5 Ways to Make Conflict Mineral Reporting Easier

In 2013, the Dodd Frank Wall Street Reform and Consumer Protection Act came into effect, with Section 1502 requiring all publicly traded companies to report their conflict mineral status on their annual reports and to disclose their due diligence via a Conflict Mineral Report (https://www.sec.gov/spotlight/dodd-frank/speccorpdisclosure.shtml). Over the course of the conflict mineral program many companies have strived to make this as efficient as possible by providing dedicated Conflict Mineral reporting services. While using an experienced 3rd party to assist with your determination can save you time and effort, to truly take advantage of the experience they bring to the table you should follow the following 5 suggestions on making your conflict mineral program as efficient as possible, regardless whether the determination is done in house or outsourced.

Know Your Supply Chain: Being able to respond quickly and answer questions your conflict mineral team may have can save you from having to contact as many suppliers and reduce the hours your team spends sifting through responses or EICC forms. There is no de minimis provided for by the rule, which means you have to contact every supplier that potentially provides conflict minerals. However, knowing who supplies what and being able to track the responses will be invaluable as you complete your determination.

Document Everything: The intention of the rule is to provide accurate and relevant information regarding where and how products are being sourced, and to be able to show due diligence and how determinations were made. Documentation can make the difference between a successful program and being found non-compliant. Additionally, having good documentation procedures and records will help provide due diligence and allow an independent auditor to spend less time confirming your program is appropriate.

Get Corporate Buy In: Having subsidiaries, branches, subordinates, or management who do not understand the program or who don’t support the process can add billable hours to a conflict mineral program. Getting everyone involved, from the CEO down to the buyers, will allow your conflict mineral team to focus on getting responses and completing the report, as opposed to tracking down contacts and clearing up which suppliers are relevant. Often, this can easily be done with a simple memo or email outlining the basic requirements and the potential ramifications if this is not completed.

Start Early: Contacting hundreds of suppliers across the globe and waiting for their responses - not counting follow ups for revisions to EICC forms - can be a daunting process spanning several months. If you start early you can avoid the time crunch in March trying to get all the responses in and your CMR prepared in time for April.

Leverage Your Resources: Your sourcing department is in constant communication with suppliers. Leverage that connection and familiarity (especially when a supplier/contact is being unresponsive) as it can prevent headaches and save time. Many smaller companies are privately held, and as such are not subject to the rule, however, by explaining how it affects you as their customer and all parties from a corporate social responsibility stand point you can often get a response, doubly quick if it comes from a buyer.

Using these techniques and the experienced suggestions of a 3rd party provider will lead to a smooth and seamless conflict mineral program and keep you and your company compliant with the law for years to come. For more information on how Allyn can help you with your conflict mineral reporting please contact us at sales@allynintl.com