Battery Supply Chain Due Diligence

Product regulations usually address what a product is. The Battery Regulation also addresses how its materials were obtained, which places a human rights and environmental due diligence obligation inside an instrument otherwise concerned with capacity, chemistry and recycling.

That is deliberate. The materials in a battery come from extraction contexts where the risks are well documented, and a passport describing a cell without addressing how its cobalt was mined would be conspicuously incomplete.

Which materials and which risks

The obligation names four raw materials, chosen because their extraction concentrates the risks the regulation is concerned with.

The risk categories are broader than the minerals list suggests. They cover human rights including labour and community rights, and environmental matters including air, water, soil, biodiversity and climate — which is a wider scope than conflict minerals regimes address.

It is a management system, not a statement

The most common misreading is treating this as a supplier code of conduct exercise. What is required is a functioning due diligence system following the structure the OECD guidance established.

1. Establish management systems. A policy, internal responsibility, supplier engagement and a grievance mechanism that actually receives complaints.
2. Identify and assess risk. In the chain of custody for the named materials, which requires knowing the chain rather than asserting it is responsible.
3. Design and implement a response. Risk management measures proportionate to what was found, with a plan and a timetable.
4. Verify. Third-party verification by a notified body of the due diligence practices themselves.
5. Report. The policy is published, making it a public commitment open to scrutiny.

Knowing the chain is the hard part

Risk assessment presupposes knowledge of the chain of custody, and for battery materials that chain is long, opaque and involves processing stages that deliberately blend inputs.

A cell manufacturer buys active material from a chemical producer, who buys refined metal from a smelter, who buys concentrate from traders aggregating output from multiple mines. Establishing which mines are in that chain is a research exercise rather than a data request.

This is why smelter-level identification has become the practical unit of due diligence. The smelter is the narrowest point in the chain and the last stage at which material origin is still distinguishable, which makes it the point where assurance schemes concentrate.

How it appears in the passport

The battery passport carries the due diligence policy and its verification, which changes the audience for a document historically read by procurement and investors.

Publication is the element with the most practical consequence. A policy that must be public and verified is one that competitors, journalists and customers can compare, which raises the cost of a policy that exists on paper only.

Where assurance schemes fit

No manufacturer audits its own smelters, so due diligence in practice rests on third-party assurance schemes that assess processing facilities against a standard and publish which facilities conform.

Using a scheme does not discharge the obligation. It supplies evidence for the risk assessment, and the operator still has to decide whether the residual risk is acceptable and document that decision. A supplier list consisting solely of scheme-conformant smelters is a strong position; asserting that the scheme membership is itself the due diligence is not.

What to do first

The sequence that works starts with the chain rather than with the document, because the document is unwritable without the chain.

Identify the smelters and refiners in your cell supply chain for the four named materials, through your cell supplier. Establish which assurance schemes they participate in. Assess the residual risk that remains, and design responses proportionate to it. Only then write the policy, because a policy written first describes an aspiration rather than a system.

The timeline is set by the cell supplier’s willingness to disclose upstream identity, which for some suppliers is a commercial negotiation. Starting that conversation early is the single most useful thing a pack assembler can do.