May 3, 2013 – May 10, 2013
The summaries provided in this Weekly Recap do not necessarily represent the views of Squire Sanders (US) LLP and should not be deemed to be endorsements of them. The Recap is intended to be a compilation of articles and events to encourage discussion within the conflict minerals community and to keep our readers updated on the most recent developments.
Gentex Corp. Discusses Conflict Minerals in Latest Form 10-Q
Gentex Corporation is a global, high technology electronics company that delivers products to the automotive, aerospace and fire protection industries. In its latest Form 10-Q, dated May 6, 2013, in the Management Discussion and Analysis section, the company discusses the impact the conflict minerals rule may have on its sourcing, supply and pricing of its materials. Excerpts from the Form 10-Q follow. “These new requirements will require due diligence efforts in fiscal 2013, with initial disclosure requirements beginning in May 2014. There will be costs associated with complying with these disclosure requirements, including for diligence to determine the sources of conflict minerals used in our products and other potential changes to products, processes or sources of supply as a consequence of such verification activities. The implementation of these rules could adversely affect the sourcing, supply and pricing of materials used in our products. As there may be only a limited number of suppliers offering ‘conflict free’ minerals, we cannot be sure that we will be able to obtain necessary conflict minerals from such suppliers in sufficient quantities or at competitive prices. Also, we may face reputation challenges if we determine that certain of our products contain minerals not determined to be ‘conflict free’ or if we are unable to sufficiently verify the origins for all conflict minerals used in our products through the procedures we may implement.”
Members of Squire Sanders’ Conflict Minerals Team to Present at IACCM Webinar
On Thursday, May 23, 2013, Dynda A. Thomas and Andrew J. Renacci will be presenting a webinar titled, “Implementing Your Conflict Minerals Program – Practical Strategies,” to members of the International Association for Contract & Commercial Management (IACCM) as part of IACCM’s “Ask the Experts” webinar program. Dynda and Andrew will discuss the following:
- Common misunderstandings about the rule
- Concrete steps to help get companies started
- Product background and filtering strategies
- Responding to customers
- Reaching out to suppliers
- Suggested contract provisions.
IACCM is a member-based, non-profit organization that provides leading-edge contracting and commercial skills, policies and procedures. We look forward to presenting to IACCM’s members at the end of the month.
Despite Conflict Minerals Rule, Armed Groups Still Benefiting From Mineral Trade
Melanie Gouby, of the Associated Press, reports in her article titled, “Officers in Congo Benefiting from Mineral Trade”, that despite international efforts to clean up the supply chain, “high-ranking officers in the Congolese and Burundian armies are continuing to benefit from the illegal mineral trade in eastern Congo.”
Her article is based on a report published this week by environmental watchdog group, Global Witness.
Ms. Gouby states that although there are localized areas of improvement, the mineral trade, specifically gold, remains a problem because of the ease of smuggling and the failure to conduct proper border checks in the African Great Lakes Region.
PwC’s 10 Minutes on Conflict Minerals
PricewaterhouseCoopers LLP (PwC) put together a short PDF titled 10Minutes on Conflict Minerals that “provides insight into the strategic benefits and risks companies will want to focus on as they comply with the SEC’s conflict minerals rule.”
In general, PwC’s 10Minute pieces are “designed to distill key information and insights on a corporate, legal, or regulatory topic relevant to your business, helping you set your compass in a landscape that is often difficult to negotiate.”
In this specific conflict minerals 10Minute piece, PwC warns that “postponing [compliance] action could create more challenges” and discusses the effect the conflict minerals rule could have on your company’s brand.