Managing the Dark Side of the Critical Minerals Rush
Social cohesion risks are particularly acute in regions where state authority is weak and extractive industries operate through informal, unregulated or criminal structures. The Darwin Dialogue identified these vulnerabilities as points of concern across Southeast Asia, the Pacific and Africa: regions where Australia’s critical mineral engagement is rapidly expanding.
The implications for industry are no less serious. Complex refining and logistics systems make it harder to verify mineral origins. This frustrates compliance with emerging ESG regulations, creates reputational risks and further undermines investor confidence. Companies that cannot guarantee the integrity of their supply chains risk being locked out of premium markets or facing costly litigation.
This is where Australia and its partners must lead. The Darwin Dialogue reports call for a new international effort to define what it means for a mineral to be fit for purpose. That definition must include both physical characteristics and ESG compliance. If a mineral is insecure, environmentally destructive or tainted by corruption, it simply isn’t fit for purpose in a climate-resilient future.
This problem demands a coordinated response from the public and private sectors. Governments must incentivize traceability and responsible sourcing, ensuring that these practices go beyond symbolic gestures. ESG requirements must be a core part of securing ethical and resilient mineral supply chains, embedded in public procurement, trade agreements and supply chain finance. Where markets fall short, strategic investments, such as the Australian Critical Minerals Strategic Reserve announced on 24 April, can stabilize by providing price signals and reducing dependence on insecure sources.
Australia and Canada should drive this agenda. Our miners already operate under strong legal and regulatory frameworks, and both countries are building credibility in critical mineral diplomacy and standard setting. The Darwin Dialogue has provided a forum for partners including Japan, India, the European Union and the United States to align strategies and develop common frameworks for investment, ESG compliance and infrastructure development.
However, credibility cannot rest on rhetoric alone. Australia must strengthen ESG certification systems, invest in diplomatic and technical capacity, and work with producer countries to improve regulatory oversight and governance. It must also recognize that ESG leadership is a commercial and strategic asset in an increasingly contested global market.
International coordination is vital. The UNODC warns of data fragmentation, varying definitions and weak enforcement, creating space for criminal activity and undermining collective action. Multilateral forums such as the Darwin Dialogue must be used to build the analytical, regulatory and enforcement muscle needed to strengthen transparency and disrupt mineral crime.
Mineral crime is not a fringe issue; it’s a litmus test for whether the global energy transition can be secure, inclusive and sustainable. Solutions lie not only in criminal enforcement but in redesigning the systems that enable exploitation. Getting this right will require bold thinking, coordinated investment and a readiness to confront uncomfortable truths about markets, supply chains and state capacity.
John Coyneis director and Raelene Lockhorst is deputy director of ASPI’s National Security Programs. This article is published courtesy of the Australian Strategic Policy Institute (ASPI).
