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26 Apr 2023

Financing mining for transition minerals in South Africa: Are banks doing enough on human rights?


South Africa is home to significant deposits of some of the world’s most strategic minerals, including lithium, zinc and manganese, which are essential for the global transition to renewable energy. It is also the world’s largest producer of manganese and has some of the biggest reserves of this mineral, which is critical for the manufacturing of steel required for wind and solar equipment, as well as in batteries.

As the race to reach net-zero intensifies, financing has begun pouring into the country’s mining industry from local and international banks. However, in the rush to harness cleaner sources of energy, serious human rights and environmental concerns associated with this increased mineral demand are being overlooked. Violations of rights of local communities, land rights and the Free, Prior and Informed Consent (FPIC) rights of Indigenous communities are particularly at risk.

This report looks at the human rights commitments and actions of 15 banks (5 local, 10 international) linked to the financing of transition minerals extraction in South Africa. The research revealed these banks are failing to take adequate measures to avoid contributing to abuses in this particularly risky sector.

Banks financing the extraction of transition minerals have a pivotal role to play in ensuring the energy transition is not only fast, but also fair. This report sets our recommendations for banks, urging them to use their leverage to shape the energy transition to be rights-respecting by undertaking due diligence on their potential new clients’ human rights and environmental performance and implementing conditions to their provision of funds for projects.