Title: Social assessment of raw materials supply chains: A life-cycle-based analysis
Publisher: Publications Office of the European Union
Publication Year: 2018
JRC N°: JRC112626
ISBN: 978-92-79-99074-8 (online),978-92-79-99073-1 (print)
ISSN: 1831-9424 (online),1018-5593 (print)
Other Identifiers: EUR 29632 EN
OP KJ-NA-29632-EN-N (online),KJ-NA-29632-EN-C (print)
URI: http://publications.jrc.ec.europa.eu/repository/handle/JRC112626
DOI: 10.2760/470881
Type: EUR - Scientific and Technical Research Reports
Abstract: The value chains of raw materials and semi-finished products can create both positive and negative impacts in society, local communities, consumers, and workers. Raw materials have also a strategic importance for enhancing the competitiveness of the European industry, and creating employment (EC - European Commission, 2017a). At European level, the secure and sustainable supply of raw materials from domestic sources and international markets are key objectives of the Raw Materials Initiative (EC - European Commission, 2008a). The relationship between low security of supply and poor governance in supplier countries is acknowledged and captured in the list of Critical Raw Materials for the EU (EC - European Commission, 2017b). Internationally, many of the Sustainable Development Goals launched by the United Nations in 2015 (UN General Assembly, 2015) address, directly or indirectly, the social dimension of sustainable development and, hence, are linked to the supply of raw materials, under several aspects. In the context of sustainability assessment, Life Cycle Thinking is a well-known concept. Social Life Cycle Assessment (SLCA) evaluates social and socio-economic impacts along the life cycle of products (from the raw materials extraction, processing, manufacture, use, end of life) using a mix of generic and site specific data. Studies can be focused on a specific supply chain, or they can look at different sectors in an entire economy. In this study, we used a SLCA database for assessing and comparing the social risks associated with the supply chain of raw materials sectors at the macro scale in EU, and in a set of extra-EU countries. Negative social impacts are expressed in terms of potential risk to be exposed to negative social conditions while potential positive contributions are expressed using an opportunity evaluation. The economic sectors under investigation are those producing primary raw materials and semi-finished products, both from abiotic and biotic resources. According to the Eurostat NACE classification they are defined as: mining and quarrying; manufacture of basic metals; manufacture of non-metallic mineral products; forestry and logging; manufacture of paper and paper products; manufacture of wood and of products of wood. A set of social aspects (called subcategories, or areas of concern) was selected from those available in the database, according to criteria of relevance, data quality, etc. These include health and safety; freedom of association and collective bargaining; child labour; fair salary; working time (for the stakeholders category “workers”); respect of indigenous rights and migration (for the stakeholders category “local community”); corruption (for the stakeholders category “actors in the value chain”) and contribution to economic development (for the stakeholders category “society”). While the latter is a positive impact, the others are negative impacts occurring in the value chain. The initial results of the analysis compare social risk in the European raw materials supply chain with those of six extra-EU countries, for the set of selected social aspects. The contribution analysis shows social hotspots within a supply chain, highlighting sectors and locations that are mostly contributing to social risk in a certain subcategory. Data quality and sources of uncertainty are also discussed. As a general remark from the results of the preliminary international comparison, the social performance appears to be linked to socio-economic conditions of the country where the production activity occurs. Social risk seems to reflect also the development of a country and, to some extent, its governance. Given the granularity of the data used to assess social aspects (mostly at country, or macro-sector level), specific features of raw materials sectors are likely not captured in this analysis. This macro-scale assessment provides a first-screening assessment of supply chains, which can be used for prioritizing areas for more detailed investigation and for supporting due diligence operations at macro/sectorial scales. However, it should be complemented with bottom-up analyses in order to get a better understanding of the social consequences of more specific economic activities.
JRC Directorate:Sustainable Resources

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