Here are 3 more reasons you should not not ignore conflict minerals legislation (catch up on the first two in the first part of this article):
3. Corporate Social Responsibility (CSR) – As a corporation, there are times to think beyond profit. Unless there is a designated social responsibility chapter in your organization, there will be little room for improvement in the long run. When it comes to DRC and the conflict minerals legislation, non-compliance would mean that a corporation is simply shirking their social responsibility. The ripple effects of the violence in the region would eventually be felt even in the developed nations. It is the indiscriminate looting of the rich natural resources, questionable smuggling rings, continued atrocities on local populace and the relentless violent atmosphere that simply makes this a significant social issue.
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The term ‘Conflict Minerals’ is in the middle of controversies and continued furor everywhere, from the Senate to the boardrooms of manufacturers and other companies. The new Conflict Minerals Law has been issued by the U.S. Securities and Exchange Commission (SEC) following the ‘Dodd-Frank Wall Street Reform and Consumer Protection Act’.
The legislation has mandated that all companies conduct a thorough due diligence of their mineral sources and prevent further sourcing from the violence-ridden areas of the Democratic Republic of Congo (DRC). The law that passed in 2010 has led a global furor since compliance will require widespread changes in nearly all supply chain networks.
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Compliance also means there will be definitive efforts to contain the violence in the Congo basin.
Despite the good intentions of the act, it has been met with a great deal of resistance. One such group of detractors claims that simply stopping the sourcing of minerals from this region won’t help. The second, and perhaps more vehement group, is composed of businesses who have an already established supply chain network that positively feeds their bottom line. The various levels of suppliers in these channels will be affected more adversely, since their business is based off of the minerals sourced from the DRC. Companies could go on for days as to why they want to resist this change, but not complying is not an option.
A brief look at the five reasons why you should NOT ignore the conflict minerals legislation: