Tesla to implement third-party audits on cobalt suppliers to ensure no child, forced labor

During the 2023 Cyber Roundup, a shareholder asked Tesla to implement third-party audits of the company’s cobalt suppliers. Although Tesla advised its shareholders to vote against the proposal, the Investor Advocates for Social Justice (IASJ) still urged TSLA investors to support its suggestion. 

Courtney Wicks, the Executive Director of the Investor Advocates for Social Justice, noted that she was speaking on behalf of several organizations calling on Tesla to address the human rights abuses within its supply chain. Wicks cited several issues, such as child labor in the Congo and the forced labor of Uyghurs in China, as problems that Tesla needs to address

Wicks suggested that Tesla should publish a report detailing its efforts to eradicate child labor and forced labor in the company’s supply chain. While Tesla has addressed its battery supply chain in its Impact Reports, Wicks argued that the electric vehicle maker needs to do more. 

As per Tesla VP of Investor Relations, Martin Viecha, the proposal from the IASJ was rejected by the company’s shareholders. However, CEO Elon Musk addressed the concern during his presentation. Surprisingly, Musk announced that Tesla would indeed conduct a third-party audit of its suppliers

“I heard a question raised about cobalt mining. And you know what, we will conduct a third-party audit. In fact, we’ll put a webcam on the mine. If anybody sees any children, please let us know,” Musk said. 

Musk also highlighted that Tesla has been reducing its cobalt use for some time, as evidenced by the company’s utilization of iron-based batteries for its mass-market cars. The CEO also pointed out that consumer devices such as phones actually use cobalt, so perhaps those who are concerned with the cobalt supply chain should voice their concerns to phone manufacturers as well. 

“I don’t want to go too off tangent on that front, but it’s important to appreciate that most of our battery packs are iron-based. Majority of our battery packs are iron-based. Our other battery packs are nickel-based, not cobalt. The nickel batteries use a little bit of cobalt as a binder, but only a tiny amount. 

“In contrast, your phones all use 100% cobalt. I recommend complaining to phone manufacturers. But even for the small amount of cobalt that we do use, we’ll make sure six weeks to Sunday that no child labor is being exploited. Obviously, we’re a company that cares a lot about doing the right thing, and we don’t want to delude ourselves or delude anyone else,” Musk said.

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