The extractives industries (e.g. mining, oil & gas, forestry) offer the potential for job creation and economic growth, which are important elements in promoting an environment conducive to the enjoyment of human rights. However, extractives industries projects and activities are also frequently associated with adverse human rights impacts. The extractives sector can have adverse impacts on a broad array of human rights, due to, for example: resettlement of communities without adequate consultation and compensation; environmental degradation; deprivation of livelihood and access to clean water; forced labour; sexual and gender-based violence; and even extrajudicial killings by security forces protecting company assets, with some cases meeting the legal definition of corporate complicity.
The potential impact of the sector depends significantly on how States and companies operate. Importantly, States have a legal obligation to protect human rights in the context of the activities of the extractives sector. They often enter into contracts with foreign investors (so called “state-investor contracts”) for the exploration and extraction of natural resources. These contracts set out the terms of engagement and responsibilities of the respective parties. Given the potential for adverse human rights impacts, it is crucial that human rights considerations are included in the negotiation and content of such contracts (UN Principles For Responsible Contracts).
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States have taken action at both supranational and national levels. For example, in May 2017, the European Parliament and the Council of Europe adopted a Regulation regarding supply chain due diligence obligations for Union importers of tin, tantalum and tungsten, their ores, and gold (so called “conflict minerals”) originating from conflict-affected and high-risk areas. Furthermore, the EU issued a directive in 2013 whereby companies making payments over €100,000 to governments from extractives or logging activities must disclose this fact in their annual financial statements. At the global level, since 2000, states and regional integration organisations have been able to join the Kimberly Process, which is an international certification scheme, underpinned by a UN mandate, to regulate trade in rough diamonds and prevent the flow of conflict diamonds. A further global standard is the Extractive Industries Transparency Initiative (EITI), which promotes and facilitates revenue transparency by governments and companies. Countries that sign up to EITI must publish what they received from extractives industries companies, and companies must publish what they pay. In this way, citizens can hold their governments accountable for the accurate accounting of public revenue from the extractives industries. The Africa Mining Vision (AMV) was adopted by Heads of State at the 2009 African Union Summit to promote transparent, equitable and optimal exploitation of mineral resources. The AMV draws on trends and governance practices from other states, to make recommendations to African mining companies and mineral-rich countries. There have also been initiatives at the national level to enhance extractives industries governance. For example, in the US, the so-called “Conflict Minerals Rule” which aimed to stem labour and human rights abuse, and the financing of armed conflict from trade in conflict minerals by requiring companies using those minerals to assess whether they originated from the Democratic Republic of Congo or an adjoining country. If found, companies were required to conduct due diligence of their supply chain to ensure that their purchases have not financed conflict in the region. (Public statement on the Conflict Minerals Rule).
In December 2017, the International Corporate Accountability Roundtable (ICAR) and the Due Process of Law Foundation (DPLF) launched a new thematic guidance document on Extractives and National Action Plans (NAPs) on Business and Human Rights.
In terms of industry initiatives and organisations, companies can join organisations such as the International Council on Mining and Minerals (ICMM), and the International Petroleum Industry Environmental Conservation Association (IPIECA), which provide guidance and require members to adhere to best-practice frameworks for sustainable development in the extractives industries.
The Ford Foundation supported a project that tracks mining operations related to renewable energy and electric vehicles. The Transition Minerals Tracker seeks to improve the human rights practices of companies that produce the minerals vital to the renewable energy and electric vehicles sectors, by shedding light on the key human rights risks in the geographies where they operate, and the human rights policies and practices of the most important companies in this sub-sector.