Supporting Indonesia to develop a sustainable tin mining industry

Posted on 08.12.15 by

ArcelorMittal

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When you last opened a can of soup for your lunch, did you stop to think where the tin that lines the steel can came from?

Probably not. Too often in life, we take it for granted how everyday objects are made.
But consumers are becoming more discerning in their shopping decisions, thanks to increased awareness about responsible sourcing and supplies.

As a consumer of raw materials, ArcelorMittal wants to develop supply chains that our customers trust. We’re already working with a number of our customers in this respect.

Tin has been in the headlines for a number of years, but is now the focus of our attention for a different reason.

Over the last few years there has been a significant focus on whether companies are sourcing tin from the Democratic Republic of Congo (DRC) or surrounding countries, because of concerns that profits from tin mining are being used to fund conflict in the region.

There are also concerns related to the tin mining industry in Indonesia, the source of most of the tin ArcelorMittal buys in order to make steel cans for packaging. Indonesia has the second largest tin reserves in the world after China, and the industry has an important role to play in job creation and poverty alleviation.

Indonesia does not have the same conflict challenges as the DRC and surrounding region, so the concerns about Indonesian-mined tin are not as a ‘conflict mineral’, but as a sustainably and responsibly-sourced mineral.

The country’s tin mining industry has a large population of small-scale miners, many of whom work under conditions that are environmentally unsound and unsafe.  There are also concerns about the way in which mainstream tin mining is done both on land and offshore.

We therefore saw that there was a need for more responsible tin mining in Indonesia, and joined the IDH sustainable tin initiative, known as the Tin Working Group (TWG). The group is made up of tin users including Tata Steel, Apple, Samsung, Sony, Blackberry and Philips, industry bodies and Friends of the Earth.

In recognition that there are many people who have a role to play in identifying how solutions can be developed, the TWG is working with all the main stakeholders, from the government, to miners and smelters, to NGOs and the ultimate tin users to develop a long-term approach to tackling the systemic, widespread problems associated with tin mining in Indonesia. The TWG sums up the situation as follows:

“Locally there is a movement to protect the environment and support the livelihoods of the communities directly affected by mining activities. Nationally there is support for developing more responsible mining and business practices while also increasing export capacity.  Downstream users of tin are looking to improve transparency to supply chain operations in an effort to ensure responsible operations from extraction to customer. Effectively managing the goals and desired outcomes of such diverse stakeholders will require a comprehensive roadmap for sustainable tin mining operations that enables protection of the environment and benefits the welfare of the local community”.

Everyone recognises that this will take a long time to solve, but we have seen the progress made since we joined the TWG in April 2015. And the arrival of 2016 signifies the start of a five-year roadmap that will, if successful, result in a locally-led solution for sustainable tin mining.

Before reaching this point, collectively we have spent time engaging with Indonesian smelters and government officials to raise awareness of our concerns, but also to develop the relationships required to make this project a success.

We believe that the eventual success of this project will come in part from the power of multi-stakeholder groups – in other words, everyone working together. This is not easy and takes time and commitment from all parties. The easier route would have been to stop our suppliers from sourcing from Indonesian smelters — and to distance ourselves from Indonesia entirely.

However, this isn’t our approach to working with our supply chain.

This initiative demonstrates our commitment to improving standards within our supply chain and collaborating in ways that will benefit all stakeholders where this is possible. Indeed, one of ArcelorMittal’s 10 sustainable development outcomes is to have ‘supply chains that our customers trust’, and having this outcome guides and informs our approach to managing supply chains.

So as part of the TWG we’re choosing to stay, working on the ground to bring about sustained change by holding Indonesian smelters accountable for how they operate.

The story so far is really only the start of the journey, and we will continue to work with the stakeholders in Indonesia as they implement the roadmap.

The end of 2015 is a good moment to reflect on the work that’s been done, and to say that we are excited by the power and impact this multi-stakeholder initiative can have when all parties work together.

Just as we’ve done before, for example through our involvement in the Ebola Private Sector Mobilisation Group (EPSMG) – a group of  more than 100 companies formed in 2014 when a devastating Ebola epidemic spread across West Africa – we intend to build on this experience in other challenges we face that also involve complex issues and many different stakeholders.

By Meera Pau Mehta, corporate responsibility manager