How Consumers Will Look Upon Your Company If You File Undeterminable
With the deadline for conflict minerals reporting fast approaching, many organizations are preparing to file as undeterminable. How will this exploitation of a loophole be seen by rival companies and most importantly the general public?
The immediate goal of section 1502 of the Dodd-Frank Wall Street Reform is for U.S. publicly traded companies to demonstrate that they are making an effort to source a conflict-free supply chain, with policies that will be communicated with and enforced among suppliers. But, with the options for companies to file as undeterminable for the next two years, a loophole has developed that takes away from the creation of a plan to achieve a conflict-free status.
During the transitional period, if filing undeterminable, all that the conflict minerals report must include is the country of origin, facilities used in the process, efforts to determine the mine and efforts to improve due diligence, meaning that the auditing stage is not required. When the report is audited, after the transition period, by filing undeterminable an issuer is saying that it has not been found to be Democratic Republic of Congo (DRC) conflict free. The difference in the language could effect how rival companies and consumers view the company.
Companies that are being proactive in their conflict minerals compliance efforts might report that there is tin, tantalum, tungsten or gold (3TG) from the DRC in their supply chain, which may look bad now. But, they will have a leg up on companies that are reporting as undeterminable, as they have already started the process. In two years, when they can no longer file as undeterminable they will be back where other companies are now and trying to play catch up.
To protect themselves from filing undeterminable, many companies are turning to Source Intelligence. They are only one with the total solution to conflict minerals compliance. Their analytics platform along with their Supplier Engagement Team, engages suppliers, collects, verifies and assesses conflict minerals related data and generates the required forms and reports needed to comply with the SEC's final rule.
To see a personalized demonstration of what Source Intelligence's platform can do for your company, click HERE
