What is the Best Way to Validate Your Smelters?

What is the Best Way to Validate Your Smelters?

Smelter validation is arguably the most challenging part of the conflict mineral compliance process.

Under Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protections Act, publicly traded companies must file Conflict Minerals Reports to exercise due diligence on the source and chain of custody of their conflict minerals. Smelter validation is a key part of this process.

Smelters are the pinch point in a company’s supply chain. They convert raw tin, tungsten, tantalum and gold ores into a more common, refined form that can be used to make products. Once this process is complete, it becomes impossible to determine the exact source of the refined materials.

If a company is unable to properly identify and validate their smelters, they cannot determine their level of risk to having conflict minerals in their products.

The difficulty for companies trying to complete their due diligence is tracking down accurate smelter information. There is a deficiency in publicly available smelter information and data collected from suppliers is unreliable.

This is why collected data must be validated.

Smelter validation is the process of evaluating data so that only legitimate smelting facilities are reported. This is a challenging process for internal compliance teams, for many of the same reasons collecting the data was difficult in the first place.

 

Clearing the Hurdles

Understanding these challenges, Assent Compliance established a Research and Analysis Team which has accumulated years of experience collecting, analyzing and reporting smelter data.

The team works to validate and prepare smelter data to ensure accurate reporting.

Incoming smelter reports are compared to Assent’s comprehensive valid and invalid smelter databases, allowing our experts to validate the data. These databases contain information on thousands of smelting facilities worldwide, along with an alias recognition system with approximately 20,000 entries on file.

Aliases are alternative names for smelters. Their use can lead to confusion or misinformation in the reporting process. Through cross-referencing the database of known aliases, Assent’s Research and Analysis Team is able to accurately identify smelter identities, thereby eliminating the risk of reporting errors.

Once a smelter is properly identified, the Research and Analysis Team determines whether or not they are valid smelters, their level of risk and proper contact information. The data is then exported into the Conflict Minerals Reporting Template or a comprehensive validation report, both of which meet due diligence requirements.

This entire process can take internal compliance departments months to complete. However, Assent’s Research and Analysis Team leverages years of expertise and curated resources to quickly deliver accurate, valid and complete smelter data.

 

Why Outsourcing Makes Sense

In terms of compliance processes, smelter validation can be tedious and time-consuming. Compliance departments are already under the gun to meet other regulatory requirements. Smelter validation is one process that, when outsourced to a third-party like Assent, can free up significant resources for allocation to other projects.

It’s also a process that is hard to get right, simply due to the lack of available information. Data is poor, invalid or misleading. Smelter aliases confuse reports. All of these issues come together to challenge the validity of corporate conflict minerals reports.

As the lynchpin of a strong conflict mineral compliance program, smelter validation is too important to leave to chance. Assent Compliance is uniquely qualified to manage this important process for companies that want to ensure accurate reporting while reducing time and resource commitments.


 

Contact our Research and Analysis Team at info@assentcompliance.com with your questions or for help validating your smelter data.

For more information on conflict minerals and your requirements, download our eBook, Conflict Minerals Compliance Toolkit.

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