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"There will be enormous pressure on resources"

Founder and vice president of the World Materials Forum, Professor Victoire de Margerie believes that we must figure out how to handle the critical metals situation immediately.

Dubbed the “Davos of materials”, the World Materials Forum (WMF) has met each year since 2015, bringing together leaders and researchers from all over the world. The latest edition was held this June in Nancy. Participants are all concerned about one thing: finding solutions to counter the global dependency on critical metals. Victoire de Margerie, vice president of the forum, spoke with Swissquote Magazine.



In the 1970s, experts estimated that petrol reserves would be used up in early 2000. Almost 20 years later, we still have petrol... Should we really be concerned with the availability of critical metals?

I hope that in 30 years, we’ll be saying the exact same thing about what we deem today to be critical materials. But in order to do that, we need to act immediately. The global economy has three major challenges: incredible urbanisation, the growth of the middle class and transport electrification, all of which exert unprecedented pressure on the usage of certain materials.

Let’s look at an example: the middle class, which is currently 1.7 billion out of the 7 billion people on the planet, is expected to more than double by 2030. It is wonderful that more and more people around the world are no longer living in poverty and can access a better quality of life. But at the same time, the middle class consumes more goods and services (smartphones, packaged foods, transport, etc.). As a result, there will be enormous pressure on natural resources: if we do nothing, the consumption of materials will double in 10 years. Obviously, that’s a problem.

Are we headed towards shortages?

No. There will never be a significant supply disruption. In the short term, the quantity of available reserves isn’t critical. But the concerns we have about the immediate availability of certain metals are already an issue. It would only take an everyday news event, like a new president being elected in Africa, to see a brutal surge in prices. In May 2016, for example, Beijing decided to limit the number of working days in coal mines to 276 days per year, which resulted in a significant increase in the price of coal in November of that year.

A more long-term perspective is that we must never forget that we only have one earth and its resources are limited. If we do nothing, we’ll end up being physically limited. That will lead, in my opinion, to two extremes. On the one hand, lawless mining companies will go in search of raw materials wherever they can find them, such as in war-torn countries, using child labour and in an environmentally irresponsible way. On the other hand, Stalinist neo-ecologists will advocate for a return to the Middle Ages. To avoid that, we created the World Materials Forum (WMF) in 2014 in order to provide moderate, pragmatic solutions.

So what are those solutions?

The first solution is to bring all players together around the same table. That’s what we’re trying to do at the WMF, where CEOs of multi-nationals, start-ups, scientists, NGOs and politicians can come together to discuss the problems and measure the progress being made. And I can tell you that the discussions get lively (laughs).

In order to avoid doubling our consumption of these materials, like we talked about earlier, we’re mainly focused on three approaches: use less (which includes reducing and recycling), use longer and use smarter (use the optimal material for a given usage). In all three of these areas, we have a lot of work to do.

Have you already seen concrete results come out of the WMF?

Our “criticality assessment”, which evaluates the risk of a supply disruption for certain metals for the industry, is starting to become an international benchmark that is useful for everyone, from raw materials suppliers to public and private users. Furthermore, we have developed performance tools that allow manufacturers to measure their progress on the path to “Use Smarter, Less and Longer”. Several prominent banks have told me they’ve studied the relevancy of our indicators in order to include them in future financial analyses of listed manufacturing companies. If financial people get involved, it’s the beginning of a virtuous circle.

But what I’m most proud of is undoubtedly the innovations that result from the forum. Each year I see amazing ideas! In 2017, for example, we awarded our grand prize for start-ups to Citrine Informatics. Based in Redwood, California, the company developed an aggregation system for all the available data on materials. Thanks to this algorithm, Boeing was able to develop a new alloy by mixing aluminium and zirconium, which means that the weight of certain parts will be reduced significantly.

So the depletion of resources isn’t the end of the world?

No. For us, the most important thing is to find ways to use existing resources in a smart manner in order to make sustainable growth independent of raw materials consumption, while also creating value. Clearly, there are many obstacles and the effectiveness of the measures we take today will only be seen in the medium to long term. But when I see all these innovations, I am optimistic.

The priestess of materials

With degrees from HEC and Sciences Po Paris, Victoire de Margerie is an industrialist through and through. After beginning her career in 1987 in chemistry at Elf Atochem (now Arkema), she held executive positions in Germany, the United States and France at CarnaudMetalbox (packaging) and Pechiney (aluminium) until 2003. As a professor at the Grenoble School of Management from 2003 to 2011, she published four books on corporate management. In 2012, she became head of Rondol Industrie, a company she founded in Strasbourg. In 2014, alongside Philippe Varin, president of the executive board at Areva, she founded the World Materials Forum, of which she is vice president. She is also the half-sister of the former CEO of Total, Christophe de Margerie, who died in 2014 in a plane crash in Moscow.

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