The following is a preview from Thomas Kase's upcoming presentation at Conflict Minerals EDGE, on May 6 at Hotel Sax Chicago. It's not too late to register - we hope to see you there!
Within the Dodd-Frank Wall Street Reform and Consumer Protection Act’s Title 15 is a “Specialized Corporate Disclosure” provision that you should have seen already:
“Section 1502 requires persons to disclose annually whether any conflict minerals that are necessary to the functionality or production of a product of the person, as defined in the provision, originated in the Democratic Republic of the Congo or an adjoining country and, if so, to provide a report describing, among other matters, the measures taken to exercise due diligence on the source and chain of custody of those minerals, which must include an independent private sector audit of the report that is certified by the person filing the report. Certain aspects of this rulemaking will require consultation with other federal agencies, including the State Department, the Government Accountability Office, and the Commerce Department. Persons are not required to comply with these rules until their first full fiscal year after the date on which the Commission issues its final rules.”
The 140 words above have led companies to make investments in consulting services, technologies, data enrichment, audits, and other efforts to ensure compliance. We have written about many of these activities and the surrounding best practices extensively on both the Spend Matters site, and our sister site MetalMiner. Here are the links:
- Spend Matters Conflict Minerals articles
- MetalMiner Conflict Minerals Articles
- Substantial research paper available here free of charge
In fact, this is such a high-demand topic that we have invested in a one-day conference focused exclusively on this area – Conflict Minerals EDGE – which you can read more about here. It is coming up soon – May 6, in Chicago, don’t miss it!
Inevitably, the journey toward Conflict Mineral compliance is paved with technology. If not before, your Supplier Lifecycle Management solutions will be put to the test, as will the quality of your vendor data – do you have accurate records covering whom to contact (not only name and location, but also personal email and direct phone number information) for every supplier you have used over the past 18 months?
Where do you even begin? Some of the main bullets to cover (and they will all be addressed during Conflict Minerals EDGE) include:
- Specific tools, such as project plans
- Pragmatic checklists including functioning spreadsheets beyond (EICC-GeSI) tools
- Technology decision guide
- Blueprint for the integration of conflict minerals compliance solutions with broader supplier management, procurement and supply chain technologies
Technology being my favorite area, I have broken this set into a string of action items of my own:
- 3rd Party Enrichment – parent-child linkages, insights & validations
- Contracts – what you have committed to on the sell-side
- Customers – what you are about to commit to on the sell-side
- Inform, Train, Document – across all areas, internal and external
- Products – and components, sub-components and ingredients to gradually audit your way to the source (certify your entire supply chain, not just your suppliers)
- Sourcing – early and full visibility to the sourcing process and team to enable early upstream correction
- Suppliers (i.e, your vendors) – their locations, parents, and subsidiaries, which individuals to engage with at each level, etc
This last list of bullets will be covered in far greater depth at Conflict Minerals EDGE as well. We will talk about how the various players – from ERPs, to point solutions, and modules from suite providers can get the job done. We’ll also address what you should consider doing at the same time as you roll out a Conflict Minerals compliance initiative.
Here’s some food for thought – vendor management tools have utility not only for data capture, but also to share information, and the better solutions can document who read which memo, and who accepted which revisions of terms and provided which affidavit and on what date/time – this is critical and typically requires a proper implementation done by someone who understands the space!