Eric Onstad

LONDON, Reuters – Volkswagen (DE) joined a group which sets social and environmental standards for mining. The world’s No. 2 carmaker is increasing efforts to ensure that its raw materials can be used in sustainable electric cars (EVs).

Consumers and shareholders are increasingly pressing big businesses to comply with stricter standards in relation to environment, governance and social issues (ESG).

VW joins the Association as the largest member company in terms of revenue.

The carmaker spoke out in advance of Thursday’s announcement to Reuters about the Initiative for Responsible Mining Assurance (IRMA).

General Motors (NYSE 🙂 and Ford are other members of IRMA.

Murat Aksel (VW’s purchasing board member) stated that in many cases it isn’t the Volkswagen Group who will purchase raw materials. We want to find out where the raw materials come from, and how they were mined.

IRMA was established in 2006. It includes buyers and sellers of minerals as well as investors, labor unions, representatives from the community, and independent experts.

VW announced in December that it is making a massive push to boost EV output. It has also increased spending to this area by about half of the 52 billion euro mark, compared to its previous rolling five-year investment plan.

Cobalt, a crucial component of EV battery batteries has been of particular interest because the majority of production is from the Democratic Republic of Congo. It has a large informal industry with a long history of dangerous working methods and child labour.

VW will participate in a pilot program in Congo together with a mine operator in order to test the new certification standards created by CERA. Aksel also added.

He indicated that VW supported a European effort to create domestic resources for crucial minerals. The initiative has focused its attention on rare earth magnetics which are used in EVs.

Our core strategy goal is to develop sustainable supply chains of raw materials. He said that he believes strengthening the European supplier network is an important part of this, but he did not give details.

Volkswagen and Daimler (OTC) began a 2020 study in an effort to encourage more sustainable mining of lithium in Chile, which is another important ingredient for EV batteries.