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Digital Supply Chain Podcast hosted by Tom Raftery 

Ethical Sourcing in the Age of Electric Vehicles: A New Paradigm

In a recent episode of the Digital Supply Chain Podcast, Circulor's Chief External Affairs Officer, Ellen Carey, joined host Tom Raftery to discuss how Circulor are transforming the way we manage complex industrial supply chains. The conversation unveiled the evolution of supply chain transparency that goes beyond claims and estimates, to granular proof, through end-to-end traceability that ensures the sustainability of key minerals and materials.  

The discussion also delved into how businesses are adapting to evolving regulations and Ellen offered insights into what the landscape might hold in 2024. Here are some of the key insights shared during the podcast.

Circulor’s innovative approach to transparency

Circulor tracks the flow of physical materials as they change chemical and physical state from raw materials to final product, with traceability enabled at every production step, connecting the supply chain. Circulor is also able to attribute ESG and compliance data to the flow of materials, including embedded carbon emissions, with a particular focus on traceability of battery minerals including cobalt, lithium, nickel, graphite, and mica. These materials not only carry substantial human and environmental impacts but are also often opaque supply chains. The podcast highlights that to overcome these concerns and the associated supply chains risks, establishing end-to-end traceability and accountability across the battery value chain is key to enabling the clean energy transition.

By gaining visibility into the provenance of materials and the activity at each stage of production, Circulor can attribute this granular data to products. Ellen explained how this approach enables market access for batteries, can unlock incentives, and provides the data needed to back up claims about products and provide assurance to consumers that they are in fact getting sustainable responsible batteries. 

How companies are responding to new Regulations 

As regulations governing sustainable and circular supply chains become more stringent, businesses must adapt swiftly to stay compliant. Some pioneering brands have proactively embraced these regulations, positioning themselves as trendsetters in their industries. Volvo Cars, for instance, distinguished itself as the first Original Equipment Manufacturer (OEM) to integrate blockchain traceability and Ellen highlights their recent news of proving SQM’s IRMA75 lithium in their batteries.

The podcast delivers a clear message: 2023 was a paramount year for supply chain transparency and is the standard for conducting responsible business. Behind the growing global momentum is an increasing understanding by policy makers that for supply chains to be secure, reliable and resilient, they must also be responsible and sustainable, which requires proof. While these regulations may be new to many, proactive adoption can set brands apart as leaders in the evolving landscape.

What will 2024 bring?

Looking ahead to 2024, the conversation underscored the ongoing dynamic between consumers questioning product content and businesses evaluating the risks associated with their supply chains. This synergy will continue to drive regulators to ensure that the supply chains of the future adhere to principles of sustainability, ethics, and visibility.

Beyond Section 30D of the USA's Inflation Reduction Act, Section 45X was highlighted as an example of expanding supply chain visibility requirements to more materials and products. Then, similarly to the EU’s Battery Regulation, passed into law last year and requires battery passports by 2027, the Ecodesign for Sustainable Production Regulations (ESPR) will require digital product passports for more products if they are to gain market access, including iron and steel, aluminium, tires and electronics, among others. 

For industry, the understanding that a successful and sustainable clean energy transition is only possible through secure and responsible supply chains will become an increasingly central theme. Brands are accepting the challenge of achieving both, recognizing the critical importance of balancing sustainability and profitability.

Click here to listen to the full podcast episode.

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