December 2, 2011 Elizabeth Grossman 0Comment

by Elizabeth Grossman

The US may be fourth on the United Nations Development Program (UNDP) list of countries ranked by per-capita income, but persistently high unemployment has left many of this country’s residents in poverty. The past year has seen a record increase in US children enrolled in free school meal programs, and the need is such that some districts are now serving not only lunch but also breakfast and dinner. In Chicago, Dallas and Newark school districts, 85 percent of children qualify for free meals, according to data analyzed by The New York Times. Given such a situation, asking Americans to think about what happens in the Democratic Republic of the Congo, a country that that ranks dead last on the UNDP income list, may seem like a stretch.

But today’s global supply chains and markets, coupled with instant telecommunications, have increased US awareness of labor, environmental, and social conditions in far-away countries. At the same time, growing demand for transparency in business practices makes it increasingly difficult for companies to ignore the conditions under which their materials and products are produced.

Most of the corporate responsibility, fair trade and other such business codes of conduct that address working conditions and sourcing of materials outside the US are voluntary. But one such certification program – part of the Dodd-Frank Act signed into law in 2010 and now awaiting finalization by the Securities and Exchange Commission – will require all US publicly traded companies that use gold, tin, tungsten, and a mineral called tantalum – used widely in capacitors for portable electronics – to certify that these minerals are not helping to fund the conflict in the Democratic Republic of the Congo.

Conflict minerals
Gold, tungsten, tin, and tantalum are abundant in the DRC, one of the most impoverished, unstable and war and violence-ravaged countries in the world. Because proceeds from mining and trading in these minerals have helped fund the devastating and brutal civil wars in the Congo in which more than 5 million people have lost their lives, they have become known as “conflict minerals.” Ongoing campaigns in Europe and the US that date back to the 1990s have sought to push companies to stop obtaining these minerals from DRC sources that support armed conflict and other violence there. One result of these campaigns is Section 1502 of the Dodd-Frank Act that will – once the Securities and Exchange Commission (SEC) issues the final rules – require all publicly traded companies to certify to the SEC that they are obtaining these minerals from “non-conflict” sources in the DRC and “adjoining countries.” This provision will apply to US and European countries as well as those from many other countries whose shares are traded on US stock exchanges.

Speaking at the NetImpact conference in Portland, OR in late October, Tim Mohin, director of corporate responsibility for Advanced Micro Devices (AMD) who has also led corporate responsibility and sustainability programs at Apple and Intel, called the policy “unprecedented.” And indeed it is. The only existing similar policy is the Kimberley Process, a voluntary international program to source diamonds. But sourcing the minerals covered by Section 1502 of the Dodd-Frank Act is more complex than sourcing diamonds – and the requirement will be legally enforceable. The “conflict minerals” covered by the Dodd-Frank Act typically travel a much longer journey of processing and manufacturing, changing hands and hopping around the world, before they end up in finished consumer and industrial products than diamonds do. And the range of products and companies affected by this certification is very broad: aerospace, electronics, automotive, medical equipment, jewelry, and food cans, to name but a few.

“We could have said it is too far away, but it is a real moral issue” said Mohin at the NetImpact conference. The conflict in the Congo – including violence against women – is extreme. It involves child soldiers, child labor, and forced labor. The mineral-rich regions of the DRC are routinely patrolled and controlled by armed groups, often of uncertain allegiance. NetImpact attendees also heard from Patricia Jurewicz, director of the Responsible Sourcing Network, a project of the socially responsible investment organization As You Sow; she explained that the link between revenue from the sale of minerals, purchase of weapons, and exploitation of people in the DRC is well documented, and has been for well over a decade – by NGOs in Africa, Europe, and the US, as well as by the United Nations and others.

Following a complex chain of custody
How the certification of this supply chain will work is not simple. The intent is not to create a boycott of DRC mineral sources, as NGOs involved in the these campaigns are careful to explain, but to develop a system of certifying the chain of custody of these minerals with a focus on their journey from mine to smelter to show this trade is not supporting armed conflict or violence. This sourcing policy for these minerals is also part of guidelines now being developed by the Organization for Economic Cooperation and Development (OECD), and a similar policy was adopted last year by the United Nations Security Council. The in-country, on-the-ground logistics of implementing these policies are daunting – that most of the mining in the DRC for these minerals is done not by large companies but by small ‘artisanal’ miners compounds the challenges. Putting these sourcing protocols into practice also requires cooperation between companies that are typically competitors. “We can’t do it without one another,” said Mohin at the NetImpact meeting.

Implementing the conflicts minerals provision of the Dodd-Frank Act will mean a lot of departures from business-as-usual. It will mean asking hard questions about exactly where materials come from, about who’s profiting from their sales – and getting auditable answers.

The DRC is a tragic and extreme situation. But I wonder what would happen if all corporations were required to provide comparable assurances about the conditions under which all of their products are made. Would there be less incentive to do things on the cheap? And would that mean fewer American children whose parents can’t afford to feed them?

i-93ffb94e8384c1e7db4d7ecfb8636819-EG&cover2.jpgElizabeth Grossman is the author of Chasing Molecules: Poisonous Products, Human Health, and the Promise of Green Chemistry, High Tech Trash: Digital Devices, Hidden Toxics, and Human Health, and other books. Her work has appeared in a variety of publications including Scientific American, Salon, The Washington Post, The Nation, Mother Jones, Grist, and the Huffington Post. Chasing Molecules was chosen by Booklist as one of the Top 10 Science & Technology Books of 2009 and won a 2010 Gold Nautilus Award for investigative journalism.

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