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It was in 2007 when I stood up in front of a crowd of investors and made my case for investing in electric vehicles.

Unfortunately for them, there were few takers at the time. Most folks thought EVs were little more than glorified golf carts designed to placate overzealous tree-huggers and self-absorbed wealthy eccentrics.

Convincing folks that the market had a future was a challenge in itself. Finding public companies operating in the sector back in 2007 was even harder. I was able to find a few young battery startups that delivered some decent gains, but admittedly I was very early to the game and most of those companies have since been acquired or gone belly-up.

Now fast-forward to today, and everything I said back in 2007 has come to fruition.

Today there is a vibrant and rapidly expanding electric vehicle market, and there are dozens of opportunities for investors to get a piece of this action.

The earliest and most successful to date is obviously Tesla (NASDAQ: TSLA).

I highlighted Tesla during my 2007 presentation — before the company went public. And we all know how that turned out...

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Of course, Tesla isn’t the only game in town.

In fact, if you want a good bang for your buck in the EV sector, look no further than all the things that are making electric vehicles a reality — the most integral of which are the materials necessary to produce electric car batteries and motors.

It’s no longer just about actual electric car companies. It’s now about the commodities that are required for the continuation of the electric car boom. These include but are not limited to:

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• Copper

• Nickel

• Cobalt

• Graphite

• Lithium

• Manganese

• Aluminum

Because these seven are the most important for the development of electric car batteries and electric car motors, these are the commodities we’re focusing on in this report.

DOING WELL BY DOING GOOD

As socially responsible investors, we face a bit of a dilemma when it comes to investing in these commodities. While we certainly want to invest in the development of electric vehicles, as they offer a cleaner, more sustainable form of personal transportation, the materials on which they rely come with a heavy environmental and human rights burden.

Truth is, there are few mining operations that operate in an environmentally responsible manner. In addition, some of these operations that are active outside North America and parts of Europe profit off the backs of child and slave labor. This is especially true when it comes to cobalt.

Check out this video to get an idea of how cobalt mines operate in the Democratic Republic of the Congo:

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Watching this I ask myself how anyone could possibly support companies that source cobalt from this kind of operation.

Personally, I can’t and I want nothing to do with them.

And I’m not the only one who feels this way.

Back in 2015, some electric car battery manufacturers began seeking supplies of cobalt and other materials from mining companies that were operating in regions where child and slave labor were banned. As a result, a number of North American miners found themselves in a very lucrative situation.

See, even with the higher prices that come with responsible mining practices, there is now a very real demand for responsibly sourced minerals in North America and Europe.

These are the operations that we as socially responsible investors can get behind. Because not only are these miners providing a viable alternative to the human rights violations we see in other parts of the world, but they’re also delivering some very serious gains.

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As always, our motto is “do well by doing good.” And by investing in the more credible, socially responsible mining companies, this is exactly what we’re accomplishing.

So let’s get started.

COPPER

Electric cars use a lot of copper. And I mean a lot!

Even more than internal combustion vehicles.

The average vehicle with an internal combustion engine requires between 18 and 49 pounds of copper. An electric car like the Tesla Model S requires about 165 pounds of copper, or about three times as much as an internal combustion vehicle. Meanwhile, larger EVs like battery electric buses require over 800 pounds of the red metal.

But that’s not the end of it. Copper is also required for charge ports and wiring.

Rest assured, my friend: This reality puts huge smiles on copper producers’ faces.

The International Copper Association reports that in 2027, copper demand from electric cars and buses will reach 1.74 million tonnes. That’s compared with just 185,000 tonnes in 2017, thereby representing a compound annual growth rate of 25.12%.

So, of course, we want some exposure to copper.

And here are four copper plays that should not only profit from the electric car boom but do so while maintaining a higher level of environmental and social responsibility.

One copper play I’m very fond of is a company called Lundin Mining Corporation (TSX: LUN) (OTC: LUNMF).

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Lundin Mining Corporation is a diversified Canadian base metals mining company with operations in Chile, the United States, Portugal, and Sweden, primarily producing copper, nickel, and zinc. It also holds an equity stake in a cobalt refinery in Kokkola, Finland.

Overall, the company maintains high-quality and competitive mines. It has strong cash flow and margins and a conservative balance sheet. It also boasts something that’s quite rare in the mining industry: corporate social responsibility and transparency.

Lundin even goes so far as to adhere to what it calls its “responsible mining policy.” Check it out:

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You can also check out the company’s most recent sustainability report here.

Another stock I like in the copper space is Sandfire Resources America (TSX-V: SFR) (OTC: SRAFF) (formerly Tintina Resources).

Now, Sandfire isn’t as far along as Lundin. It’s a more speculative, development-stage firm that’s not for the risk-averse. This is a penny stock, to be sure. But there’s a lot of potential here.

Sandfire owns the Black Butte Copper Project in central Montana, one of the highest-grade copper projects in North America. On the Black Butte Copper property sits what has been named the Johnny Lee deposit. A mineral resource update shows the Johnny Lee deposit contains a measured and indicated mineral resource of 685 million pounds of copper.

Now, in terms of investment opportunities in copper, there are plenty of stronger and safer plays, and you could do well by investing in any of those bigger players. But for our purposes of investing in companies that seek to raise the bar on social responsibility, Sandfire is upping the ante. Of course, given the high-grade nature of the deposit, the company can afford to do so.

The company’s website outlines its core environmental and health policies. Sandfire’s environmental policy is stated as follows:

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Sandfire is also very focused on community involvement, which I believe is one of the pillars of success for any company. The company regularly meets with a community group to ensure it’s addressing all the concerns of the community. It has also created a stakeholder group including the Montana conservation community and local leaders to be involved in environmental stewardship.

Sandfire’s operations will also have a big impact on the local economy. The Montana Business Assistance Connection (MBAC) has projected that the development of the mine will require 112 housing units in the community and predicts that approximately 31 additional school-age children will attend school in the county during the operational stage. MBAC has also projected annual retail sales increasing by $3.4 million during the life of the mine. Sandfire Resources America actually owes its existence to landowners who reached out to the company’s vice president, who grew up in the local area.

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While no mining project is completely environmentally benign, some are simply more sustainable than others. And Sandfire is definitely going the extra mile.

Of course, nothing is set in stone. Anything could happen, and the whole project could go belly-up. This is just part of investing in any early-stage growth company. But if I’m looking to get some exposure to the copper segment and I want to invest in a company that takes social responsibility as seriously as it takes its desire to make a lot of money, Sandfire fits the bill.

Sandfire is a high-risk, long-term investment in modern, sustainable mining. I don’t expect much to happen with the stock until we get closer to regulatory approvals, construction, and operations.

Now, if Sandfire is too risky for you, consider a company like Freeport-McMoRan (NYSE: FCX), which is the single biggest public copper producer in the world. But don’t let its size convince you that it’s some kind of hideous corporate giant that doesn’t care about sustainability. In fact, sustainability is a core part of the company’s operations.

In the late 1990s, the company established a human rights policy and later updated it in 2015. Here’s a snapshot:

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Freeport-McMoRan also has a fairly strict environmental policy. Check it out:

This doesn’t mean the company is perfect, but its operations are far more sustainable than a lot of other operations around the world.

In terms of taking sustainability seriously, we’ll also another include major copper producer, Southern Copper (NYSE: SCCO), in this list, as the company offers a pretty solid environmental commitment by reducing the use of fossil fuels at its operations, optimizing water use, and taking noticeable actions to mitigate its environmental impact by managing impact zones with high biodiversity value.

NICKEL

The latest analysis from Bloomberg New Energy Finance suggests that nickel demand will rise from about 5,000 tons in 2016 to 327,000 tons in roughly 10 years.

One of the largest producers of nickel in the world is also one of the most sustainable. To some, that may not mean much as nickel production carries a very heavy environmental burden. Still, Vale S.A. (NYSE: VALE) has made the most concerted effort in the nickel space to raise the bar on sustainability.

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You can check out the company’s most recent sustainability report here.

In terms of corporate responsibility, Clean TeQ Holdings (TSX: CLQ) comes in second. Clean TeQ owns an Australian mine and produces both nickel and cobalt. The company utilizes an ion-exchange technology that allows it to lower the environmental burden that comes with the mining of nickel.

COBALT

It’s probably one of the most well-publicized sectors when it comes to electric car battery sourcing, and with good reason. You already saw the video above, and as the demand for electric vehicles continues to grow, it’s going to be harder and harder to find sustainably sourced supplies of cobalt.

That being said, the miners that are doing this in a responsible way are likely to get the lion’s share of the market in the U.S., Canada, and parts of Europe. Sadly, China, which is the biggest electric vehicle market, is unlikely to find more sustainable sources of cobalt and will continue to rely on cobalt sourced from miners that openly use slave labor.

While there’s little we can do about that, we can focus our investment dollars on the miners that are at least making an effort. Here are three:

FIRST COBALT (TSX-V: FCC) (OTC: FTSSF)

First Cobalt is the largest pure-play cobalt exploration company with a dominant land position in North America. First Cobalt’s main cobalt exploration project is the Iron Creek Cobalt Project in Idaho, which has an indicated resource of 12.3 million pounds of contained cobalt and 29 million pounds of contained copper.

Meanwhile, the company is also currently exploring a restart of the First Cobalt Refinery in Ontario, Canada, which could produce over 25,000 tonnes of cobalt sulfate per year from third-party feed.

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First Cobalt is also committed to embedding responsible mining practices throughout its business. Its guiding principle is “zero harm” to people, the environment, and the communities in which it operates.

First Cobalt fully recognizes that mining operations have the potential to have adverse effects on the surrounding environment. Therefore, the company takes a proactive, risk-based approach to environmental management, with specific measures that help ensure it minimizes its environmental impact while ensuring the viability of the environment for future generations.

The company also recognizes its responsibility to respect the human rights of stakeholders within its sphere of influence. This includes its direct influence on human rights as well as human rights within its supply chain. This is in line with the United Nations Guiding Principles on Business and Human Rights.

It should also be noted that First Cobalt is committed to preventing the use of child labor in all its forms, whether directly through its business activities or indirectly through its supply chains. By embedding child labor-prevention provisions into its business conduct, the company can help ensure that its cobalt is free of such abuses.

This, dear reader, is the right way to do things.

A few other cobalt miners to consider include:

• Fortune Minerals (TSX: FT) (OTC: FTMDF) — high risk

• Jervois Mining Ltd. (TSX-V: JRV) (OTC: JRVMF) — high risk

Worth noting here is that in May 2018, representatives from Tesla announced the company has significantly reduced its cobalt content while increasing its nickel content. This has resulted in less cobalt demand with the added benefit of a battery cell that boasts the highest energy density used in any electric car on the market. According to CEO Elon Musk, Tesla could soon eliminate nearly all of its cobalt requirements. But based on a Tesla report in 2020, this transition away from cobalt may not be happening as quickly as Musk would like.

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GRAPHITE

It may not be discussed as much as copper or cobalt, but electric cars also rely on steady supplies of graphite. In fact, Bloomberg reports that demand for graphite is set to soar to 852,000 tons a year in 2030. Today, it’s about 15,000 tons.

Like most mining plays, we’re sticking to companies that are operating in North America, parts of Europe, and Australia.

NanoXplore (TSX: GRA) (OTC: NNXPF)

NanoXplore manufactures and supplies graphene powder for use in industrial markets. The company’s technology helps enhance the thermal, electrical, and physical characteristics of various products while replacing harmful and expensive additives.

While we are playing the graphite angle to benefit from the robust growth of the electric vehicle market, NanoXplore has more than just that one iron in the fire.

Here are some highlights of the company:

• Largest Canadian producer of graphene.

• 10,000 tonnes-per-year production capacity.

• Low-cost graphene manufacturing.

• Partnered with Sustainable Development Technology Canada, which helps fund Canadian cleantech projects.

Nouveau Monde Graphite (TSX-V: NOU) (NYSE: NMG)

This is a very early-stage operation but with some real potential.

The company’s business model is to sell its large high-purity flakes into the traditional North American market, allowing for a significant margin, and transform its fine and medium flakes into value-added products, including anode material for lithium-ion batteries.

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NOU boasts high-purity carbon content across all flake sizes. This purity content influences battery-grade purification costs.

The company is currently developing its operations with the highest environmental standards in Canada.

LITHIUM

Lithium has enjoyed most of the attention associated with the development of electric cars. But the truth is the amount of lithium required for an electric car battery isn’t much at all. That being said, the demand for lithium will continue to grow alongside the electric vehicle market.

One company that’s doing something very interesting in the world of lithium is MGX Minerals (CSE: XMG) (OTC: MGXMF). The company has a really fascinating technology it calls petrolithium. This is an approach that focuses on concentrating lithium and other minerals from abundantly available wastewater (brine) that accompanies oil, gas, and geothermal production.

In the case of oil and gas, that wastewater is typically injected deep underground or stored in massive tanks. But MGX can clean that brine while separating valuable materials, including lithium and magnesium.

This technology offers a new and somewhat more sustainable approach to lithium production. And while it certainly isn’t the biggest or safest lithium play, it’s one that’s using some next-generation technology that could make it a prime acquisition target.

Another lithium supplier that’s utilizing the latest in extraction technology while embracing the concept of social responsibility is Albemarle (NYSE: ALB). This is actually a major player with a long history of disclosing its sustainability efforts, as you can see here.

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MANGANESE

While there are dozens upon dozens of lithium players out there, there really are only a small handful of manganese plays.

One is Vale, which is included in our sections on nickel and cobalt.

The other is South32 (OTC: SOUHY), which has operations in South America, Australia, and Africa. While I tend to shy away from companies operating in Africa, South32 does seem to be a bit more responsible than others operating in that part of the world.

The company employs a sustainability policy that ensures:

• The health of its people is not compromised by the work they do.

• Everyone goes home safe and well at the end of the day.

• The creation of value for the local economies in which it operates.

• A high level of environmental protection.

ALUMINUM

In the case of electric vehicles, aluminum is relied upon for the casings that hold electric car batteries. Aluminum is used because it can provide the necessary thermal transfer capabilities required to keep batteries cool in the summer and warm in the winter.

The lightweight nature of aluminum also makes it desirable as electric carmakers need lighter materials for the bodies of the vehicles in an effort to increase “fuel” economy. The Tesla Model S bodies and chassis are actually built almost entirely from aluminum.

In terms of embracing social responsibility measures, there are a few options. These include:

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• Kaiser Aluminum (NASDAQ: KALU)

• Norsk Hydro (OTCBB: NHYDY) (This is an aluminum and renewable energy company)

• Constellium (NYSE: CSTM)

• Alcoa Corporation (NYSE: AA)

DOING IT WELL, DOING IT RIGHT

The stocks listed above represent just a small sampling of what’s available today and, of course, what will be available in the future.

While we certainly want to profit from the development of the electric vehicle boom, we want to do it in a way where we only invest in those mining and production companies that are taking their responsibility to the environment and to society seriously.

Yes, there are plenty of other mining stocks that will do very well in the coming years, but we want to do more than just “do well.” We want to do well by doing good. And investing in those companies that are seeking to operate in a socially responsible manner allows us to do just that.

As we move forward, we will continue to identify and recommend a number of mining stocks that actively and responsibly participate in the rapid development of the electric vehicle market.

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