1. Umicore’s Sustainable Cobalt Sourcing Approach
Jan Tytgat &
Jonas De Schaepmeester
Raw Materials Conference 2017 – Break out Session : ‘Responsible Sourcing and mining for the energy transition’

2. Who we are A global materials technology and recycling group
One of three global leaders in emission control catalysts for light-duty and heavy-duty vehicles and for all fuel types
A leading supplier of key materials for rechargeable batteries used in portable electronics and hybrid & electric cars
The world’s leading recycler of complex waste streams containing precious and other valuable metals
Umicore - Sustainable Cobalt Sourcing Approach

3. Global leader in active materials for rechargeable batteries
Umicore RBM has already produced enough cathode materials to…
….provide a smartphone to every person on this planet
…power
more then 1Million EV´s
1 out of 5 batteries ever made
contains Umicore technology
Over 15 years
in the market
6 production
sites
Umicore - Sustainable Cobalt Sourcing Approach

4. Umicore's activities in cobalt
Umicore has over 100 years of experience in Cobalt
Umicore is active in all main Cobalt applications:
Battery Materials
Ceramics
Super Alloys
Animal Feed
Catalysts
Paints
Tires
Diamond Tools
Umicore - Sustainable Cobalt Sourcing Approach

5. Material flow over RBM to End-Users
Copper or Nickel mine & concentrator
Supplier / mining company
Umicore CSM Cobalt Refinery
Umicore CSM:
Battery cathode precursor
Umicore RBM: Battery cathode
Battery makers
End-Users
Umicore - Sustainable Cobalt Sourcing Approach

6. 
Umicore - Sustainable Cobalt Sourcing Approach

7. Challenges in Cobalt Sourcing
Health & Safety even as Social and Environmental Challenges
Challenges inherently linked to Cobalt mining
Social and Environmental
Social standards should be respected during the cobalt supply chain (child protection, anti-slavery, anti-corruption…)
Environmental standards are required to protect environment and communities
Health & Safety
Several Cobalt substances are CLP-classified as carcinogenic
Inhalation of cobalt is linked to the prevalence of lung diseases
Fatal accidents happen in unsafe working conditions
Umicore - Sustainable Cobalt Sourcing Approach

8. Challenges in Cobalt Sourcing
More than half of the world’s cobalt reserves originate in DRC
Artisanal Small-scale Mining (ASM) represents approx. 20% of DRC’s Cobalt output
Umicore currently does not accept ASM in its supply chain, on the basis of:
Poor Safety and Health Conditions
Health risks related to Cobalt Exposure
Child Labor
Human Right Abuses
we do not want to ban DRC, it is important to stay engaged with sustainable partners in the country.
we do not want to ban ASM as such, because we know that a lot of people depend on it for income. But the abuses that are still there make it currently impossible for us to source from ASM
Amnesty Report (2016) mentions hazardous working conditions (illness, fatal accidents…), human right abuses, bribery… “110,000 to 150,000 artisanal miners in Katanga region … 40,000 children work in cobalt mines”
Umicore - Sustainable Cobalt Sourcing Approach

9. Sustainable Procurement Framework for Cobalt
The Framework was created to assure that all upstream practices are in line with Umicore’s Standards, as listed in the Umicore Sustainable Procurement Charter:
no child or forced labour;
business ethics and compliance to law;
environmental impact;
occupational health and safety
Inspired by OECD’s 5-steps process
Applied to all purchases of Cobalt in Umicore
Umicore - Sustainable Cobalt Sourcing Approach

10. http://www.umicore.com/en/cases/sustainable-procurement- framework-for-cobalt/
Umicore - Sustainable Cobalt Sourcing Approach

11. Due diligence process for cobalt
Risk Assessment
Red Flags • Any form of torture, cruel, inhuman or degrading treatment or punishment; • Any form of forced or compulsory labour; • Any form of child labour; • Any form of bribery or corruption; • Hand-picking and/or artisanal mining (as primary source); • Supplier is not willing to accept the principles stated in the Umicore Charter. 
Orange Flags • Hand-picking and/or artisanal mining (as secondary source); • Supplier does not have the minimum required legal permits and certificates; • Supplier does not have procedures in place to minimize environmental impact; • Supplier does not have procedures in place to ensure a healthy and safe working environment. 
Umicore - Sustainable Cobalt Sourcing Approach

12. Third Party Assurance
Umicore received as first company ever third-party validation for its cobalt due diligence practices
PwC audit on reporting years 2015 and 2016
In line with five steps of OECD Due Diligence Guidance
For the reporting year 2016, Umicore publicly shared the compliance report of the PwC audit via its annual report.
Umicore shows a high level of transparency to its customers and stakeholders.
this is really a level of transparency that was never seen before in industry - we are very much welcoming all feedback
Umicore - Sustainable Cobalt Sourcing Approach

13. Path forward for Sustainable Cobalt Sourcing
Umicore internal ambitious
committed to continuous improvement on our own due diligence practices
Umicore to stimulate recycling of batteries to recover more cobalt
External initiatives
Exploring how to contribute and share expertise to stimulate the development of sustainable cobalt sourcing practices
Umicore - Sustainable Cobalt Sourcing Approach

14. Thank you! Contact: Jan.Tytgat@eu.umicore.com

15. Umicore in Cheonan, South Korea
The largest cathode material production worldwide
Umicore Rechargeable Battery Materials

16. Historical perspective
RECHARGEABLE BATTERY
MARKET (GWH)
Portable
Societal driver
Electrification
Regulatory driver
Energy
Storage System
2000
“More of the same” will no longer work
Capital intensive
Umicore Rechargeable Battery Materials

17. Unique integration in the value chain
guaranteeing high speed to market, supply security, and responsiveness to customer needs
Raw material
Metal
Product
Application
End use
Portable electronics
Recycling & intermediates
Power
tools
(P) HEV / EV
Li-ion rechargeable batteries
residues
Where do we stand in the value chain?
There again we have a pretty unique position.
Li-ion batteries are now serving a full set of applications, expanding everyday.
As I mentioned earlier our direct customers, cell and batteries makers are mainly in Asia.
Umicore is one of the few upstream integrated cathode materials producers.
We source our metals, Co, Ni, Mn from long term contracts with suppliers but also via our internal refining and recycling activity.
Therefore, whatever the market conditions are, we have a very competitive raw materials mix as a basis for production of cathode materials.
Also, in these times of extreme growth and pressure on the supply side, having such a flexibility gives us a competitive edge
E-bikes
residues
Stationary
power
Umicore closes the material loop
by innovative recycling technologies