Thursday 25 July 2013

Conflict Minerals: Three Steps to Supply Chain Compliance

By Mickey North Rizza

Human rights groups won a major battle last year when the SEC approved new rules that force public companies to disclose if any of their products contain conflict minerals sourced from the Democratic Republic of Congo.

Conflict minerals – which include tin, tantalum, tungsten and gold, among others – are core components of many high-tech products that consumers use every day, like smartphones,  MP3 players and laptops. The trading of these minerals, however, is believed to fuel deadly civil wars in the Democratic Republic of Congo and Uganda.

Now, the onus is on publicly traded supply chain teams to comply. Here are three actionable steps to start the process:

  • Start with data collection. Survey your suppliers on three high-level areas: Do you provide our company with any products manu­factured with tin, tantalum, tungsten, gold or any other conflict minerals? If you provide these minerals, what geographic regions do they come from? Are your minerals at risk of supporting conflict? How?
  • Shift the onus on your sup­pliers. Contractually obligate them to ensure that their prod­ucts don’t include materials acquired from conflict zones. Make sure you include tier-2, 3 and 4 suppliers.
  • Leverage technology to report. Trying to analyze and report on conflict minerals manually is an overwhelming, and almost impossible proposition. Make sure your contract and supplier management tools have the ability to collect, analyze and report on all of the SEC’s requirements.

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