According to the European Union (EU) and the United Nations (UN) conflict minerals are used in a wide range of products, including cellphones and SIM cards. The European Commission (EC) has recently introduced a proposal for a new law to guide companies in their responsibility concerning conflict minerals. After closely reviewing the proposal, Tele2 has come to the conclusion that we are not legally responsible for our business partners that deal in conflict minerals; nevertheless, we feel an ethical responsibility which we take most seriously.
The conflict minerals that are listed at the EU and UN consist of gold, tantalum, tin and tungsten. These minerals are often extracted from areas characteristic of conflicts where forced labor, slave labor and child labor are common. The profits derived from trading these minerals have also been reported to be used to finance armed conflicts. Reportedly, the most prominent contemporary example is the eastern provinces of the Democratic Republic of Congo, where various armies, rebel groups, and outside actors have profited while contributing to violence and exploitation during wars in the region. Due to security, it can be difficult to manage trade affairs, and control where these minerals are extracted. Tele2 does not have a direct relationship with the mines, but we can push our business partners to take action when issues come to our attention.
In March 2014 the EC proposed a law regarding the trade of minerals from conflict areas. The proposal suggests self-certification for importers and appears to be inspired by the American Dodd-Frank Act 1502. Tele2 has analyzed the proposal and come to the conclusion that we have no legal responsibility for our business partners regarding conflict minerals, but we do have an ethical one that we take very seriously. ”Conflict minerals are about human rights in their most fundamental form. Ultimately, it is the party in charge or in control that has the responsibility, but we can ask questions and put pressure from our position upstream,” according to Marie Baumgarts, Head of Corporate Responsibility at Tele2 AB.
For the Corporate Responsibility department at Tele2, it is essential to be well aware of the situation regarding conflict minerals to be able to work proactively. “We need to be as informed as possible to be able to ask the right questions to the right business partners - partners that have the power and knowledge to take action to reach a solution,” Marie Baumgarts said.
At Tele2, we take our responsibility in three following ways:
- First, we demand the same high standards for our business partners as ourselves. We put written attachments in all contracts they have to sign to do business with us. The requirements are based on the UN Global Compact.
- Second, we collaborate with other ICTs, set industry norms and try to jointly raise the bar.
- Finally, we direct questions to the vendors where there could be a risk for conflict minerals. We continually assess and evaluate.
The Dodd Frank Act 1502:
The act requires companies that have products including tin, tantalum, tungsten or gold that comes from Congo-Kinshasa or an adjoining country to provide reports. These reports shall include the names of the mines from which the minerals are extracted. The companies also need to guarantee that the payment is not used for bribes or to finance armed groups. If these requirements are not followed, the companies have to pay a fine.
Source: U.S. Securities and Exchange Commission
Read the whole Dodd Frank Act 1502 here.
The EC proposal:
The European Commission proposes a system with self-certification for importers of tin, tantalum, tungsten or gold.
The self-certification demands that EU importers avoid causing harm by controlling and handling their purchases according to the five stages from the OECD.
The purpose is to take measures at the point in the delivery chain where it has the greatest effect and to make it easier for end-users to keep informed.
The proposal gives EU importers the possibility to intensify their ongoing efforts toward a correct and legitimate trading with parties in conflict-affected countries.
Read about the five-step framework for risk-based due diligence from OECD here.
Read the whole proposal here.