The mining and trading of “conflict minerals” and their derivatives – cassiterite (tin), wolframite (tungsten), coltan (tantalum) and gold (collectively “3TG”) – in the Democratic Republic of the Congo is helping to finance armed groups which promote widespread violence, human rights violations and environmental degradation in the DRC and adjoining “Covered Countries” as identified by the SEC.
Section 1502 of the Dodd-Frank Act and related SEC regulations endeavor to reduce these actions by motivating businesses to obtain their conflict minerals from sources which do not support armed groups in the DRC Region. Accordingly, the Company has implemented due diligence measures for tracing and sourcing 3TG in its products designed in conformance with The Organisation for Economic Co-operation and Development (“OECD”) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. The Company also relies on information from the Responsible Minerals Assurance Process (“RMAP”), an initiative managed by the Responsible Minerals Initiative (“RMI”) in which an independent third party audits the procurement activities of a smelter or refiner to determine, with reasonable confidence, that the minerals it processes originated from conflict-free sources.
As an SEC reporting company, ESCO is subject to the conflict minerals provisions of the Act and SEC regulations, and we fully support their objectives of responsible sourcing. However, since ESCO is typically several tiers removed from the smelter or refiner and mineral origin of products in its supply chain, the Company relies primarily on its direct suppliers to provide it with sourcing information. To facilitate the collection of complete, accurate, standardized and verifiable information, the Company relies primarily on the Conflict Minerals Reporting Template (“CMRT”) made available by the RMI.
Accordingly, it is ESCO’s policy that: