Conflict Minerals and Responsible Supply Chain Management
SHARE’s Engages Companies in Telecommunications, Electronics, Auto Parts and Aerospace Industries
This summer a US District Court denied an application by the US Chamber of Commerce and others to overturn the Securities and Exchange Commission’s new Rule on transparency regarding the use of “conflict minerals” from the Democratic Republic of the Congo (DRC) and neighbouring countries. The SEC’s rule requires issuers to report publicly about the presence of tantalum, tin, gold, or tungsten in their manufactured products that may have originated in the DRC. Issuers that are listed in the United States may be subject to these reporting requirements, starting in May 2014.The purpose of the Rule, enacted as part of the Dodd-Frank Act financial sector reforms in the USA, is to stem the financing of perpetual conflict and human rights abuses in the DRC through exploitation of these minerals by armed groups.
Although the decision is being appealed, the failure of the Chamber’s legal challenge cleared one more hurdle for the transparency regulations that promise to improve management of electronics, aerospace, auto parts and other supply chains that may make use of conflict minerals. It’s also part of a wider trend towards ensuring that the harvesting or extraction of raw commodities that make their way into manufactured products don’t contribute to human rights abuses.
In Canada, a Private Members’ Bill (C-486) has been introduced into Parliament to enact similar public reporting requirements for manufacturers that may have processed, purchased, traded in, used or extracted the designated minerals, or contracted to do so. And the EU is also considering a Directive for conflict minerals reporting.