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HuffPo Oped: Creating Conflict-Free Companies for the 21st Century

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HuffPo Oped: Creating Conflict-Free Companies for the 21st Century

Posted by John Bradshaw on August 16, 2012

HuffPo Oped: Creating Conflict-Free Companies for the 21st Century

This oped co-authored with actor and ethical mining entrepreneur Jeffrey Wright originally appeared on Huffington Post.

Conflict minerals from eastern Congo, found in our cell phones, computers and jewelry, are mined in conditions of armed violence and human rights abuse. Mining in Africa doesn't have to be this way. Dialogue and engagement between consumers, miners and civil society leaders in Africa is needed to find real, sustainable solutions.

In Sierra Leone and the Democratic Republic of Congo, the natural resource sector represents a global competitive advantage that should serve as a primary pathway toward long-term stability and prosperity. It is essential to the well being of these countries and others like them that positive stories continue to replace the tragic ones too often coming out of the mining sector.

For example, Taia Lion Resources ("Taia"), a mineral exploration company currently operating in Sierra Leone—a country whose economy used to be fueled significantly by conflict minerals, including what became known as "blood diamonds"—aims to achieve the highest profits and shareholder value through the implementation of an ethical and sustainable business model designed to serve the interests of all stakeholders. In partnership with the communities proximal to its areas of operation, Taia undertakes the development of its commercial prospects in parallel with the development of local social and economic prospects. Mineral rights are not valued above human rights. Key to the success of the model is careful relationship building—from the onset of operations—between company and community through, free, prior and informed consent and ongoing transparency.

A similar shift towards transparency and legitimacy has begun in the minerals sector of eastern Congo. The shift is driven by consumer demand for laptops, cameras and smartphones, which use conflict-free minerals from Congo. Just as consumers reject blood diamonds, they now recoil at "blood phones" and other devices that use the conflict minerals of gold, tin, tungsten, and tantalum. As this video shows, the answer is not to boycott; rather, it is to increase dialogue and engagement leading to discernible solutions.

Ending the conflict minerals trade in eastern Congo and replacing it with a legitimate mining sector is an achievable goal. But it can't be accomplished by local communities, governments and advocacy groups alone. Only when for-profit companies, on both the supply and the demand sides, become partners in the process will a clean minerals trade that benefits all stakeholders become a reality.

Some companies, particularly in the electronics sector, have made significant progress in freeing their supply chains of conflict minerals. Responding to pressure from campus activists and anticipating the impact of forthcoming SEC regulations under Dodd-Frank's section 1502, electronics companies have moved forward in tracing, auditing and certifying the minerals used in their products.

The Enough Project has been encouraging these companies to show leadership in addressing conflict minerals and has monitored their actions. This week, Enough released the 2012 Company Rankings on Conflict Minerals, which showed notable advances by a number of leading companies since 2010.

Four leading companies—Intel, Motorola Solutions, HP, and Apple—have been pioneers, not waiting for the implementation of long-delayed SEC regulations on conflict minerals. Intel was the first company to publicly commit to making a fully conflict-free product within a certain deadline—a conflict-free micro-processing chip by 2013. Apple was the first company to publicly identify the number of smelters in its supply chain—175—and to require its suppliers to use only audited, conflict-free smelters when available. Several other companies—SanDisk, Philips, Sony, Panasonic, RIM, and AMD—have significantly improved their efforts by surveying their suppliers, piloting due diligence procedures, and joining the smelter audit program.

Other companies continue to lag far behind. The laggards include Nintendo, which has made no known effort to trace or audit its supply chain, and Sharp, HTC, Nikon, and Canon, which have taken only initial steps to join industry efforts.

The efforts of the electronics industry leaders, in collaboration with government initiatives in central Africa's Great Lakes region, have had a noticeable effect on the conflict in the Congo, as armed groups are only able to generate approximately 35 percent of what they made from the trade in tin, tantalum, and tungsten, or 3Ts, two years ago. Conflict tin, a trade previously worth over $115 million per year, has been particularly difficult to sell, because the physical differences between tin from Congo and Rwanda make it tricky for smugglers to pass off Congolese tin as Rwandan.

Despite this progress, gold smuggling remains a major problem, other minerals continue to be smuggled, even if in smaller amounts, and the new M23 rebel group is trying to retake control over mines. Better independent monitoring of mines and trading routes must occur in order to stop the smuggling. But electronics company action has been at the center of a long-term process, as the electronics audit program begins to accept only minerals that are fully traced back to their mines of origin and are conflict-free.

Getting conflict minerals out of our consumer electronics is an important goal. But we can't stop there. An even more ambitious goal is within reach: Creating a clean, transparent, and legitimate mining sector in eastern Congo that benefits all stakeholders but, above all, the Congolese people who suffer the deprivations of conflict. Instead of simply telling their suppliers not to buy from the Congo, an approach that helps cut off armed groups but does nothing for mining communities, companies should take a longer view and help build a clean trade within the Congo.

Some companies have started down this road already. Seven companies are sourcing from conflict-free mines in Congo, and 16 electronics companies have joined the Public-Private Alliance for Responsible Minerals Trade, or PPA. The PPA is a government-NGO-corporate partnership created to develop traced and certified conflict-free minerals from the region. Motorola Solutions, Intel, and HP also helped get the smelter audit program to accept conflict-free minerals from Congo and the region that are certified by a regional government body, which means that greater amounts of clear minerals from Congo will go into electronic products next year, as mines become certified conflict-free.

Companies that use these minerals in their products should strive to invest in a way that creates shared value for both companies and communities. More local business leaders who have profited from the corrupt conflict trade are beginning to realize that with investment that is fully traceable and independently monitored, they can better serve their own interests and workers in their communities can enjoy livelihoods that benefit their families. As we're beginning to see elsewhere in Africa — in places like Sierra Leone — companies in the diamond and gold industries can work successfully with local communities when the commitment to doing so is serious.

The progress made by the electronics companies in the Enough Project's rankings now needs to be duplicated by companies in other sectors. Companies in the jewelry, automotive, industrial machinery and aerospace industries should join the Public Private Alliance and begin direct sourcing programs to help Congo develop a clean minerals trade.

Collaboration between commercial investors, development agencies and advocacy groups can help find sustainable solutions and end the conflict minerals trade which has been an essential driver of the long, brutal conflicts which have plagued parts of Africa for too long.

Award-winning actor Jeffrey Wright is founder and vice chairman of Taia Lion Resources and co-founder and chairman of Taia Peace Foundation which work together to assist rural Africa communities in overcoming the "resource curse."

Photo: Miners at a trading site in eastern Congo (Enough / Sasha Lezhnev)