Conflict Minerals and Your Manufacturing Business
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Posted by Michael S. on January 18, 2017 in Manufacturer Focus

Have you ever been contacted to report on conflict minerals you may be using in your business? It is very possible you have never heard about conflict minerals, or you didn’t realize they could be an issue in your business. But there are laws in place around these minerals and their uses in commerce.

 

In short, the term conflict minerals refers to tin, tantalum, tungsten, and gold that originated in the Democratic Republic of the Congo (DRC) or any of the nine countries that surround the DRC. See map. These minerals, which are also referred to as 3TG, are used in a variety of plating applications and electronics in the medical field and other industries.

 

They are considered conflict minerals because, during years of war and internal civil conflict in the DRC, warlords and other non-official governmental entities have enslaved people to mine and ship these minerals internationally to ensure currency is generated so they can maintain power. In an effort to reduce inhumane mining practices, the U.S. adopted a supply chain reporting requirement in 2010 with the Dodd-Frank Wall Street Reform and Consumer Protection Act.

 

During the implementation of the Dodd-Frank Act, the U.S. Securities and Exchange Commission (SEC) added an annual supply chain reporting requirement for all publicly traded companies. Basically, any publicly traded company is required to report its supply chain for material procurement to ensure only non-conflict minerals are used in the U.S. The goal is to prevent conflict minerals from entering the U.S., thus reducing cash flow back to warlords and bringing an end to the enslavement of people.

 

If you are a publicly traded company or a supplier to a publicly traded company, you are required by the SEC to follow Dodd-Frank sections 1502, 1503, and 1504 to ensure your supply chain is free of conflict minerals. To fulfill the SEC reporting requirement, complete the Conflict Minerals Reporting Template (CMRT) annually.

 

This form is relatively self-explanatory and will walk you through the process of reporting your raw material information for 3TG minerals you are using in your business.

 

If you receive tantalum, tin, tungsten, or gold from a conflict-free smelter program (CFSP) compliant smelter or refiners, you still have to document the origin of your raw material. However, documentation is easier as the origin is certified. There are currently about 400 CFSP smelters worldwide. It is easy to find a conflict-free smelter on this site.

 

The Dodd-Frank Act allows the U.S. Secretary of State to add additional minerals and raw materials to the conflict list. Currently, wood, diamonds, palm oil, and cobalt are under consideration to be added to the list.

 

If a customer requests you to report on your supply chain, it is your responsibility to exercise due diligence and complete all Dodd-Frank requirements. You should respond to your customer in a timely manner.

 

If you are required by the SEC to report annually, it is your responsibility to contact your suppliers to obtain the total supply chain information and file by the May deadline each year.

 

For additional info, go to:

https://www.sec.gov/rules/final/2016/34-78167.pdf

http://dodd-frank.com/update-on-oecd-conflict-minerals-project/

Michael S. is our Manufacturing guru
I have over 30 years experience in a broad range of manufacturing areas. Starting with an apprenticeship in Germany I’ve worked my way through a verity of positions within the manufacturing field. I got my start as a Tool and Die maker. I next became a supervisor of a class A tool room, then manager of a machining department. I was exposed to lean manufacturing in the mid 90s and adapted the lean philosophy. Loving and teaching the lean approach, I moved on to become a Continuous Improvement manager which led to a job as a manufacturing manager. I joined Acuity in 2015 as their manufacturing expert. I hope to evolve how manufacturers deal with, and think about insurance companies, as well as be a resource to my fellow employees – enabling them to better understand the unique needs of manufacturers.


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