Compliance Data Gathering Challenges and What To Do About Them

Compliance Data Gathering Challenges and What To Do About Them

What Do You Do When You Face A Compliance Data Gathering Challenge?

We we’re recently asked in an RFP…

What are the biggest challenges you face when seeking responses from vendors? How do you mitigate these issues?

Almost every compliance program will face these 4 key challenges. This is how Assent tackles them. They can be split between the 2 phases of Supplier engagement for Conflict Minerals. These are Supplier Data Gathering & Supplier Data Validation. Here is an overview of the methodologies employed to overcome these challenges:

Note: Assent Provides Turnkey Conflict Mineral Services To ~25% of Fortune 500 firms in Scope.

Challenges encountered during the Supplier Data Gathering Phase

 Lack of Conflict Minerals knowledge

When supplier’s lack knowledge of Conflict Minerals requirements it can lead to two main issues:

1. Incorrect/Insufficient responses

Ex: A pdf statement stating “We are compliant with the Conflict Minerals Act.” without any supporting documentation.

2. Lack of responses

Ex: “This does not apply to me, I’m not an issuer and don’t need to fill out the EICC form.”

Assent Compliance provides 2 main avenues to help solve this problem

1. Providing training materials, learning center access and supplier care packages help to explain not only the legal requirements of Conflict Minerals but the specific business requirements of our customers. This helps suppliers understand not only what is needed but why it is needed and encourages supplier buy-in.

2. Assent’s 2 stage verification process enables our supply chain coordinators to communicate directly with suppliers and provide clarification on Conflict Mineral Program requirements. By directly communicating with suppliers immediately when they refuse to cooperate, we address the issue at its source and speed up the Supplier Corrective Action process.

 Will not provide EICC – only provide PDF or other type of declaration

Sometimes, for various reasons, suppliers will not provide an EICC-GeSI form. They will have either a signed PDF declaration or a Conflict Minerals statement.

  • Assent Compliance works directly with these vendors to help identify the best fit between their response and the EICC-Form (a Proprietary Form -> EICC-GeSI form translation of sorts) in order to help identify the preliminary response and escalate as necessary
  • Once Suppliers are shown a correct EICC response based on their original, non-EICC format, they are usually more malleable to changes later on in the Supplier Data Validation process

Challenges encountered during the Supplier Data Validation Phase

Will not provide due diligence info/supporting documentation

Suppliers may be reluctant to provide supporting documentation when asked to verify claims made surrounding their compliance program.

  • This can leads to gaps in Due Diligence information which could be detrimental to our Client’s program. In these instances, Assent Compliance explains the reasoning behind the request (it is in line with OECD Due Diligence Guidelines), the use of the data and shows examples of other companies who make this type of information public (Intel, Apple, 3M, etc).
  • Assent will also NDA’s with Suppliers as appropriate. This transparent, hands-on, direct approach to Due Diligence is fully compliant with the Due Diligence requirements laid out in the OECD Due Diligence Guidance document and all these activities can be reported on in the Assent Compliance Management System. This also allows for supply chain mapping (Asking for sub-supplier info) to be done with a scalpel as opposed to a net.
  • Some of our competitors would ask a Cintas supplier for their entire list of sub-suppliers. This would be intrusive, ineffective and not in-line with best practices or OECD Due Diligence, especially when asking those sub-suppliers (For whom, Cintas is not  a direct customer) to pay to be part of the program and provide info.
  • When performing Supply Chain mapping, it is best to target high risk suppliers identified through red flags and gaps which can be shown to an independent body when demonstrating how these conclusions were reached.

 Will not comply with corrective actions

Once Data has been received from the suppliers and the 2 stage verification process begins, Supplier Corrective Action notice will be issued by Assent to Suppliers whose responses to not meet minimum requirements of the program.

  • There will be instances where suppliers will be resistant to these changes and/or refuse to comply.
  • In these cases Assent Compliance uses a transparent and cooperative approach to encourage suppliers to comply.
  • Transparency, in letting Suppliers know exactly where they stand by refusing to comply , what the timelines are and repercussions for non-compliance
  • Cooperation, in offering assistance in helping suppliers meet these actions by providing access to Best Industry Practices guideless and practical implementation methodologies they can use to meet these requirement.
  • This approach enables a greater level of Accountability by empowering the Suppliers to make their choice regarding Conflict Minerals compliance. They are provided with all the tools and information necessary to comply and have full knowledge of where they currently stand.

Contact us for more information about our conflict mineral data collection services!

Or click here for our most recent blog post about conflict mineral data collection!

 

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