Conflict Minerals - Just another compliance issue?
One of the hottest new topics in the regulatory landscape is the issue of Conflict Minerals. This is especially true in the US, but it also has a global impact throughout the supply chains of major corporations. The Conflict Minerals Statutory Provision, part of the comprehensive Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, is a more narrowly focused piece of legislation (Section 1502). This legislation will have deep and continuous implications for publically-traded companies headquartered or operating in the US. At its most fundamental the legislation means that companies need to be able to report that none of the products they sell include "conflict minerals," ultimately specific minerals (often referred to as 3TGÂ´s) from the Democratic Republic of Congo and the neighboring regions.
Companies are working rapidly to develop processes to comply with the Conflict Minerals regulation. In addition, they are seeking tools to collect that information throughout their supply chain. The first reporting to the SEC must be done by May of 2014.
In a stable regulatory environment, a solution specifically to comply with the Conflict Minerals requirements would be ideal. However, there is no such thing as a stable environment. Regulations change continuously, and the risks in the supply chain are likely to increase rather than decrease. We are already seeing new similar regulations developing (like the California Transparency in the Supply Chain Act and The Business Transparency on Trafficking and Slavery Act) so my question is, are companies going to buy a new point solution for every new regulatory requirement?
I think the question is, How to integrate conflict minerals (and other upcoming new regulatory requirements) into the overall compliance and risk management framework of the company. So, find a long term cost effective solution to be compliant. It would also be very useful to analyze the possible risks of non-compliance as well as the business impacts of this new conflict minerals regulatory requirement.
For example, when an electronics manufacturer uses these 3TG minerals in its products and finds out its major supplier is unable to explicitly prove that the minerals they use are conflict free, what happens to the availability of these minerals, or their price? What if the company is not able to find a good alternate vendor who is conflict free? All these questions can be answered when using a tool that is fully integrated and where all the information is available in one single database which is available for different departments within the organization.
BWise offers a software solution to comply with the Conflict Minerals regulation that is part of our existing proven technology and can be integrated with your compliance framework. For more information about Conflict Minerals visit our website or contact us.
"Doing just what is necessary to meet regulatory demands and deadlines isn't enough. Valtonen puts the focus on risk management. "It's a pretty simple task to send your suppliers a questionnaire," he adds. "But consequences can go unseen if you are only looking at a point of supply or treating this as a pure supply chain tool. Think about solutions that can integrate into other parts of your business. Start small, but think big." Read the article.