proportion of their minerals from the DRC countries and will need to prepare and file a Conflict Minerals Report.

Clearly, there can be serious commercial disadvantages if a company has to self-identify those products that are not "DRC conflict free".

UN Security Council sanctions

In certain cases, conflict minerals will be subject to multilateral – or indeed unilateral sanctions. Companies will need – as a matter of legal compliance – to ensure that they do not breach these sanctions.

For example, UN Security Council Resolution 1857 (2008) (subsequently renewed by later resolutions) imposes a travel ban and asset freeze on "individuals or entities supporting the illegal armed groups in the eastern part of the Democratic Republic of the Congo through illicit trade of natural resources".

UN Security Council Resolution 1952 (2010) suggests that the UN Security Council's Sanction Committee for DR Congo should consider whether individuals/entities have exercised due diligence when they are being considered for the application of sanctions for supporting illegal armed groups in eastern DR Congo. These include, for example, "strengthening company management systems, identifying and assessing supply chain risks, designing and implementing strategies to respond to identified risks, conducting independent audits, and publicly disclosing supply chain due diligence and findings".

Criteria for designation by the Sanctions Committee include "Individuals or entities supporting the illegal armed Groups in the eastern part of the DRC through the illicit trade of natural resources, including as a consequence of not having exercised due diligence consistent with the steps set out in resolution 1952 (2010)."

There will be cases where conflict minerals are themselves subject to direct sanctions. As noted above, this is the case with Ivory Coast. Under the most recent UN sanctions regime – which was based on Resolution 1643 (2005) – countries could not import rough diamonds from Ivory Coast. However, this ban lost effect on 30 April 2012 and, as of April 2013, has not been renewed. Any designation under this criterion, if renewed, would have an obvious legal, financial and reputational impact on MNCs – including potential asset-freezing and travel bans and national implementing laws.

Forthcoming EU Conflict Minerals Regulation

A future significant piece of legislation that is likely to affect companies headquartered or with interests in the EU, is a forthcoming EU Regulation on conflict minerals.

In May 2015 Members of the European Parliament voted in favour of establishing an EU-wide system of self-certified supply chain due diligence that will be applicable to smelters and refiners, mineral importers and all manufacturers who source tin, tantalum and tungsten, their ores, and gold (3TG) from ‘conflict-affected and high risk areas'.

The draft Regulation does not at present provide a definitive list of mineral source countries likely to be covered by the geographic scope of this legislation. Nonetheless, it may include 3TG originating from both the DR Congo and adjoining transit countries, in addition to 3TG originating from other ‘conflict-affected and high risk areas', potentially including parts of countries such as Afghanistan, Colombia, Myanmar and Zimbabwe.

While the proposed legislation is not expected to enter into force until mid-2016, the proposed obligatory due diligence system for the whole 3TG supply chain in the EU would affect an estimated 880,000 companies. The draft Regulation will oblige EU-based smelters and refiners, mineral importers and manufacturers to comply with a mandatory system for self-certified supply chain due diligence. In particular:

• EU-based smelters and refiners of 3TG would be required to apply a defined system of self-certified supply chain due diligence or an equivalent system recognised by the European Commission. In addition, smelters and refiners would also have to undergo an independent third-party audit of their supply chain due-diligence practices, with a view to being included on the European Commission's list of responsible smelters and refiners
• EU-based importers of 3TG would be required to certify their origin to help guarantee transparency and traceability in respect of their sourcing practices in ‘conflict-affected or high-risk areas'. According to the draft Regulation, due diligence measures must be akin to the OECD's Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas – or an equivalent system
• Downstream companies in the EU who use 3TG in their manufacturing processes would be required to take all reasonable steps to identify and address any risks that their mineral purchasing decisions and practices finance conflict or human rights abuses. In addition, manufacturers would be obliged to conduct and publicly report on the supply chain due-diligence measures they perform to promote responsible sourcing

Reputation risk and responsibility: Conflict minerals within the supply chain

Even if a company is not subject to legal sanctions for non-compliance with the law, allegations around conflict minerals can have a serious and lasting impact on companies' reputations.

In August 2008, for example, the UK's Department for Business Enterprise & Regulatory Reform made a public statement in which it confirmed that the activities of trading company Afrimex (U.K.) Ltd. – including the export of columbite-tantalite from DR Congo – helped fund armed rebels. It also noted that the company had failed to carry out adequate supply chain due diligence with respect to child labour and forced labour.

Owner Ketan Kotecha was reported as saying the finding was "crippling for Afrimex" and it was "unlikely to be able to continue trading". Deputy Mines Minister Victor Kasongo was reported as saying DR Congo would "suspend trade licenses" for all trading companies linked to Afrimex. The investigation into Afrimex was carried out by the UK National Contact Point for the OECD Guidelines for Multinational Enterprises. The original complaint against Afrimex was lodged by NGO Global Witness.

Divestment

Companies linked to conflict minerals also face the risk of potential divestment. In June 2010, for example, trustees at Stanford University voted to create new guidelines for the university's investments in light of growing concerns over conflict minerals. The guidelines ask companies to report on their policies and the actions they take to establish whether minerals in their supply chain are illicitly funding armed groups in countries like DR Congo.

Activists are making particular efforts to ‘name and shame' companies they claim are linked to conflict minerals. In July 2009, for example, NGO Global Witness published a report Faced with a gun, what can you do?: War and the Militarisation of Mining in Eastern Congo, in which it accused a number of companies of being linked to the purchase of minerals produced under rebel control in DR Congo. It claims, for example, that several of the main trading houses (or comptoirs) in the cities of Goma and Bukavu in the eastern Kivu region of the country "buy, sell and export minerals produced by or benefiting the warring parties".

These comptoirs allegedly included Groupe Olive, Muyeye, MDM, Panju and others – which Global Witness says were selling these minerals on to European and Asian companies such as the Thailand Smelting and Refining Corporation (THAISARCO – the fifth largest tin producer in the world, owned by UK-based Amalgamated Metal Corporation), as well as Belgian companies Trademet and Traxys.

The report cites Congolese government statistics suggesting that Belgian-registered companies (including Trademet, Traxys, SDE, STI and Speciality Metals) accounted for the largest proportion of "cassiterite, wolframite and coltan imports from North and South Kivu in 2007 and from North Kivu from January to September 2008". In 2007, the report says that the next largest purchasers from the North and South Kivu region were THAISARCO, AMC, Afrimex, the Rwanda-based subsidiary of South African owned Kivu Resources, Malaysian Smelting Corporation Berhad. The report notes that four other companies (China-based African Ventures Ltd, Met Trade India Ltd, Russia-based Eurosib Logistics JSC and Canada-based BEB) accounted for "an increasing proportion of cassiterite imports from North Kivu between January and September 2008".

The report also notes that THAISARCO's main supplier in South Kivu is Panju, "one of the comptoirs identified by the Group of Experts as complicit in pre-financing négociants who work closely with the FDLR and are aware that certain mines they buy from are controlled by the FDLR". Global Witness cites AMC's 2007 Annual Report and Accounts as referring to THAISARCO as a "principal subsidiary and operating unit" in which it had a 75.25% interest.

Global Witness further claims that some of these companies also used suppliers who purchased minerals produced by the Forces Armées de la République Démocratique du Congo (FARDC). It alleges that SDE bought cassiterite from Sodexmines – a main buyer from the Bisie mine, which was then under the control of the 85th brigade. SDE and Sodexmines are both part of the Blattner Elwyn group, which is owned by US national Elwyn Blattner.

As noted above, the Enough Project has been proactive in its efforts to make the public aware about the alleged failings of companies to address the issue of conflict minerals. This includes, for example, the publishing of companies perceived to be "falling behind", including Canon, Nintendo, Panasonic, SanDisk, Sharp and Toshiba. The Enough Project defines "falling behind" as follows: "(Score: less than 5%) These companies have done next to nothing to shift their practices toward conflict-free. They are not members of the electronics industry association process, and have not engaged with other stakeholders.".

Reputation and responsibility: Total exclusion of Congolese Minerals

Ironically, there is also a risk that companies that effectively exclude any minerals from DR Congo face criticism for undermining local development where it is needed most. For example, in April 2011 Bloomberg noted that "rules backed by Apple Inc. (AAPL) and Intel Corp. (INTC) to stop sales of minerals used in electronics from funding war in Central Africa" (i.e. the Conflict-Free Smelter Program) were, in effect, forcing local miners to seek new buyers in Asia. John Kanyoni, president of the mineral exporters association of North Kivu, is reported as saying "there is a de facto embargo" as smelters avoid buying minerals from Goma – in part, because local miners are unable to comply with these new rules yet. Jason Stearns, former head of the UN Group of Experts monitoring sanctions on DR Congo was reported as saying that Asian manufacturers were unlikely to make up for declining Western demand.

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The UN ‘Protect, Respect and Remedy' Framework for Business and Human Rights provides guidance on how to protect individuals and communities from corporate related human rights harm.

The framework is comprised of three key principles:

• Protect: The state duty to protect against human rights abuses by third parties, including business;
• Respect: The corporate responsibility to respect human rights; and
• Remedy: Greater access by victims to effective remedy, both judicial and non-judicial.

The framework states that in addition to complying with national laws businesses have a responsibility, in the context of the countries where they operate, to respect human rights through their own business activities and through their relationships with third parties – such as business partners and entities in their supply chains. To meet this responsibility, the framework notes that businesses should engage in human rights due diligence and specifies the main components of the process:

Policies: Including a human rights policy containing broad commitments, supported by more detailed guidance in specific functional areas

Impact assessment: Including assessments that explicitly reference internationally recognised human rights and are used by companies to avoid potential negative human rights impacts on an ongoing basis

Integration: Including the embedding of respect for human rights throughout a company

Tracking performance: Including regular updates of human rights impact and performance

The Guiding Principles for the Implementation of the UN "Protect, Respect and Remedy" Framework aim to provide "concrete and practical recommendations" about how businesses can operationalise their responsibility to respect human rights. According to the Guiding Principles, the responsibility to respect human rights requires responsible companies to:

• Implement a human rights policy
• Apply human rights due diligence
• Provide for remediation

The UNGPs apply to all States and to all business enterprises, both transnational and others, regardless of their size, sector, location, ownership and structure.

The UNGPs have experienced widespread uptake and support from both the public and private sectors, and numerous companies have publicly stated their commitment to the Guiding Principles. The UN Guiding Principles Reporting Framework is also used by companies to report on how they respect human rights.

Companies can seek specific guidance on this and other issues relating to international labour standards from the ILO Helpdesk. This aims to help company managers and workers understand the ILO approach to socially responsible labour practices and to assist in the development of good industrial relations.

UN Group of Experts on DR Congo ‘Due Diligence Guidelines'

Furthermore, the UN Group of Experts on DR Congo has published a set of detailed Due Diligence Guidelines aimed at encouraging responsible supply chain of minerals from ‘red flag' locations to mitigate the risk of complicity with armed groups in the country. This sets out five different steps companies for companies to take to help ensure their supply chains are ‘clean'. These include:

• Step 1: Strengthening of company management systems
• Step 2: Identification and assessment of risks in the supply chain
• Step 3: Designing and implementing a strategy to respond to identified risks
• Step 4: Undertaking third-party audits
• Step 5: Public disclosure of supply chain due diligence and findings

Each of this actions are addressed below in further detail, in addition to other potential efforts companies can make to reduce the risk of coming into contact with conflict minerals. Although intended for application in DR Congo, the principles contained in the due diligence guidelines are equally applicable in other locations/contexts.

Likewise, the Organisation for Economic Co-operation and Development (OECD) has published its own Due Diligence Guidance for responsible supply chains of minerals from conflict-affected and high-risk areas. These are closely aligned to the UN Group of Experts' Due Diligence Guidelines. Where relevant, these are again addressed below in further detail.

Additional specific guidance is provided by the OECD within the Due Diligence Guidance for different upstream and downstream actors. This more specific guidance applies to companies operating in a "conflict-affected and high-risk area" or which are "potentially supplying or using tin (cassiterite), tantalum (tantalite) or tungsten (wolframite), or their smelted derivates, from a conflict-affected and high-risk area".

In light of such guidance, specific actions that responsible business might take include the following:

1. Company management systems

In its Due Diligence Guidelines, the UN Group of Experts identifies four key steps in this process. These include:

• The adoption, dissemination and clear communication to suppliers of a supply chain policy for minerals originating from conflict mineral sources, and the incorporation of this policy into supplier contracts. The Due Diligence Guidelines provide detailed wording companies can use in this respect
• The structuring of internal management systems to support due diligence, including the assignment of roles and responsibilities, the provision of sufficient resources and the establishment of clear lines of accountability
• Establishment of effective systems of control and transparency over the mineral supply chain. These will vary depending on where a company sits in the supply chain – and the mineral in question. For example, ‘upstream' entities (from mine site to smelter) should aim to establish the exact origins of minerals (ideally to shaft-level), as well as the "date, method and quantity of their extraction". They should also try and establish "the value and beneficiaries of all taxes, fees, royalties and other payments made, including to armed groups, criminal networks and/or perpetrators of serious human rights abuses". Further information to be gathered includes the "exact locations where minerals are consolidated, traded, processed or upgraded" and "all upstream intermediaries involved in the supply chain"
• Development of mechanisms allowing stakeholders to "voice and record concerns regarding the circumstances of mineral extraction, trade, handling and export" in relevant conflict mineral areas, particularly in relation to armed groups, criminal networks and human rights abusers

In addition, the OECD Due Diligence Guidance also provides a Model Supply Chain Policy for a Responsible Supply Chain of Minerals from Conflict-Affected and High-Risk Areas. This model policy is likely to be useful to any company seeking to develop its own policy with respect to conflict minerals. It includes, for example, detailed policy provisions around:

• Direct or indirect support to non-state armed groups
• Public or private security forces
• Bribery and fraudulent misrepresentation of the origin of minerals
• Money laundering

Global Witness suggests that one way in which a company can ensure suppliers meet its supply chain policy is the incorporation of a standard suppliers' declaration. This would require suppliers to confirm that they will comply with the company's conflict minerals supply chain policy and to cooperate with the company's related due diligence activities.

Downstream companies

Specific management system provisions suggested by the OECD for downstream companies (e.g. nearer the point of sale than extraction) – the group within which most MNCs would likely fall – include:

• Introduction of a "supply chain transparency system" that allows for the identification of smelters and refineries in the company's supply chain through which information on minerals from ‘red flag' areas can be obtained. This might include, for example, countries of "origin, transport and transit" for all minerals passing through each smelter and refinery.
• Active cooperation with other companies with whom they share suppliers or have other business relationships with, to identify smelters and refineries in the supply chain
• Maintenance of relevant records for at least five years
• Support for digital information-sharing on suppliers and the adaptation of systems to assess supplier due diligence in the supply chain (with due regard for issues of confidentiality and competition)

Upstream companies

Specific management system provisions suggested by the OECD for upstream companies (e.g. nearer the point of extraction than sale) include:

• Introduction of a chain of custody and/or traceability system that generates information around: "mine of mineral origin; quantity and dates of extraction; locations where minerals are consolidated, traded or processed; all taxes, fees, royalties or other payments made to governmental officials for the purposes of extraction, trade, transport and export of minerals; all taxes and other payments made to public or private security forces or other armed groups; identification of all actors in the upstream supply chain; transportation routes."
• The making of all such information (and other relevant data generated through due diligence activities) available to downstream purchasers, auditors and relevant institutional mechanisms
• Avoidance of cash purchases – or, where cash purchases are unavoidable – ensure such transactions are supported by "verifiable documentation and preferably routed through official banking channels"
• Support for the implementation of the Extractive Industry Transparency Initiative (EITI)

The OECD further recommends that companies should build strong, long-term relationships with their suppliers in order to ensure they apply relevant due diligence processes and standards. This includes, for example, the clear communication of company expectations, the incorporation of relevant ethical supply chain measures into commercial contracts (including, where necessary, the right to conduct unannounced spot-checks and document inspections. As part of this process, companies can explore ways in which they can build supplier capability so they are better able to conform to the company's ethical supply chain policy. They can likewise develop measurable improvement plans with suppliers – in some cases with the help of government and/or NGO involvement.

Like the UN Group of Exports, the OECD recommends that companies develop grievance/whistleblowing mechanisms (directly, through a collaborative arrangement or through a third party) to raise relevant issues of concern. This might include, for example, the provision of an anonymous, independently run hotline/email address/postal address, the details of which can be posted within mining communities from which a company is known to source its minerals. This should improve the ability of community members to raise concerns with the company, where exploitative behaviour by armed group takes place.

See the OECD Supplement on Tin, Tantalum and Tungsten (contained in the Due Diligence Guidance) for more specific guidance for both upstream and downstream actors – including buyers, smelters, traders and others.

2. Risk-mapping within the supply-chain

Both ‘upstream' and ‘downstream' companies are encouraged to ensure that their supply-chain policies are being implemented by suppliers in reality. The UN Group of Experts encourages ‘downstream' companies to assess the due diligence efforts of their supplying smelters and refineries, including an assessment of the degree to which they have carried out due diligence on their own supply chains. Meanwhile ‘upstream' companies should instead focus on conditions of mineral extraction, trade and export from conflict-affected countries.

Downstream companies

Specific measures recommended by the OECD to downstream companies (the group into which most MNCs would fall), include the following:

• Identification of smelters and refineries in their supply chain. This might be achieved, for example, through confidential discussions with its ‘tier-1‘ suppliers, the inclusion of confidential supplier disclosure requirements into procurement contracts, by letting ‘tier-1' suppliers know which smelters and refineries it considers meets necessary due diligence standards, and using confidential information sharing systems on suppliers
• Engagement with smelters and refineries in their supply chains and the gathering of information from them on countries of origin and transit, as well as transportation routes between the mineral source and the smelting/refining facility
• Use of this information to target risk assessments on ‘red-flag' minerals and suppliers

In addition, the company should review the quality/depth of smelters'/refiners' supply chain due diligence, including:

• The review of information generated by on-the-ground assessment teams deployed by downstream companies in the supply chain (see below)
• A cross-check of the smelters'/refiners' due diligence practices against the company supply chain policy and best practice
• Engagement with the smelter/refiner to help "build capacity, mitigate risk and improve due diligence performance" – including through potential engagement in relevant sector-wide initiatives

The OECD further suggests that downstream companies participate in broader industry programmes. This includes, for example, the carrying out of "joint spot checks" of smelters'/refiners' facilities as part of the broader risk management programme.

Global Witness provides useful guidance relating to the assessment of smelters' supply chain controls in Annex B of its report, Do No Harm – Excluding Conflict Minerals from the Supply Chain.

Upstream companies

The UN Group of Expert's Due Diligence Guidelines recommend that ‘upstream' companies use information gathered in their due diligence efforts and supplement this with "their own or jointly conducted on-the-ground assessments". This includes particular focus on:

• Factual circumstances
• Security context
• Chain of custody
• Supply chain relationships
• Locations and qualitative conditions "extraction, trade, handling and (where relevant) export"

Specific measures recommended by the OECD to upstream companies, include the following:

• Identification of the scope of the mineral supply chain risk
• Mapping of the "factual circumstances of the company's supply chain(s), under way and planned" (essentially in line with the UN Group of Experts' guidance). The OECD Due Diligence Guidance provides specific advice in this respect, through its appended Guiding Note for Upstream Company Risk Assessments. This includes information on the establishment of on-the-ground assessment teams and a recommended list of questions for consideration
• Assessment of risks within the supply chain by comparing the "factual circumstances of the supply chain against the model supply chain policy". This includes a review of applicable standards and applicable laws, relevant legal instruments governing company operations (such as supplier agreements, financing agreements, etc.), and relevant international instruments (including the OECD Guidelines for Multinational Enterprises, as well as international human rights and humanitarian law)
• Assessment as to whether the supply chain meets the standards required under the Guidelines

The OECD notes that the on-the-ground assessment team in the "conflict-affected and high-risk areas of mineral origin and transit" should obtain information on suppliers and the context of "mineral extraction, trade, handling and export" (Likewise, a joint team can be established with other relevant companies). Global Witness notes that the nature of the work of such teams, and the contexts in which they will work, means that it is essential to put in place effective security arrangements in place to ensure their safety.

The assessment team should ideally consult with local/central government, as well as local civil society groups with local knowledge and expertise. They should also examine opportunities for the support of community monitoring networks to gather information for the assessment team. Information generated by the assessment team should be shared with other players in the supply chain.

According to the OECD, assessment team activities should specifically focus on:

• Obtaining first-hand evidence around the "militarisation of mine sites, transportation routes and points where minerals are traded", including the identification of "factual circumstances resulting in direct or indirect support to non-state armed groups and public or private security forces"
• Obtaining first-hand evidence around "serious abuses associated with the extraction, transport or trade of minerals….committed by public or private security forces, non-state armed groups or other third parties operating in mining areas, along transportation routes or points where minerals are traded"
• Responding to specific questions posed by cooperating companies (e.g. on evidence generated by relevant chain of custody systems and/or information on suppliers)
• Receiving, assessing and communicating stakeholder grievances
• Proposing recommendations for company risk assessment and risk management

According to Global Witness, companies should also review ‘chain of custody data'. This includes:

• The exact origin of the mineral in question, the date of extraction and the identity of the individual or organisation that did the mining
• Locations where the mineral was subsequently traded, the dates of trading and the parties involved in the trading
• Details around transportation, including means, routes, dates and the identity of transporters (including import/export documents)
• Details around the taxation of the minerals, including locations, dates and the identity of those to whom taxes were paid
• A description of minerals, including type, weight, purity – as well as information relating to their processing or transformation along the supply chain

See the OECD Supplement on Tin, Tantalum and Tungsten (contained in the Due Diligence Guidance) for more specific guidance for both upstream and downstream actors – including buyers, smelters, traders and others. This includes a detailed set of questions that the assessment team should answer.

Likewise, Global Witness provides useful guidance relating to on-the-ground assessment in the Great Lakes Region in Annex A of its report, Do No Harm – Excluding Conflict Minerals from the Supply Chain.

3. Development and implementation of risk mitigation measures

The UN Group of Expert's Due Diligence Guidelines recommend that companies develop two sets of risk management strategies:

• The first strategy should address "the risks of providing direct or indirect support to criminal networks and/or perpetrators of human rights abuses, particularly within the State's armed forces". Where risks are identified relating to such players, it is recommended that companies ensure state security forces "progressively cease any illegal involvement in mining and trade in minerals, including through illegal taxation and extortion of money or mineral shares, and that they are present solely to maintain security and the rule of law." Progress should be regularly evaluated by auditors examining the ‘downstream' elements of the supply chain – with disengagement if no progress is identified within a reasonable time
• The second strategy should address "the risks of providing direct or indirect support for armed groups and/or sanctioned individuals and entities". Where risks are identified relating to such players, it is recommended that the response should be disengagement from the relevant ‘upstream' suppliers until the risk is removed

It is recommended that companies regularly review their risk mitigation measures to ensure they remain appropriate given facts on the ground and their supply chain policies.

The OECD Due Diligence Guidance further recommends that:

• Findings from any supply chain risk assessment exercise should be reported to company senior management
• Companies adopt a risk management strategy based on "(i) continuing trade throughout the course of measurable risk mitigation efforts; (ii) temporarily suspending trade while pursuing ongoing measurable risk mitigation; or (iii) disengaging with a supplier after failed attempts at mitigation or where a company deems risk mitigation not feasible or unacceptable." When choosing a strategy, the company should "consider their ability to influence, and where necessary take steps to build leverage, over suppliers who can most effectively prevent or mitigate the identified risk"
• "If companies pursue risk mitigation efforts while continuing trade or temporarily suspending trade", they should consult and coordinate their efforts with affected stakeholders including central and local government officials, civil society and other affected parties
• Monitor the implementation of the risk management plan and report the results to senior management. This can potentially be done in collaboration with relevant government officials and civil society
• Ensure that the risk management strategy is subject to review following changes in circumstances

Risk mitigation measures recommended by the OECD for upstream companies to address the issues raised in its model policy include the following (amongst others):

• Where relevant, ensure "upstream intermediaries and consolidators" disclose payments made to "public or private security forces for the provision of security"
• Where relevant, support the "formalisation of security arrangements" between artisanal and small-scale mining communities, local government, and public/private security forces (in partnership with civil society). In particular, this should ensure all payments are "freely made and proportionate to the service provided, clarify rules of engagement consistent with the Voluntary Principles on Security and Human Rights, the UN Code of Conduct for Law Enforcement Officials and the UN Basic Principles on the Use of Force and Firearms by Law Enforcement Officials"
• Assist in the establishment of community-based forums to share/communicate information
• Support government efforts to professionalise/formalise the artisanal mining sector, for example "through the establishment of cooperatives, associations or other membership structures"
• Develop "supplier, customer and transactional red flags to identify suspicious behaviour and activities", identify and verify all suppliers, business partners and customers, and report suspicious behaviour/criminal activity to law enforcement officials
• Support the implementation of the Extractive Industry Transparency Initiative, public mineral revenue transparency and disclosure, and the building of government capacity to identify/address weak points in revenue collection and monitoring

Measures that the OECD suggests can be used to monitor the performance of a company's risk management system include the following:

• Global Reporting Initiative G3 Guidelines indicator HR8: "Percentage of security personnel trained in the organisation's policies or procedures concerning aspects of human rights that are relevant to operations".
• The percentage of minerals or money (on a disaggregated, per batch basis), illegally taxed or extorted from upstream actors by public/private security forces
• Global Reporting Initiative Mining and Metals Sector Supplement indicator MM8: "Number (and percentage) of […] operating sites where artisanal and small-scale mining (ASM) takes place on, or adjacent to, the site; the associated risks and the actions taken to manage and mitigate these risks".
• Frequency/depth of engagement in capability training and/or other industry initiatives for supply chain due diligence
• Global Reporting Initiative G3 Guidelines indicator EC1: "Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments".

See the OECD's Supplement on Tin, Tantalum and Tungsten for more specific guidance for upstream and downstream actors within the respective value chains of these metals.

4. Implement third-party auditing

The UN Group of Expert's Due Diligence Guidelines recommend that all company due diligence processes are subject to third-party auditing in order to ensure their credibility. This includes, for example, the independent auditing of refineries and smelters in order to assess whether their due diligence efforts capture "sufficient information to enable a reasonable inference of relevant individuals' and entities' compliance or non-compliance with due diligence at the smelter/refinery level and upstream from the mine site."

If necessary (i.e. the information being collected by the smelters and refineries is insufficient), then third-party auditing can potentially be extended further ‘downstream'.

As part of this process, audit activities should include the following:

• Examination of documentation and other evidence produced by the smelter's or refinery's supply chain due diligence (e.g. internal controls, chain of custody documentation, communications, contractual provisions with suppliers, risk assessments, etc.)
• Interviews, observations and document reviews
• On-site investigations (including smelter facilities, refinery facilities and a sample of suppliers (including, for example, concentrate traders, re-processors and local exporters – and potentially down to mine-level)

The UN Group of Experts specifies a range of stakeholders that auditors should specifically consult, including "joint assessment teams, local and central government authorities, the FARDC auditorat militaire, diggers' associations, the Group of Experts, MONUSCO and civil society organizations." In addition, the UN has recommended that the Security Council consider endorsing or recommending an "institutionalized mineral supply chain mechanism that would oversee and support the audits of smelter/refinery due diligence". This guidance can likewise be applied to equivalent stakeholders in alternative locations to DR Congo.

Likewise, the OECD Due Diligence Guidance recommends that third party auditors meet with upstream companies' on-the-ground assessment teams to "review the standards and methods for generating verifiable, reliable and up-to-date information, and audit a sample of evidence relied upon by the smelter/refiner". Furthermore, it is advised that third party auditors consult with "local and central governmental authorities, UN expert groups, UN peacekeeping missions and local civil society."

The OECD further recommends that all actors in the supply chain work with governments and civil society to incorporate relevant "audit scope, criteria, principles and activities" into an "institutionalized mechanism that would oversee and support the implementation of due diligence for responsible supply chains of minerals from conflict-affected and high-risk areas". This would include the accreditation of auditors, oversight and verification of audits, the publishing of audit reports (notwithstanding considerations of confidentiality and competition), the development of relevant training modules, and the provision of relevant grievance mechanisms.

See the OECD's Supplement on Tin, Tantalum and Tungsten for more specific guidance for upstream and downstream actors within the respective value chains of these metals.

5. Reporting

The OECD Due Diligence Guidance suggests that companies "publicly report on their supply chain due diligence policies and practices", for example through "their sustainability, corporate social responsibility or annual reports".

Downstream companies

The OECD recommends that downstream companies provide the following details in particular:

• The company's supply chain due diligence policy and the management structure through which it is implemented – including who is responsible within the company for addressing conflict minerals
• Steps taken by the company to identify smelters and refiners in its supply chain and to assess their due diligence practices, including the publishing of a list of smelters and refiners that qualify through industry best practice validation schemes, as well as steps taken to manage risks around conflict minerals
• Details of supply chain due diligence audit reports (notwithstanding issues of confidentiality and competition) and company responses to risks identified within the supply chain during the audit process

Upstream companies

The OECD recommends that upstream companies provide the following details in particular:

• The company's supply chain due diligence policy and the management structure through which it is implemented. This includes details around responsibilities, control systems, relevant data, record-keeping systems and payments to governments
• The outcome of the supply chain risk assessment (with due regard to issues of confidentiality and competition). This includes an outline of methodology and the results of on-the-ground assessment
• Actions taken to manage identified risks, including the involvement of relevant stakeholders, risk management strategy and details around the monitoring of performance

See the OECD's Supplement on Tin, Tantalum and Tungsten for more specific guidance for upstream and downstream actors within the respective value chains of these metals.

Additional elements

Global Witness goes further and suggests that companies identify all of their suppliers back to the mine of origin of relevant minerals, what commitments these suppliers have made in terms of conflict minerals, and what due diligence they are carrying out.

Furthermore, the NGO suggests companies disclose a ‘supply chain map', setting out the following (on a disaggregated basis):

• The mines from which minerals are sourced
• Locations where the minerals are traded, mixed or processed
• Relevant transportation routes
• Taxation information, including how much was paid, where and to whom
• The identity of all participants in the supply chain, including mine operators, traders, exporters and transporters

This is likely to be further than many companies are willing to go due to the cost, time and energy involved in such a process.

6. Support the formation of a certification scheme

Increasing focus is being placed by a number of companies on the establishment of certification schemes to exclude conflict minerals from international markets and to assure consumers that the products they are buying are ‘conflict free'.

The most notable example of such a scheme is the Kimberley Process Certification Scheme – a multi-stakeholder programme aimed at regulating the export and import of rough diamonds, which came into force in January 2003 (see case study). This was formed in light of evidence that during the 1990s, illicit rough diamond exports helped finance a number of rebel movements in countries such as Angola, Ivory Coast, DR Congo and Sierra Leone. Under the Kimberley Process, all international rough diamond shipments must be accompanied by an official certificate issued by the exporting government, stating that they are conflict free. This is supported by a system of internal controls the producing countries, as well as those countries in which diamonds are traded, cut and polished. Although the Kimberley Process has been notable in its success at excluding conflict diamonds from world diamond flows, there has been recent criticism around its ability to address non-conflict situations, where human rights abuses are nonetheless being carried out in relation to diamond extraction. This has been a particular concern with respect to the Marange diamond fields of Zimbabwe, where state security forces have been accused of serious abuses against illegal diggers.

In January 2010, for example, the World Gold Council (WGC) established the Responsible Gold initiative. Under the initiative, the WGC is planning to develop standards that will help establish a Responsible Gold brand within the global market place. This would be based on a system whereby gold miners, traders, transporters and refiners can obtain third party verification that their product meets the necessary Responsible Gold standards. These standards will initially relate to chain of custody (i.e. to establish the origin of Responsible Gold) and conflict gold (to ensure conflict-related gold is excluded from the Responsible Gold chain of custody). It is planned that the initiative will be aligned with other relevant initiatives including, for example, the OECD Due Diligence Guidance and the Dodd-Frank Act in the US.

See Conflict Minerals case studies

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Although minerals have played an important role in a wide range of conflicts throughout history, it was the rise of ‘conflict diamonds' that saw this relationship enter into the broader public consciousness. The UN General Assembly defines conflict "diamonds that originate from areas controlled by forces or factions opposed to legitimate and internationally recognized governments, and are used to fund military action in opposition to those governments or in contravention of the decisions of the Security Council".

Conflict diamonds were used by rebel movements –mainly during the 1990s – as a source of funding for wars against established governments in countries such as Angola, Ivory Coast, DR Congo and Sierra Leone. This includes, for example:

• The direct financing of the UNITA rebel movement in Angola in the 1990s through the export of rough diamonds
• The financing of rebel movements during Sierra Leone's civil war in the 1990s. This includes the export of diamonds by rebel factions, as well as the reported provision of weapons to the Revolutionary United Front by Liberian president Charles Taylor in return for diamonds from mines under their control

It was in response to such events – as well as the need for countries and companies to protect the legitimate diamond trade, and by extension the psycho-emotional value of diamonds in the mind of the consumer– that the Kimberley Process was established.

The UN, governments, NGOs and the diamond industry worked together to establish a system whereby participant governments are required to certify that sealed, international shipments of rough diamonds are free from conflict diamonds. Certification is issued by the exporting country, and is supported by a range of internal controls in the producing country – as well as those countries where diamonds are cut and polished. The Kimberley Process came into effect in January 2003, and has contributed to the exclusion of conflict minerals from the global diamond trade – with around 99.8% of world diamond production taking place in participant countries.

The international diamond industry has developed a system of warranties to support the implementation of the Kimberley Process throughout the value-chain – including both rough and polished diamonds. It requires all invoices for the sale of diamonds and jewellery containing diamonds to include a written guarantee that the diamonds are conflict-free.

As conflicts in sub-Saharan African diamond producing countries ceased, the original impetus for the Kimberley Process subsided. Nonetheless, it established a model – in terms of both issue and solution – that was to be applied to at least some degree to the issue of a wider range of conflict minerals in DR Congo. With diamonds, the relationship between the mineral in question and the consumer is a very direct one – it is essentially the same as when removed from the ground, albeit cut and polished. As a result, there was a clear danger that consumers would start to view diamonds per se as less desirable or valuable as a result of their association with conflict and related human rights abuses.

Many other minerals – and metals in particular –tend to be produced on much larger scale, are subject to intensive processing (including amalgamation, smelting and refining), are manufactured into (often small and invisible) components, which are then integrated into mass-manufactured consumer products. As a result, the relationship between sourcing and consumer is much less direct.

Nonetheless, campaigners have built on the findings, for example, of the UN Group of Experts on conflict minerals in DR Congo in order to turn what was originally a localised, geopolitical issue into a global consumer issue. They have done so by introducing more transparency around the journey of these minerals through relevant supply chains and into consumer goods. This has helped generate much higher levels of public awareness– and has also helped generate political pressure in the US that contributed to the passing of relevant provisions in the Dodd-Frank Act.

Human rights impacts of the extraction and trading of conflict minerals

Human rights that are typically related to the illegal exploitation of mineral resources by armed groups include:

Right to life (ICCPR, Article 6): Again, armed operations carried out by groups relying on – and trying to control – conflict minerals regularly result in the loss of life. This is both as a result of their direct impacts (such as battles, the ‘clearance' of populated areas, and efforts to induce the mass movement of people) or their indirect impacts (such as dislocation of populations, hunger and disease). In addition, loss of life is also likely to take place at controlled mining sites. This might be intentional (such as illegal killings of mineworkers and/or local people due to perceived theft and/or the enforcement of discipline in forced labour situations) or unintentional (with many illegal artisanal mine sites controlled by armed groups offering very dangerous working environments that reportedly result in, for example, serious collapses of ground and other fatal health and safety incidents).

Right not to be subject to torture, cruel, inhuman and/or degrading treatment or punishment (ICCPR, Article 7): Many of the armed groups controlling or exploiting mines in conflict area have particularly bad human rights records. This not only includes their behaviour during armed operations funded through conflict minerals (which are sometimes attended by – for example – mutilation, rape, torture and other very serious abuses in order to terrify local populations), but also the means by which they control conflict minerals in the first place. This can include, for example, actions to control local communities, punish perceived ‘thieves', take control of mine sites, enforce mine discipline amongst workers, etc.

Rights to liberty and security of person (ICCPR, Article 9) and Right to physical integrity (Articles 6 and 7 ICCPR): General conditions of lawlessness and the effective control of significant areas by armed groups through the use of intimidation and violence means liberty, security of person and physical integrity is likely to be infringed upon. This is as true in and around mining sites, as in many rebel-controlled areas in general.

Prohibition on slavery, servitude or forced labour (including sexual and economic exploitation and trafficking) (ICCPR, Article 8): Armed groups controlling conflict mineral sites often rely on forced labour for the extraction of minerals. This is reportedly attended by the use of violence, exploitative commercial terms and severe discipline to ensure that they are able to get members of the artisanal mining community – or local community members in general – to extract the minerals on their behalf. Furthermore, there are reported to be cases of sexual slavery and exploitation on the part of armed groups that rely on conflict minerals for their financing.

Prohibition of child labour (Convention on the Rights of the Child (adopted 20 November 1989, entered into force 2 September 1990); ILO Convention No. 138, the Minimum Age for Admission to Employment (1973); ILO Convention No. 182, on the Worst Forms of Child Labour (1999)): The unregulated conditions in which the exploitation of conflict minerals takes place – as well as local conditions of poverty – means that child labour is reported to be relatively common. ILO Convention No. 182, on the Worst Forms of Child Labour prohibits young workers under 18 from engaging in hazardous work. The ILO defines hazardous work as "work which by its nature or the circumstances in which it is carried out is likely to harm the health, safety or morals of children". This includes mining.

Right to a safe work environment (ICESCR, Article 7) and Right to health (ICESCR, Article 12): The very nature of artisanal mining means it often offers an inherently unsafe and unhealthy working environment. This is particularly the case where people are subject to coercive exploitation and where the state is unable to implement protective regulations. Common issues include unsafe underground workings, exposure to dust, exposure to chemicals, a lack of protective equipment –amongst others.

Right to an effective remedy for acts violating fundamental rights (UDHR, Article 8): The state will have only very limited authority in areas where conflict minerals are exploited – or where armed groups operate. As a result, there will rarely be any recourse for those who have been subject to serious human rights abuses linked (directly or indirectly) to conflict minerals.

Right to freedom of association (ICCPR, Article 22): Workers are highly unlikely to be afforded this right when subject to the control of exploitative armed groups in areas of weak governance.

Right to enjoy just and favourable conditions of work (ICESCR, Article 7): Artisanal miners under the control of coercive armed groups are unlikely to be in a position to secure acceptable conditions of work and will have very little leverage in relevant negotiations. This – as well as the absence of legitimate government regulation – is one of the key causes of exploitation in conflict mineral producing areas.

Right to freedom of movement (ICCPR, Article 12): Some armed groups use roadblocks to apply illegal and exploitative ‘taxes' on minerals being moved along significant transit routes. Furthermore, there may be situations in which artisanal miners working under the control of armed groups are forbidden from leaving the area – in order to ensure mining continues to take place. Likewise, the deliberate terrorisation of local people in order to clear and control areas is also likely to infringe on this right.

See Conflict Minerals case studies

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