The accusations against the BMW supplier were massive. The Moroccan raw material group Managem should be responsible for the fact that large amounts of poisonous arsenic have entered the environment in its mine in Bou Azzer. In addition, the protection of workers would not correspond to international standards. Moreover, conscious action is being taken against critical trade unions. In any case, these were the results of a research by NDR, WDR and Süddeutscher Zeitung, which were published in November 2023.
The media response was high, not least because the critical public is increasingly focusing more on the entire supply chain when it comes to sustainability. According to the German Supply Chain Act 2023, a legal regulation is currently also in the works at European level.
Environmental protection, safety and workers’ rights or the massive intervention in landscapes through large-scale open-cast mining – which can also affect indigenous peoples: Such aspects often shape the image of mining, including here. In Germany, the media-present protests in the “Hambacher Forst” celebrated for the fifth time in 2023. Mining does not have the best image. With the concept of sustainability, it is difficult or not at all for many to bring together.
Mining: Expectations and demand are rising
The Managem case is exemplary in two respects. On the one hand, it shows the steadily increasing interest in more sustainable practices along supply chains, including metals. And secondly, the Moroccan mine with the world-famous car manufacturer as a customer represents a global trend that is directly linked to our efforts for decarbonization and energy transition: The demand for important raw materials is growing and will rise rapidly in the coming years.
Example of more environmentally friendly mobility: Modern electric cars require about six times as much critical raw materials as conventionally operated vehicles. The energy-storing battery alone contains lithium, cobalt, and nickel. It is estimated that the demand for lithium could increase by a factor of 42 by 2040, that of cobalt by a factor of 21 and that of nickel at least 19 times higher than in 2020. This cannot be covered by recycling alone, according to the assessment.
Why industry representatives are stirring the drum for a stronger European sector – such as Rolf Kuby. Kuby heads Euromines, the European Association of Mining Industries, Metal Ores & Industrial Minerals. Euromines, based in Brussels, sees itself as a representative of European mining in the field of metals and minerals, 15 national associations and 18 mining companies are among the members.
“Some voices from science predict: We need as many important raw materials produced in the entire history of humanity so far for a decarbonization of the economy,” emphasizes Kuby. “Stiles, we have neglected mining in Europe in recent years.” Although – in different depths and qualities – raw materials can be found. “In the first place is Scandinavia with iron ore and copper, but also Portugal, Spain or the Czech Republic,” explains Kuby.
Ten to 15 new mines needed by 2030
In fact: The report “World Mining Data 2021” of the Austrian Federal Government shows a global increase in mining production of almost 60 percent by 2019 since the turn of the millennium. Only in Europe did the yield fall: And by a significant less than 30 percent, i.e. contrary to demand.
According to insiders, ten to 15 new mines could be needed by 2030 to promote the metals for the European energy transition. That sounds like a good market. But currently, for example, investors have a greater interest in gigafactories for batteries than in mines, observes the documentary “Made in Europe: from mine to electric vehicle”, created by the Dutch university KU Leuven.
“The biggest issue that mining has in Europe and worldwide is social acceptance,” observes Kuby. For many, this is no longer even “NIMBY” – i.e. “Not in my backyard”, but even “BANANA”. So a categorical ‘Building absolutely nothing anywhere near anything.’ In doing so, we would have to understand, according to Kuby, what makes our prosperity possible. Kuby continues: “Of course, mining changes the world, and of course mining has a footprint – but there is modern mining that itself includes biodiversity and a restoration of the landscape.”
What do you think of in Germany when it comes to mining? Many certainly especially to the Ruhr area, including a perception of an industry that is rather a relic of the past. Finally, the mining of hard coal in the pot ended in 2018. Or just to the controversial lignite in four large territories. Possibly still on salt, such as Südwestdeutsche Salzwerke AG as one of the most important salt producers in Europe, or on the Kassel fertilizer manufacturer K+S.
Renaissance of German mining?
The GDR, for example, was the fourth largest uranium producer in the world. Over a period of more than 40 years, more than 200,000 tons of the radioactive raw material were extracted. And individual companies such as Sachtleben Bergbau in the Black Forest are now part of the medium-sized backbone of the German economy. In 2023, the company celebrated the 125th anniversary of its Clara mine, in which ore has been mined without interruption since 1898.
Such mining lighthouses could be reinforced in the future. South of Dresden, for example, a lithium mine is to be built and copper will one day be mined in Lusatia, as well as other metals in smaller quantities. In the Erzgebirge, at least two to three mining projects could receive approval in the coming years. Saxore Bergbau GmbH, for example, hopes to start mining tin in Breitenbrunn in the course of 2026.
Can this European, this German mining be sustainable? “I am confident that the industry in Europe and internationally has the claim to lead mining in the cleanest and best possible way,” says Rolf Kuby. “And fortunately, we don’t have problems like child labor here at all.” Unlike, for example, in the Congo, which is why BMW no longer purchases cobalt for its electric car batteries from the African country.
Despite overall higher standards, there is something to consider. “The most important ESG topic here is occupational safety, i.e. health and safety,” says Kuby. “And environmental influences, i.e. air, water, soil.” Connected to this is: energy. So an electrification, especially the transport in the mine. In general, however, if you go underground in Kiruna in the LKAB mine, for example, you are more likely to have the feeling of entering a spaceship. Everything is great,” reports Kuby.
How sustainable is EU mining?
LKAB is a Swedish mining company that is 100% owned by the Swedish state. Among other things, it operates the world’s largest iron ore mine in Kiruna and is also a member of Euromines. “We take responsibility for building a sustainable future,” says the LKAB website. But is there such a thing as sustainable mining at all? Some say: Metals are permanently removed from the ground. They don’t grow back. Therefore, no mining can be sustainable. And therefore prefer the term “responsible mining”.
Just like Sachtleben Minerals GmbH & Co KG, to which Sachtleben Bergbau belongs. So far, the company has given little insight into the website. The short Code of Conduct contains eight topics: business ethics, which also includes UN human rights, compliance with the laws, equal opportunities, leadership – training – health and safety at work, employee representation, data protection and finally environmental protection as well as supply chain. “A responsible use of energy and the protected goods of humans, animals, plants, water, climate, air, soil and landscape is decisive for our actions,” says the paragraph on environmental protection. More comprehensive data is missing so far.
Different with RHI Magnesita. Based in Vienna, the company produces materials for use in industries from steel to chemicals that can withstand temperatures of more than 1,200°C. RHI Magnesita operates mining itself, including Austria’s largest underground mine in Breitenau, Styria. A comprehensive sustainability report can be found on his website. As highlights, the company refers to its share of 33% women on the board, a low frequency of injuries, a reduced CO2 emissions per ton and a recycling rate of 10.5%.
“Recycling is the order of the day in several respects, not only in mining, but also in the downstream refractory industry,” says Thomas Drnek, Head of Environment at RHI Magnesita. “On the one hand, because every ton of refractory, which we do not even have to dismantle and sinter, saves a ton of Co2. And on the other hand, because recycling plays a very central role in the Critical Raw Materials Act of the European Commission.” The entire industry is in the process of reinventing itself in terms of recycling. The large customers pass through the sustainability requirements.
Companies more obliged
As in the case of Managem. When signing the cooperation in 2020, BMW had announced that it would obtain “sustainable cobalt” from Morocco in the future. Accordingly, after the critical research became known in 2023, the reaction was immediately: The car manufacturer announced that it would investigate the accusations. “If there is misconduct, it must be turned off,” says a spokesman.
In the future, companies within Europe will be even more obliged to keep such promises through rigorous management of the supply chain – and to communicate this transparently and continuously along clear KPIs (key performance indicators). This means for all parties involved along the entire value creation: to minimize the negative impact, especially on the environment, to keep an eye on the social and cultural influence and to meet clear ESG criteria. And finally, to be transparently accountable. New standards are currently emerging for all this.
For example, the “ESG Standard for Mineral Supply Chains of the Responsible Minerals Initiative (RMI)” has been in place since 2021. In autumn 2023, the OECD published a manual for environmental due diligence obligations in mineral raw material supply chains. And several organizations such as the ISO or the US-based Initiative for Responsible Mining are currently working on further standards.
New ESG standards are coming
Legislation is also in motion: The German Supply Chain Act and the EU’s Corporate Sustainability Due Diligence Directive (CSDDD), which is under advanced discussion, oblige companies to assume their responsibility in the supply chain. And the Corporate Sustainability Reporting Directive (CSRD) will determine what companies will have to report on sustainability in the future.
A central aspect of the CSRD: the double materiality. So not only the financial-related ESG risks, but also the influence of the company on the environment and society must be disclosed. Companies are affected by this extended non-financial reporting obligation if they meet at least two out of three criteria at the parent company level: More than 250 employees and/or a net turnover of more than €50 million in sales and/or a balance sheet total of more than €25 million.
In January 2024, the European Critical Raw Materials Act (CRMA) came into force. The CRMA is intended to make Europe more independent of imports of critical raw materials. It is about more domestic mining, more recycling and more stable supply partnerships with so-called safe countries of origin. BMW & Co have been with a driving force: “Today we do a lot in the field of raw materials, because the needs of the European automotive industry have to be met,” says Rolf Kuby. The CRMA is explicitly intended to promote the circular economy and sustainable procurement. The CRMA is welcomed in the industry as an overdue “good balance” between raw material requirements and minimization of environmental impact. Environmentalists criticize that concrete measures such as resource efficiency are lacking in it. “the opportunity to strengthen the rights of the people affected by mining through the law is also missed,” says the WWF. And last but not least, raw material mining in nature reserves remains possible.
Transparency and dialogue create trust
However, the public must be brought more on board – through openness and dialogue: “Large parts of society still have a negative attitude to mining and the entire mining sector,” said Sinead Kaufman, Chief Executive Minerals at the mining group Rio Tinto, recently told the industry portal Miningscout. And: “What could be of benefit to society in general does not necessarily feel right for the communities directly affected.”
“What’s in it for me?”, i.e. the question of what do the local people get out of it, is more important than abstract concepts such as the independence of Europe or security of supply. Communication must not simply be convincing or even greenwashing. It must be transparent and open, also with regard to the risks and effects – which must be managed according to strict ESG criteria and audited externally. Stakeholder engagement in all trend-setting issues and the willingness to compromise will be crucial for social acceptance.
Rolf Kuby: “I therefore want companies to be more committed to society. We want to be more recognized by her. We can’t demand that she just hugs us like that. We can only gain their trust through transparency and communication.”
If it is to be accepted, mining in Europe must be operated in a manner and ear-eable manner in a mannable manner along clear ESG guidelines. Maybe we will make the right path under the sign of the European Green Deal. If not for fully sustainable, then for responsible mining.
