Last week, Elm delivered a “mini lab” on current condlict minerals issues at the Ethical Sourcing Forum held in New York City. The Forum drew over 150 attendees representing many of the world’s most recognized brands from retail, apparel, jewelry and consumer products.
The session avoided basics/background matters and focused on timely issues including:
- Relevant examples of level of influence on contract manufacturing that may or may not trigger disclosure
- Key concepts and interpretations of “reasonably reliable representations” and “reason to believe,” especially relating to implications of company level information from suppliers rather than parts level information.
- Defining “due diligence” as a subset of the five steps of the OECD Guidance
- Content and future evolution of the Form SD and Conflict Minerals Reports for the US Securities and Exchange Commission
- Updates on AICPA and The Auditing Roundtable guidance on the independent private sector audits (IPSAs)
Not surprisingly, the topic of most interest was that of the Form SD and CMR content and length. Overwhelmingly, Forum attendees indicated a desire to develop a clear, concise and brief submittal for the 2013 filing. Among the factors in determining content is identifying the audience for which the report is written. Several expressed concern about the length and content of automatically-generated Form SD and CMR templates from IT systems. A number of attendees planned to reassess their approach to their disclosure as a result of our conversations.