Today marks the deadline for publicly traded companies in the United States to disclose the potential presence of conflict minerals in their supply chains, and what they’re doing about it.
In a recent statement, Nobel Peace Prize nominee and Sakharov Prize winner Doctor Denis Mukwege said of the issue, "A conflict-free minerals industry would contribute to ending the unspeakable violence the people of Congo have endured for years. Government must not only enact strong legislation, they must be willing to enforce the law.”
This is the second year companies have had to file such reports, marking a significant milestone. And progress is already apparent. Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act passed in 2010 and was implemented by the Securities and Exchange Commission (SEC) in 2012. It creates a transparency measure, requiring companies that use tin, tungsten, tantalum, or gold in their products to determine where those minerals were sourced. If it is determined that the minerals came from the Democratic Republic of Congo (Congo) or one of the surrounding countries, the company must report on the due diligence measures they conduct to uncover whether the minerals are contributing to Congo’s ongoing conflict – the deadliest in the world since World War II.
“Companies bear the responsibility of compliance and public disclosure,” Mukwege emphasized. “Tens of thousands of legitimate miners would benefit from a clean, transparent minerals industry. Communities and families torn apart by conflict deserve a viable path to peace.”
A lawsuit spearheaded by the National Association of Manufacturers (NAM) and other industry associations argued the law was too burdensome for companies. However, NAM’s claims were largely struck down in court, and companies like Apple and Intel are proving that its argument lacks a grounding in reality. Both companies not only filed their reports early this year, which is unusual for most companies, but they also went beyond the strict reporting requirements by describing practices that raise the bar and provide leadership in the conflict-free sourcing movement. Intel has verified that all of their microprocessors are “DRC conflict free” – clarifying for consumers that these products don’t contain conflict minerals. Apple’s report details the process they undertook to notify and educate their smelters and refiners on the importance of sourcing conflict-free minerals from Congo – a process which resulted in Apple ultimately cutting four smelters and suppliers from their supply chain for not complying with Apple’s request that they participate in an audit process.
In addition to individual companies demonstrating progress, the whole landscape of conflict-free supply chains has seen sustained momentum. As Intel noted in its report, “The overall response rate [from our suppliers] was approximately 99% compared to the 83% response rate attained in 2013.” This indicates a growing awareness of the importance of addressing the conflict minerals issue, and improved models for making due diligence efficient, accessible, and thorough.
Companies are not meant to tackle this process alone. Support from US government agencies, local and international NGOs, donor governments, and Congolese communities are key to the comprehensive transformation of Congo’s minerals sector from violent and unregulated to formal, peaceful, and profitable. Targeted sanctions and prosecutions for high-level traffickers and violent actors who continue to profit from the illicit mineral trade are both critical for ensuring that Congo’s minerals contribute to economic prosperity and peace in the region. The Responsible Sourcing Network (RSN) and Global Witness in partnership with Amnesty International both recently released reports evaluating companies on their 2014 filings, and providing guidance for improving the reporting structure. As both reports note, it is critical that the company reporting mechanisms be strengthened by additional reforms and support to Congolese mining communities.
While many positive trends are emerging, implementation of Dodd-Frank 1502 is still in its nascent stages and there are many improvements still to be made. With a strong consumer movement continuing to call for conflict-free products made with minerals from Congo, and other governments beginning to adopt their own schemes similar to 1502, the willingness and sense of responsibility for continued improvement is growing, which is key to improving security and human rights in Congo. As Mukwege said in a recent New York Times op-ed, "Cleaning up the industry, on which tens of thousands of legitimate miners in Congo depend, is vital if there is any hope of restoring peace."
Photo: U.S. Securities and Exchange Commission building, D.C./Wikimedia Commons