Mining the Disclosures 2014

An Investor Guide to Conflict Minerals Reporting

RSN and research provider Sustainalytics collaborated to produce Mining the Disclosures, which measures company performance on a major human rights risk. In the inaugural year of filings, 1,315 companies submitted conflict minerals disclosures as required by Section 1502. The MtD report provides a transparent and scalable methodology for analyzing company social performance as part of an integrated approach toward environmental, social, and governance reporting. The results determined by RSN and Sustainalytics were mixed. This was no surprise given this was the first year of reporting and most companies are new to the concept of due diligence.

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Reporting Findings

Companies in the IT sector, which have borne the brunt of activist concern over conflict minerals, led the pack — Intel, Qualcomm, and Apple were all top performers. Companies in lagging industries, like Energy Equipment, Containers and Packaging, and Healthcare Equipment, scored much lower.

We applaud the authors of this report for digging deeper into the topic of conflict minerals reporting. We share their view that you cannot have true accountability without transparency.

- Jackie Sturm, VP, Global Supply Management for Intel Corporation

The report calls on investors to encourage lagging industries to engage in conflict-free certification systems and take a more proactive approach to due diligence. While some companies took the initiative to provide robust conflict minerals reports, many took the easy way out by fulfilling only the most minimal compliance requirements. As companies see their peers adopting leading practices, we expect more transparency and greater depth in future reporting.

The study examined a pilot pool of 51 companies across 17 industries with high exposure to conflict minerals. The methodology was designed to encourage higher quality reporting, incentivize companies to support multi-stakeholder efforts, and set a precedent for comparing social performance.

Conflict minerals reporting is a central part of the strategy adopted by stakeholders across sectors and continents to help free the minerals trade in the DRC and the broader Great Lakes region of Africa from the grip of armed groups.

Qualcomm is proud to be recognized as a leader in the effort to ensure industry supply chains aren’t supporting groups that commit human rights violations in the Democratic Republic of the Congo or adjoining countries. But this is not a single company or industry effort – cross-industry collaboration, engagement with non-industry stakeholders and support for projects on the ground are critical to our effort to promote the responsible sourcing of raw materials.