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Conflict Minerals: Why No SEC Rule Yet?

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syedzunair
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Re: good start
syedzunair   5/2/2012 1:25:38 PM
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@Hospice:

In principle I agree with you. But the reality is much different. Enterprises value profits before everything else. Running a lucrative manufacturing business with social and ethical values is icing on the cake. Most manufacturers are not doing it currently but I believe an educated consumer base will eventually force them to it. 

Hospice_Houngbo
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Re: good start
Hospice_Houngbo   4/29/2012 10:30:18 PM
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@syed:

"most consumers will be willing to pay a bit more to get products that are made keeping in mind the social and ethical values."

I agree that most will do. But this is first the duty of electronics manufacturers to start putting social and ethical values above and before their revenue streams and profit. 

kmanchen
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Re: good start
kmanchen   4/26/2012 6:52:04 PM
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Thanks for your post. It is a complicated issue and you are right, the details are not well understood. Regardless, human rights violations are occuring in the Congo and it is an issue that needs addressed. Delay or not it is good to see progress. A delicate balance is needed to ensure the final rule is not too onerous for companies or they could decide to no longer source any mined product from the Congo. That would only hurt the Congo. I am pleased that the SEC is aware of the issues and working an solution that hopefully will be amenable to all.

bolaji.ojo
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Re: good start
bolaji.ojo   4/25/2012 10:51:31 PM
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Syedzunair, You'll be surprised how uninformed the general public is about these issues. For many, "conflict minerals" is a phrase that needs explaining and even this may not be enough. The average iPhone buyer does not care that the device is assembled under conditions many have criticised. And, they certainly, won't sweat over whether or not somebody died in Africa mining tantalum powder used in tantalum capacitors. It's too far removed from their daily lives. At least until someone takes the step to explain in the simplest terms the issues involved.

Barbara Jorgensen
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Re: Conflict minerals
Barbara Jorgensen   4/25/2012 3:49:43 PM
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@Ken: I was listening to a WSJ report yesterday that pointed out the SEC has about 4,000 employees charged with overseeing regulations--everything from the practices that got us into the recession to compliance with...well Dodd-Frank. The gist of the story was the SEC does pretty well with limited resources. I know that the "tacking on" practice often gets legislation passed that would otherwise be shot down, but it does result in some strange bedfellows.

syedzunair
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Re: good start
syedzunair   4/25/2012 1:47:29 PM
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@flyingscot: 

I agree, most consumers will be willing to pay a bit more to get products that are made keeping in mind the social and ethical values. 

R.J.Matthews
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Re: Conflict minerals
R.J.Matthews   4/25/2012 1:14:17 PM
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Barbara probably no agency single agency is perfect to have oversight on the issue and if you moved it away from the SEC it would probably mean starting the whole process again. With so much money involved in the minerals trade you are probably going to need to have a heavy hitting agency like the SEC to keep an eye on things.

 

Bit like the old saying of follow the money would hope the SEC is the best agency do that!

 

Kmanchen probably big business would and did stop any conflict mineral rules seeing the light of day. Think that reflects poorly on big business more than anyone else. Agree the SEC is in a tough position as they are threatened with lawyers which is a disgrace. Case of having totally lost the argument some business interests think this is the only way left they have to derail things.

 

SEC should stand up to the blackmail, if the business interests are dumb enough to follow through with their threat going to turn out to be very embarrassing for them as NGO's will have a field day, the Foxconn scandal will turn out to be a storm in a tea pot in comparison.

 

Think some of the smarter companies have already realized that and this is why the are working with agencies trying to change things. The best companies are going to incorporate a lot of processes to deal with the conflict mineral issue whether these rules are brought in or not.

Why should the worst companies be allowed to slowdown and undercut this process or gain some competitive advantage by accessing conflict minerals?

 

The U.S. Chamber of Commerce is increasingly going to find themselves out of step and just representing a minority of companies with the worst practices at this rate. The best companies are going to incorporate a lot of processes to deal with the conflict mineral issue whether these rules are brought in or not, or when.

FLYINGSCOT
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good start
FLYINGSCOT   4/25/2012 11:59:17 AM
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I believe this is a step in the right direction and hope that similar initiatives can be used to ensure we all produce and consume in socially responsible ways.  most people would be willing to pay a bit more for products that make environmental and social sense.

kmanchen
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Re: Conflict minerals
kmanchen   4/25/2012 10:19:03 AM
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Barbara -  Great point! Why the SEC was given responsibility, why the regulations only target SEC registered companies, and why compliance is to be reported in SEC annual filings could be the subject of a whole other blog. The problem stems from the issue being addressed as an amendment to the Dodd-Frank Act. An attempt was made prior to Dodd-Frank to write a stand alone conflict minerals law. It never made it out of committee. If it had I think the legislation would have been written differently.

Adding an amendment to a pressing bill with widespread support (like Dodd-Frank) is not uncommon. The problem is it by-passes the normal affected party vetting process (and legislative give and take) that legislation is supposed to have. The SEC is now receiving industry comments after the fact and is having to deal with an issue that taxes their capabilities. EPA would probably have been better equipped to tackle this issue.

kmanchen
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Re: SEC Trouble
kmanchen   4/25/2012 9:30:21 AM
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Thanks for your response. The SEC is in a tough position. The Dodd-Frank Act tasked it with over 800 obligations and it has swamped the agency. To-date the SEC has missed 70% of their rulemaking deadlines and have only issued 100 of the 393 final rules they are required to issue. It is a can't win proposition. If they rush out a poorly considered rule, the resulting lawsuits could be worse than the delay.

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