Achieving global climate goals will require a quantum leap in investment to ensure sufficient supplies of key minerals needed for clean energy technologies. But while these inputs can dramatically accelerate emissions reduction efforts, protecting human rights when extracting them is an essential requirement for climate justice.
DUBLIN – Can we avert climate catastrophe without triggering a tsunami of human rights abuses? Policy makers, investors, CEOs and mining company boards should seek – and provide – positive answers to this question. Instead, failure to address human rights concerns could derail our already shaky journey to a low-carbon world.
At the United Nations Climate Change Conference (COP26) in Glasgow last November, governments and much of the investment community reaffirmed their commitment to the 2015 Paris Climate Agreement. Exceeding the global warming threshold of 1.5° Celsius above pre-industrial levels in this agreement will expose current and future generations to the deadly effects of climate breakdown. To avoid a collision with Earth’s ecological limits, we need a high-speed acceleration in the transition to a zero-carbon path, starting with halving carbon dioxide emissions this decade.
Achieving this goal will require a quantum leap in investment to ensure sufficient supplies of so-called transition minerals. Clean energy technologies such as solar power plants, wind farms and electric vehicles are mineral-intensive. Engines and turbines need nickel, chromium, manganese and rare earths. New electrical networks require large amounts of copper wires. Electric vehicle batteries need lithium and nickel. The International Energy Agency estimates that achieving net-zero emissions by mid-century will require a six-fold increase in mineral inputs and a 40-fold increase in lithium supply.
Policymakers and investors have slowly realized that shortages of transitional minerals pose a real and present danger to global climate goals. As demand exceeds supply, prices soar. Mining companies are desperate for new sources of minerals, as evidenced by Rio Tinto’s recent acquisition of a lithium project in ArgentinaBHP’s investments in Ecuadorian copper and Tanzanian Nickel Glencore’s projects and investments in African copper and cobalt. Larry Fink, chief executive of BlackRock, the world’s largest fund manager, anticipates a boom in investment in transition minerals which “is going to be significant and […] it will take several years of investment.
There is both an opportunity and a threat here. This is an opportunity for governments, investors, mining companies and civil society organizations to come together to develop new investment models aimed at delivering a renewable energy revolution while building shared prosperity, public and strengthening governance. The threat is that we are failing to protect the human rights of vulnerable communities in the transitional minerals boom, with increased investment fueling instead the destruction of livelihoods, environmental damage and a global wave of land and water grabbing by multinational corporations.
Anyone in doubt of the extent of this threat should consult the Transition Mineral Tracking compiled by the Business and Human Rights Resource Centre. Tracker documents 61 new credible allegations of human rights abuses over the past year, including erosion of land rights, toxic pollution, diversion of scarce water resources and attacks on local communities and defenders human rights. Companies featured prominently in the tracking database’s billing sheets include Glencore, Anglo American, China Minmetals and Rio Tinto.
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I was quite shocked to see that companies that embrace the green economy commit human rights abuses. But perhaps none of this should come as a surprise, given that deposits of many transitional minerals are concentrated in countries with notoriously poor governance.
In the Democratic Republic of Congo, the world’s largest source of cobalt and a major supplier of copper, mining is associated with child labor, corruption and widespread violence. Indonesia, the world’s largest nickel producer, has a poor record of protecting communities from mining pollution. Lithium mining in Argentina, Chile and Bolivia has pitted local communities seeking to defend scarce desert water resources against mining companies that use water-intensive extraction methods and trample on the land rights.
As a former United Nations High Commissioner for Human Rights, I am well aware of the challenges faced by mining companies and the broader investment community. Extracting minerals while protecting the environment and respecting human rights is an inherently difficult balancing act, especially when governments fail to take responsibility.
Environmental, social and governance (ESG) investing does not fill the void. Pervasive greenwashing aside, the focus has been almost entirely on decarbonization and the “E” in the acronym. Social criteria – including human rights – have been ignored, exposing communities to the threat of systemic rights violations and investors to reputational risks.
Human rights must be placed at the center of ESG investments. The Investor Alliance for Human Rights, a group of more than 200 companies representing over $10 trillion in assets, has called for stronger regulatory measures, including human rights and environmental due diligence, in line with the UN Guiding Principles on Business and Human Rights. The European Commission directive proposal on Corporate Sustainability Due Diligence, which would impose obligations on companies – with potential penalties – to monitor their value chains, promises to spur movement in the right direction.
Mining companies and investors in transitional minerals should be at the forefront of efforts to strengthen human rights protections. Board members of mining companies should ensure that the corporate cultures and practices of these companies reflect the human rights principles that most of them claim to endorse. These include deep engagement with affected communities and respect for their prior informed consent, due diligence in supply chain reporting, and access to remedies for harm.
Ahead of the COP27 climate summit in Egypt in November, I will call on governments, mining companies, investors, financial regulators and civil society organizations to agree on a common agenda for a low carbon transition both fast and fair. While increasing supplies of transitional minerals can dramatically accelerate emissions reduction efforts, the protection of human rights is an essential condition for climate justice.