March 6, 2017
On January 31, Acting Chairman of the Securities and Exchange Commission (SEC) Michael Piwowar welcomed interested parties to submit comments in response to a statement calling into question the current U.S. Conflict Minerals Rule that is the guidance for companies to implement Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In the weeks following, numerous companies, investors, activists, NGOs, and others have come out publicly in support of the Rule, including the Enough Project.
The Conflict Minerals Rule was created by the SEC pursuant to Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Since implementation began in 2013, the Rule has gradually led to improvements in the rule of law in the mining sectors of Congo, Rwanda, and other Great Lakes countries, contributed to improvements in humanitarian conditions in Congo and a weakening of key insurgent groups, and resulted in tangible benefits for U.S. corporations and their supply chains. The U.N. stated in 2010, the year that Dodd-Frank became law, that nearly every mine in the Kivu provinces was controlled by a military group, but according to an October 2016 study by the International Peace Information Service, 79 percent of miners at tin, tantalum, and tungsten mines surveyed in Congo now work at conflict-free mines.
If the Rule is suspended or weakened, it would incentivize armed groups in eastern Congo to return to hundreds of tin, tantalum, and tungsten mines, causing an increased humanitarian crisis. This would also lead to increased corruption in the minerals certification process in Congo and the region, thus creating major risks for U.S. companies sourcing minerals, and it would likely lead to a new de facto embargo on minerals from Congo, Rwanda, and the Great Lakes region. Furthermore, the cost for U.S. businesses to comply with the rule has been 74 to 85 percent less than the original SEC estimate, according to new information from Elm Sustainability Partners. Why in God's name do we want to further that result?
Since implementation began in 2013, the Rule has gradually led to improvements in the rule of law in the mining sectors of Congo, Rwanda, and other Great Lakes countries, contributed to improvements in humanitarian conditions in Congo and a weakening of key insurgent groups, and resulted in tangible benefits for U.S. corporations and their supply chains.
Over 100 Congolese civil society groups and other individuals have responded, saying that a suspension or weakening of the Rule would lead armed groups to go back to mines and cause a new humanitarian crisis. Additionally, companies, investors, activists, NGOs - including the Enough Project - and others have come out publicly in support of the Rule. But the SEC also needs to hear that consumers and investors -- and I am both -- oppose any suspension, weakening, or repeal of the Conflict Minerals Rule.
Good Lord, please do the right thing here.