US companies fail to disclose use of conflict minerals

US electronics companies are failing to to disclose their usage of conflict minerals ahead of the introduction of a federal law – with 90 percent of companies yet to produce the necessary data.

Following a ruling by the Securities and Exchange Commission (SEC) in August, electronic component manufacturers have been told to be more transparent about the sourcing of the materials they use.

The ruling is part of attempts to clamp down on the use of minerals such as tin, tungsten, tantalum and gold, which are mined in regions where armed conflict and human rights abuses take place.One of the most well known is the resource rich Democratic Republic of Congo.

These minerals often end up in components used in all manner of consumer devices, from PCs to smartphones.  However, consumers are generally unaware that revenues eventually make their way up the supply chain into the hands of those controlling the mineral production, effectively supporting human rights atrocities.

As the public outcry against labour conditions in Foxconn factories, used to manufacture Apple products, has shown, there is consumer interest in ethical production.  But many companies have failed to provide clarity about the minerals they source for their components.

Nintendo, for example, was marked in arecent report as one of the worst for investigating its own supply chain.

Authorities in the US are now pushing publicly traded manufacturers to not only disclose the origins of minerals used in production, but to actively investigate their supply chain.

As part of the SEC ruling, they now have 21 months to comply with the legislation. A survey from IHS iSuppli has shown that only a small proportion have made any headway.

Only 11.3 percent of electronics components manufacturers were found to have disclosed conflict mineral information. These companies accounted for just 17.1 percent of the market, meaning that the vast majority of data on the use of conflict minerals is unavailable.

According to Sasha Lezhnev, at the Enough Project, a US group which conducts research in conflict areas such as the DR Congo, believes it is “disingenuous” to say that electronics companies are unprepared to take action against conflict minerals.

Lezhnev says that companies such as Intel and HP have known about the problems surrounding conflict minerals and have taken action to address supply concerns. Apple fully identified all of the smelters in its supply chain in six months, for example.

“It takes some effort, but frankly we’ve seen that it’s not that difficult for companies to do this work,” Lezhnev told TechEye. “So it is time for the laggard companies to stop making excuses and get on with these reforms”.