Leak: Intel to rely on TSMC for GPUs | Amazon, Ikea sued under Germany's supply chain law | Smurfit Kappa in talks over Colombia controversy

Welcome to Portfolio Intelligence Daily, where each weekday morning we spotlight under-the-radar investment themes involving supply chain issues, ESG risks, and regulatory and government actions.

Today:?

1. Is Intel turning to TSMC for next-gen GPUs??
2. Germany’s new supply chain law hits Amazon, Ikea?
3. Smurfit Kappa in mediated talks over Colombia controversy

Summaries are curated by Auquan’s analyst team using our Portfolio Intelligence Engine to uncover investment insights at scale.

Leak: Intel to rely on TSMC for next-gen GPUs

Intel may intend to rely entirely on rival Taiwan Semiconductor Manufacturing Company Limited (TSMC) for the production of its next-gen GPUs.

• A leak from Intel implies that TSMC will produce the next-gen Alchemist, Battlemage, Celestial discrete & integrated GPUs for Arc & Xe families for Intel.
• The two companies have been competitive, with TSMC expected to increase R&D spending by 20% in response to Intel.
• TSMC and Intel have been vying for the $50 billion government investment that is part of the CHIPS Act (Creating Helpful Incentives to Produce Semiconductors for America), which is intended to encourage both US and overseas companies to build chip fabrication plants in the United States.?
• TSMC announced in 2020 that it would be building a $12 billion chipmaking plant in Arizona.?

Select timeline

• April 30, 2023 | Intel Leak Points To TSMC Being The Choice For Next-Gen GPUs: 5nm Xe-LPG, 4nm Battlemage, 3nm Celestial & Xe2-LPG (WCCFTech)
• February 24, 2023 | CHIPS Act rivalry between Intel and TSMC prompts White House ‘slap’ (9tto5Mac)
• February 08, 2023 |? TSMC Responds To Intel (Seeking Alpha)

Tags: #tsmcc #intel #chips #semiconductorindustry #chipsact #semiconductor

Amazon, Ikea, and Tom Tailor sued under Germany’s new supply chain law

Three organisations accused Amazon, Ikea, and Tom Tailor of violating the new German supply chain law by failing to conduct adequate safety checks on their suppliers in Bangladesh.

• Germany’s Supply Chain Due Diligence Act (LkSG) was passed in 2021 and came into effect on January 1, 2023. The law requires companies with more than 3,000 employees in Germany to conduct due diligence on their supply chains to identify and prevent human rights and environmental abuses.
• The organisations that filed the complaint are the European Center for Constitutional and Human Rights (ECCHR), the National Garment Workers Federation (NGWF), and the African Women’s Development and Communication Network (FEMNET).
• The complaint alleges that Amazon, Ikea, and Tom Tailor failed to identify and prevent human rights and environmental impacts in their supply chains, and could see the companies face fines of up to 2% of their global turnover.
• The complaint was filed on the 10-year anniversary of the Rana Plaza factory collapse in Bangladesh, which killed over 1,130 people.

"We are convinced that the failure to sign is a violation of corporate due diligence. It is now up to the competent German authority, the Federal Office of Economics and Export Control, to consider the complaint. We very much hope that the authority will ensure that German companies' business practices will not contribute to deadly disasters like Rana Plaza in the future.” — Miriam Saage-Maa?, ECCHR lawyer and legal director (source)

Select timeline

• April 26, 2023 | First complaint filed under German Supply Chain Due Diligence Act (Supply Management)
• April 11, 2023 | Most Supply Chains Are Not Ready for Due Diligence Compliance (Supply Chain Brain)
• Germany’s new Supply Chain Due Diligence Act: What you need to know (Sadex)

Tags: #EU #Germany #supplychain #amazon #ikea #tomtailor #esg

Smurfit Kappa in talks with Colombian communities over land dispute

Irish paper-based packaging company Smurfit Kappa is in mediated talks with indigenous communities in Colombia to resolve an ongoing land dispute that’s involved charges of land-grabbing, violence, and negative environmental impact.

• We covered this controversy in Portfolio Intelligence Daily earlier this month.?
• The dispute involves Smurfit Kappa’s subsidiary in Columbia, Cartón de Colombia, and the indigenous people of the Misak people of Cauca region of Colombia
• The company is being accused of grabbing more than 121 hectares than officially registered, leading to water contamination and food production/security issues impacting locals
• The Front Line Defenders organisation says protests against Smurfit Kappa’s operations have been violently repressed, resulting in one death
• An OMAL (Observatory of Multinationals in Latin America) report highlights the socio-ecological impacts, human rights violations, and negative environmental impacts of Cartón de Colombia operations on soil, water and biodiversity
• Smurfit Kappa CEO has named the Colombia operation as one of the company’s most important, employing 1,200 people and generating $1.83B in exports in 2021

“An Irish company should not be operating on indigenous land, should not be one of the biggest landowners in the Cauca and should not be damaging the planet.” — Alys Samson Estapé, a campaigner with environmental watchdog Ekō (source)

“This is an issue that has come and gone in our company for years. We have an absolute right to the land that we have, but we are prepared to negotiate and mediate with them. We are engaging with them and we will see where it leads. That’s what mediation is.” — Tony Smurfit, CEO of Smurfit Kappa (source)

Select timeline

• April? 28, 2023 | Smurfit Kappa in ‘mediated dialogue’ with Colombian groups to resolve land dispute (Independent.ie)
• February 27, 2023 | Los impactos detrás de la producción de una caja de cartón en Colombia (RTVC Noticias)
• December 15, 2022 | El lado oscuro del cartón en Colombia (Cuestión Pública)
• October 4, 2019 | "Vamos a seguir invirtiendo en el Valle del Cauca": Tony Smurfit, CEO de Smurfit Kappa (El País)

Tags: #smurfitkappa #colombia #esg

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