In 2010, the US Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010) (Dodd-Frank). Section 1052 of the Dodd-Frank, which relates to ‘conflict minerals’, aims to prevent violence and violation of human rights that are funded by exploitation and trade of certain minerals (such as gold, columbine-tantalite, cassarite and wolframite – referred to as the ‘3TG’) in the DRC and surrounding countries. Section 1052 of the Dodd-Frank is seen by some as being flawed as (in their view) it unfairly stigmatises Central African states and requires companies to declare minerals as ‘not conflict free’ resulting in companies withdrawing from business.
Global Witness, an international organisation which investigates and campaigns to prevent natural resource related conflict, is now pushing the EU to implement legislation that builds on section 1052 of the Dodd-Frank. The proposed legislation would require companies doing business in the DRC and surrounding countries to conduct supply chain due diligence and meet the Organisation for Economic Co-operation and Development’s guidelines for Multinational Enterprises. This will ensure that companies only stop sourcing minerals from mines where human rights abuse is taking place, rather than excluding entire regions.
Herbert Smith Freehills Partner and Co-Chair of the International Bar Association CSR Committee, Stéphane Brabant, agrees it is time for change. ‘No company wants to be faced with allegations that its use of minerals has funded conflict and contributed to human rights violations,’ he says. ‘Such allegations would damage the reputation of the company and ultimately the success of the business […]. By being proactive, companies are better able to anticipate human rights issues and defend against allegations of complicity in abuses.’
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