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When most consumers buying a new electric product or vehicle, they often do not reflect on where the parts and products come from or how they have been manufactured. They are probably not aware of children in the Democratic Republic of Congo (DR Congo) working in mines risking their lives to find cobalt for companies to use to produce lithium-ion batteries for their electric products. A lithium-ion battery is a rechargeable battery, which contains cobalt minerals (Wang, 2016. p108) that are mostly used in portable electronics and electrical vehicles for its high specific energy, low costs and long-life cycle (Helbig, 2018). According to Tsurukawa, Prakash & Manhart, lithium-ion batteries contain an average of 65g cobalt, and it is associated with 10 minutes of labour, whereas 3 min is child labour in artisanal miners in DR Congo (2011). Cobalt exists in mines located in DR Congo, one of the world’s most poor and underdeveloped countries. It is common that children under 15 years old are working in cobalt mines for long hours and under poor health and safety regulations. The rising demand for electric vehicles and portable electronics has resulted in an increased demand for lithium and cobalt to produce lithium-ion batteries (Church & Crawford, 2018). This report will focus on the ethical issues with companies using cobalt to produce lithium-ion batteries, and what actions they and their suppliers have taken to eliminate their use of cobalt from DR Congo.
The demand for cobalt has tripled between 2000-2010 due to its importance in producing lithium-ion battery, and the increased demand has resulted in an increased number of artisanal mines in DR Congo (Tsurukawa, Prakash & Manhart, 2011). There are about 80% artisanal mines in DR Congo with informal activities taking advantage of the people who are working under minimal safety and healthy work conditions. Artisanal mining often uses techniques that are both capital and technology poor and it causes environmental damages and health and safety issue for the workers (Maria SJ & Taka, 2012). There are reported to be tens of thousands of young people, including children, working in these mines, digging to find cobalt and other minerals. The working conditions are often dangerous and poorly regulated (Banza, Nawrot, Haufroid, Decree, Putter, Smolders, Kabyla, Luboya, Ilunga, Mutombo & Nemery, 2009). Workers in cobalt mines exposed to the toxic pure cobalt can develop threatening diseases such as asthma, cardiomyopathy, which is a disease of the heart muscle that can cause heart failure, skin rash and severe lung diseases (Lauwerys & Lison, 1994. p3). Cobalt is one of the most produced mineral resources found in DR Congo’s province Katanga, which is a world market supplier of the strategic mineral (Kalenga, 2013). A study made of U.S. Geological Survey in 2004 shows that DR Congo stood for 21.3% of the world production and 48.6% of the cobalt reserves in the world (Taylor, Schultz, Doebrich, Orris, Denning & Kirschbaum, 2009). DR Congo’s high cobalt reserves lead to a geopolitical supply risk of the minerals, because of its high demand for producing lithium-ion batteries. Cobalt has been identified as a critical resource since the concern regarding its supply risk and economic importance increasing. As DR Congo is a world-leading distributor of cobalt supply it has resulting in rising prices and increased actions against finding solutions to reduce the use of cobalt or find a substitute (Habib, Hamelin & Wenzel, 2016). The increased demand for lithium-ion batteries is a result of the growing interest in electric vehicles in the last decade. Furthermore, cobalt has a very high supply risk as they are subject to political scrutiny due to the consideration that cobalt is a conflict mineral exported from a conflict region and therefore an ethical questioning (Helbig, Bradshaw, Wietschel, Thornez & Tuma, 2018).
Child labour in artisanal miners in DR Congo is common, about 28% of the miners are children under 15 years of age and some are as young as 6 years old. Working in artisanal mining are regarded as one of the worst forms of child labour. The children are used for washing ores, transporting minerals, and digging for cobalt, some are hired to dig in smaller places in the mines where the adults cannot get through. They are working under poor work conditions with minimal wages, long working hours work, hazardous working spaces underground and they are exposed to dangerous substances, for as little as 1 US$ a day (Tsurukawa, Prakash & Manhart, 2011. p31-32). Artisanal mines support about 20% of the population in DR Congo, and about 50% of the labour force are women. Due to DR Congo’s history and culture, women are still suffering from sexual and gender violence, and in artisanal mine communities, the risk for the women doubles. Women who work in the mines are often subject to gender discrimination, such as limited presence in a higher level of the production chain, they get less paid than the men, and in some mines, women are not even allowed to enter due to fear of them stealing minerals (Hayes & Perks, 2012). Prostitution in artisanal miners is common and involves women and sometimes children as young as 12 years old (Tsurukawa, Prakash & Manhart, 2011). The lack of childcare options in DR Congo forces women to bring their children to the mines, and this might affect children’s wellbeing and health due to them being exposed to dangerous substances from minerals, dirty water and unsanitary conditions. It might also affect their future if they cannot go to school and get an education, they might be forced to remain working in the mines for the rest of their lives (Hayes & Perks, 2012). In Dr Congo children can play an important role in bringing income to their family, due to poverty and the governments’ low investment in education. Even though working in mines deems to be one of the worst forms of child labour, a lot of children chooses to work there on own will. A research made in 2007 shows that in some cases, school-going children choose to work in the mines on their free time to help with the family economy (Andre, 2014). Local authorities and miner’s associations in DR Congo has formally forbidden children to access the mines. However, the abolishment of child labour in artisanal mines has had a little effect, as the income for the traders decreases when they are losing important workforce. (Tsurukawa, Prakash & Manhart, 2011. p33).
Analysis of ethical issues In recent years, corporate social responsibility (CSR) of big corporations has received more attention regarding developing countries, this because they can have a potential helping impact on the local situations and help eliminate the problem the countries are confronted with. When it comes to operating in developing countries, corporations need to consider the CSR regarding the economic and social aspects. These considerations include economic impacts such as transportation, social consequences for the employees working hours, working rights etc, and how to demonstrate good practice, such as consideration for human rights and ethical behaviour (Kolk and Lenfant, 2010). Tesla Inc is an automotive company specialising in manufacture rechargeable electric vehicles, and the company need cobalt to produce lithium-ion batteries for their vehicles. To assure their customers that they are not supporting the work conditions, human right violations and child labour in DR Congo Tesla has developed a Supplier Code of Conduct. According to Tesla’s Supplier Code of Conduct, they expect their suppliers to operate in a responsible manner regarding their conducts policy and within their principles about conflict minerals, child labour or slaves. Which means that Tesla expects their suppliers to use reasonable efforts to make sure their supplies are conflict-free, and they will not accept any products or services in their manufactures from suppliers that support this cause or benefits armed groups in DR Congo (Tesla, Inc n.d). One of Tesla’s main suppliers of lithium-ion batteries is Panasonic, who are responsible for developing new and more efficient batteries (Karamitsios, 2013). In 2016 The Global Procurement Company for Panasonic issued CSR requirements in order to make sure their suppliers know they are following international standards and standard approaches within the industry. Their procurement guidelines establish legal and regulatory international requirements regarding labour rights, regarding child labour and human rights, workplace safety and health, environment standards, ethics regarding responsible mineral procurement and social contribution. Panasonic continuously works to improve its procurement regarding responsible minerals. They recognise that the procurement of cobalt from conflict areas carries a risk of funding organisations involving illegal, unethical activities, child labour and human rights violations, which is a huge social concern. They have therefore improved their CSR through promoting responsible procurement of cobalt in the global supply chain. To build a fair supply chain of minerals, they are working along with a range of stakeholders, countries, companies and organisations to ensure their minerals are not associated with illegal or unethical behaviour. Panasonic is communicating their policies with all of its suppliers and partners to meet their determined social responsibilities to promote responsible minerals procurement of cobalt through the supply chain. Panasonic is also working towards developing a conflict-free system of upstream mining companies and implementing conflict-free certifications from mining companies, and they require their suppliers to provide relevant information throughout the supply chain. In 2018, Panasonic examines around 1,700 of their suppliers on conflict materials and had responses from 99% of them. After this event, they conducted a risk analysis and requested a further investigation from suppliers according to risk (Panasonic, 2018). In order for Tesla to decrease the ethical issue regarding geopolitical supply risk, recycling of cobalt can help lower the supply risk in the future (Habib, Hamelin & Wenzel, 2016. p854). Even though the world supply of cobalt is not considered to be of critical shortage, world leading countries are working to prevent future cobalt shortage, as the mineral is of importance to some industries. To prevent this shortage, countries across the world have implemented a recycling strategy, and in 2006 an estimation of 10,000 tons of cobalt was recycled (Tsurukawa, Prakash & Manhart, 2011. p8). Tesla Inc is working with Umicore, a factory plant focusing on recycling batteries into reusable materials. Cobalt is the material with the highest value in Tesla’s lithium-ion batteries, and Umicore’s process is using the cobalt from recycled lithium-ion batteries, makes LCO (lithium, cobalt oxide) batteries and sells them to other battery manufacturers. In an environmental aspect, so far this process has been profitable for Tesla and it has also provided them with a high margin of return (Kelty, 2011).
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