A report published by Verité today reveals a link between unregulated, illegal gold mining and human trafficking in Latin America, a connection that can have deep “legal and reputational risks for major companies with gold in their supply chains.”
In 2013, Latin America supplied 20% of the world’s gold, and research indicates that nearly 75% of gold imports to the United States come from Latin America alone due to its close proximity to the region. While gold is an extremely scarce commodity, the global demand for the precious metal has never been higher, leading to an increase in illegal extraction and exportation as well as contributing to violations at the raw material level.
“The ubiquity of illegally-mined gold and the lack of transparency upstream of most gold refineries means that companies buying gold from major refineries are often at risk of illegally mined gold entering their supply chains.”
It is important that companies with gold in their supply chains take the necessary steps to ensure they are not contributing to corruption and human trafficking in the gold industry. This report is a helpful reminder that forced labor abuses often happen deep within supply chains at the commodity and raw material level.
KnowTheChain’s recent Information and Communications Technology (ICT) benchmark found that several U.S.-based ICT companies have been able to trace their supply chain down to the level of metals that are used to make components, demonstrating to companies in other sectors that deep traceability to the commodity-level is possible.