Single Largest Initiative on Conflict Minerals Compliance Introduced

Seven of the world’s largest industry associations are collaborating with Source Intelligence and Schulte Roth & Zabel LLP, a law firm specializing in conflict mineral compliance, to launch the first cross-industry training and resource center, addressing the Securities and Exchange Commission’s (SEC) Conflict Minerals compliance regulation.

As noted in SCMR late last year, identifying the chain custody of conflict minerals has been problematic for managers of multinational corporations.

Source Intelligence has developed the Conflict Minerals Resource Center (CMRC) to support over 15,000 member companies who collectively generate over $3 trillion in GDP and hundreds of thousands of U.S. jobs.
 
Key representatives from the American Apparel & Footwear Association (AAFA), the Fashion Jewelry and Accessories Trade Association (FJATA), the National Association of Manufacturers (NAM), the National Electrical Manufacturers Association (NEMA), the National Retail Federation (NRF), the Toy Industry Association (TIA) and the United States Fashion Industry Association (USFIA) worked with Source Intelligence and Schulte Roth & Zabel to align training and resource center priorities to provide member companies with the information they need to comply with the SEC regulation.

According to spokesmen, the goal of the joint initiative is to deploy Conflict Minerals compliance tools across the seven industry associations.

The guiding premise of this initiative is that by providing the member companies and their vendors and contractors with the information and resources needed to meet the compliance requirements, all players along the supply chain can spend less time navigating policy, and more time producing the products and services that generate economic growth and jobs.

Ideally, these tools will help companies understand the complicated requirements of the regulation, recognizing that it is the responsibility of individual companies to identify their specific compliance obligations and handle the real challenges that remain as they design their own programs.

On August 22, 2012, the SEC adopted a final rule to implement Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). The rule requires publicly-held companies to disclose whether their products contain conflict minerals as defined by the law: tin, tantalum, tungsten or gold (3TG) originating from the Democratic Republic of the Congo (DRC) and specific adjoining countries.

The first report, covering calendar year 2013, is due to the SEC by May 31, 2014. The SEC and Government Accountability Office estimate that approximately 6,000 issuers and 280,000 non-issuer companies will be directly or indirectly impacted by the rule.

Jess Kraus, CEO and co-founder of Source Intelligence, says Source Intelligence and Schulte Roth & Zabel are leverating “best practices and resource libraries to provide a comprehensive training and resource center to inform and educate companies in these vital industries.”

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