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What You Need to Know About Conflict Minerals

Tin, tantalum, tungsten, and gold are produced at smelters from conflict minerals originating from mines in warring African countries. (Source: PTC)
Tin, tantalum, tungsten, and gold are produced at smelters from conflict minerals originating from mines in warring African countries. (Source: PTC)

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Unrealistic rules
TheBug   7/29/2015 8:54:09 AM
Thank you for the heads up about the requirements. Though in reality it is impossible to collect the required information.

The theory that one can ask their supply chain and get useful answers is far from the actual situation. Maybe a large corporation like Apple is able to do this, but SMEs (which are in the supply chains of large corporations too) are in no position to do this.

Supply chains in the electronics industry are long and complex. Not even the large component manufacturers are able to assess their complete supply chain. Especially if the amount of potential conflict material contained in a püroduct is small there is not much of a chance to learn about its origin.

The Conflict Minerals law is a perfect example of a well intended but totally mislead law. It tries to unload a problem on the industry instead to addressing the real root cause of the problem.

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Conflict Materials
FrankRoseEngineer   7/29/2015 11:16:21 AM
All the steps that must be taken to comply with the regulations add SIGNIFICANT cost for a company. And then the Government wonders why manufacturing isn't doing well in the US. They need to GET A CLUE!


If the Government doesn't want US manufacturers to use materials from the Congo, then why don't they simply ban importing those materials from the Congo? Why take such an inderect, ineffective approach that puts a significant burden on US manufacturers? It seems obvious that the Dodd-Frank regulations can't, and haven't worked. Then again, most of our lawmakers live in la-la land and haven't a clue how to actually solve a problem.

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Re: Conflict Materials
ck_02   7/29/2015 1:07:40 PM
@FrankRoseEngineer While I tend to agree that the gov't has the most ineffective solution track record, I don't think that placing an embargo against the Congo is the solution. I absolutely agree with your statement about gov't regulations adding significant costs. However, those conflict materials will simply then be routed through another country first if the Congo is under embargo.

This may not be a great example, but look at how money is transfered between countries by companies to avoid taxation. I don't have a perfect solution (or any at all), but I worry that embargoes may not be the best route.

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Re: Conflict Materials
DFCMAudit   7/30/2015 8:50:13 AM
The rationale behind the SEC conflict minerals rule is that companies should not profit (knowingly or otherwise) from minerals that are sourced using forced labor, and where the funds are diverted to benefit armed groups.  These groups destabilize a region, and pose threats to global security.  The rule requires companies to perform due diligence on their supply chain, and disclose.  The rationale is that, if companies discover problems in their supply chain, they will be motivated to fix them if they are required to disclose what they have done. 

It is NOT a ban on materials sourced from Congo.  There are reputable companies mining there, and their contributions to the economy are improving the economy, stabilizing the region, and improving the quality of life.  These companies should not be penalized.  In fact, some stakeholders think they deserve some special consideration for bravely going where many companies fear to tread. 

The stories I hear indicte, anecdotally, that the rule is making a difference.  The GAO does an independent audit every year to provide an objective assessment.  Their next report is due out ~3Q2015. 

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