Traceability and foreign corporate accountability in mineral supply chains

Abstract

Industrialized economies in the EU depend heavily on imports of minerals. The extraction and parts of the transport and processing of these minerals take place in the Global South and often bear high human rights and environmental risks. A lack of traceability in mineral supply chains makes it particularly difficult to hold companies accountable for negative environmental and social impacts of their operations and those of their suppliers. This paper analyses three mineral supply chains (copper, platinum, and gold) in order to develop propositions about how supply chain‐specific characteristics affect traceability and foreign corporate accountability (FCA) in mineral supply chains. The analytical framework focuses on three dimensions: geopolitical dynamics, industry characteristics, and private governance mechanisms. The authors argue that chain‐specific characteristics may foster or thwart traceability and FCA in mineral supply chains and thus provides a novel contribution to the debate on traceability and accountability in mineral supply chains.

The politics of supply chain regulations: Towards foreign corporate accountability in the area of human rights and the environment?

“…To start with, there is often a lack of knowledge regarding corporate impacts in distant sites of production, and lack of full traceability has been identified as a key challenge for enhancing FCA (Schöneich et al, 2023). There are also likely to be divergent interests, legal issues of jurisdictional competencies, and regulatory competition involved (Newig et al, 2020).…”

The devil is in the detail—The need for a decolonizing turn and better environmental accountability in global supply chain regulations: A comment

“…Variations in political governance between producer countries–for example, regulatory culture, enforcement capacity, and (lack of) transparency–significantly affect the effectiveness and perceived legitimacy of transnational regulatory interventions. For example, deficits in foreign corporate accountability can arise from shortfalls in domestic regulatory presence (e.g., Zimbabwe), or lack of transparency (e.g., China; Schöneich et al, 2023). Furthermore, the discretionary nature of consultative norms within HREDD laws has generally allowed engagement by implementing companies with accountability holders ( affected people ) to remain performative and superficial . The “hardening’ of foreign corporate accountability , represented by the adoption of HREDD laws in Europe and the US , has not reduced asymmetries between importing and producer countries .…”

“…However, this blanket categorization underplays both the diversity of domestic political contexts in host countries and also their constitutive role in the accountability dynamics of supply chains subject to external scrutiny over human rights and environmental harms. Through their comparative analysis of the characteristics of mineral supply chains (transnational power dynamics, industry characteristics, and private governance mechanisms), Schöneich et al (2023) make a major contribution to the literature. Variations in political governance between producer countries are crucial explanatory variables, for deficits in foreign corporate accountability can arise from shortfalls in domestic regulatory presence (e.g., DRC, Zimbabwe), enforcement (e.g., Peru), or lack of transparency (e.g., China).…”

“…Interestingly, we found greater interaction between foreign proxy actors and affected communities when gathering information on compliance with external standards on mineral production. As noted by Schöneich et al (2023), there are particular challenges building up traceability in the complex extraction, transportation, and processing of minerals exported from the Global South. These authors emphasize that supply chain-specific characteristics matter for HREDD institutional design.…”

Enhancement the Performance of Multi-Level and Multi-Commodity in Supply Chain: A Simulation Approach

“…This study shows that information sharing can reduce the bullwhip effect in the supply chain. Schöneich et al [19] developed a simulation model to promote and facilitate the study of design and analysis of wooden pallets supply chain. This model includes uncertainty, interdependencies between chains of the supply chain, and resource constraints.…”