Access to remedy through judicial, administrative or legislative means is essential to righting wrongs. But to make these effective, the remedy landscape must recognise and squeeze out these wrongs. Businesses can contribute significantly to the latter, paving the way for constitutional institutions to govern effective remedies. This paper illustrates, for child labour in the cobalt supply chain, how the most effective remedy landscape begins with proactive and strategic socio-economic marginalisation of the problem, and how businesses can play a major role.

In a world of rapidly advancing technology that is catapulting us into new energy products – including renewables and battery storage – rare minerals like cobalt and lithium are essential.  Cobalt is needed in our smartphones, our home battery systems and electric vehicles. Its demand is set to grow. However, nearly 60% of the world’s known cobalt resources are in the Democratic Republic of Congo (the DRC), and the cobalt supply chain from this region is riddled with child labour, often originating at artisanal mining camps, as documented by Amnesty International in 2016.

The problem

We all know the socio-economics of child labour. Children are a cheap and bountiful source of labour. Their small size and flexibility allows for smaller and cheaper mining shafts. They complain less than adults. When they disappear, victim to unsafe conditions, the tragedy is easier to hide from the authorities.

Cobalt’s supply chain is conducive to child labour. Apple, Samsung, Tesla and others buy their cobalt from component manufacturers. Component manufacturers buy their cobalt from large aggregators, many of whom are generally in Asia; the hub of electronic componentry. They, in turn, buy from other smaller aggregators in the DRC, Tanzania and the region. These smaller aggregators purchase from cobalt processors and smelters in the region. The processors and smelters purchase their ore from a variety of sources. Many of those sources employ child labour.

Contemporary business stances on the problem

In 2017, Apple made public commitments to improving its supply chain scrutiny and reducing the risk of child labour in their products.  How they, and other companies like them (Samsung, Tesla etc) will do this is unclear.  The obvious way is to demand some kind of certification. The Kimberley certification process had some success with conflict diamonds since the early 2000s. However, processes like this are only tenuously capable of tracking cobalt. This is because we don’t blend one (potentially conflict-associated) diamond with another (‘clean’) diamond; they are distinct items. But with cobalt, we smelt ore that might have been mined by a child together with ore that might not have been, resulting in a batch of cobalt that is tainted with child labour. We cannot separate those molecules, therefore it is harder to separate accountability.

Some of the larger mining companies can distance themselves from child labour to some degree by leapfrogging links in the supply chain. They can track shipments of their validated ore to aggregators in Asia and are able to show that their product, free from child labour, made it to a major aggregator safely. But unless the whole chain – all links and all branches – can be scrutinised by successive buyers, this is a part-solution only. And this part-solution risks always being paired with a remainder that is perennially unsolved; that has child labour. Satisfaction with this paradigm is equivalent to accepting that unscrupulous practices will always exist as a kind of globally necessary evil.

Even taking the step of declaring cobalt a conflict mineral in various jurisdictions (eg the US and the EU) would leave a remainder.  These are good, but insufficient, initiatives.

Causes of the problem

It is helpful to recognise why the problem persists; to break it down and apply effective remedies. The cause of this problem is threefold.

One is that, in the Democratic Republic of Congo, artisanal mining is illegal. This sets artisanal cobalt mining up to be a black market industry; unregulated, shadowy and therefore prone to child labour practices, and potentially connected to conflict in the region. In a jurisdiction that struggles with governance, this is a recipe for failure.

Two is that artisanal mining for cobalt is a commercially attractive enterprise compared to other livelihoods, despite the pittance paid by buyers at the very start of the supply chain. Parents are lured towards this economy – and are willing participants in the child labour problem – because it is a practical household option for survival.

Three: consumers of Apple, Samsung and Tesla products are somewhat apathetic and will probably buy the product irrespective of the percentage of child-labour procured cobalt in it, because “getting to zero” seems impossible.

This gives us a three-part strategy to pursue as we move toward effective remedies for child labour in the DRC.

Foundations of solution, remedy and the business role

Encouraging and even legislating that businesses should keep their operations free of child labour is necessary, but it is not, by itself, sufficient. A broader perspective is needed, with businesses encouraged to step up to a more comprehensive – and less self-involved – solution.

The first part of such a comprehensive solution is the legalisation of artisanal mining in the DRC. Artisanal mining has been around for centuries as a legitimate contributor to community economies; governed in the right way, it can alleviate poverty and avoid child-labour pitfalls. Securing its legitimacy and encouraging its potential benefits in contributing to the improvement of lives can help bring it out of the had-to-govern shadows, as a 2013 report by the International Peace Information Service attempts to illustrate.

Thus far, major mining companies have been loath to support legalisation because this would interfere with their own access to the mineral. As a result, this part of the solution is given little airtime. However, if mining companies, the end-use giants like Apple, development banks and the international community collaboratively encouraged legalisation and regulation (and, importantly, supported capacity building of the DRC to effectively regulate child labour out of the supply chain), the size of the problem would shrink. In practice, businesses such as large mining companies can incubate coexisting artisanal mining communities, buying and processing ore from legal, regulated operations in the region, supporting a more transparent industry. In such a setting, the use of child labour can be more easily identified, prosecuted and remedied quickly, choking out the practice.

This first part of the solution alone, however, risks a flocking of labour to artisanal mining. While not in itself problematic, one unintended consequence of this is that labour shifts from other productive parts of the economy to legalized artisanal mining, making regulation a mammoth task, and also detracting from a diversified economy.  To neutralise this, a second part is needed.  Focus should be brought to alternative economies so that artisanal mining is not the first, most attractive solution for income generation at the household level, particularly as cobalt demands increase. In the DRC, for example, regional agricultural productivity could be improved by strengthening farming practices, co-operative aggregation and access to markets. A series of reports from 2006 t0 2017 by the World Bank show both the opportunity and the means to achieve this improvement.

Many mining companies encourage agriculture in their Corporate Social Responsibility (CSR) efforts, but there is little strategic overlay to strengthen this economy – both in its own right and as an effective inoculant to the inherent problems in legalising artisanal mining. Mining companies collaborating with development banks, for example, can boost alternative economies so that economic pressure is distributed; so that artisanal mining does not become the only, or easiest, accessible source of household income.

The third part rests with the consumer public – to place more pressure on Apple, Samsung, Tesla and others. Simply demanding child-labour free cobalt is not enough if a solution seems vague and tenuous, or even academic and impossible. This demand invites a “best efforts” response, which is what we see today – and the efforts are not enough to eradicate child labour. The demands need to be focused on tangible parts of the solution: Show us how you are helping legalise and regulate cobalt mining; show us how you are helping find alternative livelihoods. The consumer public needs greater awareness of the problem, and the potential remedies, to be better engaged and to hold their suppliers more accountable.

Business has a central part to play, by not settling for insular “my cobalt is child-labour free” stances; by lobbying for a more connected solution. But businesses cannot do this alone; they require the collaboration of other sectors such as development banks and the UN, who have political leverages and support mechanisms to offer. A more comprehensive solution to decimate child labour in the cobalt supply chain exists. It takes a strategic approach; a collaborative rather than a finger-pointing, self-distancing one.

Dr Raj Aseervatham was General Manager of the Sustainable Development, Communities and ESG Performance at Origin Energy & MD of Corporate Integrity.