On September 5, 2013, Responsible Sourcing Network and the Enough Project published a paper detailing certain stakeholders’ expectations about the form and content of a company’s Form SD and Conflict Minerals Report.
The authors fire a warning shot to reporting companies – telling them what components certain observers deem important and urging companies to report additional factors that can be tracked and compared over time.
The authors recognize that they recommend more disclosure than what is required by the rule itself, but they warn that they “will look poorly upon issuers that postpone robust reporting or file a report that simply ticks a box.”
Reporting companies are focusing on compliance with the rule, but they must also be keenly aware of the expectations of activists when drafting their initial Form SD’s and Conflict Minerals Reports next spring. The Responsible Souring Network and Enough Project paper tells companies that they should consider publicly disclosing a conflict minerals policy, participating in a conflict-free minerals initiative, implementing the OECD due diligence framework and listing the country of origin information for all 3TG minerals, all of which are more than the rule requires and would increase the cost process and the reporting for most companies. Although the authors urge companies to report more than the rule requires, they do say that they will “publicly acknowledge issuers that demonstrate efforts to address the issue, provide transparent procedures and results and make progress over time.” For their future conflict minerals filings, companies in certain industries with active stakeholders should look to this paper to anticipate certain stakeholders’ expectations and demands.