Here are the final three of the 7 Things You Gotta Know To Comply With SEC’s Conflict Minerals Rule (if you missed #2-4, here they are):
Timing of disclosures for product components is as important in conflict minerals compliance as is timing for possession of conflict minerals.
For the former, one has to disclose the source and network information for the year when the conflict minerals have been used in manufacturing and production. At times, it can be the year when the finished product that contains that component has been completed. If one possesses the conflict minerals, but did not produce the product in a calendar year, then there is no need to audit and report that year.
Businesses – and especially manufacturers – face a major challenge today in compliance with the Conflict Minerals Law passed via Dodd-Frank in 2010 and enacted by the SEC.
As per this law, companies are now encouraged to examine their mineral sources and ensure that they do not buy these from the Democratic Republic of Congo, an area known for its rich mineral deposits and an environment of extreme crime and violence.
While companies listed with the Securities and Exchange Commission (SEC) must undergo the annual audits without fail, other companies associated with them through the supply chain network will also feel the effects of these stringent regulations and face untoward losses.
Not complying would be damaging to a company’s brand image in the long run – not to mention illegal.
While conflict minerals compliance issues and related problems are on manufacturers’ minds, experts have come up with certain methods that can help businesses prepare for the Conflict Minerals Law.
Here’s a look at Nos. 2 through 4 of the 7 Things You Gotta Know to Comply With the SEC’s Conflict Minerals Rule:
(Read our intro and The No. 1 Thing here.)
2. Exemption of Minerals
Do not blindly make changes to your logistics framework before you have all facts at hand.
You may have been sourcing the conflict minerals listed, but if your source country does not fall under the covered names then you will be exempt from the audits and regulations.