to show suppliers and customers they understand the value of human rights ... Work with non-compliant suppliers to corre
Disrupting conflict is good business An analysis
Business leaders have taken unprecedented, collaborative steps to show suppliers and customers they understand the value of human rights — and increasingly, company reporting reflects this value.
of the impact of the Conflict Minerals Rule from
INNOVATIVE PRACTICE. Better due diligence starts with a compelling business case for change.
HOW A COMPANY GOES CONFLICT-FREE
DEMOCRATIC REPUBLIC OF THE CONGO (DRC)
Understand the cost.
Mines
Everyone, including a miner in DRC, deserves the chance to do good business in global value chains for:
Tin Tantalum Tungsten Gold
Kinshasa Capacitors
Conflict in Q1 of 2016*
Click for more details.
Turbines
Cans
Drills
Lightbulbs
36 thousand people fled their homes in DRC in 2016. $400 million lost to gold smuggling in DRC in 2013. 12% of the world’s tantalum came from DRC in 2012. $6.57 trillion invested globally under sustainable,
*January, February, March
Levy illegal taxes Buy minerals
Armed groups:
Earrings
Sometimes do not interfere
responsible, and impact investment principles in 2013.
Dig for minerals themselves Require forced labour
Put human rights on the balance sheet.
As global regulations on due diligence increase, the balance sheets of major brands will increasingly reflect the risk of human rights abuse. Click each box to learn more about new regulations.
Many leading brands have played an active role in creating:
Since 2013, the U.S. has required publicly traded companies to track conflict minerals and report findings to the Securities and Exchange Commission (SEC).
Conflict minerals mandatory disclosure passed by EU Parliament.
UK Modern Slavery Act
Global frameworks.
The OECD Due Diligence Guidance provides detailed recommendations to help companies respect human rights and avoid contributing to conflict through their mineral purchasing decisions. As a forum for governments to work together to promote standards that will improve the economic and social well-being of people around the world, the OECD included private sector input in their standards, which have become the norm for responsible sourcing due diligence.
New voluntary guidelines created by China's Chamber of Commerce for Metals, Minerals, and Chemicals Importers & Exporters, in coordination with the OECD.
The International Conference of the Great Lakes Region has created a regional certification for minerals.
Click to learn about Other Important global frameworks:
Honor people’s trust in your brand. In a recent study, Intel found that 8 out of 10 millenials believe consumers have a responsibility to make sure products they buy don’t use resources that harm society or the environment. Disclosures to the SEC have given consumers a wealth of information, increasing both transparency and accountability for brands.
Watch a webinar on how conflict-free leaders are overcoming obstacles.
Human rights abuse is material risk to:
Adopt a strong conflict minerals policy. Conduct onging due diligence Clear expectations for suppliers
Suppliers & Buyers You may do business with companies subject to conflict minerals reporting requirements, even if your business is not.
Commit to conflict free Support in-region trade
Compare policies from tablet and auto manufacturers.
Of 155 major companies: had strong policies.
15%
Consumers An increasing share of consumers globally express willingness to pay more for products from companies committed to social impact. Failure to address human rights could hurt the bottom line.
60%
joined industry or multi-stakeholder groups.
Performance by industry group:
Investors
A sustainable source of raw minerals has implications for almost every business. Your brand and legal compliance directly impact the bottom line. Above all, an increasing number of investors, pension funds, and endowments are considering human rights in investment decisions.
1. INFORMATION TECHNOLOGY 2. INDUSTRIALS 3. HEALTHCARE
The electronics industry lead the charge to address conflict minerals, with many others such as the Automotive and Energy services convening groups to face industryspecific challenges.
4. CONSUMER DISCRETIONARY 5. OTHER
Make updates easy to find.
Link to reports, supplier expectations, and other conflict minerals information in a single webpage, so stakeholders know what your company is doing to proactively address human rights risks and opportunities.
6. ENERGY 7. MATERIALS
View a summary of results in Mining the Disclosures 2015. Analysis of 2016 filings will be available in September 2016.
Reduce barriers to communication in the chain. Brands are a pressure point for investor and consumer expectations, and collectively exert significant leverage on suppliers. Disclosures to the SEC by major brands have shed light on new ways to source responsibly on a global scale.
Support smelter audits and initial audits.
Use understandable language
Successful auditing projects have been funded by and propelled by the private sector and have grown to include members from companies outside their original sectors. Learn more:
to receive accurate survey responses. Develop and imporve industry-standard surveys. Click to learn about plain language.
Build trust with suppliers.
Educate customers on the importance of conflict-free.
Individually or as part of a group, visit suppliers or host educational events. Work with non-compliant suppliers to correct any issues, but also define consequences clearly.
Conflict-free mines Invest in change. Leading companies are investing directly in the region, in research, capacity building, and in-region sourcing, through groups like the Public Private Alliance for Responsible Minerals Trade. Many challenges remain, including:
continue to increase in number. Learn more.
Why buy responsible, artisanally-mined gold? > Secure diverse and new sources of supply. > Respond to increasing consumer interest in materials and products that benefit producer communities. > Drive positive change in global supply chains. > Foster sustainable economic development in mining communities. > Reduce the share of gold funding conflict or terrorism.
—OECD, FAQ on Sourcing Gold from Artisanal and Small-Scale Miners
Stop smuggling Improve regional governanace Invest directly in infrastructure Fund research Hold regional actors accountable Protect activists
Do not unfairly embargo conflict-free sources. Some companies have chosen to place a complete embargo even on conflict-free minerals from the DRC region:
Enforce sanctions Prosecute serious crimes
ExxonMobil
Parker Hannafin
Improve Security
Nautilus
Precision Castparts
Learn more: Point of Origin by the Enough Project.
Ralph Lauren
Promote good business for everyone. Recent reports cast light on human rights risk in the DRC: child labor in the mining of cobalt; charcoal in the funding of armed groups; others show opportunities for downstream companies to support progress. As new challenges arise, leading brands look ahead.
Around the world, mineral extraction is linked to:
Human trafficking Child labor Labor rights violations Violence
Click below to find out which 8 of 17 Global Goals overlap with conflict minerals challenges
While the U.N. Guiding Principles on Business and Human Rights recognize that the role to protect human rights rests with States, major brands embrace the document’s call for companies to respect human rights. Such companies act with foresight today to benefit employees, shareholders, customers, and people in the supply chain in the years to come — with a disruptive understanding of
the value of human rights. REFERENCES (SEE LINKED CONTENT ABOVE FOR MORE) http://www.ussif.org/sribasics http://www.nielsen.com/us/en/press-room/2014/global-consumers-are-willing-to-put-their-money-where-their-heart-is.html http://www.enoughproject.org/reports/dodd-frank-1502-impact-update http://www.oecd.org/corporate/mne/mining.htm http://download.intel.com/newsroom/kits/ces/2016/pdfs/Intel_Conflict_Free_Research.pdf http://www.oecd.org/daf/inv/investment-policy/FAQ_Sourcing-Gold-from-ASM-Miners.pdf http://www.enoughproject.org/blogs/number-conflict-free-mines-congo-increases-31-204-mines-certified
