Critical raw materials
Identifying critical raw materials
Critical and strategic raw materials are essential to the European economy. Many companies rely directly on these materials in their production or service provision. Examples include lithium for batteries and bauxite as the basis for aluminum. The availability of these types of raw materials is under pressure worldwide. Geopolitical tensions, regional instability, and climate disasters are making international supply chains increasingly vulnerable.
This poses clear risks for businesses. A disruption in the supply chain can lead to downtime, higher costs, or the loss of customers. That is why it is crucial to understand which critical raw materials you use and where they come from. This is not only a legal requirement but also a strategic step toward building a future-proof organization.
The less dependent you are on scarce and vulnerable supply chains, the more robust your business becomes. You reduce risks, increase supply reliability, and build a resilient operation. In addition, many critical raw materials are scarce. Paying extra attention to this issue therefore contributes not only to risk management but also to sustainable and responsible business practices.
Here’s how we do it — your own action plan in four steps
1. Procurement analysis
Together with the procurement department, we carefully map out which raw materials you purchase and where they come from. We then prioritize these materials based on their importance to your organization. This includes not only officially designated “critical” raw materials, but also materials that are strategically indispensable to your business operations. This creates a clear overview of the raw materials that truly deserve attention.
2. Risk analysis
For each selected raw material, we examine both the risks and opportunities. We examine vulnerabilities in the supply chain, geopolitical dependencies, the availability of alternatives, and the potential impact on your business operations. This provides a clear picture of which supply chains pose the greatest risk and where there is room for improvement or substitution.
3. Mitigation plan
Based on the risk analysis, we determine which measures are needed to mitigate risks. These can range from alternative suppliers and material substitutes to process adjustments or inventory strategies. For each raw material supply chain, we make specific decisions that align with the material’s origin, use, and strategic value.
4. Implementation
Finally, we help embed these measures within your organization. We provide support for procurement training, policy development, and the establishment of processes that ensure risk management continues to function effectively in the future. In this way, managing raw material risks becomes a standard, robust business practice.
Frequently asked questions
Critical raw materials are materials that the EU considers to be both economically important and vulnerable in terms of supply security. Strategic raw materials are a subset of these: these are the raw materials that the EU considers most essential for the green transition, digitalization, defense, and space exploration. A total of 34 raw materials have been designated as critical, and 17 of those as strategic.
Yes. A stress test is valuable for any raw material that is important to your business. Even materials not included on the EU list can pose risks — for example, due to dependence on a single supplier, significant price fluctuations, or limited alternatives. That’s why we look not only at EU-critical or strategic raw materials, but also at materials that are essential to your organization.
The most common critical raw materials used by companies are lithium and graphite in batteries, rare earth metals for magnets, cobalt in electronics, and bauxite/aluminum and copper in a wide range of industrial applications. In addition, there are many other critical materials that may be used, but this varies greatly by sector and by company.
Getting started with your own team
We strongly believe in teamwork. We tailor our long-term strategic programs to meet the specific needs of your company or organization. We’re a dedicated team of three to six experts — diverse and resilient. They work together to guide your organization from development through implementation. This way, we ensure quality and guarantee the continuity of your sustainability initiatives. Ready to make an impact together?
A selection of our experts
Meet our expert who — together with a strong team of fellow experts — contributes to our clients’ long-term success.
