Enabling traceability and provenance to meet regulations on conflict minerals and unfair labor practices.
“Critical minerals our world needs for electric vehicles and semiconductors can be found here. Clean energy we need to power artificial intelligence data centers and economic growth can be built here.”[1] This statement was made by former US President Joseph Biden during his visit to Angola in December 2024 to support a US-funded railroad project called the Lobito Corridor. The railroad would connect mining areas in the Democratic Republic of Congo (DRC) and Zambia to a port on the western coast of Africa, an important step towards expanding access to critical minerals needed for growth of the semiconductor and energy industry in the west.
According to the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF), “there is no universally agreed upon definition of what ‘criticality’ means…criticality is also very country- and context-specific, particularly with respect to mineral endowment, the relative importance of the minerals to industrial and economic development, and a strategic assessment of supply risks and volatility.”[2] In other words, the term “critical mineral” may vary by location, application, and current events. Many countries have generated their own lists of critical minerals to help guide legislation, budgetary allocations and diplomatic efforts. For example, the United States Geological Survey released a list of “50 mineral commodities critical to the US economy and national security” in 2022 which included 10 minerals that were directly linked to semiconductors and electronics.[3] These included arsenic, dysprosium, gallium, lutetium, rhodium, ruthenium, tantalum, terbium, tin, and tungsten. Other lists might include cobalt, copper, and sometimes uranium. For most countries that make chips and electronics, critical minerals are both essential for supporting their industry and also hard to find within their own borders.
While downstream electronics and semiconductor manufacturers are often located in countries with robust labor protections, the extraction of raw minerals too often takes place under less humane circumstances. In April 2024, the UN Secretary General launched the Panel on Critical Energy Transition Minerals to address the challenges associated with responsible extraction of critical minerals. One of the motivations for the formation of the panel was the concern about human rights violations related to mineral extraction. “Mining, at all scales, large and small, has too often been linked with human rights abuses, environmental degradation and conflict.”[4]
The term “conflict mineral” has a much narrower definition than critical mineral, and usually only refers to tin, tantalum, tungsten and gold, also known as ‘3TG’. This definition is often used in policy frameworks, such as the US Dodd-Frank 1502 Act[5] and the European Union (EU) Regulation 2017/821[6]. These four minerals were identified as a major source of income for armed groups in the DRC, fueling a decades long war that has claimed more than 6 million lives since the start of the Second Congo War in 1996.[7] For example, in May 2024, armed groups from Rwanda captured a town in the Congo with the largest coltan mine in the country, which is the second largest producer in the world of the ore that is refined to make tantalum – a key component of capacitors. The incursion helped to finance the armed group, collecting at least $800,000 per month in taxes.[8]
Over the past 15 years, several frameworks have emerged to address the conflicts and tensions stemming from extraction of critical minerals. A common framework within the semiconductor industry was written by the Organization for Cooperation and Development (OECD), which is an intergovernmental economic organization founded in 1948 (then known as OEEC) to “build better policies for better lives.” The organization publishes several guidelines, including the OECD Due Diligence Guidance for Responsible Business Conduct[9] (see suggested measures in Figure 1) and the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas with focuses specifically on 3TG minerals.[10] These guidelines provide a structure through which companies and organizations might address human rights and environmental issues that may arise from their or their suppliers’ operations.
Fig. 1: Due Diligence Process and Supporting Measures from the OECD Due Diligence Guidance for Responsible Business Conduct (2018).
Several regulations have been implemented by governing bodies to prevent financing of armed groups through procurement of conflict minerals. In the United States, Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act requires certain companies to “publicly disclose their use of conflict minerals that originated in the Democratic Republic of the Congo or an adjoining country.”[11] Also known as the “Disclosure Rule,” a company must file a report to the Securities and Exchange Commission (SEC) describing the source and chain of custody of its conflict minerals, and must also conform to a nationally or internationally recognized due diligence standard such as the OECD guidelines.
Similarly, the EU Regulation 2017/821 refers to the OECD Due Diligence Guidelines and calls on companies within the EU to monitor, audit and disclose procurement of conflict minerals. In 2024, the EU furthered its efforts to address human rights and environmental issues by adopting the EU Corporate Sustainability Due Diligence Directive (EU CSDDD). This directive will require all companies that do business within the EU, regardless of country of origin, to monitor their supply chains for labor and environmental violations or risk penalty.
Given the tremendous effort by the industry to address the conflict associated with 3TG minerals, it is unclear whether these efforts have had an effect. The U.S. Government Accountability Office (GAO), which serves as the federal government’s watchdog agency and is tasked with providing Congress with independent, nonpartisan information, has been reporting on issues related to conflict minerals in the DRC since 2010. Kimberly Gianopoulos, Managing Director of GAO’s International Affairs and Trade Team, has led this body of work over time, including GAO’s most recent report, which was published in October 2024. Gianopoulos stated that, “although it has been over a decade since the SEC issued its conflict minerals disclosure rule in 2012, GAO’s most recent report found that there is no empirical evidence that the rule has decreased violence in the eastern DRC, where many mines and armed groups are located, and that a majority of companies that conduct due diligence on their mineral supply chains continue to report being unable to determine the origins of minerals used in their products.” The 2024 Conflict Minerals report can be found here: https://www.gao.gov/products/gao-25-107018.
Regulatory approaches are only one way in which the semiconductor industry interacts with conflict mineral issues. Many companies and industry associations have implemented their own initiatives and formed associations to share resources to trace materials and collect supplier information. One such industry association is the Responsible Business Alliance’s Responsible Minerals Initiative (RMI). Jennifer Peyser, the executive director of the RMI, stated that the initiative “supports over 500 downstream, midstream, and upstream member companies with a suite of due diligence standards and tools, data, guidance, training, and other resources for global responsible sourcing and regulatory compliance. Our facility and supply chain due diligence standards are rooted in longstanding international norms while reflecting emerging corporate and stakeholder priorities for regulatory compliance, managing sustainability risks and impacts, and fostering responsible mineral supply chains.” More information about the RMI can be found here: www.responsiblemineralsinitiative.org.
Recently, SEMI has formed a new Responsible Supply Chain (RSC) working group under its Supply Chain Management initiative to provide a platform for enabling traceability and provenance across the supply chain to meet government regulations on conflict minerals and unfair labor practices. This new working group aims to bring together SEMI member companies to raise awareness of key issues, share resources, and advocate effective regulations and standards. The working group is comprised of SEMI member company employees from a wide range of backgrounds, including sustainability managers, supply chain experts and process engineers. If you are interested in joining our discussions, please visit our website for more information: https://www.semi.org/en/industry-groups/supply-chain-management.
On July 9 at 8am Pacific/11am Eastern, the SEMI Responsible Supply Chain working group will host a webinar featuring a roundtable discussion with Jennifer Peyser, Executive Director of the Responsible Business Alliance’s Responsible Minerals Initiative, and Kimberly Gianopoulos, Managing Director of the International Affairs and Trade Team at the US Government Accountability Office, including Q&A for attendees to join the discussion. Visit https://www.semi.org/en/event/critical-minerals-due-diligence-and-semiconductor-supply-chain to register.
Other upcoming events include a panel discussion at SEMICON West, October 7-9, 2025 in Phoenix, Arizona!
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