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Conflict Minerals and Supply Chain Due Diligence: An Exploratory Study of Multi-tier Supply Chains

Abstract

As recently stakeholders complain about the use of conflict minerals in consumer products that are often invisible to them in final products, firms across industries implement conflict mineral management practices. Conflict minerals are those, whose systemic exploitation and trade contribute to human right violations in the country of extraction and surrounding areas. Particularly, supply chain managers in the Western world are challenged taking reasonable steps to identify and prevent risks associated with these resources due to the globally dispersed nature of supply chains and the opacity of the origin of commodities. Supply chain due diligence (SCDD) represents a holistic concept to proactively manage supply chains reducing the likelihood of the use of conflict minerals effectively. Based on an exploratory study with 27 semi-structured interviews within five European industries, we provide insights into patterns of implementation, key motivational factors, barriers and enablers, and impacts of SCDD in mineral supply chains. Our results contribute to both theory and practice as we provide first insights to SCDD practices and make recommendations for an industry-wide implementation of SCDD. Altogether, this study provides the basis for future theory testing research in the context of SCDD and conflict mineral management.

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Notes

  1. Although the term is often used as a synonym and sometimes also as an umbrella term for many related concepts such as business ethics, corporate accountability, corporate citizenship, and corporate sustainability (cp. Scherer and Palazzo 2011), in line with McWilliams and Siegel (2001, p. 117), we define CSR as “actions that appear to furthersome social good, beyond the interests of the firm and that which is required by law.” “Social good” in this context does include ethical and environmental issues, too. Moreover, we will follow the extended notion of CSR, “political CSR,” as discussed within the background section. For a detailed overview of CSR definitions see Dahlsrud (2008).

  2. Drebes’ argument is mainly based on Foucault’s definition of a relationship of power as “a mode of action which does not act directly and immediately on others. Instead, it acts upon their actions: an action upon an action, on existing actions or on those which may arise in the present or the future” (Foucault 1982, p. 789).

  3. Prasad (2003, p. 6) defines neocolonialism as the “continuation of Western colonialism by nontraditional means” although the former colonies in the Global South are de facto independent. Besides economic and political dimensions of control, these means also include cultural control.

  4. The most pertinent expression in this regard might be “to use power is to lose it” coined by Bacharach and Lawler (1986).

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Acknowledgments

We would like to sincerely thank the two anonymous reviewers for their constructive feedback that helped us to improve the manuscript significantly. We also like to mention the financial support of Global Witness for the collection of the empirical data.

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Correspondence to Constantin Blome.

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Hannes Hofmann, Martin C. Schleper, and Constantin Blome have contributed an equal amount to the manuscript.

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Hofmann, H., Schleper, M.C. & Blome, C. Conflict Minerals and Supply Chain Due Diligence: An Exploratory Study of Multi-tier Supply Chains. J Bus Ethics 147, 115–141 (2018). https://doi.org/10.1007/s10551-015-2963-z

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  • DOI: https://doi.org/10.1007/s10551-015-2963-z

Keywords

  • Exploratory case study
  • Conflict minerals
  • Corporate social responsibility
  • Dynamic capabilities
  • Supply chain due diligence
  • Standards
  • Supply chain management