Stakeholder Trends and Insights

Report:
Many Brands Failing to Adequately Protect Miners, Investors from Conflict Mineral Risks

Responsible Sourcing Network (RSN), a project of As You Sow, recently reported which major brands are leading in adequately protecting human rights and informing investors about their conflict minerals risk, and those who are failing to do so. Mining the Disclosures is RSN’s annual analysis of conflict minerals reporting, ranking 200+ individual companies across 25+ industries in risk mitigation, human rights impact, and reporting quality.

By Talia Rudee | Published 8 years ago | About a 3 minute read

Responsible Sourcing Network (RSN), a project of As You Sow, recently reported which major brands are leading in adequately protecting human rights and informing investors about their conflict minerals risk, and those who are failing to do so.

Mining the Disclosures is RSN’s annual analysis of conflict minerals reporting, ranking 200+ individual companies across 25+ industries in risk mitigation, human rights impact, and reporting quality.

Well-known brands play a role in an international, multi-stakeholder strategy to break the links between minerals used in manufacturing airplanes, smartphones, and countless other items, and the funding of militias in countries such as Colombia and the Democratic Republic of Congo (DRC), where rape and mass killings are fueled by the sale of these conflict minerals.

“Protecting people at the heart of the supply chain is good business,” said the lead report author, Andrew Arriaga. “With conflict minerals, we’ve seen some companies move from pleading powerlessness to integrating risk management into daily business practices, combining efforts across multiple industries, and creating replicable models that can address other issues, like forced labor.”

While many leading brands monitor and mitigate risk, other companies provide little evidence of similar efforts. Berkshire Hathaway, for example, fell into the ‘Weak’ category for faulting suppliers for weak reporting and declined to identify smelters. In contrast, Microsoft exercised leverage with its suppliers to enforce conflict-free policies and apply pressure on smelters; Apple helped improve risk monitoring between mines and smelters; Philips increased its demand for conflict-free tin sourced from within the DRC; ExxonMobil prohibited suppliers from sourcing from the DRC region, contributing to an embargo that prevents the development of a legitimate minerals trade and worsens the humanitarian crisis in the DRC; and Boeing and GE supported research on child labor in the region. Intel, one of only two companies ranked in the ‘Superior’ category (along with Qualcomm), continued its public campaign to support conflict-free mining in the DRC.

“Full disclosures are fundamental to our evaluation of corporate risk management,” said Susan Baker, VP at Trillium Asset Management. “This comparative analysis allows investors to better assess risk and the extent to which issuers are promoting ethically sourced minerals and economic development in the DRC and neighboring regions.”

In another recent report, YESS: Yarn Ethically & Sustainably Source, RSN highlighted brands such as adidas and Woolworths, which have shown commitment to upholding human rights in the textile supply chain. These reports’ insights have been adapted for use by experts across many disciplines, helping drive improvement in the ways companies improve investor communication and protect human rights across many supply chains.