MULTI-STAKEHOLDER COLLABORATION Glencore is actively supporting the FCA, and are encouraging other relevant companies to join the initiative
Diversified miner Glencore is playing a significant supporting role in the Fair Cobalt Alliance (FCA), a multi-stakeholder initiative to support the production of fair cobalt in the Democratic Republic of Congo (DRC), says Glencore lead cobalt trader David Brocas.
“We operate industrial mines in the DRC, and we are the largest industrial producer of cobalt in the world, with almost 30% of the world’s overall production. Cobalt at Glencore is primarily produced in the DRC. Only 30% of cobalt is produced outside the DRC, demonstrating how vital the country is in terms of cobalt supply and growth.”
Brocas emphasises the importance of the FCA as a multi-stakeholder initiative in the cobalt supply chain among companies, as well as civil society and other stakeholders.
Members of the FCA include social enterprise Fairphone, lighting company Signify, cobalt supplier Huayou Cobalt, sustainability organisations the Impact Facility and the Responsible Cobalt Initiative and German mobility provider Sono Motors, power bank provider Lifesaver as well as sustainable energy company Tesla.
Cobalt is a key mineral in battery production and the long-term transition to a low-carbon economy. The FCA connects cobalt from artisanal and small-scale mining (ASM) operators in the DRC to global electronics and automotive supply chains.
Brocas says that multi-stakeholder involvement will enable the FCA to efficiently solve the challenges that have “tainted the industry’s reputation”.
The DRC government has dedicated entities, meant to represent ASM suppliers of concentrates in the country, that liaise with the FCA to help ensure that the said concentrates have been produced in a legal, responsible and safe manner, he adds.
This will help to create a measure of professionalisation and regulation within the ASM sector in the country, which, in turn, will result in improved working conditions for miners in the ASM sector and facilitate the elimination of child labour.
Brocas adds that the company has also sought to introduce mutual obligation in commercial transactions, which will be audited under the Responsible Minerals Initiative cobalt standard, and has adopted the Cobalt Industry Responsible Assessment Framework, developed by commodity organisation the Cobalt Institute.
“Investing in the DRC is the only way to have a direct impact on the wellbeing of its local communities. We need to assist our host communities. This is part of a long-term strategy in trying to improve the reputation of the cobalt industry.”
Protecting Long-Term Investments
The FCA can help Glencore to protect its long-term investments in cobalt operations in the country in terms of repairing the sector’s reputation, which, in turn, attracts more interest and investment.
In this way, Brocas explains, the initiative will contribute to ensuring that cobalt is not replaced as an important metal in the evolving battery mix.
He comments that battery manufacturers do not want to be associated with illegal mining operations and poor working conditions that are currently associated with cobalt and the DRC’s ASM sector.
If these issues are not addressed, technology companies may attempt to “de-risk their supply chains” by replacing cobalt in battery manufacture, which is a significant threat to Glencore’s investment in cobalt mining in the DRC, Brocas highlights.
“We intend to produce cobalt for the next 40 years – at least. We have plenty of discussions with parties in the battery supply chain. If cobalt is replaced, the durability of the battery is reduced, which is not ideal if one wants to reduce the environmental impact. Replacing cobalt also compromises battery safety, as cobalt provides thermal stability.”
Brocas stresses the importance of Glencore’s securing long-term contracts with technology companies that want to secure cobalt supply.
“Glencore is one of the safest options for companies looking for responsibly produced cobalt, so we are experiencing strong demand because we’re trying to lead the way in terms of responsible production. We are focused on collaborating more closely with other companies, particularly original-equipment manufacturers, and entering into long-term supply agreements,” he concludes.