Electronics
Electronics, such as smartphones, laptops, renewable energy infrastructure, and medical devices are key technologies for our everyday lives. All of these technologies need microchips to function, highlighting our dependence on microchips. Microchips are often produced outside Europe such as the USA, South Korea or Taiwan. Currently, only 10% of microchips are manufactured in Europe. By 2030 Europe aims to increase the manufacturing rate to 20%. This is highly ambitious, especially since the market for microchips is expected to grow significantly within the next years.
At a policy level, the European Commission adopted the European Chips Act in February 2022. The European Chips Act aims to strengthen the semiconductor industry in Europe, by ensuring the resilience of supply chains and reducing dependencies from countries outside the European Union (European Commission, 2025). More and more companies are voluntarily addressing sustainability challenges often through codes of conduct (Schöggl et al., 2016).
Unlike other industries, the manufacturing processes and products of the electronics sector have complex and rapid innovation cycles, and a broad spectrum of applications. Covering consumer electronics to industrial and strategic equipment (KT et al., 2019). But the same technologies that drive progress are also linked to sustainability challenges, such as resource-intensive production, reliance on critical raw materials, and supply chains that are often linked to environmental risks and human rights violations (González & Schipper, 2021).
With an annual growth rate of 3 - 5%, electrical and electronic equipment makes the fastest-growing waste stream in Europe. Per capita, Europe produces the most electronic waste worldwide, roughly 11 kg per person a year. And less than half of such waste is recycled, resulting in lost value in raw materials of 13 billion per year (Chaudhuri et al., 2024).
For sourcing the respective individual parts, the electronics supply chain spans continents, involving multi-tier networks, and is heavily dependent on critical raw materials such as Copper, Nickel or Lithium. Mining these materials often come with human rights violations or environmental harms (González & Schipper, 2021).
Similar issues arise specifically, with so-called “conflict minerals”, such as tin, tantalum, tungsten and gold. There are several challenges that need to be considered when sourcing and utilizing these minerals. Often these minerals are extracted under conditions associated with armed conflict, human rights violations, or other serious risks. Also trading these minerals can contribute to financing such conflicts.
However, conflict minerals are in great demand on today's global market, because after being refined, they end up in products like consumer electronic goods such as laptops and mobile phones (Airike et al., 2016). Based on this circumstance in the electronics supply chain, the awareness for sustainability and social issues is gaining importance. This increasing expectation from investors and customers is pushing companies to ensure their supply chains meet environmental and social responsibility standards. (Schöggl et al., 2016).
Besides the various voluntary initiatives, regulatory frameworks also serve to drive companies towards engaging in an exchange of sustainability information to avoid the risks of non-compliance. In the European Union, the Corporate Sustainability Due Diligence Directive requires companies to identify, prevent, and address adverse human rights and environmental impacts in their supply chains.
This risk-based Due Diligence Approach is often challenging for companies to navigate, as resources are often insufficient, data is intransparent and the market for digital tools is fluid and it is difficult for companies to find the tool that best fits their needs.
DiliCHANCE addresses these challenges by providing a One-Stop-Shop, with free insights into tools, standards and regulations, clearly listed and presented.
References
Airike, P., Rotter, J. P., & Mark-Herbert, C. (2016). Corporate motives for multi-stakeholder collaboration– corporate social responsibility in the electronics supply chains. Journal of Cleaner Production, 131, 639–648. https://doi.org/10.1016/j.jclepro.2016.04.121
Chaudhuri, A., Wæhrens, B. V., Treiblmaier, H., & Jensen, S. F. (2024). Impact pathways: digital product passport for embedding circularity in electronics supply chains. International Journal of Operations & Production Management. https://doi.org/10.1108/ijopm-01-2024-0012
European Commission. (2025, June 3). Electronic components and semiconductors. Retrieved August 11, 2025, from https://digital-strategy.ec.europa.eu/en/policies/electronics
González, A., & Schipper, I. (2021). State of play and roadmap concepts: Electronics Sector. In European Commission. Retrieved August 11, 2025, from https://re-sourcing.eu/content/uploads/2022/11/final_sop_eees.pdf
KT, R., Sarmah, S. P., & Tarei, P. K. (2019). An integrated framework for the assessment of inbound supply risk and prioritization of the risk drivers. Benchmarking an International Journal, 27(3), 1261–1286. https://doi.org/10.1108/bij-03-2019-0119
Schöggl, J., Fritz, M., & Baumgartner, R. (2016). Sustainability Assessment in Automotive and Electronics Supply Chains—A set of indicators defined in a Multi-Stakeholder approach. Sustainability, 8(11), 1185. https://doi.org/10.3390/su8111185