Conflict Minerals EDGE: Live Blog!

4:25 p.m.: From the perspective of Western tantalum and tungsten producers, voiced by members of our final panel of the day, US manufacturers would be better served if we’d wean ourselves off of foreign mined, smelted and exported material.

3:10 p.m.: Michael Littenberg of Schulte, Roth & Zabel: If you look at SEC guidance [whenever it comes out…the word is “soon”], it’s fairly limited. The guidance won’t be that granular, and a lot of it will contain softball questions that folks already know how to answer. Begs the question: how does a regulatory agency such as the SEC not have these systems in place before they go through with legislation?

2:27 p.m.: Michael Loch of Motorola Solutions: Just because gold is smuggled doesn’t mean it’s ‘conflict gold’ – smugglers are avoiding high taxes, etc.

2:25 p.m.: Here we go! Panel 2: “Ask the Expert/The Special Case of Gold”

2:07 p.m.: The Tinplate Question. Do I have to change anything if I’m buying from integrated tinplate-producing mills?

1:56 p.m.: Question to panel – How are distributors dealing with Chinese-produced material coming in? Lawrence: Distributors are in a tough spot with requests for info on materials they don’t produce or aren’t familiar with…as a distributor, reach out to your customers and find common ground. As far as China goes, it’s the white elephant in the room, and we don’t know what the answer is yet – however, the quality of information coming out will improve over the years.

1:39 p.m.: Nucor has led the charge on conflict-free issues, and have won a scrap exemption – “we can say with certainty that we are conflict-free,” according to Jennifer Diggins.

1:38 p.m.: MetalMiner’s Lisa Reisman moderating the Upstream Metal Industry Roundtables, with representatives of Nucor, Kloeckner Metals, Stainless Steel Corporation and others.

The Tweet-Stream from “Conflict Minerals Technologies Within Supply Management” (panel discussion with Jason Busch, Pierre Mitchell, and Thomas Kase of Spend Matters):


Still Live Tweeting! – @Metalminer and @Spendmatters #ConflictMineralsEDGE

Key takeaways in conflict minerals compliance for manufacturers, from our morning sessions, courtesy of Spend Matters Executive Editor Jason Busch:

11:02 a.m.: Compliance audits will undoubtedly form a critical component of overall compliance strategies for companies that most document traceability and compliance in their supply chain for conflict minerals compliance. But how far should compliance audits go?

Earlier, Lawrence Heim suggested that audits should consider traceability and attest down to the mine-site level. This includes chain of custody, refiners/smelters and manufacturing suppliers in the supply chain (e.g., tier 3 semi-finished material supplier; tier 2 parts suppliers; tier 1 component suppliers) as well as at the OEM manufacturing level itself.

For auditing, SEC regulations clearly impact issues hitting manufacturers and their immediate tier one suppliers. Lawrence suggests that SEC regulation is open to interpretation at the tier 2 level and below. OECD, industry initiatives, local laws, and related guidance for auditing differs for different conflict minerals (e.g., for gold versus tin, tantalum, and tungsten – the 3Ts). Lawrence notes that customers may conduct supplier audits (other than tin, tantalum, tungsten smelters and gold refiners) themselves.

In comparison, conflict minerals report (CMR) audit for SEC filers may be different…

More at Spend Matters. Also Live Tweeting – @Metalminer and @Spendmatters #ConflictMineralsEDGE

10:30 a.m.: Lawrence suggested three foundational conflict minerals compliance efforts to consider: 1) Setting corporate policy 2) Product assessments/product reviews 3) Defining supplier engagement

For overall corporate policy, Lawrence suggests remembering that compliance policy requires far more than just putting general concepts and plans on paper. Corporate policy forms the foundation of the program’s scope, execution, and ultimate audits.

Establishing corporate philosophy is a key element. For example, are you going to pursue, a completely DRC-free strategy? Or a DRC conflict free strategy? Will you offer incentives for positive supplier engagement, or will you pursue a more “stick” and less “carrot” driven approach with your supply chain? Will you go down a list of past tier one suppliers in your direct efforts to drive visibility, traceability, and compliance? These are all questions best tackled as early as possible in defining corporate policy.

More at Spend Matters. Also Live Tweeting – @Metalminer and @Spendmatters #ConflictMineralsEDGE

9:52 a.m.: Lawrence Heim came out with a strong statement that those tasked with conflict minerals compliance should consider as early as possible in developing their compliance policy: “Just say no” to complete outsourcing approaches.

Lawrence suggests that he does “not personally recommend outsourcing all elements of Conflict Minerals compliance” to a third party. He says, “We are on the line. We have to face customers. We have to address concerns of suppliers. If we’re going to think about having a third-party take responsibility, just consider the fact that it is not beneficial to pursue a black box strategy in a vacuum” where uncertainty and ambiguity is still front and center.

Having a third party “that spits out reports” creates distance between us and our supply chain in an uncertain environment. Further, the core challenge with outsourcing, Lawrence observes, is that “We need to be more actively engaged ourselves. Ultimately we are accountable and responsible for compliance and working with all internal and external parties” in managing through the complexity of conflict minerals expectations and compliance.

More at Spend Matters. Also Live Tweeting – @Metalminer and @Spendmatters #ConflictMineralsEDGE

8:59 AM: Lawrence Heim, Director of The Elm Consulting Group International, kicked off Conflict Minerals EDGE with a presentation exploring practical strategies and approaches for conflict minerals compliance.

He began by suggesting the importance of having a strategy that mirrors what your customers have to deal with (for those not at the highest levels of the supply chain already). Even if you’re not directly impacted by regulations in terms of your own SEC reporting, you will be based on the requirements for traceability in the supply chain.

So you need to think like your customers.

In other words, if you’re involved in any aspect of the manufacturing supply chain involving conflict minerals (tin, tungsten, gold, tantalum, etc.) usage in any capacity: yes, this is your problem too!

More at Spend Matters. Live tweeting – @Metalminer and @Spendmatters #ConflictMineralsEDGE

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