Dodd Frank taking hold in real terms?
Over on Mining Weekly we recently found an interesting piece in which Anine Vermeulen reports how Dodd Frank may lead to genuine changes in sourcing practices in the US.
It’s not breaking news but it does provide a succinct introduction to Dodd Frank, what it means, what it sets out to do and how it’s working. Kind of a conflict-minerals-for-dummies piece, and no less useful for it.
While we’ve reported a number of different views on this issue over the past months - not least the notion that the whole idea of tackling conflict minerals in this way, and the philosophy that underpins the idea in the first place, are misguided - it’s our opinion that some kind of action’s required on this issue. In the absence of a perfect solution we’re with the writings of the wise italian: let not the perfect be an enemy of the good.
Vermeulen’s of the opinion that “legislation has led to many companies being more critical about their supply chains and has catalysed important reforms in Africa’s Great Lakes region.” A little vague but we’re not entirely bereft of concrete examples.
More in the full piece here, including discussion of how companies can mitigate associated risk, OECD guidance in this regard, and how many commentators believe vulnerable companies further down the supple chain should be moving to exercise as much leverage as possible over upstream suppliers who can most effectively mitigate the risks of unethical sourcing.
The article also addresses the thorny issue of importation of dodgy minerals into South Africa, where companies not listed in the US aren’t obliged to toe the Dodd Frank line (though of course Kimberley still applies as far as diamonds are concerned). There is discussion also of whether the South African government has the ethical responsibility to move of its own accord in this regard - to which we say “yes”, of course they do.