'Conflict-Free' Electronics Bundled in Financial Reform Law

'Conflict-Free' Electronics Bundled in Financial Reform Law

Nearly unmentioned in the discussions of the financial reform bill is a measure that will affect large swaths of the U.S. economy and that seeks to remove "conflict minerals" sourced from the Democratic Republic of the Congo from products sold in the United States.

The Washington Post reported late last week that the 2,300-page financial reform bill contained a provision focused on eliminating the use of four materials that are commonly sourced in war-torn Congo: Gold, tin, tungsten and tantalum.

The country has been embroiled in a horrific war since 1994 that has killed an estimated 5 million people, and led the nation to be dubbed "the rape capital of the world."

The materials included in the financial reform law are commonly found in electronics, but the provision's impacts will go much further: It applies to any publicly traded U.S. firm that uses gold or tin in its products.

"This is a law that is going to affect virtually the entire U.S. manufacturing sector," Rick Goss, vice president of environment at the Information Technology Industry Council, told the Post's Mary Beth Sheridan.

The article continues:

The issue got tied to the financial reform bill largely because of [Republican Senator Sam] Brownback, who had previously introduced legislation on "conflict minerals." He sought to attach an amendment to the bill, and Sen. Christopher J. Dodd (D-Conn), chairman of the banking committee, supported it, congressional staff said. In the end, Brownback voted against the overall bill, but his amendment survived.

 

The new law requires American companies to submit an annual report to the Securities and Exchange Commission disclosing whether their products contain gold, tin, tungsten or tantalum from Congo or adjacent countries. If so, they have to describe what measures they are taking to trace the minerals' origin.

The law does not impose any penalty on companies who report taking no action. But the disclosures must be made publicly on firms' Web sites.

"The consequence is a market-driven one. Consumers can make their choices. Do they want their electronic products to be funding gang rape in central Africa? I don't think most Americans would want that," said Rory Anderson of the World Vision humanitarian group, which has been pushing for the legislation.

The issue of responsible sourcing of materials has been on tech companies' radars for some time. In 2009, the Center for American Progress launched a "No Blood for Gadgets" campaign focused on conflict materials, and electronics companies have long focused on the greening of their supply chains.

Hewlett-Packard, for instance, showcased its efforts on scouring its supply chain of conflict materials at the 2009 BSR conference, and in 2008, the company released green supply chain guidelines for suppliers and top-level global enterprises alike to work toward transparency in supply chains. Later that year, HP also named its largest suppliers as part of its CSR report, an unprecedented move in the secretive IT industry.

Conflict materials are not just a problem for the electronics sector; jewelry retailers have repeatedly worked on cleaning up the supplies of sometimes "dirty gold" in the marketplace.