Conflict Minerals: Are Companies Sourcing From Conflict-Free Refiners & Smelters?

The Good

The number of companies sourcing only from conflict-free refiners and smelters has increased, which is encouraging, although they are still a small minority. Thirteen major electronics, jewelry, and automotive companies report that 99% to 100% of their supply chains are made up of conflict-free smelters and refiners that are conformant with credible, independent audits and that require their suppliers to source from conflict-free smelters. The companies were Apple, Google, Intel, Microsoft, IBM, Macy’s, Micron Technology, Nvidia, Signet Jewelers, Skyworks, Target, Tiffany & Co., and ON Semiconductor, and they deserve praise for these efforts. That is a significant achievement, as it is up from just a small handful in previous years.

The Bad

The majority of the largest companies in each sector still do not require their suppliers to source from conflict-free refiners and smelters. Among large electronics companies, this was 82% (41 out of 50 companies); in the jewelry sector, 73% (11 of 15 companies); and in the automotive sector, 100% (24 of 24 companies).

The Ugly

Shockingly, many of these companies continue to list smelters and refiners that have failed or have not undergone credible, independent conflict minerals audits in their supply chains. Additionally, there is still a sizeable number of companies that did not disclose their refiners and smelters at all, or that reveal very little about the due diligence they undertook to eliminate conflict minerals from their supply chains, which goes against the spirit of the Dodd-Frank legislation.

Additional Reflections

Mandatory reporting requirements matter — a lot. Companies that filed Dodd-Frank SEC reports disclosed a healthy amount of information that can be helpful to consumers: what steps they are taking on conflict minerals, what is or isn’t in their supply chains, and what areas they can improve. Companies that did not file SEC reports, by contrast, disclosed almost nothing on their websites or in annual sustainability reports. Reading those voluntary disclosures, which often included a vague sentence or two on conflict minerals, was a stark reminder of the critical importance of mandatory disclosures on environmental, social, and governance (ESG) issues.

What should consumers look for from companies in the new 2021 SEC filings?

As the new SEC filings start to come in next week, consumers can compare and contrast company efforts on conflict minerals with a couple of quick searches.

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The Sentry

The Sentry is an investigative and policy team that follows the dirty money connected to African war criminals and transnational war profiteers. TheSentry.org