KINSHASA, Democratic Republic of Congo – From the packaging that surrounds countless Christmas presents this, and every year, to the vehicles that transport us from one festivity to the next during each holiday season and beyond, consumer goods often contain what are known as conflict minerals.
Conflict minerals originate in the mines of the Democratic Republic of Congo (DRC,) they are also known as “3TG” materials and include tin, tantalum, tungsten and gold.
The term ‘conflict’ attaches itself to these minerals due to the human rights violations that accompany the process of extracting them from the ground and turning them into products such as cell phone parts.
To reap the rewards of a natural resource-rich landscape, armed groups have afflicted brutal atrocities on local residents of mining areas over the past century, according to The Enough Project’s campaign, Raise Hope for Congo. A campaign that is committed to ending the long-standing conflict in eastern Congo through grassroots activism.
The anti-slavery group Walk Free is yet another foundation involved with the issue. Walk Free is fighting for transparency in manufacturing supply chains to eradicate the presence of conflict minerals in consumer goods.
One of the most notable discoveries made by the foundation occurred in August. The revelation that the multinational consumer electronics company, Nintendo, was found to have conflict minerals in its supply chain, led to an online campaign, which grew in notoriety as the company refused to address the issue.
For the first time these NGOs are not alone. In 2010 the Obama administration signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act. It has taken three years to adjust the language and clarify the law, which includes obligatory compliance for publically traded companies to disclose of conflict minerals in their supply chains, starting in May.
Although there will be no penalty associated with the disclosure, with admission comes notoriety. Success of the law hinges on the assumption that the public release of companies found to have conflict minerals in their supply chains, will result in public awareness and boycott of those who do not act upon the discovery.
Companies will be required to report to the United States Securities & Exchange Commission (SEC,) which will entail an approximate $4 billion dollar initial investment in the first year and as much as $600 million the following year.
These cost estimates (reported by the SEC) may explain the reluctance found by a Pricewaterhouse Coopers LLP survey conducted in early 2013, suggesting that one third of executives were yet to implement a system in which their suppliers and contract manufacturers could comply with reporting requirements.
An additional objective of the law is continued trade and inclusion of DRC products in the global market; not to disregard the region but to improve the conditions that surround its exports.
Despite the lengthy implementation process, predictable compliance delays, and possible impact issues with consumer responsibility as a key factor, experts see the value in this law.
The chief executive officer of risk-management specialist, Hiperos, Greg Dickinson, suggests companies should break up the process (of checking their supply chains) into “chunks” and improve compliance over time.
Most importantly Dickenson says, the SEC wants to see a “reasonable effort.”
– Zoë Dean