We are pleased to have as a guest contributor Jeffrey W. Rubin. Mr. Rubin a partner of Hogan Lovells US LLP practicing in New York, and is the Chair of the Federal Regulation of Securities Committee in the Business Law Section of the American Bar Association. He can be contacted directly at jeffrey.rubin@hoganlovells.com. The views he expresses below are solely his own. Certainly one of the most frequently viewed pages on the SEC’s website these past few months has been the page announcing upcoming SEC meetings to adopt rule proposals. Interest in the timing of the SEC’s adoption of its final conflict minerals rules has perhaps prompted most of those views. Although Section 1502 of the Dodd-Frank Act required the SEC to promulgate regulations by last April, that date passed with the SEC caught between the Scylla of a statutory mandate and calls by the Congressional conflict minerals sponsors and NGOs for prompt and strict adoption of the final rules, and the Charybdis of companies’ concerns regarding the extraordinary burdens the rule will impose upon them. Contrast, for example, the SEC’s estimate that the aggregate additional burden on companies as a result of the rule will be 153,864 hours of
Read more →After the devastating tsunami in Japan early in 2011, we began exploring the interrelationship of green/ethical procurement (such as conflict minerals) with business continuity/disaster recovery planning. Now, an article from leading electronics supplier Digi-Key states that lead times are delayed up to almost 6 months for a significant amount of the world’s production of tantalum capacitors as a result of the flooding in Thailand, combined with raw material supply impacts of conflict minerals laws/policies. Of course, higher prices are also expected. ”Combine those two things together and that put a big strain on the supply of raw materials in the market as well as pricing,” said Joe Porter, vice president tantalum product marketing at Kemet Corp. based in Greenville, S.C. We continue to believe that significant opportunities exist for business continuity/disaster recovery planning efforts to incorporate growing green/ethical procurement initiatives. Robust sustainability risk assessment exercises are essential in identifying relevant gaps and areas for improvement. Feel free to contact us for more information about how we can help.
Read more →If you missed this morning’s broadcast of the webinar on conflict minerals sponsored by MetalMiner and Aravo with Elm as a presenter, you can watch the replay here. Please feel free to contact us if you have questions or comments about the presentation.
Read more →We field many phone calls asking us about the US conflict mineral law and associated requirements. As a result, we developed a Frequently Asked Questions (FAQ) document that provides concise information on the most common questions we receive. We hope you find this document useful. We welcome any comments or suggestions you may have on the document or its content. Updated FAQ
Read more →The Elm Consulting Group International LLC has released a new revision to the Self Implemented Conflict Minerals Audit Preparation Tool. The update, Revision 1.33, incorporates Minor changes in response to feedback obtained from the late June EICC Extractives Supply Chain Workshop VI in Washington DC; Further clarifications on the OECD framework, its relationship to SICMAP℠ and SEC auditor standards; and Related elements of California Transparency in Supply Chains Act of 2010. Lawrence M. Heim, CPEA, is leading the firm’s conflict minerals services and SICMAP℠ development: In our discussions with various companies and workshop attendees, we obtained feedback on a few minor changes and clarifications to improve the tool. In addition, we decided to incorporate the new California law as there are many similarities between those mandates and the conflict minerals requirements. The video introduction and overview of SICMAP℠ can be viewed here.
Read more →It is not uncommon for EHS auditors to be asked (or ask themselves) “If you find a noncompliance during your audit, do you report it to the regulators?” The answer depends on the company and audit program, but a recent news item caught our attention due to a variation on the theme. We have no information other than what is publicly available here, but it appears that an organization managing a voluntary electronic waste management certification program found alleged significant non-conformities at a specific company seeking certification. As a result, the organization declined to issue its certification to that company. So far, so good, but the story doesn’t end there… In its declination letter to the company, the organization states: Further, there is substantial reason to believe that such exports may violate Public Act 095-0959 (Electronic Products Recycling and Reuse Act, recycler requirements) of the State of Illinois, the Federal CRT Rule, (40 CFR Parts 9, 260, 261, 271; Cathode Ray Tubes; Final Rule) as well as the waste importation laws of Hong Kong/China. Further, while it is not our policy to disclose the results of certifying body audits, we can state that the audit only further substantiated all of
Read more →Ed. note: We are fortunate to count Mark Schaffer as an Elm Affiliate. Mark is located in Austin, Texas and runs Schaffer Environmental, providing a range of supply chain, sustainability and product content consulting support to the computer, technology and electronics industries. Mark submitted the following piece on conflict minerals from his perspective on other product content matters. The Dodd-Frank Act requires companies regulated by the Securities and Exchange Commission (SEC) to report whether their products contain conflict minerals from the Democratic Republic of the Congo (DRC) and other nearby countries. These conflict minerals are defined as cassiterite, columbite-tantalite, gold, wolframite and their derivatives (tin, tantalum and tungsten) – though, in the future, more minerals may be added to this list. These materials are found in a variety of consumer products that we love to use everyday, from computers to cell phones, golf clubs to fishing weights. So, to the purchaser of these consumer products, what is the real impact of whether the product contains one of these minerals sourced from the Congo? Currently, the exact reporting requirements are still not established. The law requires manufacturers sourcing “conflict minerals” to include information on their sourcing in their websites. The SEC
Read more →The new issue of iPhoneLife magazine highlights Elm’s use of iPads for environmental, health and safety audits in a short feature. Unfortunately, the article indicates we use them for energy audits, which is not the case. We have contacted the editor to inform them of their error. Interestingly enough, the current issue also reviews various notetaking apps for anyone interested in reading up on the subject.
Read more →A significant report was published today by the Payson Center for International Development and Technology Transfer at Tulane University for the US Department of Labor. The report, titled Oversight of Public and Private Initiatives to Eliminate the Worst Forms of Child Labor in the Cocoa Sector in Côte d’Ivoire and Ghana, March 31, 2011, reviews the progress made under the industry’s voluntary International Cocoa Initiative (ICI) created in 2002 to identify, monitor and prevent child labor in the cocoa farms of Ghana and the Ivory Coast. The study provides the following conclusions on the effectiveness and validity of the cocoa industry’s self regulation for supply chain traceability: … we conclude that Industry’s “certification” model does not yet conform with ISO 65 standards of certification. Industry has only partly established bodies with the appropriate mandate, and has not finalized the required processes to develop a “credible” certification system. … These mixed results seen over the past decade of Industry self-regulation leave unanswered the question of “is Industry able to self-regulate in the absence of enforceable legal repercussions.” The authors looked to potential analogs or solutions, discussing the US Conflict Minerals Law enacted as part of the Dodd-Frank Wall Street Reform and
Read more →. FOR AN UPDATE ON SEC’S DELAY OF THE FINAL RULE, CLICK HERE. As veterans of regulatory research, we are accustomed to spending hours poring over a plethora of governmental regulations, background documents, guidance and other reports. Our work with conflict minerals supply chain traceability and SEC’s regulations has been no different. In addition to having completed such audits, we have read and re-read the proposed SEC regulation and its preamble; the OECD Due Diligence Guidance for Responsible Supply Chains of Materials from Conflict-Affected and High Risk Areas, and the Supplement on Tin, Tantalum and Tungsten; the ISO 19011 standard; comments submitted to the SEC on the proposed regulation (approximately 700 total comments were submitted, of which 433 were standard form letters. Of the remaining 270, approximately 75% provide substantive content); hundreds of relevant media reports, legal advisories and NGO documents; various auditor standards under SEC, including Government Accounting Office Government Accounting Standards GAO-07-731G, AICPA Statements on Standards for Attestation Engagements (SSAEs); and industry commentary and alerts on the topic. Yesterday, we completed an analysis of the 263-page report from the Boston Consulting Group (BCG) titled US Securities and Exchange Commission Organizational Study and ReformMarch 10, 2011 to see what
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