The Democratic Republic of Congo’s top exporter of coltan — a raw material needed to make mobile phones — has signed on to a rival mineral-tracing program after exiting the more-established ITSCI system.
Societe Miniere de Bisunzu is joining RCS Global Group’s Better Sourcing system, the parties said in a joint statement. Like ITSCI, Better Sourcing provides tracking and verification services for minerals originating in Congo and neighboring countries where there are concerns that they could be funding conflict or contributing to human-rights abuses and corruption.
The ITSCI system was devised by the U.K.-based International Tin Association and became the main traceability initiative for the metals covered in the U.S.’s Dodd-Frank Act, requiring listed companies to disclose their use of potential conflict minerals sourced in Congo and adjacent countries. The rules apply to tin, tungsten, tantalum — which is extracted from coltan ore — and gold.
SMB is leaving ITSCI because of the increasing costs of the program and inadequate on-the-ground monitoring, said Managing Director Ben Mwangachuchu. The company informed Congo Mines Minister Martin Kabwelulu of the move in a letter sent mid-December and seen by Bloomberg.
SMB’s criticism is “factually incorrect,” ITSCI’s sustainability and regulatory affairs manager, Kay Nimmo, said by email. The program has grown its team over the years and makes regular visits to mine sites, she said.
SMB holds a permit granting the company the right to acquire all the coltan ore dug up by a local cooperative at seven sites in North Kivu province. Congo produces more than a quarter of the world’s tantalum, the scarce mineral that is used in smartphones as well as armaments and aviation components.
SMB’S operations in North Kivu will be the first that have implemented both ITSCI and RCS’s systems, Mwangachuchu said in the joint RCS-SMB statement.
“Permanent monitoring activities are coupled with electronic traceability, which reads assigned tags used to seal each bag of minerals,” the statement said. “Throughout the material’s journey, data will be continuously captured, verified and made available through the Better Sourcing digital dashboard, accessible to Better Sourcing supply chain participants.”
SMB’s announcement follows more than 20 ITSCI members that became inactive including through withdrawal in 2018, according to the program’s website.
The Organisation for Economic Co-operation and Development, which developed the benchmark guidance for supply chains of minerals from conflict-afflicted and high risk areas, said it won’t comment on specific cases.
Programs like ITSCI “were set up in the first place to avoid duplication of due diligence efforts for mineral producers and their buyers and to reduce the number of third party checks and audits,” said OECD policy adviser Hannah Koep-Andrieu. “This might create additional work but is not insurmountable, provided the companies’ proposed new systems are deemed sufficiently credible by the market to continue to buy the material.”