‘Justice Requires Change’: Toward a New Paradigm for the Just and Equitable Pursuit of Transition Minerals

The race for critical energy transition minerals—essential to power the renewables needed to avert looming climate catastrophe—is at a crossroads. In the geopolitical scramble for control of mineral supply chains, governments and companies risk repeating irresponsible mining practices and exacerbating deep-rooted inequities and injustices that have long plagued the sector.

But there is an alternative path: if officials and executives manage the sector guided by principles of justice and equity, the increase in demand can enable people in low- and middle-income countries to at last see benefits and economic opportunities from their minerals.

In April, UN Secretary-General António Guterres responded to the mineral supply challenge with an unprecedented call: “The race to net zero cannot trample over the poor.” He convened a panel on minerals critical for the energy transition, noting that “one principle shines from the heart of this initiative—and that principle is justice.” Today, he has released the panel’s recommendations.

The panel included NRGI and the Climate Action Network from civil society; industry and finance leaders; expert representatives from countries as various as China, the Democratic Republic of the Congo, Chile and the U.S.; youth and labor activists; and Indigenous Peoples. This unique composition enabled the panel to fill an important gap in the rapidly expanding but often fragmented global dialogue on critical minerals.

With the voices and needs of people in developing producer countries at the center of the dialogue, in four short months, those of us on the panel sought to learn from past mistakes and craft urgent and impactful action from the global community. In doing so, we made progress toward defining “a new paradigm rooted in equity and justice.”

The newly released panel report includes several key advances:

‘Development must be fostered through benefit sharing, value addition and economic diversification.’ - Principle 4

With the spike in demand for critical minerals, many of our partners in low- and middle-income producer countries are asking “What will be different from past mineral booms?” Notably, the panel has demanded increased efforts to ensure that lower-income countries that produce minerals like lithium and cobalt are able to process those commodities domestically where feasible, and to diversify their economies more generally. By moving further up the supply chain and leveraging shared infrastructure to expand economic prospects beyond mining, such countries can benefit more than they have under the colonial “pit-to-port” model that persists in many places.

To activate this principle, the panel has called for the establishment of a multistakeholder, high-level advisory group to support producer countries to “[m]obilise resources and promote best practices on issues such as value addition, economic diversification, taxation and fiscal policy...local content policies...and shared infrastructure that supports downstream processing facilities and broader energy access, energy transition and green industrialization.” The panel has laid a strong foundation for this work by calling for: the inclusion of all actors key to unlocking the economic potential of transition minerals; more focus on resources necessary for reform; and the identification of priority areas for change.

More broadly, the panel has made clear that developing producer countries deserve “fair shares of sector revenues that are effectively managed,” underscoring the need for greater economic justice—for lower-income countries in their partnerships with both consumer countries and mining companies, as well as for vulnerable populations within producer countries, who often face greater harms and reap few benefits from mining.

At NRGI, fresh from our experience on the panel, we will ensure the work of the advisory group results in substantial technical and financial support to lower-income countries. Achieving greater equity will require:

• A reassessment of what constitutes a “fair” economic split between governments and companies. While short-term prices for transition minerals may be down, producers of longer-term forecasts foresee general undersupply, likely leading to higher prices. Governments may therefore have the potential to secure larger takes without impacting commercial viability.
• Development finance institutions and donors to provide concessional financing to governments of producing countries, to support value addition facilities and address energy, infrastructure and skilled labor bottlenecks in ways that enable broader economic diversification. 
• Mining companies to support independent, publicly disclosed value addition feasibility studies.

‘Transparency, accountability and anti-corruption measures are necessary to ensure good governance.’ - Principle 6

Recognizing that commodity booms often lead to an increase in corruption, we at NRGI welcome our fellow panel members' push for enhanced measures to ensure that corruption—whether perpetrated by industry actors, foreign parties linked with consumer markets, or domestic elites—no longer derails the development prospects of lower-income mineral-producing countries. The panel’s guidance highlights an important linkage that is often overlooked: that “[s]table legal frameworks, access to justice, respect for the rule of law, and anti-corruption and anti-bribery frameworks are important enablers of economic diversification.”

Building on existing initiatives, but acknowledging their gaps and limitations, the panel has called for a multi-stakeholder expert-led process that will improve due diligence and corporate accountability along the entire mineral value chain—from mining to recycling. The panel has underscored that such due diligence must be cross-cutting, covering policies and practices ranging from human rights to environmental impacts to social practices and governance issues. The guidance calls for measures to have real teeth “to support regulators and market actors to incentivise good performance and penalise bad or illegal practices.”

The panel has also drawn a line in the sand with its directive that “[h]uman rights must be at the core of all mineral value chains,” and has called for multistakeholder oversight and “protection of civic space and human rights for environmental and anti-corruption defenders,” highlighting this as a necessary foundation for democratic participation in matters of public significance. In his message announcing the panel’s report launch today the Secretary-General underscored this point: “civil society, young people and Indigenous Peoples must be heard and have a seat at the table” in implementing the recommendations.

Action on these principles is urgently needed; NRGI has documented that civic space violations are on the rise in countries with mining and other extractive industries. Global Witness recently found the mining and extractive sector to be the single biggest industry driver of killings of land and environmental defenders.

In view of the urgency for reform, NRGI will support and advance:

• Galvanized action to address harms across the supply chain, in both the regulatory space and in companies’ own policies, including those in the downstream sector. While regulatory initiatives in the European Union that require mandatory due diligence, such as the Battery Regulation and the Corporate Sustainability Due Diligence Directive, are a welcome recent development, their lack of coverage of governance issues is blind spot and notable weakness. The panel’s push for due diligence measures that assess corruption risks, illicit financial flows, the fairness of deals and equitable benefit-sharing alongside environmental and social factors is an important step towards addressing this gap.
• Increased efforts by governments and companies to tackle broader corruption associated with “undue influence and policy capture.” The panel has noted this risk—a welcome recognition of facets of corruption that are too often ignored or inadequately addressed, but which have a devastating impact on the ability of democratic systems to deliver in the public interest.
• Government reforms to restrictive legal frameworks and practices preventing the full exercise of freedoms of association, peaceful assembly, and expression by civil society and communities; and responses to attacks and threats to activists and community members. Governments should undertake and fund meaningful investigations and prosecutions. Authorities should also ensure that companies refrain from threats, harassment, attacks, and abusive litigation such as strategic litigation against public participations (SLAPPs); or doing business with entities engaged in such practices.

‘The integrity of the planet, its environment and biodiversity must be safeguarded.’ - Principle 2

More than 300 civil society organizations recommended that the panel should establish principles to reduce overconsumption of transition minerals and enable equitable, efficient and sufficient energy for all. Developed country governments must lead the way in such reduction to limit global warming to 1.5 degrees Celsius by 2030.

A critical innovation is the panel’s pioneering call for a process aimed at reaching agreement on “equitable targets and timelines for the implementation of material efficiency and circularity approaches along the entire life cycle of critical energy transition minerals.”  This is accompanied by important panel recommendations on declaring World Heritage Sites as “no-go areas” and encouraging governments to consider declaring other protected and conserved areas as no-go areas for activities related to critical energy transition mineral value chains.

In line with NRGI’s mission to ensure that low- and middle-income mineral-producing countries build resilient and inclusive societies and advance just energy transitions, we will seek to ensure that next steps on these issues:

• Put “equitable targets and timelines” at the center of mining circularity debates and actions, pushing high-income countries to take on their fair share of responsibilities to reduce environmental pressures and supporting innovations in policy, technology and financing that help developing producer countries to benefit from increased circularity.
• Create space for low- and middle-income mineral-producing country governments and civil society actors to lead the definition of equitable targets and timelines,  and prioritize the financial and technical resources they will need to define and implement their own national goals and policy frameworks on engaging with and benefiting from increased circularity.
• Push for no-go zones to be respected and to include not only UNESCO World Heritage Sites, but also vast tracts of forest and areas of valuable biodiversity. To create the incentive to maintain these zones, donors should implement financing conditions that ensure that authorities and companies never establish mining, processing plants and other linked industries in a no-go zone.

Journey to a new paradigm

There is still work ahead to grapple with the structural inequities at the heart of critical mineral extraction—including reforming the international architecture on trade and investment, holding industry accountable for legacies for the past and for a new way of doing business, and ensuring that developed and consuming countries center equity in their actions. The panel’s report is an important contribution to help chart a course for our collective efforts to advance a new, more just and equitable paradigm for responsible mining that enables urgent climate action and sustainable development.