Only half of African Great Lakes mineral exporters reported on responsible sourcing efforts – new Global Witness report

Less than half of companies officially recorded as exporting minerals from eastern Democratic Republic of Congo, Rwanda and Uganda published due diligence reports in 2015, according to a new study by Global Witness. ‘Time to Dig Deeper’ is the first ever detailed analysis of public supply chain due diligence reporting in the region.

Due diligence was introduced in response to the well-documented links between the minerals trade, human rights abuses and the financing of conflict prevalent in parts of the Great Lakes region and elsewhere. It is mandatory for companies exporting certain minerals from Congo and Rwanda, according to their national laws.

“Millions of people rely on the difficult and often dangerous artisanal mining business for an income. Yet too many are exposed to human rights abuses, corruption or violence on a daily basis,” said Global Witness Campaigner Natasha White. “Due diligence is the steps companies can take to identify, address and be transparent about issues in their supply chains. It is a means by which they can do their best to ensure they don’t contribute to such harms and continue to source minerals from high risk areas in a responsible manner.”

The study found a national reporting rate of 70 per cent of exporting companies in Rwanda, 45 per cent in eastern Congo and zero in Uganda. No companies published reports prior to 2014 so the study reveals progress, but there remains a long way to go.

Across the three countries, almost 75 per cent of the companies that published reports failed to mention any risks encountered in their work or how these were addressed. For some of these companies, Global Witness uncovered major incidents along their supply chains that were not reported.

“Due diligence reports are a vehicle for sharing information on risks throughout the supply chain, and a crucial mechanism for ensuring that all the companies profiting from these minerals can be engaged in addressing the problems associated with them,” said White. “This is the honest and responsible way to do business; if profits are shared along the supply chain, then responsibility should be too,” she adds.

In terms of reporting quality, Congo came out on top. Six Congo-based companies were transparent about at least one risk associated with their operations, compared to just one in Rwanda. No Ugandan companies in the study reported at all, showing that the country is seriously lagging behind in efforts to promote responsible mineral sourcing.

“Too many companies wrote generic one-pagers on what they commit to doing rather than what they have actually done. The seven companies that took steps to report on risk represent the beginning of a much-needed shift in the region’s minerals sector,” notes White.

Global Witness tracked minerals from Congo-based companies to six international traders based in Malaysia, Hong Kong, Belgium, Luxembourg and Rwanda. The reports of some of these companies were even less detailed than those of the exporters, despite their greater size and resources. From here these minerals would have been used in electronics, jewellery and industries the world over.

The Great Lakes’ gold sector is particularly high risk, yet it remains at the back of the pack in terms of due diligence reporting. Gold is a high-value commodity that can be easily smuggled and traded in small quantities. Global Witness estimates that 94 per cent of Congo’s gold left the country illegally in 2014. Only one of the 18 companies officially recorded as operating in the region’s gold sector in 2015 published a report for that year.

Key recommendations include:

• All companies operating in and sourcing minerals from Congo, Rwanda and Uganda to conduct and report on their due diligence. In Congo and Rwanda this is law.
  
• All companies to improve the quality of their reports. In particular, to include more detail about risks identified and how these were addressed with tangible reforms or actions.
  
• Congo, Rwanda and Uganda to monitor the due diligence and reporting efforts of companies in their jurisdiction, and – in the case of Congo and Rwanda – to sanction those that don’t comply.
  
• Uganda to live up to its international commitments made in 2010 to ensure companies operating in and from its jurisdiction conduct due diligence and report on this. Introduce a due diligence law as soon as possible, like Congo and Rwanda have done.