2023 Impact & Finance Report

Reflecting on 2023: FCA’s Official Impact and Financial Report

By Camila Gomez Wills, Program Manager: Business and Human Rights, Responsible Sourcing and Sustainability at Tesla and Chairperson of the Steering Committee

The Fair Cobalt Alliance (FCA) remains steadfast in its commitment to nurturing a responsible and equitable artisanal cobalt sector in the Democratic Republic of Congo (DR Congo). As we reflect on the past year, 2023 emerges as a pivotal period led by significant changes in the global cobalt market.

Indonesia’s rapid emergence as a major player in cobalt production poses a potential challenge to the DRC’s long-standing dominance associated with human rights concerns. However, the narrative is currently shifting. Investors are expanding their presence in the nickel extraction and processing sector in Indonesia, positioning themselves to play a significant role in the global cobalt market. This expansion is part of a larger trend of companies competing to secure their positions in the battery supply chain, from mineral extraction processing to battery and electric vehicle (EV) manufacturing.

Additionally, the persistently low price of cobalt throughout 2023 has presented a significant obstacle for producers in the DRC, impacting their economic viability and sustainability efforts.

Nevertheless, despite facing headwinds stemming from market fluctuations, the FCA has continued to forge ahead, undeterred in our mission to drive positive change within the artisanal cobalt sector. These challenges have served as catalysts for resilience, prompting us to redouble our efforts in implementing sustainable practices and fostering equitable outcomes for all stakeholders involved. As we navigate these challenges, we remain optimistic about the opportunities for growth and transformation that lie ahead. The FCA is committed to leveraging lessons learned from the past year to further enhance our initiatives, ensuring that we continue to make meaningful strides towards our vision of a sustainable and inclusive cobalt sector in the DRC.

Embracing local transformation, strategic partnership and formalisation

As key players in providing green energy solutions, African countries, including the DRC, are increasingly seeking to lead local sustainability initiatives. The Congolese government’s proactive steps towards formalising the artisanal sector, exemplified by the presentation of the Ministry of Mines’s five-year strategic plan and their launch of the Entreprise Générale du Cobalt (EGC), signify a significant stride towards aligning mineral exploitation with local development goals.

Strategic partnerships have been crucial in driving this transformation, fostering collaboration among governments, local institutions, and international stakeholders. For instance, initiatives such as EGC and Conseil Présidentiel de Veille Stratégique (CPVS) have facilitated two workshops involving various stakeholders in the ASM sector to find lasting solutions for its formalisation. Through the exchange of expertise, a clearer plan has emerged. Despite challenges such as the lack of a clear agreement between large-scale mining (LSM) and artisanal mining, our collective efforts have yielded tangible progress, paving the way for sustained collaboration.

International actors, including the United States, are also becoming more involved in the DR Congo, indicating a positive trend towards broader engagement.

Formalisation is a beacon of hope, promising heightened investment and enhanced working conditions within the ASM sector. However, navigating its path is riddled with challenges, such as obtaining legal status for ASM operations and conducting thorough geological assessments that add layers of complexity to the formalisation process. Legalisation emerges as a pivotal milestone, indispensable for unlocking crucial funding streams and fostering sustainable practices.

Despite the formidable hurdles, the FCA’s sustained interaction with key government figures underscores our resolute dedication to catalysing constructive transformation. The FCA remains steadfast in its efforts to develop a legalisation format that garners acceptance from government bodies, as well as both LSM and artisanal and small-scale mining (ASM) actors. Through ongoing dialogue and collaboration, we are committed to forging a path forward that promotes regulatory compliance and fosters sustainable practices.

Changing the Narrative of DRC ASM Cobalt: Amplifying Transparency and Accountability

Transforming the perception of Congolese cobalt involves addressing both the realities on the ground and the narrative surrounding DRC cobalt. We will continue to nurture open dialogue and dispel misconceptions, paving the way for constructive change.

A 2023 delegation visit to the DRC served as a catalyst for concerted action, fostering collaboration among stakeholders and emphasising the urgency of our mission. Concurrently, journalist visits provided invaluable insights into the realities of the artisanal cobalt sector, highlighting the critical importance of transparency and accountability in our pursuits.

The objective was to dispel the misconception that all ASM sites are synonymous with human rights violations and environmental degradation and to showcase the progressive practices that exist within the sector. This initiative aimed to foster a nuanced understanding among journalists, facilitating more balanced and accurate reporting on the artisanal cobalt sector in the DRC.

Key Achievements

Throughout 2023, significant strides have been made across various fronts:

• Enhancing safety measures: Our efforts to elevate safety standards at the Kamilombe mine site have led to significant strides, including the registration of mine workers and the rollout of tailored interventions designed to minimise risks and ensure the welfare of workers. These initiatives encompass bi-weekly toolbox training, the strategic placement of safety posters across the Kamilombe mine site to reinforce safety protocols, and the provision of Personal Protective Equipment (PPE) to depot workers, safety captains, women washers and mine site cleaners.
• Child labour remediation: Significant strides have been achieved in tackling child labour through the establishment of a comprehensive remediation system in collaboration with The Centre for Child Rights and Business and Save the Children Germany, through The Hub. Currently, 18 children are enrolled in the remediation program, with a total of 20 children having been involved since its inception.
• Improved Incomes: Through the collaboration with Alternatives for Action (AFA), a local Non-Governmental Organisation (NGO) providing financial education to the Kapata community, the FCA, through sensitisation efforts done through Churches and local administrative frameworks resulted in 242 people joining the 10 saving groups created in 2023, resulting in a total of 21 savings groups made up of 456 individuals, who have been able to collectively save more than USD 40.000 in 2023. These groups allow the creation of micro-enterprises, solidarity funds, school fee loans, and alternative incomes. The saving groups represent a key element in raising the worker’s and the community’s incomes and help the diversification of revenue sources.
• Governance and Member Engagement: Our continuous dialogue and collaboration with our 19 members and stakeholders have fostered a collective approach that is yielding concrete transformation within the ASM cobalt sector. This collaborative effort exemplifies our commitment to inclusive decision-making and collective action, driving positive change in the sector.

As we look towards the future, fueled by the momentum of our achievements and the collective dedication of our members and stakeholders, we remain steadfast in our resolve to continue advancing towards our vision of a sustainable and inclusive ASM cobalt sector in the DR Congo.