The Largest EV Manufacturer Worldwide Faces the Industry’s Lowest Human Rights Evaluation.
Amnesty International released a report outlining the supply chains and human rights due diligence practices of 13 leading electric vehicle manufacturers. The outcomes are vastly different from the tidy, secure future that electric vehicles guarantee.
THE RACE TO keep up with EV progress might be facing a grim shift. Amnesty International has published a report stating that the top electric vehicle manufacturers are not sufficiently showing how they handle human rights issues in their mineral supply chains, which collect essential materials for electric car battery production.
The document, Recharge for Rights, claims that BYD, Mitsubishi, and Hyundai exhibited the poorest human rights due diligence practices among 13 leading EV manufacturers, as shown in a league table (the three firms did not reply to Amnesty regarding its conclusions).
Other electric vehicle manufacturers—like Tesla, Mercedes-Benz, and Stellantis—ranked higher in Amnesty’s league table, yet the organization claims those firms could only show a “moderate” level of their human rights due diligence.
“The violations of human rights associated with the mining of minerals for energy transition are concerning and widespread,” stated Agnès Callamard, the secretary general of Amnesty International, expressing in the report that the industry’s reaction was “woefully inadequate.” Those auto firms that are falling behind “must put in more effort and accelerate their actions to demonstrate that human rights isn’t merely a superficial phrase, but a matter they genuinely prioritize,” she stated.
When we consider batteries, we think of lithium extraction—which already possesses a questionable reputation. However, another essential component is cobalt, a considerable portion of which is extracted from deep shafts utilizing basic tools, or sometimes just by hand. A few of the miners are kids.
It is important to note that Amnesty’s report, which evaluates car manufacturers not just on their assessment of human rights but also on supply chain mapping and other criteria, claims that the largest global producer of EVs, the Chinese firm BYD, is the most egregious violator.
Cobalt China Worry
Over two-thirds of the globe’s cobalt—crucial for lithium-ion batteries—originates from the Democratic Republic of the Congo (DRC), a nation that experiences significant poverty despite its rich mineral resources. Seventy percent of individuals in Congo survive on under $2.15 daily.
Amnesty has estimated that about 25% of the cobalt obtained from the DRC comes from small-scale mining, where miners, including children, excavate perilously deep tunnels with basic tools or sometimes just their hands. Obtaining supplies from other nations would deprive these small-scale, “artisanal” miners of income; it’s typically more advantageous for EV companies to advocate for better working conditions for all miners in the DRC instead of rejecting cobalt sourced from the DRC.
Amnesty’s ranking system, scored out of 90, evaluated automotive companies based on criteria such as dedication to human rights policies, supply chain mapping and reporting, and remedial actions. Mercedes-Benz achieved the top score with 51 out of 90. BYD—who did not reveal the names of smelters, refiners, or mines to Amnesty—received a poor score of 11 out of 90.
“BYD’s reports indicate a significant deficiency in transparency regarding human rights due diligence in its battery supply chains,” stated Amnesty’s Callamard. “Other firms with low scores, like Hyundai and Mitsubishi, do not possess the required depth and knowledge concerning implementation in essential human rights due diligence areas.”
“The obligations that these companies disclose are frequently unclear and lack substantial proof of genuine action, indicating they still have much progress to make to achieve global benchmarks,” Callamard stated. Although companies like Renault and GM have expressed their dedication to human rights due diligence and score better than some of the lowest-ranking firms, they still offer minimal proof of completely incorporating these commitments into their supply chain processes, with little information regarding their risk assessments, as reported by Recharge for Rights. Amnesty remarked that BMW, Mercedes-Benz, Tesla, and VW have “more to do” to “identify actual and potential human rights risks across their supply chains,” yet Recharge for Rights noted that their “moderate” score “should serve as an example for others to emulate.”
Vehicle Compliance
Six out of the 13 companies highlighted in the Recharge for Rights report emphasize that they are taking the issues pointed out by Amnesty seriously. BMW, GM, Nissan, Mitsubishi, and Hyundai all issued statements concerning their low scores.
Mitsubishi stated that Amnesty’s report relied on data from 2023, “however, we have launched multiple initiatives since that time.” The Japanese company stated that these measures involve employing AI to “examine possible links with suppliers concerning conflict minerals and other matters.”
Nissan released its Sustainability Data Book, which featured best practices for sourcing minerals, stating that the company honored the “human rights of all stakeholders” and adhered to “relevant laws, regulations, and standards.”
“Our supply chain compliance initiative establishes the utmost standards,” said Hyundai, emphasizing its “dedication to a sustainable, ethical supply chain that respects human rights, safeguards the environment, and ensures safety.”
“Mazda has been dedicated to upholding human rights for years, exceeding legal standards,” Mercedes-Benz remarked, emphasizing that it “achieves the highest ranking among assessed car manufacturers” in Amnesty’s report.
BMW referred to the compliance management documents of the group. General Motors stated that it was dedicated to “sustainable and responsible procurement of products and services.” A Ford representative agreed to participate in a Zoom call interview but failed to appear at the scheduled time.
History of Evaluation
Extracting minerals can be highly profitable for mining firms, but individuals residing near these resources seldom, if at all, gain any advantages. For certain Brazilian communities, this shifted last month after a legal ruling that will be closely scrutinized by the industries dependent on these minerals, such as the automotive industry.
The biggest class action in English history was initiated in London on October 21, involving 700,000 people seeking compensation following a catastrophic tailings dam collapse in 2015 on the Doce River in Brazil’s southeastern region. Nine years later, the Doce River—which the Krenak Indigenous community holds sacred as a god—is still contaminated by the toxins from the deluge caused by the iron ore mine.
Only four days following the announcement of the lawsuit, the Anglo-Australian mining powerhouse BHP reached a compensation deal with Brazil, agreeing to pay $29.85 billion in the largest environmental settlement to date, far surpassing the $15 billion paid by VW for “Dieselgate” in 2016, and the $20.8 billion from BP for Deepwater Horizon in 2015.
As reported by Reuters, this compensation might possibly settle all existing and forthcoming legal disputes.
Recharge for Rights isn’t Amnesty’s initial critique of electric vehicle brands. In 2016, the organization published groundbreaking research that claimed leading companies were overlooking the environmental and human exploitation inherent in the extraction of the 30 metals and minerals essential for EVs.
Collaborating with African resources expert Afrewatch, Amnesty recorded instances of children as young as 8 participating in the search for cobalt and highlighted the exploitative and dangerous conditions faced by both child and adult miners.
New laws in Europe, the US, and Japan dictate how businesses should handle human rights abuses. Companies that violate the new EU-wide Corporate Sustainability Due Diligence Directive—which has mandated rigorous oversight of labor, social, and ethical conditions in procurement chains since July—face penalties reaching 5 percent of global revenue, while non-EU firms may encounter limited market access.
The influence extends past the EU’s boundaries. “Since Chinese firms seek entry into Europe, the EU has significant leverage to declare, ‘If you wish to enter this market, you must comply with our regulations,’” states Henry Sanderson, executive editor at Benchmark Mineral Intelligence and author of Volt Rush, a 2022 book examining the often opaque EV supply chains of automakers. He states that the EU possesses “significant power to improve supply chains.”
According to Sanderson, the US is also “driving a lot of this” through the Biden administration’s Inflation Reduction Act (IRA), though more from a protectionist viewpoint. “You can’t qualify for certain IRA credits if there’s a so-called foreign entity of concern—a Chinese company, for instance—in your supply chain,” he states. “Consequently, it is essential to outline your supply chain.”
Supply chain mapping—the method of collecting and evaluating data about a company’s supply chain to develop a comprehensive map of its network, also referred to as SCM—can serve as a “force for good,” emphasized Audi’s procurement strategy head, Marco Philippi, to Automotive Logistics in 2022.
“Philippi estimated that by having our suppliers implement our sustainability ratings with their suppliers, we are referring to 14,000 direct partners across 60 countries multiplied by ‘N’ taking action on it.” “When we examine the group, there are 60,000 suppliers.” “This is a strength we recognize.”
In Recharge for Rights, Callamard from Amnesty stated: “Automobile manufacturers must utilize their significant influence as global mineral purchasers to affect upstream mining firms and smelters to reduce human rights hazards.”
Decarbonization Initiative
Amnesty International is not the sole civil society organization that evaluates automakers based on their adherence to human rights standards. The results in Recharge for Rights resonate with those found in recent studies published by Human Rights Watch and Lead the Charge, a coalition of local and international NGOs advocating for fair, sustainable, and fossil-free automotive supply chains.
Lead the Charge discovered that two-thirds of the firms in its league table lacked policies concerning Indigenous peoples’ rights. The organization has urged mining firms to secure the “free, prior, and informed consent” of Indigenous communities, as outlined in a declaration signed by Indigenous groups during last year’s United Nations climate summit.
What benefits Indigenous people can frequently benefit the planet as well. Lead the Charge believes that a more sustainable automotive sector can facilitate a transition for heavy industries, especially steel and aluminum, to move away from fossil fuels. The steel sector accounts for 7 percent of global greenhouse gas emissions. According to Chris Alford from the Sunrise Project, a worldwide climate justice organization, including aluminum raises it to over 10 percent of total human-created emissions.
“The automotive sector is the biggest user of aluminum and batteries, as well as one of the leading consumers of steel worldwide,” Alford, a British national residing in Mexico, stated. “They can leverage this buying power to encourage other sectors to reduce carbon emissions.”
Certain automotive companies show a greater willingness to decarbonize compared to others. For example, in 2021, Volvo expressed its plans to obtain fossil-free steel, and the following year became the initial automaker to join the SteelZero initiative, which seeks to boost demand for fossil-free steel and hasten a shift toward carbon neutrality in the worldwide steel sector. Mercedes-Benz has also made a comparable promise.
Similar to Audi’s head of procurement strategy Philippi, Alford is of the opinion that automakers can leverage their purchasing influence to propel the industry toward a more sustainable future while tackling environmental and human rights concerns throughout the car supply chain. “According to Alford, we possess a chance with EVs, as the shift to electric vehicles is prompting a change in auto supply chains.” Therefore, the chance to step in and enhance that is present now, as these supply chains are already undergoing transformation.”
Sam Hardy, the ESG head for mining at Australian environmental firm JBS&G, which isn’t associated with Lead the Charge, stated that the recent Amnesty report is a “must-read for anyone interested in responsible supply chains.” Hardy asserts that the EV brands must be recognized. “Instead of pulling back, they have generally been open to participating and enhancing sustainability practices,” he states. “Although the Amnesty scorecard indicates significant opportunities for enhancement, the overall sectorwide advancement deserves recognition.”
“What instruments do we have available to ensure that companies honor human rights and protect the environment?” asks Mark Dummett, leader of the Amnesty team that created Recharge for Rights. “One advocates for the implementation of laws and regulations.” Another aspect is the effort we’re undertaking with the Recharge for Rights report to enhance the visibility of these matters. A third method is strategic litigation like the class action that succeeded against BHP to hold corporations accountable. Litigation can impact not only specific cases but also more generally shape corporate behavior. Nonetheless, even with recent advancements, Dummett expresses concern about the implications of president-elect Donald Trump’s win in the US election for the continuous struggle over human rights issues involving electric vehicle manufacturers. “Trump has vowed to diminish regulatory agencies.” “We are very worried about that.”
