LME will delist brands which do not comply with responsible sourcing policy
The London Metal Exchange will delist brands that do not comply with its responsible sourcing policy, it announced on Thursday, September 1.
In 2019, the exchange published a policy on responsible sourcing of LME-listed brands which required producers to comply with requirements. The requirements aim to ensure that supply chains of metal traded on the exchange respect human rights and do not contribute to conflict financing or corruption.
“The LME is pleased to report that over 96% of producers of LME brands complied with the first reporting deadline of 30 June 2022, where they were required to demonstrate how they are implementing the ‘OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas’,” the exchange said on Thursday.
But the exchange said that it is conscious that all brands need to meet its minimum requirements to ensure fairness and the ongoing accuracy of LME pricing.
This means that in instances where brands do not comply with the policy, or choose not to, they will be delisted.
Brands with “significant work outstanding to meet the policy requirements” will be suspended until the work is completed, the exchange added.
“The exact timing of these actions depends on when the producer of the brand notifies the LME of its decision not to comply, or when the LME concludes that the producer of a brand’s efforts are not of a sufficient standard,” the LME said in a notice to members.
The LME stressed that it does not share specific reasons for each brands delisting or suspension and that “interested parties should contact producers of brands shown as suspended or delisted directly if they require further details.”
Other reasons for brands being suspended or delisted include failure to meet other LME requirements, production stoppages and a desire to no longer maintain a listing.
“It should be noted therefore, that not all recent suspensions or delistings, or those announced in the coming months, may be directly due to a brand’s failure to comply with the policy,” the LME said.
The LME said it plans to make improvements to the responsible sourcing program over time, with the aim of facilitating better understanding and ease of reporting.