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Conflict-Free Sourcing Initiative Expands Geographic Scope, Adopts Risk-Based Approach
ALEXANDRIA, Va., May 27, 2015 – The Conflict-Free Sourcing Initiative (CFSI) today announced it stands ready to help companies navigate compliance with the pending conflict minerals legislation that was recently voted on by the European Parliament. In addition, the CFSI is adopting a risk-based approach to its audit program to bolster audits of smelters and refiners of tin, tantalum, tungsten and gold worldwide.
The draft EU legislation on conflict minerals requires importers and processors of tin, tantalum, tungsten and gold to self-certify via independent, third-party due diligence audits of smelters and refiners that their products do not directly or indirectly finance conflict and serious human rights abuses. In addition, “downstream” companies that use tin, tantalum, tungsten and gold in manufacturing consumer products will have to provide information on the steps they take to identify and address risks in their supply chains with regard to conflict minerals. Companies that import and process ores can use existing industry programs such as the CFSI Conflict-Free Smelter Program (CFSP) to fulfill this requirement, and companies that manufacture consumer products can rely on these certifications from industry programs to make informed sourcing decisions.
The new EU legislation recognizes OECD Due Diligence Guidance, the only internationally recognized standard on this issue, which recommends independent third-party audits at identified points in the supply chain. The CFSP is the only existing industry program that audits tin, tantalum, tungsten and gold smelters and refiners for conflict minerals sourcing, which will enable responsible sourcing to continue under the new rules.
The CFSI is an initiative of the Responsible Business Alliance (EICC) and the Global e-Sustainability Initiative (GeSI), but represents over 200 members in numerous industry sectors including aerospace, apparel, automotive, defense, general and heavy manufacturing, medical devices, retail and others.
The European Parliament will now enter into informal talks with representatives of the European Commission and European Council to try to seek agreement on a final version of the law.
“The Conflict-Free Sourcing Initiative has been actively engaged with the European Council, member states, the OECD, business associations, NGOs and other key stakeholders regarding the EU conflict minerals legislation,” said Rob Lederer, Executive Director, Responsible Business Alliance (EICC). “We must ensure this new law has a positive impact on the lives of people in conflict-affected areas while helping the industries on which the livelihoods of those communities depend.”
The CFSI is developing a risk methodology to help member companies make conflict-affected determinations under the new law. Whereas the CFSI has traditionally focused on the Democratic Republic of the Congo and surrounding areas to meet Dodd-Frank Act requirements, it recognizes that conflict and its connection to mineral sourcing is not limited to central Africa and is therefore updating its protocols to accommodate an expanded definition of “conflict-affected and high risk.” The CFSI will require smelters and refiners to assess their sourcing’s impact and make a credible determination, based on internationally recognized methods, on whether their sourcing patterns risk financing conflict and serious human rights abuses.
Recently the CFSI announced the publication of its new Conflict Minerals Reporting Template (CMRT 4.0). The CMRT is the leading multi-industry tool to facilitate transfer of information throughout the supply chain in support of conflict-free sourcing. It is widely used by companies to survey their supply chains, understand which smelters and refiners are being used, and from where they are sourcing materials. CMRT 4.0 includes an updated Standard Smelter List and numerous translation improvements.
The CMRT is available for download on the CFSI website. For additional tools to support conflict-free sourcing, companies can join the CFSI as members and enjoy benefits including access to Reasonable Country of Origin data and other resources that support making informed decisions about conflict minerals in their supply chains.
About the Conflict-Free Sourcing Initiative
Founded in 2008 by members of the Responsible Business Alliance (EICC) and the Global eSustainability Initiative (GeSI), the Conflict-Free Sourcing Initiative (CFSI) has grown into one of the most utilized and respected resources for companies addressing conflict minerals issues in their supply chains. More than 200 companies participate in the CFSI today, contributing to a range of tools and resources including the Conflict-Free Smelter Program, the Conflict Minerals Reporting Template, Reasonable Country of Origin Inquiry data and a range of white papers and guidance documents on conflict minerals sourcing. The CFSI also runs regular workshops on conflict minerals issues and contributes to policy development and debates with leading civil society organizations and governments.
Jarrett Bens, Director of Communications
Responsible Business Alliance
Phone: +1 571.858.5721
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