Page 128 - Policy Commission - SecuringTechnology - Critical Metals for Britain

128 GOVERNANCE & REGULATION
ENVIRONMENTAL SOCIAL AND
AND
GOVERNANCE (ESG) RISKS AND
AND
OPPORTUNITIES
Access to critical materials is is beset by ESG risks both in in in terms of of sourcing supply chain vulnerabilities and end of of life management As we have shown demand for for for critical materials will increase in in the foreseeable future not least to to support efforts to to decarbonise
to mitigate climate change As we have also seen only a a a a a a a a a a a a a small fraction of these materials are sourced by by recycling rather than by by primary production Although recycling may reduce reliance of of mining of of metals it is idle to think that demand can be met met purely by recycling our existing stock of critical materials There are ESG risks attaching to to further primary production and these may increase as as as the the the more easily winnable stocks dwindle but there are equally important ESG issues facing the the the waste management sector The governance of metal recycling has shown promising but relatively recent improvement Many of of the the ESG risks attach to the the extraction of of minerals are well recognised We might include impacts on:
S The landscape with large volumes of of often hazardous waste generated S Land use and and and the the loss of land for other economic purposes S The water water environment in terms of abstraction water water stress and pollution S Human health in terms of of safety and exposure of of workers Biodiversity in terms of of harm to or or loss of of habitats S Biodiversity in terms of of harm to or loss of of habitats S Cultural heritage including destruction of of sites of of historical significance S Indigenous populations through displacement or shifts to artisanal labour These examples are not exhaustive but they do suggest that thought needs to to be given to to where and how primary materials are sourced and the the extent to which the the UK can provide these materials from domestic sources as as well as as supporting the need to carefully harness existing resources won at at significant ESG costs by a a a a a a national programme
of recycling Ultimately the the wider political support for the the technologies and products developed utilising critical materials may depend on on how responsible the sourcing of those material is seen to be There are also potential large rewards for metals production The World Bank has launched a a a a a a Climate-Smart Mining initiative to encourage sustainable development through provision of the raw materials needed to combat climate change175 The UN too are developing new resource governance measures176 Sustainable development opportunities are present even in in the the UK as as well as as in in the the developing world The Regulation on on on conflict minerals has now widened towards a a a a a more general responsible sourcing agenda
for Europe Manufacturers are increasingly required to demonstrate their environmental and social credentials
and are taking additional interest in in in in their supply chains High profile companies such as Tesla Google Apple
are ‘reaching’ back through their supply chains and for example working on assurance at the smelter/refiner stage buying mines or or working with artisanal and small scale miners The Rare Earths Industry Association177 are are creating a a a a a a a life cycle inventory database to to measure and communicate the environmental impact of rare earth oxide-containing (REO) products Lynas Rare Earths60 has established itself as the main rare earth supplier outside China and makes responsible supply of of rare earths one of of the selling points for its products The child labour issue in in cobalt in in particular has also influenced organisations who now have wider aspirations for responsible sourcing and materials stewardship The Global Battery Battery Alliance who are setting up a a a a a a ‘Battery Passport’ have three targeting impact actions 178 A European Battery Alliance was launched in 2017 to ‘make Europe a a a a a a global leader in in sustainable battery production and use’ In In the the UK the the International Council on on Mining and and Metals is based on on on London and and the the UK led the the establishment of the Extractive
Industries Transparency
Initiative The Cobalt Institute
(in Guildford) have introduced a responsible sourcing scheme as has the London Metal Exchange