Traders and market makers — Step 1

Establish strong management systems

• Adopt a policy for respon­sible supply chains of minerals consis­tent with the OECD Due Diligence Guidance.
• Assemble an internal team to oversee supply chain due dili­gence. Ensure that the neces­sary budget resources are assigned and that a senior manager is ulti­mately accountable.
• Communicate company policy, actions and expec­ta­tions related to respon­sible sourcing to suppliers. Companies may want to incor­po­rate these expec­ta­tions into supplier contracts and consider other ways to support the capa­bil­i­ties of suppliers to fulfil respon­sible sourcing expectations.
• Establish an internal system of trans­parency, infor­ma­tion collec­tion, and records of supply chain due dili­gence processes, find­ings and resulting deci­sions. In partic­ular, main­tain records on the iden­tity of smelters and refiners, or any other suppliers at points of trans­for­ma­tion where the mineral is processed to reach commer­cial market quality, once this infor­ma­tion is collected in Step 2.
• Collect and address stake­holder grievances.

Traders and market makers — Step 2

Identify, assess, and prioritise risks

• Identify your company’s suppliers and collab­o­rate with them to iden­tify the key points of trans­for­ma­tion in the supply chain where the mineral is processed to reach commer­cial market quality (e.g. smelters or refiners for metals).
• Engage with the key points of trans­for­ma­tion (e.g. smelters or refiners for metals). Obtain prelim­i­nary infor­ma­tion on the country of origin and the transit and trans­porta­tion routes used between the mine and refiners, or other point of trans­for­ma­tion to iden­tify any rele­vant red flags. 
• Assess whether smelters and refiners have conducted all neces­sary due dili­gence steps for any red-flagged supply chains that have been, or should have been, iden­ti­fied (e.g. by reviewing infor­ma­tion from the assess­ment teams and the results of any audits under Step 4 below).
• The above may be best achieved through an industry scheme or other collab­o­ra­tive initia­tive. If relying on such schemes or initia­tives, review those find­ings to ensure they are cred­ible, up-to-date, and cover risks specific to your supply chain.

Traders and market makers — Step 3

Manage risks

• Inform senior manage­ment of recog­nised supply chain risks (e.g. iden­tify priority suppliers; iden­tify smelters and refiners and assess their respec­tive risk levels and corre­sponding due dili­gence actions; docu­ment any infor­ma­tion gaps; and clarify the chain of custody).
• Identify and track which suppliers respond to infor­ma­tion requests and which do not. Follow up with suppliers and esca­late unco­op­er­a­tive suppliers to senior management.
• Strengthen efforts and systems to iden­tify and main­tain infor­ma­tion on key points of transformation.
• Disengage from suppliers asso­ci­ated with smelters and refiners that may be contributing to conflict or to the most serious human rights impacts as defined in Annex II of the OECD Guidance.
• Manage all other risks by devising a risk manage­ment plan with suppliers to promote progres­sive improve­ment within reason­able timescales. Specifically, risk manage­ment plans with smelters & refiners or other points of trans­for­ma­tion should include clearly defined targets, indi­ca­tors and time­frames to demon­strate signif­i­cant measur­able improve­ment every six months.
• Implementing risk manage­ment plans with smelters & refiners or compa­nies at other points of trans­for­ma­tion may be best achieved through an industry scheme or other collab­o­ra­tive initia­tive. If relying on such schemes or initia­tives, review those efforts to ensure they are cred­ible and on track.
• Improve internal risk assess­ment systems over time by tracking internal imple­men­ta­tion as well as commit­ments with suppliers.

Traders and market makers — Step 4

Audit control point

Support an audit of the smelter, refiner, and/or other key points of trans­for­ma­tion by:

• providing finan­cial resources for inde­pen­dent third-party audits of refiners and smelters
• becoming members of industry programmes or promoting smelter and refiner partic­i­pa­tion in audit programmes
• peri­od­i­cally assessing the quality of industry-led vali­da­tion programmes or inde­pen­dent audits of the smelters or refiners that choose to partic­i­pate in such schemes.

Traders and market makers — Step 5

Communicate and report on due diligence

• Report publicly on your compa­ny’s due dili­gence efforts for respon­sible supply chains of minerals from conflict-affected and high-risk areas.
• Reports should focus on the actions taken by the company to address iden­ti­fied risks (e.g. manage­ment systems estab­lished; steps taken to iden­tify smelters and refiners in the supply chain; risk assess­ment method­ology imple­mented; assess­ments conducted to iden­tify smelter and refiner risks and corre­sponding due dili­gence measures in accor­dance with the OECD Guidance; steps taken to manage risks; and efforts made to monitor and track perfor­mance for risk mitigation).
• Disclose infor­ma­tion with due regards taken of busi­ness confi­den­tiality and other compet­i­tive concerns (i.e. price infor­ma­tion and supplier relationships).