Conflict Minerals and OECD Due Diligence: Inspection Implications for Mineral Supply Chains

The OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas was first published in 2011 and is now in its third edition. It is the global reference framework for due diligence on tin, tantalum, tungsten, and gold (the so-called 3TG minerals), with subsequent expansion to cover other commodities including cobalt and mica.

The Guidance sets out a five-step framework: establish strong company management systems, identify and assess risks in the supply chain, design and implement a strategy to respond to identified risks, carry out independent third-party audit of supply chain due diligence at identified points, and report annually on supply chain due diligence.

Step 4, independent audit, is where on-the-ground assessment lives. Auditors physically visit refiners, smelters, and in some programmes upstream sites, reviewing inspection records, custody documentation, and worker testimony. The audit produces findings that must be acted on within defined timeframes.

The Guidance is voluntary at the OECD level but is operationalised by mandatory regimes in several jurisdictions. The US Dodd-Frank Act Section 1502 imposed disclosure obligations on certain SEC filers. The EU Conflict Minerals Regulation imposes obligations on EU importers of 3TG. Both regimes reference the OECD Guidance as the underlying due diligence standard.

Mineral producers operating in conflict-affected or high-risk areas should expect on-the-ground assessment as a normal part of doing business with downstream customers.