SECTOR AGREEMENT | June 2017 Dutch Gold Sector IRBC Agreement on international responsible business conduct of companies in the Netherlands with gold or gold bearing materials in their value chains SOCIAL AND ECONOMIC COUNCIL SECTOR AGREEMENT | June 2017 Working towards a responsible gold value chain Agreement on international responsible business conduct of companies in The Netherlands with gold or gold bearing materials in their value chains SOCIAL AND ECONOMIC COUNCIL The Social and Economic Council in the Netherlands The Social and Economic Council of the Netherlands (Sociaal-Economische Raad, hereafter “the SER” or “the Council”) advises government and parliament on the outlines of national and international social and economic policy and on important legislation in the social and economic sphere. The Council is also responsible for the enforcement of certain laws. The SER was founded in 1950 pursuant to the Dutch Industrial Organisation Act (Wet op de bedrijfsorganisatie). Employers, employees, and independent experts are all represented on the Council. The SER is an independent body that is funded by Dutch industry. Several permanent and temporary committees support the SER in carrying out its functions. Some permanent committees may at times also carry out their mandate independently. Please visit the SER’s home page at www.ser.nl and its section in English. It offers a host of information, such as on the composition of the SER and its committees. Each of the nearly 1,000 Dutch language advisory reports that have been published since 1950 are also available on the website. Some reports or abstracts thereof are also available in English. In addition, advisory reports that have been published recently in Dutch are available in printed form. Sociaal-Economische Raad (Social and Economic Council) Bezuidenhoutseweg 60 P.O. Box 90405 2509 LK The Hague The Netherlands T +31 (0)70 3499 525 E [email protected] www.ser.nl © 2018, Sociaal-Economische Raad All rights reserved. Sections from the SER advisory reports may be used for the purpose of quotation, with due acknowledgement of the source of the publication. Table of contents Preamble 7 1. Considerations 9 2. Nature of the Agreement and roles of the Parties 13 3. Conducting due diligence 17 4. Directly creating positive impacts on the ground 25 5. Increasing and using our collective leverage 27 6. Governance, implementation and funding 31 7. Final provisions 35 List of terms 37 Thus agreed and signed 19 June 2017 in The Hague 41 Annex I: List of issues and risks in mining and processing of gold 45 II: The Parties to the Agreement 49 III: Joint forces to tackle child labor - from gold mines to the electronics supply chain 51 IV: Plannedcomposition of the Steering Committee and Working Groups53 3 4 Dutch Gold Sector Agreement 6 PREAMBLE Preamble By means of this Agreement, the Parties aim to achieve a material positive impact in the international gold supply chain and reduce (potentially) adverse human rights impacts and/or negative environmental impacts. In the context of this Agreement, the Parties promote individual company due diligence and joint efforts to directly alleviate adverse impacts and contribute to the increase of supply and demand of gold produced under improved social and environmental conditions. The Parties endeavour to cooperate in finding and implementing solutions to address problems that companies cannot solve individually. The Parties to the Agreement accept the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights as the reference for International Responsible Business Conduct in a globalised economy. The Parties realise that companies, in their endeavour to act in conformity with these guidelines and principles, face challenges including the lack of adequate and easily available information on actual and potential human rights violations and environmental impacts. The complexity of the international value chain and its (potential) connection to conflict affected and high-risk areas, calls for collective leverage to prevent or mitigate adverse impacts. By participating in this Agreement and by working together, the Parties are committed to support companies in their implementation of the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. Simultaneously, the Parties ambitiously strive for concrete positive impact in and around gold mines and in collecting and recycling waste from electrical & electronic equipment (e-waste). Signifying the transition towards a circular economy, the Parties regard e-waste as a valuable resource, rather than a waste. Companies adhering to this Agreement will benefit from the shared and collective knowledge of the Parties, opportunities for collective leverage and support from the Parties for their endeavours to follow the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. The Parties promote respect for human rights, working conditions and environmental protection throughout the international gold sector and will liaise with their counterparts at the European, UN, OECD and other international levels and in their networks. They will motivate other companies, trade associations, governments, trade unions and civil society organisations worldwide to join their efforts and therewith increase the impact of this Agreement. 7 8 CONSIDERATIONS Whereas: 1 Considerations 1.1 The mining and processing of gold are associated with a heightened risk of violations of human rights, labour rights and environmental safeguards, as set out in the 2014 KPMG CSR sector risk assessment1 and the 2015 Profundo report2. Based on these reports, parties have identified risks and (potential) issues as listed in Annex I. The most pressing ones are prioritized in and around mines, with specific concerns regarding Artisanal and Small Scale Mines (ASM); 1.2 In its utilisation of natural capital, humanity is reaching the capacity of the earth. A transition towards a circular economy can address the increasing demand for raw materials and the worldwide strain on sustainability by enabling the efficient and sustainable production and consumption of materials through i.a. urban mining, eco-design of products and materials, product life-time extension and recycling; 1.3 Through the international gold supply chain, companies that handle gold or gold bearing materials are at risk of being linked or (indirectly) contributing to human rights violations and/or violations of environmental safeguards; 1.4 The Dutch gold sector can be summarised in a few sentences: – From an international perspective, the Dutch gold sector is relatively small; – There has been an increase in the amount of electronic scrap that contains gold and that can be recycled; – In the Netherlands, gold is primarily used in jewellery, electronics, for savings and monetary stock (bullion gold); – In addition to the relevance of gold to the financial sector (project financing and investments in gold mining companies as well as in bullion), the gold sector consists predominantly of downstream supply chain actors, either engaged in selling finished products, subcontracting assembly or supply of products or turning semi-finished products into final products; – The Dutch specialised jewellery sector is rather structured, with many goldsmiths and jewellers sourcing a substantial share of their products from a relative small number of wholesalers or manufacturers; 1 KPMG CSR sector risk assessment (2014) see https://www.rijksoverheid.nl/documenten/rapporten/ 2014/09/01/mvo-sector-risico-analyse 2 Profundo report (2015) see http://www.profundo.nl/projecten/nationale-ronde-tafel-over-goud 9