The goal of the conflict minerals law is simple: to inform people that certain products may be helping to finance a war…In the face of horrible conflict in that region, the law gives manufacturers an incentive to reduce their reliance on conflict minerals — and simultaneously enables investors and consumers to bring pressure to bear on manufacturers.
In a recent Bloomberg article, Cass R. Sunstein (former administrator of the White House Office of Information and Regulatory Affairs) defends the importance of strong corporate regulations as they relate to public disclosures. Specifically, he argues that the descriptor requirement of Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the ensuing Conflict Minerals Law promulgated by the Securities and Exchange Commission is an essential component of consumer protection.
Sunstein also highlights the far-reaching implications of the recent ruling from the U.S. Court of Appeals for the D.C. Circuit, which removed companies' obligation to describe whether or not their products have been found to be "DRC Conflict Free." He asserts that this ruling should not stand, as it may have ripple effects on other important disclosures, such as fuel economy labels.
Read the full article here.