As discussed in our recent blog, the U.S. Securities and Exchange Commission (SEC) recently passed a decision to mandate the public disclosure of conflict minerals usage. This blog offers readers some insight regarding the issues and definitions involving conflict minerals.
WHAT is meant by “conflict mineral”? The most commonly known conflict mineral is the diamond. The “conflict” issues associated with diamonds was largely brought to light by the eyebrow raising film, Blood Diamond. Additional conflict minerals of concern are tin, tantalum, tungsten, and gold. There is a common theme among this particular group of minerals – they are largely found in the circuits, wires, and components of electronics like cell phones, cameras, computers, video games, and lighting.
With the rising conflict in the Congo in 2009, those in support of U.S. action recommended a bill requiring companies to disclose the sourcing of conflict minerals. In July of 2010, President Obama passed the Dodd-Frank Act, primarily as a means to address financial concerns in the country, but tacked on the conflict minerals bill as a miscellaneous provision. After two long years of drafts, advocacy, and debate, the SEC mandated last week that companies must disclose if they use conflict minerals and are required to track their sourcing.
WHO: Conflict minerals disclosure affects both companies and consumers. Any company that uses conflict minerals “necessary to the functionality or production of a product” will be required to disclose sourcing information about the minerals in use. On the opposite side of the spectrum, consumers can practice responsible purchasing decisions by being educated about the products they use.
WHERE: A majority of the conflict minerals in question are located in the Democratic Republic of the Congo and bordering countries.
WHEN: Companies manufacturing products containing conflict minerals will have until May 31, 2014 to submit disclosures for 2013. That means on or before January 1, 2013, companies using conflict minerals will need to evaluate their supply chain for the presence of conflict minerals and begin tracking quantities of conflict minerals purchased.
WHY: Conflict minerals are found in mines that are controlled by armed groups. Once mined, the minerals are sold on the black market to purchase weapons and supplies. Therefore, purchasing a product containing these minerals funds violence and promotes human rights violations. This issue is important because companies that practice sustainability must demonstrate social responsibility and transparency by avoiding conflict minerals and disclosing sourcing information.
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Additional information: http://www.enoughproject.org