Several Industries lack Due Diligence for Conflict Minerals

A recent report by the Responsible Sourcing Network (RSN) has raised eyebrows, as compliance parameters for risk management seems to have become an after over in several industry sectors.

The report analyzed 206 companies, and their level of due diligence, in regards to conflict minerals sourcing, production and overall use in their supply chains. Products containing 3TG (tin, tantalum, tungsten and gold) were some of the main products in focus. As for these products, the measurement of companies identifying these materials in their supply chain production dropped by over a third from 2016 to 2017. This means that about 33% of the assessed-supply chains have turned a blind eye, or reduced the engagement of sustainable quality management and development amongst suppliers.

RSN’s analysis was carried out by assessing 24 KPI’s within various areas of risk management capacities that can impact both environmental, but also social aspects.

“The Technology sector dominated the ranking, outperforming all other industry groups analyzed. On the other end of the spectrum, Oil & Gas, Steel, Business Services and Building Materials received the lowest scores, reflecting a compliance-only focus, instead of the proactive, due-diligence-based strategies implemented by the top five leading companies: Intel, Microsoft, Qualcomm, Apple and Royal Philips” (sustainablebrands.com 2017).

Lack of compliance, in regards to the recently passed legislation requirements laid out in the Dodd-Frank Act, is disappointing to say the least. RSN leaders shares that disappointment. 

“We’re disappointed to see so many companies simply ticking a compliance box, rather than engaging in genuine risk reduction,” said Patricia Jurewicz, Director of RSN (sustainablebrands.com 2017).

This furthers the notion- seen today in multiple sectors of business- where companies are easily building a sustainable image, but lacking the engagement needed to actualize sustainable change. Stakeholders should be weary after reading the results of RSN’s industry analysis. The same demands stakeholders and customers thought were being answered, might just be a charade in some cases.

RSN leaders have suggested that companies within verticals that are lacking proper compliance should take notes from the Technology industry; where supplier due diligence and the sourcing/documentation of materials has been proactive.

One could assume that tech companies are utilizing technological advancements to ease their supply chain management pain points. Thus, they're creating better transparency, and performing on par with international standards in regards to sensitive materials.

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