➡️ Tell us more about Infyos and why the company was founded.

The energy transition is the most crucial element in achieving global net-zero goals and ensuring energy security. Energy and mobility also account for 40% of the global economy, meaning, it is a huge industry to unlock. However, the technologies behind the transition are underpinned by fragile, complex, and geopolitically fraught supply chains that are a black box of risk.

Infyos was born out of this paradox. Our founders, whose backgrounds focused on building supply chain tech in China and who both speak Chinese, realised that accessing supply chain data in China – where 70-80% of the manufacturing of clean technology is located – would be crucial for building efficient energy and mobility supply chains. They brought together a team of experts in metal supply chains, risk management, AI technology, sustainability and geopolitics to build an AI-powered operating system that helps energy and mobility companies manage their Tier 1 to Tier N supply chain risk.

Our mission is to be the source of truth for these supply chains, and we are already working with some of the largest European companies in this space.

➡️ How does Infyos support companies in managing and mitigating supply chain risks more effectively?

The status quo is to consult a generic regional-level risk database, ask your suppliers to submit responses to a few ESG questions and update their responses every year. This is often done through a consultancy, which results in a one-off report with high-level analysis or risk tools that focus on multiple sectors and are too broad to address the particular nuances and ever-changing nature of renewable energy supply chains.

​​The problem is that companies using these approaches don’t know who is in their supply chain and where major red flag risks might sit, putting them on the back foot to proactively identify and mitigate any ESG risks that could harm their reputation.

Our AI-powered operating system allows us to automatically compile and analyse data from across the renewable energy supply chains to identify who is in a company’s supplier network and cross-analyse this with potential risks. When a risk is flagged, the system can auto-generate mitigation roadmaps for the customer to implement with its suppliers. Not only does the use of AI allow us to process larger amounts of supply chain data from unstructured sources, but it is adept at identifying patterns and anomalies that can be used for predictive analytics.

➡️ The recent Amnesty report on the human rights ranking of the EV industry suggests that no company is adequately addressing human rights violations in the battery metal supply chains. What are the most common violations in the EV industry?

Amnesty’s most recent report, and its wider body of work, captures the most common violations in the EV industry. This includes child labour, particularly in cobalt supply chains, as well as forced evictions and the violations of Indigenous Peoples’ rights. It also covers the important intersection between environmental and human rights. For example, deforestation and pollution associated with nickel mining in Indonesia has had negative impacts on local livelihoods and health of many Indigenous Peoples. This has also been documented in relation to water resources in South America’s lithium triangle.

What the report doesn’t specifically mention, however, is the issue of forced labour. In fact, our proprietary database has identified that companies accounting for 75% of the battery cell market are exposed to forced labour risks in their supply chain.

➡️ The Amnesty report notes that companies like BMW, Ford, and Tesla have taken steps towards human rights standards but need to do more in practice. What do you think are the main challenges preventing the companies from fully implementing their human rights policies?

The main challenge is the sheer complexity of battery supply chains. The amount of data – and the granularity of this data – a company needs to collect to map their supply chain and then ensure that risks are being effectively identified and mitigated or remediated is daunting. Currently, this is a very manual process that takes significant amounts of time and resources.

➡️ Why have so many companies failed to conduct sufficient human rights due diligence within their supply chains? Is the problem structural in some parts of the world and industries?

There is definitely no such thing as a ‘perfect’ supplier. The whole industry is struggling to conduct sufficient human rights due diligence and nearly all major players are exposed to human rights risks to some degree. It’s important to note, however, that this isn’t necessarily a result of ill intent. Renewable energy supply chains are incredibly complex. EV manufacturers, for example, can have over 10,000 suppliers dotted across the globe, each with their own socio-political, economic and cultural nuances. Furthermore, each of the critical materials comes with its own unique risk profile based on geography, politics and technology.

Combine this with tricky data security laws in certain jurisdictions, as well as a competitive landscape where supply chain data is often considered intellectual property, and you get an industry that is often unable to share the very data needed to properly conduct due diligence.

➡️ Which critical minerals make it the most challenging to track and why?

Each critical mineral comes with its own unique risk profile and challenges. In the case of cobalt, for example, 15-30% of global cobalt mining is estimated to be informal, making it difficult to standardise tracking and documentation. What links all of these together, however, is the role of China. China accounts for the majority of refining across many of these materials; accessing the necessary documentation and data needed for tracking can be a challenge at these particular stages.

➡️ A report by Infyos highlighted the prevalence of human rights abuses such as forced labour and child labour in the battery supply chain. How can companies at the top of the supply chain – such as EV manufacturers – better ensure that their materials are sourced ethically?

Our operating system enables companies to implement a six-step process to ensure their materials are sourced ethically. The first is to align internal policies and processes with international standards, then we run supplier ESG assessments and collect chain of custody data on an ongoing basis – the timing and depth of the initial assessment may depend on the category of supplier.

We triangulate chain of custody data with open-source data to model out Tier N supplier network, working with suppliers to collect and provide further chain of custody data. Then, we overlay supplier network with industry-specific risk databases to identify any real-time incidents or red flag risks; develop targeted mitigation actions with supplier to address any incidents/risks. Ultimately, we continuously monitor supplier network and ensure mitigation actions are completed and any early warning signs of incidents are flagged. The final step is to transparently report to internal and external stakeholders.

➡️ How do you view the current and upcoming regulations around human rights and environmental standards in the battery supply chain? Are they sufficient to address the risks?

The battery industry – as well as the wider renewable energy space – are facing new regulatory challenges that are mandating more granular supply chain data and robust due diligence processes. This includes the Battery Regulation, Forced Labour Ban and Corporate Sustainability Due Diligence Directive in the EU, as well as the Uyghur Forced Labour Prevention Act in the US, which now considers batteries a high-risk product. There are also specific requirements at the member state level.

The new requirements have definitely moved the needle forward, especially in regard to non-compliance. Non-compliance with the EU Battery Regulation or US UFLPA, for example, can lead to products being blocked from the market. To comply, companies, among other requirements, have to implement detailed due diligence and risk management systems that include full visibility down to the mine for certain materials.

This trend emphasises the global reach of these regulations, as it applies to foreign companies trying to access the respective markets as well. The only issue, however, is whether or not companies are prepared. As a result, companies are now more likely to request and access supply chain data extending beyond their immediate suppliers, which will hopefully drive more transparency across the industry, but many in the industry are still a long way off.