Consumers, regulators and investors have called for electronics manufacturers and retailers to better manage e-waste, but the most destructive practices tend to be performed by individuals and small firms outside the formal economy. In this context, California’s in-state recycling model may still prove instructive, especially as developing nations begin to generate more of their own e-waste.

Electronics Account for 70 Percent of Heavy Metals in US Landfills

Modern electronic devices can contain 60 different elements. When electronics enter the regular waste stream, the metals and chemicals they contain can potentially contaminate the soil and water. The Natural Resources Defense Council has stated that electronic waste accounts for 70 percent of the heavy metals found in municipal landfills, including lead, mercury, arsenic and cadmium, which can potentially seep into ground water.

More Gold in a Ton of Electronics than in a Ton of Ore

Ideally, discarded electronics can be stripped of metals and rare minerals. This can be a profitable trade; one can extract more gold out of a ton of electronics than a ton of gold-bearing rock. In fact, some of the gold in recent Olympic medals came from e-waste.

Unfortunately, this recycling is often done in developing nations, where labor costs are lower and environmental and health regulations less stringent. Even companies that explicitly claim to process e-waste safely and locally have been found to have illegally shipped containers of waste to developing countries.

For example, in July 2009, the US Environmental Protection Agency filed a Complaint and Compliance Order against EarthEcycle, a company handling e-waste disposal for several charities in Pittsburgh, for shipping cathode ray tubes to South Africa and Hong Kong after it had pledged to recycle the waste locally. The company was accused of exporting hazardous waste without authorization and failing to prepare a hazardous waste manifest.

US Government Accountability Office investigators have posed as Hong Kong-based foreign importers looking to buy e-waste; more than forty companies responded with offers, despite the fact that it is illegal to import e-waste into China under Hong Kong law, Chinese law and the Basel Convention.

Picking the Toxic Bones of Burnt Electronics

A 2007 New York Times report described the awful human cost of developing-world e-waste processing. In Guiyu, a city in Guangdong Province, women and children scavenge electronic components for minute amounts of precious metals, breaking apart and burning old computers with little protective gear. The region is said to process 1.5 million pounds of e-waste a year. Here, the recyclers are peasants who recover precious metals by burning old electronic products, and then sorting through the remains. This method releases toxic chemicals, including brominated flame retardants (BFRs) used in circuit boards. Certain BFRs induce neurotoxicity and immunotoxicity, and when electronics are burnt or smelted in open air, BFRs can form additional toxic chemicals.

Greenpeace has filmed some Guiyu workers burning circuit boards and extracting gold with acid—work for which they earn less than ten dollars a day. Drinking water has to be brought into the city, as pollution has ruined the local river. Greenpeace also claims that pregnancies in that area are six times more likely to end in miscarriage. The Basel Action Network (BAN), another NGO active in this space, has stated that people in Guiyu have shown some of the highest levels of cancer-causing pollutants ever documented. According to BAN, seventy percent of children have elevated levels of lead in their blood, and instances of brain damage have been recorded.

More Developing-World Wealth, More E-Waste

Developing nations are also generating more e-waste domestically. In February 2010, the United Nations Environment Programme (UNEP) presented a report to the Conference of the Parties of the Basel Convention and other world chemical authorities.

Using data from 11 developing countries, UNEP’s Recycling - from E-Waste to Resources outlined the expanding threat of e-waste by estimating current and future e-waste generation on a global scale. By 2020, China and South Africa e-waste is expected to increase by 200-400% as compared to 2007 levels; a 500% increase was predicted for India.

Similarly, a 2010 report by the American Chemical Society in Environmental Science & Technology forecasts that the global generation of obsolete personal computers in developing countries will exceed that of developed regions in the coming decade. By 2030, discarded computers from developing regions were predicted to total 400-700 million units, twice that of developed regions at 200-300 million units.

International Efforts to Control E-Waste Trade

Concerns about e-waste have led to a number of responses, from both governments and corporate actors. The 1992 Basel Convention prohibits exports of e-waste to developing countries. The US is the only industrialized country that has not ratified the Basel Convention. (In comparison, the only other countries that are signatories but that have not yet ratified the treaty are Afghanistan and Haiti.)

At the corporate level, multi-stakeholder initiatives like Solving the E-waste Problem (StEP) and  the Global e-Sustainability Initiative (GeSI) bring together a constellation of members, including industry actors, to determine sustainable approaches to deal with e-waste. StEP projects include annual status reports and a  “best practices” document for e-waste policies.

At the regional level, the 2007 European Community’s Waste Electronic and Electrical Equipment (WEEE) directive targets manufacturers of electronics. European manufacturers are now obligated to take back and recycle their products, or dispose of them in an environmentally-friendly way if they cannot be refurbished or recycled.

The Basel Action Network and the Electronics TakeBack Coalition (ETBC) are pushing for more national legislation prohibiting the export of e-waste to developing countries. BAN has also put together a list of responsible e-waste recyclers called the e-Stewards Initiative.

US Efforts by State and City Governments

In the US, states and cities have grappled with the e-waste crisis. Unlike California, most states do not directly pay for or collect old electronics. New York State now mandates that manufacturers take back their discarded products, effective April 2011. Companies will be required to take back not only their own products, but also those of companies who have gone out of business by 2011. They will also be prohibited from dumping any e-waste in landfills and face recycling quotas and fines in the case of non-compliance. Consumers face the same requirements as of January 2015. New York City passed its own e-waste law in 2008. The bill was supposed to begin collection from manufacturers in 2009 and impose fines for residents starting 2010.

Corporate Initiatives

Most leading electronics manufacturers and retailers have take-back programs for their own products, and some accept any manufacturer’s products. Best Buy recycles appliances, accepts mail-in mobile phone recycling, and accepts all manufacturers’ products. Apple, Epson, Dell, Nokia, HP, IBM and other large ICT companies typically recycle end-of-life products for free or for a small fee, or offer them for reuse. In May 2009, Dell officially banned the export of e-waste to developing countries by its contractors or intermediaries. Wal-Mart assesses its suppliers on the environmental sustainability of their products, including end-of-life solutions and the amount of hazardous substances used, and has announced that its buyers would weigh these elements in their purchasing decisions.

Investors Push for Disclosure and Less Toxic Alternatives

While these efforts are important, California’s struggles with fraud and the persistence of illegal e-waste exporting show that they are incomplete. A lack of transparency in the post-consumer e-waste stream makes it difficult to judge the effectiveness of the various initiatives.

In response, shareholders have called for better disclosure of actual waste management practices. Domini Social Investments has submitted a resolution at Becton, Dickinson & Co, a medical technology company, asking it to report on its use of BFRs and to examine safer alternatives. In 2006, the proposal received 8.7% of votes. In 2008, it obtained 36.1%. Other companies have also had to address shareholder concern over the presence of hazardous substances in their products.

Investors can play an important role in managing the e-waste crisis. The current safety net of state, municipal, international and corporate initiatives has proven porous. By holding electronics companies responsible for results, not just policies and initiatives, shareholders can help mitigate the ugly consequences of the world’s appetite for shiny new gadgets.