Valentin Vigier, Head of Responsible Investment, La Financière de l’Échiquier (LFDE) – December 2025
According to the European Commission, a raw material is critical when it combines ‘high economic importance’ and ‘high vulnerability to supply disruptions’.[1] This definition takes on particular significance in the current geopolitical context, where the concept of sovereignty is paramount. Europe needs to strengthen its access to certain raw materials, but this comes at a significant financial, environmental and social cost. Europe’s success on the road to autonomy will depend on achieving the right balance between sovereignty and consideration of environmental and social challenges.
Europe under pressure
The equation is not simple. With demand for raw materials being driven by the enormous needs of AI, energy transition, electrification and European rearmament, the major challenge for Europe is to secure supplies of dozens of resources, including lithium, cobalt, copper and rare earth elements, which are essential for the manufacture of batteries, solar panels, data centres and many other key components. The risks of this high dependence are exacerbated by the trade war. China controls 85% of the world’s rare earth elements and has recently demonstrated that it can cut off supplies to exert pressure in negotiations. The US government is accelerating its direct involvement in the critical minerals sector – a strategic change aimed at securing domestic supply chains and reducing dependence.
Caught in the middle, the European Union is rolling out a legislative framework to strengthen its sovereignty. In 2025, it published a list of 47 strategic projects across the continent that will benefit from investments totalling over €22 billion, as well as fast-track procedures to contribute to its recycling, processing and extraction [2] ambitions by 2030.
Balancing sovereignty and impact control
Striking a balance between the quest for sovereignty and controlling the environmental and social impact of projects is a delicate task. After all, the mining industry is both essential to the energy transition and one of the sectors most exposed to such risks. The support of local populations for projects is crucial. Some companies are addressing these crucial and complex challenges.
Imerys , a French mineral processing specialist, has launched the EMILI (Exploitation de Mica Lithinifère par Imerys ) project in the Allier department in central France. The project covers all stages of lithium processing, including the construction of infrastructure such as an underground mine, a concentration plant and a rail platform. The process will be lengthy, as it is subject to multiple authorisations and consultations on environmental impacts, water management and health risks. Another example is the JADAR project of Anglo-Australian company Rio Tinto in Serbia. Launched in 2021, the project aimed to exploit one of Europe’s largest lithium deposits and produce up to 58,000 tonnes of lithium per year, primarily for use in electric vehicle batteries. However, faced with strong local opposition due to environmental concerns about the project’s potential impact on water resources, agricultural land and biodiversity, the Serbian government suspended the project in 2022, cancelling Rio Tinto ’s operating permits. This shows that acceptability is essential despite growing demand for lithium and the site’s strategic importance. Although discussions resumed in 2024, the group has just announced the project’s indefinite suspension.
Meanwhile, Belgian chemical company Solvay has announced plans to expand its rare earth production capacity in La Rochelle, in southwestern France, with the aim of supplying 30% of Europe’s permanent magnet needs by 2030. Beyond environmental considerations, the economic aspect is crucial at this scale. Management has already warned that these ambitions can only be realised if governments and customers are willing to accept higher costs than competitors, particularly those in China – in other words, to pay a premium to guarantee sovereignty.
These are all challenges for the future of Europe and responsible investors, who will need to identify companies capable of responding to current issues while implementing robust CSR strategies.
[1] Critical Raw Materials Act (CRMA), 2024
[2] Representing 25%, 40% and 10% of domestic demand, respectively
