RiskWatch Virtual Town Hall Meeting program is being launched as a series of webinars taking place in collaboration with thought-leaders from the industry, leading analysts firms and think-tanks. The debut session of the virtual town hall meeting series is being led by Adam Greene, Vice President of Labor Affairs, Corporate Responsibility & Governance, at United States Council for International Business (USCIB), in a session titled: ‘Why Ignorance of OECD Due Diligence Guidelines for Conflict Minerals is No Excuse!’ In this fact-filled webinar session, participants will gain behind-the-scenes insights into the OECD Guidelines for Due Diligence on Conflict Minerals and learn why procurement and compliance professionals as well as C-level executives should care about the OECD guidelines as they prepare for compliance under Section 1502 of the Dodd-Frank Act. As Vice President of Labor Affairs, Corporate Responsibility & Governance, Adam Greene is responsible for USCIB policy and programs on corporate responsibility, international labor standards and corporate governance. He manages USCIB engagement with international corporate responsibility principles, codes of conduct and multi-stakeholder initiatives. His focus areas include business and human rights, supply chain management, conflict minerals, stakeholder engagement, corporate reporting and social investment. He was actively engaged in the development of the UN Guiding Principles on Business and Human Rights, the revised OECD Guidelines for Multinational Enterprises and the ISO 26000 guidance standard on Social Responsibility, and works closely with the UN Global Compact. He also manages USCIB activities on labor and employment policy, including the development of international labor standards in the International Labor Organization (ILO) and employment policy in the OECD. He leads USCIB work in the areas of trade and labor, working conditions in supply chains, human trafficking, forced labor and child labor. Additionally, he manages USCIB programs on corporate governance, centered on the revision of the OECD Principles on Corporate Governance. Prior to joining USCIB, Adam was Associate Director of the Global Environment Program at the Stern School of Business at New York University, and Manager of Fixed Income Securities for Dean Witter Financial Services. Adam earned a BA from the University of Rochester and an MBA from the NYU Stern School of Business. The RiskWatch Virtual Town Hall Meeting Series is a free ongoing educational program under the theme "3rd party ecosystem (3PE) risks in a changing climate of regulations and activism" to help customers manage their external risks with better information while using Integrity360, RiskWatch’s GRC software-as-a-service module for 3PE risks. For more information on RiskWatch’s suite of SaaS offerings, visit http://www.riskwatch.com.

1. Speaker: ADAM B. GREENE
Vice President, Labor Affairs and Corporate
Responsibility
Virtual Town Hall Meeting Series on
3rd Party Ecosystem Risks in a Changing Climate of Regulations and Activism
Why Ignorance of
OECD Due
Diligence Rules for
Conflict Minerals is
No Excuse.
presents

2. UNITED STATES COUNCIL FOR
INTERNATIONAL BUSINESS
Why Ignorance of OECD Due Diligence
Guidelines for Conflict Minerals is No Excuse
RiskWatch Virtual Town Hall on Conflict Minerals
July 30, 2013
Adam B. Greene
Vice President, Labor Affairs & Corporate
Responsibility
July 30, 2013

3. RiskWatch Virtual Town Hall on Conflict Minerals
July 30, 2013
Global
Network

4. RiskWatch Virtual Town Hall on Conflict Minerals
July 30, 2013

5. RiskWatch Virtual Town Hall on Conflict Minerals
 UNDP Human Development Index: 187 out of 187
 Fund for Peace Failed State Index: 176 out of 177
 World Bank Doing Business: 181 out of 185
 Transparency International: 160 out of 174
 Freedom House: “Not Free”
 Save the Children: World’s worst place to be a mother
 Global Hunger Index: bottom
 Population:
– 88% below absolute poverty line
– 70% lack access to adequate food
– 2.7 million internally displaced
DRC ranks near the bottom on most indices
July 30, 2013

6. RiskWatch Virtual Town Hall on Conflict Minerals
 In a word – no.
 The main causes stem from political, ethnic, tribal and
territorial disputes
 1994 Rwanda genocide: ~ 800,000 killed in 100 days
– Had nothing to do with minerals or other resources
 DRC has resource-rich areas with no conflict
 Many other funding sources: “taxes”, timber, robbery
 Major armed groups don’t control any mines
– M23 rebels get direct funding and military support from
neighboring countries
Are minerals causing the conflict?
July 30, 2013

7. RiskWatch Virtual Town Hall on Conflict Minerals
July 30, 2013

8. RiskWatch Virtual Town Hall on Conflict Minerals
 No hearings, no amendments, DRC not consulted
 Basic elements of the law:
– Do your products contain tin, tantalum tungsten or gold?
– If so, did any of those metals originate in the DRC or an
adjoining country? If yes, conduct (OECD) due diligence.
– If so, did the sourcing of those minerals finance or benefit
any armed groups?
 Zero-defect approach (vs. risk-based due diligence)
 Imposes significant regulatory and financial burdens on
any sourcing from the DRC – responsible or not
Dodd-Frank Act Section 1502:
July 30, 2013

9. RiskWatch Virtual Town Hall on Conflict Minerals
 Increased attention on the conflict…
– But with significant negative unintended consequences:
 Resulted in a de-facto embargo:
– No systems in place can ensure zero-defects
– Huge costs of trying to map highly complex supply chains
– Much easier to source elsewhere than to comply
 Exports have plummeted, smuggling has surged
– 3T export markets limited to China, Vietnam and Indonesia
– Penalized legitimate enterprises in the DRC
– Reduced the earning capacity of millions of workers
Impact of Dodd-Frank
July 30, 2013

10. RiskWatch Virtual Town Hall on Conflict Minerals
Global Supply Chains
July 30, 2013

11. RiskWatch Virtual Town Hall on Conflict Minerals
 OECD founded in 1960
– Successor to the Marshall Plan
– 34 member countries
 Good-government forum for
the leading free-market
democracies to:
– Compare experiences
– Address common problems
– Identify best practice
– Coordinate policies
Organization for Economic Cooperation & Development
July 30, 2013

12. RiskWatch Virtual Town Hall on Conflict Minerals
 Internationally recognized framework
 Developed through a multi-lateral, multi-stakeholder
process:
– Governments: OECD, ICGLR, UN Group of Experts
– Industry: Gold / jewelry; 3T Upstream, Downstream:
electronics, automotive, aerospace, manufacturing
– Civil society: International & DRC organizations
 Promotes responsible sourcing of minerals from the
DRC
 Risk-based due diligence: focus on actors vs. minerals
OECD Due Diligence Guidance
July 30, 2013

13. RiskWatch Virtual Town Hall on Conflict Minerals
OECD 5-Step Framework
1. Establish strong company
management systems
2. Identify and assess risks
in the supply chain
3. Design and implement a
risk mitigation strategy
4. Conduct independent
third-party audits
5. Report annually on supply
chain due diligence
July 30, 2013

14. RiskWatch Virtual Town Hall on Conflict Minerals
Current options being considered:
1. No action
2. Voluntary approach: ask EU enterprises to voluntarily
apply the OECD Due Diligence guidance
3. Require due diligence by companies placing minerals (or
products) on the EU market for the first time
4. Require public disclosure by EU-listed and large
companies to demonstrate due diligence
5. Prohibit imports of minerals into the EU market when
operators fail to provide evidence of supply chain due
diligence
EU Regulation on Conflict Minerals
July 30, 2013

15. RiskWatch Virtual Town Hall on Conflict Minerals
Thank You
Adam B. Greene
Vice President, Labor Affairs & Corporate Responsibility
United States Council for International Business
1212 Avenue of the Americas, Suite 2100
New York, NY 10036 USA
Email: agreene@uscib.org
Office: +1-212-703-5056
Mobile: +1-917-318-1795
www.uscib.org
July 30, 2013