Tailoring our risk mitigation approach to local contexts
Bolivia: zinc and lead
Bolivia is an important mineral producing country where both large-scale mining (LSM) and artisanal and small-scale mining (ASM) play a role in extracting minerals. Noting the potential risks in the Bolivian mineral supply chain, including in relation to child labour in ASM, our approach to engaging with Bolivian suppliers is guided by the objective to drive sustainable capacity building for small- and medium-sized mining companies and concentrator plants. Our tailored risk mitigation strategy looks to address local challenges, including occupational health and safety and labour rights.
Supply chain risk mapping
The initial step in developing our tailored approach was an assessment to identify and map the participants in our Bolivian zinc and lead supply chains. The objective of the assessment was to evaluate both our direct and indirect suppliers against relevant international standards, including the OECD DDG, and a focus on the suppliers’ approach to HSEC&HR. Our assessment started by distributing supply chain due diligence questionnaires to our Bolivia-based suppliers. Simultaneously, we undertook desktop research to identify ASM-related risks and cooperatives that operate legally in Bolivia.
We also conducted over 25 site visits, a joint on-the-ground assessment with a customer and consulted local stakeholders to further improve our understanding of risks on-the-ground.
Raising supplier risk awareness
We compared the identified ASM risks with the responses provided by our suppliers. This indicated a need to strengthen our suppliers’ awareness and understanding of our expectations and requirements. To address this, we distributed brochures in Spanish, developed a site assessment strategy and trained our local marketing staff in delivering on-site training.
Building supplier capacity
Our approach extends beyond management systems and controls to include supplier training, capacity building, and tools to help suppliers improve their sustainability and sourcing practices.
For example, we developed a policy template for our Bolivian suppliers, covering issues such as HSEC&HR and responsible sourcing, and support them to implement it. Beyond simply providing this template to the supplier, we work closely with each supplier to tailor it to their specific operations. We begin with a gap assessment of the supplier’s existing management systems against the template and then collaborate to develop a bespoke policy that reflects their context. Where needed, this is reinforced through on-the-ground training to support effective implementation and rollout.
Colombia: coal
Recognising the challenges in Colombia, including risks of corruption, potential funding of non-State armed groups (NSAGs), and other human rights risks listed in OECD Annex II, we developed a tailored coal supply chain management strategy.
Risk assessment at municipality level
We conducted a deep dive risk assessment at a municipality level, with the use of local expertise and desktop research, to identify the risk level of each of the OECD Annex II risks within our Colombian supply chains. This assessment helped us refine our risk mapping by identifying sub-regions within conflict-affected and high-risk areas (CAHRAs) in Colombia that present comparatively lower risk.
Due diligence on direct and indirect suppliers
We assess Colombian coal suppliers to confirm alignment with our Supplier Code of Conduct, and compliance with applicable Colombian legislation. This includes assessing potential risks using publicly available information and other relevant data sources. Our approach also includes on the ground assessments of our suppliers’ suppliers (indirect suppliers) to identify salient human rights risks and evaluate the effectiveness of their risk management processes.
For example, in 2023, we undertook a deep dive assessment on select suppliers involving a desktop review of relevant documents, on-the-ground assessments, and interviews with the suppliers’ employees. The assessments’ findings were fed into recommendations for each analysed supplier, which in turn generated individual corrective action plans.
Supplier training
Our Colombian procurement team provides trainings in Spanish to the suppliers to raise their awareness and build capacity on HSEC&HR matters, including modern slavery and child labour, and other expectations and requirements set out in our Supplier Code of Conduct.
We continue to engage with local suppliers to identify opportunities for risk mitigation and, where appropriate, support efforts to strengthen ESG performance across the local coal supply chains.