The Roundtable for the Responsible Recycling of Metals: Improving ESG management and performance in metals recycling
By Dave Knight, Convenor, the Roundtable for the Responsible Recycling of Metals
Recycling delivers key socio-economic and environmental benefits but unknown to most are the risks involved when it is not done responsibly.
The Roundtable for the Responsible Recycling of Metals (RRRM), a multi-stakeholder, multi-metal initiative, was set up to support the development of responsible scrap sourcing standards, systems, and tools. For the last 18 months, RRRM overseen by a Steering Group of which ResponsibleSteel is a member, has collaborated with stakeholders across the metals sector to understand and make recommendations to improve ESG management and performance. This process involved running working groups, conducting extensive research, and mapping existing voluntary standards, legislation and industry guidance on metals recycling.
In May, RRRM launched its findings, demonstrating that current approaches are insufficient to ensure recycled metals do not harm people or the environment. The roundtable also published its recommendations and ResponsibleSteel plans to incorporate these into the review of the ResponsibleSteel International Production Standard in 2025.
Steel recycling
Steel has one of the highest recycling rates in the metals industry. Approximately 650 million tonnes of steel scrap feed about 30% of global steel production.
Carbon emissions from secondary steel production using scrap are less than a third of those from primary steel production, which is why companies are increasingly investing in secondary production as part of their decarbonisation strategies. But there are limits to scrap availability. We need to ensure that the scrap available is being responsibly sourced and isn't being displaced to meet the decarbonisation needs of one producer to the detriment of others.
Findings and recommendations
Widely used OECD ‘Due Diligence’ guidance relies on traceability and risk assessment. But traceability in diverse and distributed value chains can be extremely challenging due to the number of actors in the collection and pre-processing sectors. Reaching informal and subsistence collectors and recyclers, where some of the highest risks exist, is particularly hard and traders can be reluctant to disclose sources to maintain commercial interests.
For example, there are hundreds of thousands of people, mainly women and vulnerable groups, working at a subsistence level in the hinterlands of ship recycling facilities, notably in India, Bangladesh and Pakistan. Knowledge of these groups is poor and often overlooked in the downstream value chain. For more distributed post-consumer sources, like white goods or steel within electronics, the International Labour Organisation estimates that approximately 20 million informal workers work as waste collectors and sorters, often in poor conditions. Guidance on labour and human rights needs to be improved and post- and pre-consumer recycled content should be further broken down to help inform scrap sourcing risk profiles.
Improving assurance
The inclusion of recycled metal value chains in assurance processes is the starting point and metal producers should expect increasing focus on the ESG management and performance of these inputs. Legislation and voluntary approaches should be enhanced to include requirements relating to ‘untraceable’ parts of supply chains, recognising the high numbers of smaller-scale formal, informal, and subsistence recyclers. Worker and community engagement and grievance mechanisms, app-based accessible reporting, site sampling in third-party audits, commissioned research and independent surveying of high-risk locations can also be considered.
Policy and market opportunities
Extending producer responsibility legislation across nations would better reach high-risk parts of diverse supply chains. Market platforms and exchanges can strengthen ESG disclosure requirements and differentiate products which demonstrate higher ESG performance.
Furthermore, not all recycling of metals is economic and losses of materials lead to higher ESG risks. For example, the shipbreaking and steel working group found that shipowners get better prices for end-of-life (EOL) vessels broken in poorer conditions. The last beneficial shipowners have a key role to play in recognising this and metal producers should understand the risks associated with these inputs.
Metal Producers and recyclers
Recyclers should work to improve collection, segregation and sorting practices and the development and transfer of recycling technologies to higher-risk locations. This would help reduce contamination and exposure to hazardous materials as well as help maintain the alloy or grade quality maximising profitability. Producers and recyclers should also collaborate with brands and manufacturers to optimise efficiency and reduce ESG risks across the value chain considering new business models such as metals leasing and service delivery.
Labour, human rights and biodiversity risks are less well covered by industry requirements, guidance and common practice. Third-party audits will place more emphasis on recyclates, on analysing sources from an ESG perspective and will expect metal producers to be able to clearly communicate the boundaries of traceability.
Brands and manufacturers
As responsible sourcing becomes more sophisticated, brands and manufacturers should invest in improved performance at higher-risk locations that represent the ‘untraceable’ part of their supply chains. ‘Book and claim’ systems enable appropriate responsible sourcing claims to be made and can support action in areas which are currently overlooked. Brands and manufacturers should also publish data to better educate consumers, build opportunities for products with higher ESG performance, and improve the transparency of secondary scrap supply chains.
Further information and next steps
ResponsibleSteel recently ran a webinar on the outcomes of the Roundtable, the slides of which can be accessed here. A summary report, a 1-page route map, a risk profile, and three background reports with detailed findings and recommendations are all available on RRRM's website.
Parties interested in collaborating to take forward some of these recommendations should contact Dave Knight.
Images: Shutterstock
ResponsibleSteel™ welcomes Heathrow into membership
Heathrow is the UK’s busiest airport, and in 2019 served over 81 million passengers. We pride ourselves on giving excellent service, our vision is to give the Best Airport Service in the World. We want to do this, whilst minimising our carbon footprint and operating as the hub airport for the UK, connecting people, families and businesses across the globe. As we work towards our recovery from the impacts of COVID 19, we are continuing with the activity of maintaining, enhancing and developing the airport, and our capital works programme (2019 capital spend at circa £650m), is highly dependent on key materials such as steel.
Darren Colderwood, Director of Infrastructure at Heathrow, said: “We are striving to develop low-carbon, sustainable solutions, where we use re-use existing hardware, reduce our use of new materials, optimise the materials that we do use, and reduce the carbon footprint of everything that we do, and we are delighted to be joining Responsible Steel. We see this as a key next step in our pursuit of working with sustainably-sourced, low-carbon products that help us to achieve our objectives whilst minimising our impact on the planet.”
“We are delighted to welcome Heathrow – one of the world’s busiest airports – as a business member of ResponsibleSteel” said Ali Lucas, Executive Director, ResponsibleSteel. “It is incredibly encouraging to see that companies such as Heathrow who, whilst navigating the challenges of recovering from COVID 19 – recognise that becoming a member of and working together with ResponsibleSteel can help to achieve their objectives of using low carbon, sustainable products.”
ResponsibleSteel™ welcomes CarbonChain into membership
CarbonChain’s mission is to make supply chains green again. CarbonChain has built technology solutions to enable commodities companies to measure the greenhouse gas (GHG) emissions in their supply chains. This allows our customers to understand and mitigate the risks they face from carbon pricing and climate legislation, as well as unlock sustainability-linked opportunities such as interest rate discounts and access to green financing.
The CarbonChain platform allows metals traders, mining companies, and manufacturers to receive automated, detailed carbon reporting for their individual trades/transactions. Importantly, the reports include a carbon intensity figure showing the amount of carbon dioxide emitted per metric ton of product delivered to their end-customer (e.g. X tonnes of carbon dioxide emitted per Y tonne of steel produced and delivered). This enables customers to compare the carbon emissions intensity of their different supply chains and ultimately take action to mitigate their transition risk to moving to a low-carbon economy carbon risk (i.e., carbon taxes, green borders, etc).
Based in London, U.K., CarbonChain has been supported by the U.K. government’s innovation arm, Innovate UK, The Mayor of London’s Business Launch Program and the London Business School Incubator. In addition to metals & mining, they work with traders, producers, and manufacturers in oil & gas and agriculture sectors.
The CEO of CarbonChain, Adam Hearne, said: “Transparent supply chains are the hallmark of any sustainable businesses. We believe that taking proactive steps in carbon reporting is essential for measuring and managing carbon emissions. Given the importance that steel plays to achieving a low carbon future, we are excited to join ResponsibleSteel and work with its members to manage carbon emission reductions in a fair and responsible manner.”
Executive Director of ResponsibleSteel, Ali Lucas, said: “As ResponsibleSteel is involved more and more in the whole steel supply chain – from mining all the way through to end user – it is a really opportune time to welcome CarbonChain as an Associate Member. We are sure that with their deep skills and expertise in the supply chain arena we, and our other ResponsibleSteel members, will benefit greatly from their participation in our various work programmes and projects over the coming months.”
An update from Matthew Wenban-Smith
A reflection from Matthew Wenban-Smith on his time as Executive Director:
Dear Friends and Colleagues,
I started working for ResponsibleSteel at the end of 2016, with a remit to review the work that had been completed to date on the establishment of the programme, and to propose ways forward. Three years later I am delighted to be passing on the management of that programme to Ali Lucas, my successor as ResponsibleSteel Executive Director.
I will continue to work for ResponsibleSteel as its Policy and Standards Director, along with my colleague Marnie Bammert in her expanded role as Assurance and Technical Director.
I would like to take a moment though to thank you all – members and non-members alike, and my board and colleagues on the secretariat team – for your help, encouragement and support over the last three years.
ResponsibleSteel is now an active collaboration of more than 60 member organisations, including leading mining companies, steelmakers, car makers, construction companies, civil society organisations, assurance bodies, consultancies and business associations – all committed to maximising steel’s contribution to a sustainable society. Together, we have developed the world’s first multi-stakeholder approved standard for responsible steelmaking, and we have launched an assurance programme to identify and support steelmakers who meet that standard.
And the most important word is ‘we’. I am proud to say that ResponsibleSteel is a genuine multi-stakeholder organisation. We work by bringing diverse organisations together, to create value that our members cannot achieve on their own: business value for our business members, and social and environmental impact for our civil society members and supporters.
There’s a long way to go, but we have made a start, and it has been a privilege to be involved. I wish Ali all the best in her new role.
And finally – if you believe in what we are doing, and are not yet a ResponsibleSteel member – what are you waiting for?
With my very best regards, and best wishes in these difficult times,
Matthew
ResponsibleSteel Virtual Members’ Meeting 2020
The ResponsibleSteel Members’ Meeting is taking place this year on 24th and 25th June. This will be a chance for our members – full members as well as associate members – to discuss ongoing ResponsibleSteel developments.
The meeting this year focuses on two specific issues: the requirements that steelmakers will need to meet to make claims about the steel products they produce and sell; and the development of the new ResponsibleSteel constitution.
Restrictions to control the coronavirus pandemic mean that the meeting will be virtual, rather than in person. Since we want to cover multiple time zones we cannot do full day sessions. Instead, we will hold 2-hour sessions and will repeat them so that all our members have an opportunity to participate.
On the 24th June, we will focus on the additional requirements in relation to GHG and raw materials that we are currently developing. The ResponsibleSteel Board has decided to give Members more opportunity to engage in the development of these additional requirements before they are launched for public consultation and we want to use the Members meeting to provide that opportunity. Draft proposals will be circulated in advance of the meeting, and the formal public consultation process will take place after the Members’ have had the opportunity to review and comment.
On 25th June ResponsibleSteel will seek feedback from members on a new draft constitution.
There is still time to join ResponsibleSteel in advance of the Members’ Meeting. If you would like to know more, please look at the membership pages of our website, or contact George Deslandes at gdeslandes@responsiblesteel.org for more information.
Public consultation on Steel Product Certification Requirements – schedule update
As announced in our last newsletter, ResponsibleSteel is in the process of developing additional requirements in relation to raw materials and greenhouse gas emissions. While meeting the requirements published in November 2019 will allow steel sites to make claims about the way their site is operated, meeting the additional requirements will enable sites to also make claims about their steel products.
In developing the additional requirements, we held working group meetings and discussed the received input with our Board. Over the next weeks, we will revise our draft requirements before publishing them for stakeholder consultation. ResponsibleSteel stakeholders are advised that the first public consultation will take place between late July and late September.
Further information on the working groups are available on the Resources page.
If you have any questions please feel free to get in touch with George Deslandes – gdeslandes@responsiblesteel.org
ResponsibleSteel – AGM 13th May 2020
ResponsibleSteel held its 2020 AGM on 13th May at 19:00 Melbourne time. The annual financial report and Director’s & Co Chair’s Report were unanimously approved.
A notice of resignation of Directorship was received from Matthew Wenban-Smith effective 14 May 2020.
The following were voted in as Directors of the ResponsibleSteel Board:
Alan Knight – ArcelorMittal
Gerry Tidd – BlueScope Steel
Francis Sullivan – HSBC
Andrew Marjoribanks – Independent Board Member
Giulia Carbone – IUCN
Matthias Hartwich – IndustriALL
Thomas Maddox – Fauna & Flora
With the following elected Office Bearers:
Alan Knight as Co Chair
Gerry Tidd as Co Chair
Francis Sullivan as Deputy Chair
The Secretariat would like to take this opportunity to congratulate all the Directors on their elections and we look forward to working with them over the coming year.
If you have any questions or would like access to the detailed minutes, please get in touch with George Deslandes – gdeslandes@responsiblesteel.org
SCS Global Services joins ResponsibleSteel as an Associate Member
SCS Global Services is a global leader in third-party environmental and sustainability verification, certification, auditing, testing, and standards development. Its programmes span a cross-section of industries, recognising achievements in natural resource management, green building, product manufacturing, food and agriculture, consumer products, and more. Headquartered in Emeryville, California, SCS has representatives and affiliate offices throughout the Americas, Asia/Pacific, Europe and Africa. Its broad network of auditors are experts in their fields, and the company is a trusted partner to many environmental NGOs due to its dedication to quality and professionalism. SCS is a chartered Benefit Corporation, reflecting its commitment to socially and environmentally responsible business practices. For more information visit www.scsglobalservices.com.
“SCS Global Services has a long history with the Steel Industry which includes conducting Lifecycle Assessments for North American Steel and leading certification audits to standards in the mining and metals sector. Given that iron and steel make up over 90 percent of all the metal produced globally, a concerted effort on improving environmental and social performance in this sector is critical for our planet. SCS is looking forward to a productive partnership with Responsible Steel given the alignment of our missions,” states Stanley Mathuram, Vice President, SCS Global Services.
“This is a perfect time for SCS Global Services to join ResponsibleSteel. We are delighted to welcome them as an Associate Member, and really look forward to having them participate and share their knowledge and skills in a number of our priority programmes and projects over the coming months and years” said Ali Lucas, Executive Director, ResponsibleSteel.
ResponsibleSteel Stakeholder Panel on Coronavirus
On 31st March ResponsibleSteel board members from IUCN, IndustriALL, ArcelorMittal and BlueScope Steel took part in an on-line panel to reflect on how the coronavirus crisis was affecting them personally and professionally, and to consider potential long-term effects.
The breadth and depth of impacts across such diverse organisations and across all geographies was striking. Giulia Carbone of IUCN noted that 2020 was to have been a ‘super year’ for biodiversity. But the pandemic has disrupted the quadrennial World Conservation Congress, the meeting of the Convention on Biological Diversity and the launch of a new global framework to protect life on earth. Alan Knight and Gerry Tidd, of ArcelorMittal and BlueScope Steel considered that while steelmaking is used to economic cycles, the severity, suddenness and global nature of the crisis created by the coronavirus is unprecedented. Markets are drying up and companies are fighting for survival. And Matthias Hartwich of IndustriALL observed that the crisis has put workers’ health at risk as companies try to continue to operate, and yet also threatens workers’ rights as businesses lay workers off without proper consultation or provision.
But perhaps just as striking were the personal commonalities. All four speakers were speaking from their homes. All four organisations were having to cope with new ways of working, trying to keep staff safe while maintaining core tasks, and having to deal with restrictions on travel and meetings.
And all four drew attention to surprising linkages – the impacts on small NGOs as their partnerships with businesses are affected, just as small and large businesses are struggling financially with knock on effects through global supply chains. The fact that 80% of the oxygen supplied to hospitals in New South Wales is a by-product of BlueScope’s steelmaking. Or that ArcelorMittal’s 3D printing capacity has been repurposed for the manufacture of ventilators.
Looking to the future Alan Knight reflected on what the crisis may mean for sustainable development and the climate debate. While it is too early to know, he hoped that there would be recognition of the deep connections between different systems, and the strength and resilience of governments, NGOs and businesses working together towards common social and environmental goals.
Thank you to all our speakers.
Please follow these links for more insight into how ArcelorMittal, BlueScope Steel, IndustriALL and IUCN are responding to coronavirus covid-19.
ResponsibleSteel™ Steel Product Certification Working Groups
The first meetings of the ResponsibleSteel working groups on steel product claims, greenhouse gas emissions and raw materials all took place on 22 April. The three groups each met in two sessions to allow participation from working group members based in Australia, Europe and the Americas. Working group members then reconvened in joint sessions on 24 April to listen and comment on the headline findings.
All three working groups are considering the requirements that will need to be met in order for claims to be made about the ResponsibleSteel certified status of steel products.
The meetings were originally scheduled to have taken place face to face, but in common with many organisations around the world ResponsibleSteel has had to adapt to the measures being taken to respond to the coronavirus pandemic and implement a virtual process.
Some 60 participants took part across the three working groups, including active participation from mining and steelmaking businesses and interest groups, downstream steel users, civil society organisations, assurance bodies and consultancy organisations. Participants responded to a series of high-level questions that had been introduced in an earlier briefing session on 11 March, and built on their comments on a draft ‘Steel Product Certification Requirements’ document circulated in advance of the meetings.
A recording of the 11 March Briefing session and the accompanying slides are available on the Resources page of the ResponsibleSteel website, together the slides for the working group meetings on 22 April, the headline feedback from those meetings, and the collated anonymised comments submitted in advance of the working group sessions.
The next step in the process will be to publish and circulate a revised draft set of requirements, taking account of the working group feedback, for a formal 30-day public stakeholder consultation. Comments will be welcome from ResponsibleSteel members and non-members alike.
BHP joins ResponsibleSteel™
BHP extracts and processes minerals, oil and gas, with more than 72,000 employees and contractors, primarily in Australia and the Americas. BHP is among the world’s top producers of major commodities, including iron ore, metallurgical coal and copper. The company also has substantial interests in oil, gas and energy coal.
BHP’s purpose is to bring people and resources together to build a better world.
The company’s approach to environmental management is based on the robust identification, assessment and control of material risks across all phases of its business, from exploration to development, operation and closure. BHP aims to avoid or, where this is not possible, minimise its impacts, while contributing to lasting environmental benefits across the regions where the company operates.
Fiona Wild, Vice President, Sustainability and Climate Change, BHP, said: “At BHP we take a product stewardship view of how our commodities are used through the value chain. We are pleased to join Responsible Steel and continue to partner with our customers to help improve sustainability and emissions standards in the steel making value chain.”
Matthew Wenban-Smith, Executive Director, ResponsibleSteel, said: “We are delighted to announce that BHP has joined as our newest Business Member. Having one of the largest resource and mining companies in the world as a member sends a very strong signal and commitment to the steel sector to help achieve the responsible sourcing and production of steel. BHP’s membership will ensure that as we further develop our ResponsibleSteel standard to include three additional components: requirements for the responsible sourcing of raw materials; requirements related to the measurement and reporting of GHG emissions and the claims that certified sites can make about the steel products they produce, we will have additional input, expertise and experience from an organisation committed to helping the sector reach higher levels of sustainability.”
ResponsibleSteel™ welcomes the Green Building Council of Australia (GBCA) into membership
Established in 2002, the Green Building Council of Australia (GBCA) is the nation’s authority on sustainable buildings, communities and cities. Our vision is for healthy, resilient and positive places for people. Our purpose is to lead the sustainable transformation of the built environment. The GBCA represents more than 550 member companies including major developers, professional services firms, banks, superannuation funds, product manufacturers, retailers, utilities and suppliers. We also work with 35 local government members, 25 state government departments and land organisations, and 22 universities.
Jorge Chapa, Head of Market Transformation said: “ResponsibleSteel is doing some inspiring work to ensure steel is contributing toward a more sustainable built environment. We’re pleased to work with them as we lead the sustainable transformation of buildings, cities and communities.”
Matthew Wenban-Smith, Executive Director, ResponsibleSteel, said: We are extremely pleased to welcome GBCA as an Associate Member of ResponsibleSteel. So much of the work that we are involved in will directly benefit from the GBCA’s specialist experience and expertise in the built environment and we are really looking forward to having GBCA participate in our ongoing work programme and projects.”
The Climate Bonds Inititive joins ResponsibleSteel™
The Climate Bonds Initiative is an investor-focused not-for-profit, promoting large-scale investment in the low-carbon economy. Climate Bonds carries out market analysis, policy research, market development; advises governments and regulators; and administers a global green bond Standards and Certification Scheme. Please visit http://www.climatebonds.net. ”
“Transitioning to low carbon operations is one of several challenging, but unavoidable sustainability objectives for the global steel industry. ResponsibleSteel is taking a lead in supporting positive change in multiple companies across the sector. Climate Bonds Initiative is happy to join ResponsibleSteel and looks forward to working cooperatively in the future on sustainability projects.” said Sean Kidney, CEO, Climate Bonds
Matthew Wenban-Smith, Executive Director, ResponsibleSteel, said: We are excited to welcome the Climate Bonds Initiative as an Associate Member to ResponsibleSteel. Focusing on the investment and financing opportunities for the steel sector in the transition to a low-carbon economy is a priority for us as we continue to expand our work on our standard and certification programme and associated projects.”
