We’re working closely with our suppliers and industry partners to promote responsible metal and mineral sourcing to provide the materials we need for the green energy build-out.
Why is it important to source metals and minerals responsibly?
Metals form a crucial part of our renewable energy assets, including rare earth elements for wind turbine magnets, copper for transportation cables, and lithium for batteries. Building an offshore wind farm requires more metals compared with building, for example, a gas-fired power station with a similar capacity.
Our renewable energy assets are dependent on metals, including rare earth elements, copper, and lithium – materials with long, complex supply chains, often mined in countries with a high likelihood of negative human rights impacts.
We believe that the growth of renewable energy shouldn’t come at the expense of human rights, neither in our own operations nor in our supply chains.
Like those in the tech and automotive industries, we in the renewable energy sector need to actively guard against any harmful effects the mining of these metals and minerals could have on people and the environment.
What we know: Potential adverse effects
The mining industry can bring economic benefits to the countries where metals and minerals are extracted, for example through creating jobs and tax revenue, which can be used to improve infrastructure.
However, mining can also have unwanted side effects, including pollution, the displacement of communities, precarious working conditions, and effects on biodiversity.
We’re not directly involved in the mining of metals and minerals, nor do we have direct control over the conditions under which they’re mined, because this work occurs deep in our supply chains. However, as an end user, we promote responsible and sustainable practices and develop ways of sourcing these metals more responsibly.
Simplified supply chain for renewable energy products
What are we doing?
Supply chains tend to be long and complex. If we’re to address any risks, we need to work together with other stakeholders, not only across the renewable energy sector, but also in other sectors.
Our metals and minerals sustainability programme covers the ten metals with the highest risk of adverse social and environmental impacts that end up in our wind turbines, foundations, cables, components, solar panels, or energy storage systems: cadmium, cobalt, copper, iron, lithium, manganese, nickel, rare earth metals, silicon, and tellurium.
Our work focuses on three areas:
- Supplier engagement
Twice a year, we talk with our key first-tier suppliers to align our supply chains with the OECD due diligence guidance on responsible mining. This means we’re asking suppliers to ensure they have strong company management systems and to identify and address any social and environmental risks in their supply chains.
- Supply chain transparency To increase transparency on the origins of the metals we use, we’re working with suppliers to map our individual supply chains. We’re also working with industry associations to create more transparency in general, including by creating a ‘chain of custody’ system in which the origin of metals can be certified.
- Industry partnerships We engage with industry groups, such as the Initiative for Responsible Mining Assurance (IRMA), to advocate for responsible mining practices and learn from end users in other industries – like electronics and automotive – facing similar challenges. We’re also raising the topic with our partners and in industry groups such as WindEurope, which brings together all large developers and original equipment manufacturers for wind energy in Europe.
Engaging with our suppliers and industry partners has shown us that there’s momentum to address risks relating to the mining of the metals and minerals that fuel the renewable energy transition.
However, it’s also brought home to us the full extent of the challenge. We’re committed to taking on this challenge and to working together with others to ensure that the growth of renewable energy is beneficial, and sustainable, for everyone involved.
Latest updates from 2022
In 2022, we took the first steps towards implementing the OECD’s guidelines in our full minerals and metals supply chain:
- We mapped the performance of 17 suppliers to the first three steps of the OECD guidelines, concluding that they have policies and management systems in place, but that efforts are needed to increase transparency to identify and address risks deeper in the supply chain.
- We sent a senior executive letter to 11 suppliers and their sub-suppliers asking them to engage with IRMA and to start mapping their own supply chains. The response was generally positive, and the action points will be discussed in the ongoing dialogue with the suppliers.
- We started mapping the supply chains for two of our key metals, iron and copper, to identify and address human rights risks at mine level.
We need to address the lack of transparency in metal and mineral supply chains before we can deliver on our ambitions.
The next step is to map the remaining eight metals in the programme, explore the use of blockchain as a digital innovation for supply chain transparency, and to continue talking to suppliers.
We’ll also map the most common human rights risks at mine level for all ten key metals and begin to engage directly with mining companies through IRMA to learn more about these risks.
In addition to close collaboration with suppliers and industry partners, our primary partnership is with the Initiative for Responsible Mining Assurance (IRMA). IRMA is a multi-stakeholder organisation that promotes the leading standard on responsible mining. Membership enables us to (i) map the social and environmental risks in our metals supply chains, (ii) increase our leverage in the supply chain, and (iii) learn from other sectors facing similar challenges.
- UN Guiding Principle on Business and Human Rights
- OECD Guidelines for Multinational Enterprises
- OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas
Accountability lies with our Head of Global Stakeholder Relations, who also chairs our ESG Supplier Due Diligence Steering Committee.
This programme contributes towards the following Sustainable Development Goal: