High Tech Companies Weigh Merit of Conflict Minerals Reporting Automation

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Resilinc Launches Free Solution for Conflict Minerals Compliance

We are introducing today Resilinc SupplyIntel™ Conflict Minerals Pro which is a free trial version of our cloud solution that can be used for up to one year as a proof of concept.

As we mark the beginning of the third compliance period – January 1, 2015 – of the SEC provision known as the “Conflict Minerals Rule,” reporting companies are still weighing their options for how best to achieve compliance in the most cost-effective manner.

Under the Rule, if conflict minerals — tin, tantalum, tungsten and gold — are necessary to the functionality or production of products manufactured or contracted to be manufactured by an SEC reporting company, the company must take steps to determine and make specified disclosures concerning, among other things, the source of the 3TG contained in its in-scope products. The intent of the Rule is to reduce a significant source of funding for armed groups that are committing human rights abuses and contributing to the conflict in the eastern DRC.

The decision to rely on external consultants and service providers or invest in a tool that automates some or all of the processes associated with supplier data collection and validation, progress and status tracking, and report aggregation and generation, depends largely on the scale of a reporting company’s supplier network.

“We have a relatively shallow supply chain network,” said the CEO of a Mountain View voice processing technology company. “As a result, it is cost-efficient at this time for us to work with external consultants to address our conflict minerals obligations.”

For organizations with a more complex web of supply chain partners, automation tools are becoming an increasingly viable option. According to a Tulane University study released in October, companies spent on average approximately $545,000 worth of time and effort to comply. This makes cloud supply chain risk management solutions from companies like Resilinc (Milpitas, CA), more compelling for companies with complex supplier networks.

“We are introducing today Resilinc SupplyIntel™ Conflict Minerals Pro which is a free trial version of our cloud solution that can be used for up to one year as a proof of concept,” said Wayne Caccamo, chief marketing officer at Resilinc. “This complements our flagship turnkey service, Conflict Minerals Enterprise, which can be used to onboard and manage an unlimited number of suppliers.”

Whether you rely on consulting services, automation or a blend, far too many companies are severely lagging in getting commitments from suppliers to provide detailed information, according to a recent statement by Jess Kraus, CEO of Source Intelligence (Supply Chain Management Review, October 7, 2014). “This is a huge obstacle, especially since we are fast approaching a key stage in Dodd-Frank – audited and verifiable reports on source materials.”

Resilinc believes it has the solution for achieving high rates of supplier collaboration. “Our secure Linked-In model for supplier information sharing, allows suppliers to submit their information once, and share it with multiple reporting companies upon their approval,” said Caccamo. “This is a dramatically more efficient way to respond to disparate customer requests for information and has resulted in unprecedented levels of supplier cooperation, as evidenced by the 40,000 participating suppliers in our network representing over 400,000 parts. Our customers leverage this network to manage supply chain risk management initiatives beyond conflict minerals.”

Resilinc suggests that high tech companies can more easily justify any incremental expense in conflict minerals reporting automation, by viewing it as part of a more comprehensive program to manage a variety of supply chain risks, such as disruption risk, business continuity planning, and capacity management. By enabling companies to build a single centralized repository of supplier risk information, the company claims it is simplifying pro-active risk mitigation and incident response for its customers through its patent-pending and award-winning analytics engine.

One company that leverages risk management automation technology in precisely this way is Juniper Networks (Sunnyvale, CA). “We were already using a cloud platform to support our global supply chain resiliency program,” said global operations executive, Joe Carson. “What we learned was once we had our suppliers mapped and on-boarded, we were able to resolve our conflict minerals audit in a matter of weeks. If I was going to give other executives advice on building a supply chain resiliency program, I would say get started now.”

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Marc Gendron
MarComm PR
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