U.S. federal legislation regarding "conflict minerals" continues to affect manufacturing industries. Under Section 1502 of the Dodd-Frank Wall Street Reform Act, manufacturers who file certain reports with the Securities and Exchange Commission (SEC) are required to disclose whether the products that they manufacture or contract to manufacture contain "conflict minerals" that are "necessary to the functionality or production" of those products.
"Conflict minerals" refers to gold, as well as tin, tantalum, and tungsten, the derivatives of cassiterite, columbite-tantalite, and wolframite, regardless of where they are sourced, processed or sold. The intent of these requirements is to further the humanitarian goal of ending violent conflict in the Democratic Republic of the Congo (DRC) and in surrounding countries, which has been partially financed by the exploitation and trade of conflict minerals.
To ensure compliance with these requirements, each manufacturer in the supply chain must request and receive information regarding the use of conflict minerals from their direct suppliers, who, in turn, must solicit and receive that information from the next tier of suppliers. Therefore, each Hendrickson/Watson & Chalin supplier must continue to impose appropriate reporting requirements on its global supply chains, regardless of where the components and materials are purchased.
Hendrickson/Watson & Chalin require our suppliers to provide a completed Electronic Industry Citizenship Coalition and Global e-Sustainability Initiative (EICC-GeSI) Conflict Minerals Reporting Template, including all smelter information for all of the designated minerals. The EICC-GeSI template and instructions can be found at the Conflict Free Smelter website.
Suppliers are also required to document all steps taken to collect and report conflict minerals information and preserve that documentation. The materials provided may be reviewed in an audit related to due diligence efforts to collect this information. The framework for this audit can be found in the OECD Due Diligence Guidance. We would be happy to provide you with further guidance upon your request as to our requirements to minimize deficiencies in the event of an audit.