RED FLAG # 14
The business’s commercial success substantially depends upon commodities with unclear provenance and visibility into impacts on workers or communities.
For Example
- Using resources with limited traceability (including mass balance and spot markets):
- Agricultural and other “soft” commodity products (e.g., wood/paper, sugar, coffee, cocoa, wheat, soybeans, cattle, palm oil, cotton)
- Energy (e.g., oil and gas)
- Metals, minerals and metalloids (e.g., iron ore, copper, aluminum, gold, cobalt, silica)
Higher-Risk Sectors
- Commodity traders, including:
- Trading companies
- Companies with trading arms
- Market-based/ financial sector commodity traders
- Companies using commodities in the process of manufactured products, including:
- Agricultural commodities:
- Food and beverage industry
- Fast-moving consumer goods industry
- Apparel industry
- Metals, metalloids and precious stones:
- Jewelry companies (e.g., metals and precious stones)
- Electronics and IT industries
- Renewable energy industry (e.g., polysilica)
- Minerals and elements (e.g., mica, cobalt):
- Electronics and IT industries
- Automotive industry
- Paints and coatings industry
- Cosmetics and personal care industry
- Construction industry
- Agricultural commodities:
- Greenhouse gas emissions-based market participants, including:
- Trading companies
- Carbon offset project developers
- Carbon market intermediaries and brokers
- Corporate offset buyers
Business Model Red Flags
Tool for Indicator Design



