Why Smelter Verification is Crucial for any Conflict Minerals Program
This is the time of year when companies are in the last stages of their due diligence for conflict minerals compliance. Compliance professionals responsible for SEC reporting, or reporting information to their customers have been working all year, gathering data from their supply chain on the origin of the conflict minerals used in their supply chains.
Purpose of the Conflict Minerals Compliance Program
The ultimate goal of any conflict minerals compliance program is to identify the 3TG (tin, tantalum, tungsten and gold) used in your products, and trace those minerals to their smelter of origin. Once the data is gathered, smelter information is then logged (most commonly in the form of a Conflict Minerals Reporting Template) and passed on to customers who have requested conflict minerals compliance information, or structured in an official report.
Now, the above workflow may seem relatively simple, and in essence, tracing 3TG should be a straightforward process - gather information and generate a report. Unfortunately, the process has quite a few bumps in the road that can increase supplier response fatigue, delay customer communication, and ultimately create a burden at all levels of the supply chain.
Helpful Resources to help with the Conflict Minerals Reporting Process:
There are many potential solutions that aim to alleviate the pressures of conflict minerals reporting, but at this point, the reporting deadline of May31st, 2018 is too close to implement a turn-key conflict minerals compliance program. There are, however, solutions that can complement your already-in-progress due diligence programs.
As mentioned above, the ultimate goal of any conflict minerals compliance program is to trace the 3TG in your supply chain down to its smelter of origin. This involves determining who the Smelter or Refiner (SOR) is who processed the 3TG. The smelter verification process in itself can be accompanied by challenges as well. For example, inaccuracies in smelter data like smelter alias naming conventions can result in a failure to identify a high-risk smelter and ultimately lead to higher risk reporting.
Smelter Aliases Database
Over the past 5 years, our smelter verification team has been gathering and analyzing smelter data. Through technology, we’ve been able to identify key risk indicators for smelters, which have given us the ability to maintain a running list of smelters of high concern. Overall, we’ve accumulated a database of smelters and smelter aliases, that, along with our membership to the Responsible Minerals Initiative, is regarded as the most extensive database of accurate smelter information available.
Our smelter verification compliance program is one of our most utilized solutions during this time of year. Now, your company can leverage accurate up-to-date information and verify your smelter data is accurate. We are able to inexpensively and quickly identify any smelters in your database who:
- Have a history of associated risk
- Are not identified as an official smelter
- Potentially use an alias name, and ID the correct associated smelter name
- Overall risk rating of the 3TG in your supply chain based on the smelters you use
If you'd like to learn more about the smelter verification compliance program, click here to speak with an expert on how to begin the process, what type of timeline can you expect for analysis, what type of results to expect.