Conducting conflict minerals inquiries takes a lot of effort and money. Is it recommended that my company simply tell suppliers not to purchase raw materials from conflict-affected and high-risk areas in the first place?
No. Terminating legitimate business activities in the covered countries or other conflict-affected and high-risk areas may create potential risks to downstream companies due to increased smuggling activities. Furthermore, such policy decisions are not in line with the OECD Due Diligence Guidance and, CFSI’s mission and may contribute to consequences for local populations in the form of negative economic impacts, loss of livelihoods, etc.
Section 1502 of the U.S. Dodd-Frank Act and the SEC final rule are intended to mandate disclosure of information, not to forbid use of minerals from certain regions. Furthermore, non-governmental organizations working on conflict minerals issues call on the industry to not disengage their businesses from conflict-affected and high-risk areas. The CFSP and the CMRT have been developed to support the responsible sourcing of 3TG from conflict-affected and high-risk areas, one of the pillars of the Conflict-Free Sourcing Initiative.