Signs are surfacing that manufacturers are taking steps ahead of the U.S. Frank-Dodd act to ensure so-called blood minerals no longer make it into cellphones and other electronic devices.
An industry program announced this week comes as tough new U.S. regulations promise to severely cut down on the purchase of minerals, such as coltan, from conflict zones in the Democratic Republic of the Congo, where the illicit mining trade helps finance a brutal war. Coltan contains tantalum, a key ingredient in electronic circuitry.
The Washington-based Electronic Industry Citizenship Coalition and the Brussels-based Global e-Sustainability Initiative - two industry groups representing companies such as Apple Corp., Research In Motion Ltd. and Intel Corp. -this week formally launched the Conflict-Free Smelter Program. The international program "aims to identify smelters that can demonstrate through an independent third-party assessment that the raw materials they procured did not originate from sources that contribute to conflict in the Democratic Republic of Congo," the groups said.
The groups are framing the initiative as a means for member organizations to begin preparing for introduction of the sweeping Dodd-Frank Wall Street reform act, which contains tough new measures dealing with the sourcing of several minerals associated with the conflict in Congo.
As big-name manufacturers begin imposing stricter audit requirements on the companies that produce the raw minerals, those companies are in turn implementing tougher guidelines for tracing the origin of the minerals.
Earlier this year, some of the world's biggest mineral companies began implementing a "bag-and-tag" system for certifying the origin of Congolese minerals. Under the program, tags would follow the minerals offshore, certifying they had not been extracted from conflict mines.
Richard Burt, president of the Belgian-based Tantalum-Niobium International Study Center, an industry group, said the process was set to expand region-wide from a single pilot project mine when, in mid-September, Congolese President Joseph Kabila banned all mining in the eastern part of the country, where many of the conflict mines are located. It is not yet clear when the ban will be lifted.
The mineral companies and technology hardware firms believe that the bag-and-tag process and the conflict-free smelter rules will build a framework for complying with the Dodd-Frank regulations. Both processes still have weaknesses, however: They appear to be largely voluntary, and in the case of bag-and-tag, the Congolese government has a significant say in what constitutes a conflict mine, raising the prospect of lax standards.
Still, the moves are some of the boldest yet on the part of industry groups to impose ethical guidelines on the mining of minerals such as coltan. In large part, those moves have been prompted by the Dodd-Frank reforms.
Gregory Mthembu-Salter, a South Africa-based former consultant to the UN Group of Experts on Congo, spoke at an industry conference last month where companies were trying to determine exactly what the new law's due diligence requirements will entail.
"It's had a huge impact, this legislation," said Mr. Mthembu-Salter, who drafted the due-diligence guidelines in the UN's latest report on the situation in Congo. "[The conference]was full of companies … Maybe they would have been there without the legislation, but I doubt it."Report Typo/Error
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