The Ford Motor Company, IBM, RCS Global, Huayou Cobalt and LG Chem are considering employing blockchain to track and corroborate ethically sourced minerals. They aim at creating an open, industrywide network to track and confirm minerals and other significant materials for the automotive and consumer electronics sector in their supply chains.
According to a report by Forbes, the first work will deal with creditworthy sourcing of industrially-mined cobalt.
Lisa Drake, Vice President, Global Purchasing and Powertrain Operations, Ford Motor Company revealed:
“We remain obligated to transparency across our global supply chain.”
“By working with other top industries in this network, our aim is to use state-of-the-art technology to guarantee materials produced for our vehicles will aid meet our dedication to shielding human rights and the environment.”
Cobalt, a hard ferromagnetic silver-white bivalent or trivalent metallic element, is seeing abnormal demand due to its wide use in lithium-ion batteries. These power a series of products ranging from laptops to mobile gadgets to electric vehicles.
In the 2017 report, Morgan Stanley said that by the year 2026, demand will increase 8-fold, particularly for its use in all those kinds of devices. For instance, a standard electric car battery needs around 10 Kgs of cobalt; and a typical laptop needs up to 30 grams of the same mineral.
In a traditional manner, miners, smelters and consumer marques depend on third-party audits to set up compliance with by and large allowed industry standards.
Linked with these assessments, distributed ledger technology (DLT) provides the outlook of network partakers and immutable data visible by all authorised network partakers within the real time. Additionally, the use of DLT can help network players to manage compliance needs.
Since the first focus is particularly on large scale miners (LSMs), the main objective of the team is to help rise transparency in artisanal & small-scale mining (ASMs). The advantage of the ASMs is that these operators are: be capable to easily sell their raw materials in the world market; and fulfil their internationally sanctioned responsibility needs.
Effectively, the DLT network can assist ASM operators: partner with due diligence data providers; and thus join a DLT-based network of formalised actors.
The DLT pilot will also delve into the use of incentives for ASMs and their local people wedged by mining.
The CEO of Huayou Cobalt, Chen Hongliang, revealed:
“As a top worldwide battery material provider, we are very proud to have an OECD Due Diligence Program and active community support initiatives in place linked to our activities in the DRC. This is fundamental to our proactive approach to presenting ethical cobalt.”
The plans for the governance board typifying individual members within these industries, to assist guarantee the platform’s development, functionality & allegiance to democratic rationale and principles.