CFSI - Responsible Minerals Assurance Process, Tin and Tantalum Standard
14 June 2017
CFSI is pleased to announce the release of the revised Responsible Minerals Assurance Process, Tin and Tantalum Standard. The Standard replaces the CFSP Audit Protocol for Tin and Tantalum of 2013, and goes into effect 1 June 2018.
CFSI greatly appreciates the participation of T.I.C. and its members in the revision process.
Over the past year, CFSI consulted with a variety of stakeholders, including downstream companies, smelters, industry associations, NGOs, and consultants. Starting in May 2016, CFSI engaged in two public consultation periods, receiving over 800 comments from 47 commenters, which informed the revised Standard. The Standard was approved by the CFSI Steering Committee in May 2017, and is currently being translated into Chinese, German, Indonesian, Japanese, Russian, and Spanish. CFSI is reviewing and updating associated audit tools and procedures.
The revision process brings the Standard in closer alignment with internationally recognized frameworks including the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (OECD Guidance) and ISO management systems. Importantly, the Standard utilizes a global scope for the identification of Conflict-Affected and High-Risk Areas (CAHRAs), and includes a simplification of risk categories from the previous Level 1-3 system into low-risk or high-risk sourcing. Additionally, the Standard now explicitly references both conflict-related risks and other serious human rights abuses contained in the OECD Guidance’s Annex II risks. To align with ISO management systems, the Standard now includes requirements for document control and the internal performance monitoring of due diligence management systems.
The revised Standard reduces the former focus on a transactional review, instead concentrating on smelters’ management systems. As a result, the standard includes enhanced requirements for Know Your Counter-party (KYC) processes, fewer requirements for chain of custody documentation for low-risk sources, and consolidated data points for high-risk sources, aligning with the OECD Guidance recommendations. The Standard also includes updated sampling methodology, decreasing the number of samples for secondary material. Lastly, the Standard allows for smelters to utilize alternate systems for reporting transactions and conducting the mass balance and clarifies the definition of companies in scope.
What has stayed the same?
The procedural components of the audit remain the same. The auditors will review a smelter’s management system to ensure it is robust and allows for the appropriate risk-based due diligence in the mineral supply chain. The audit frequency continues to be annual, excepting those smelters on a three-year audit cycle. The general audit process remains the same, as does the on-site audit procedure. Materials in scope include both primary and secondary materials, whether mined, purchased, tolled, or otherwise obtained. As with the previous version, origin determination is not required for secondary materials, legacy materials, or assay samples; however, KYC requirements are in place for all counterparties regardless of material type.
Impacts on smelters
The new Standard provides more flexibility in smelters’ due diligence approaches, in line with the OECD Guidance. Requirements are less prescriptive, allowing for due diligence systems that are proportional to the size, complexity, and risk-profile of a company and its sourcing practices. Smelters should identify sourcing from CAHRAs as part of their due diligence management systems and proceed to evaluate the presence of OECD red flags in their supply chains. Risk assessment and management are required for smelters with high-risk supply chains.
To enhance audit preparations, smelters will be asked to provide more information on their management systems prior to the on-site audit. This will allow for better preparation of both the smelter and the auditor, resulting in a more efficient and informed onsite audit process. After the smelters’ first audit under the new Standard, audits will focus on the maintenance of their due diligence management systems, reducing the audit burden over the long-term.
What is next?
The remainder of 2017 and first half of 2018 will be a transitional year for smelters. CFSI will provide extensive training and resources to ensure that all smelters understand the changes, and are adequately prepared for their first audit under the revised Standard. Smelters wishing to have their audit under the revised Standard prior to 1 June 2018 are welcome to do so by notifying Hillary Amster, firstname.lastname@example.org.