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1 Proprietary & Confidential
KPMG & Thermo Fisher Discuss Conflict Mineral Compliance
Today’s Agenda
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Thermo Fisher’s Conflict Minerals Expectations
Conflict Minerals Filing Status Update
Conflict Minerals Survey FAQ’s
Open Questions
Today’s Speakers
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Scott GordonThermo Fisher ScientificSenior Program Leader
Scott Gordon is a Senior Project Leader for Supply Chain Regulatory Compliance for Thermo Fisher Scientific. Scott joined ThermoFisher Scientific in 2006 as a credit analyst. Over the last several years, Scott has been promoted several times, first as a Customer Complaints and Contracts Coordinator, next as an Import-Export Coordinator and then in his current role as a Senior Project Leader in charge of Thermo Fisher’s conflict minerals compliance program.
Charles RiepenhoffKPMGManaging Director
Chuck is a professional with over 40 years of consulting experience and is KPMG’s Global Leader for Conflict Minerals. He has assisted numerous companies, across multiple industries, in designing and implementing conflict minerals programs and preparing for audits. He has also published conflict minerals guidance and is a frequent presenter at conferences on the subject.
Jonathan NauthAssent ComplianceRegulatory Division
Jonathan joined the Assent Compliance Team in 2012 as a Key Account Manager focusing on Ethical Sourcing and Material Compliance in the supply chain. This included program development, data collection and reporting. In 2015 Jonathan joined the Regulatory Division to focus on Strategic Partnerships and Alliances. Jonathan works with industry leaders in Ethical Sourcing and Materials Compliance to help strengthen Assent’s product platform.
Introduction
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Thermo Fisher Scientific Inc. is the world leader in serving science, with
revenues of $17 billion and approximately 50,000 employees in
50 countries. Our mission is to enable our customers to make the world
healthier, cleaner and safer. We help our customers accelerate life
sciences research, solve complex analytical challenges, improve patient diagnostics and increase laboratory
productivity.
KPMG LLP, the audit, tax and advisory firm, is the U.S. member firm of KPMG
International Cooperative ("KPMG International"). KPMG is a global
network of professional firms providing Audit, Tax and Advisory services. We
operate in 155 countries and have more than 162,000 people working in
member firms around the world.
Assent builds elegant software to help automate processes, reduce workload,
increase efficiencies and ultimately help companies save on compliance costs. Assent also partners with companies
who need additional data collection and program support. Assent is the trusted compliance partner for thousands of
customers and suppliers globally.
The world leader in serving scienceProprietary & Confidential
Scott GordonSenior Project Leader, Supply Chain Regulatory ComplianceFebruary 10, 2016
Conflict Minerals
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For our suppliers that have recently been made aware of the conflict minerals regulation, we have a Supplier Success Center with more foundational information on conflict minerals in addition to information on completing our survey.
This content of this presentation is not legal advice and should not be construed as legal guidance for conflict minerals compliance.
The Assent Supplier Success Center can be found here: http://www.assentcompliance.com/supplier-success-center/
Additional guidance can be obtained by contacting KPMG at the link below: [email protected]
Disclaimer
Please note that the intention of this presentation presumes a basic understanding of the conflict minerals rule and compliance. The purpose of this webinar is to update you on our understanding of the conflict minerals rule and to address some frequently asked questions.
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Thermo Fisher’s entire Supplier Code of Conduct with regard to responsible sourcing and other conflict minerals disclosures can be found at the link below: http://corporate.thermofisher.com/en/responsibility/resources.html
Further questions should be routed through an Assent Compliance representative or the conflict minerals mailbox: [email protected]
Thermo Fisher’s Conflict Minerals Expectations
EXPECTATIONS ON RESPONSIBLE SOURCING:
“Thermo Fisher supports responsible sourcing practices, which includes compliance with the Conflict Minerals provision of the Dodd-Frank Act. As a result, suppliers shall design and implement reasonable
processes to ensure all products supplied to Thermo Fisher are “DRC Conflict Free” as defined under Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Additionally, Suppliers shall assist Thermo Fisher with its conflict minerals compliance by making a reasonable, good-faith effort to answer any questions and to provide all materials requested by Thermo
Fisher regarding this initiative.”
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• Conflict minerals compliance is an ongoing process
• Use of the Conflict Minerals Reporting Template (“CMRT”)
• Expected timeline
• All responses are evaluated for accuracy and completeness
• All responses assess program strength
• Further questions on due diligence may arise
Thermo Fisher’s conflict minerals expectations
Completed CMRTResponse Submitted
Response is Assessed for Accuracy, Completeness,
and Program Strength
Follow-Up May be Necessary
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Filing Status Update
The U.S. Court of Appeals for the District of Columbia Circuit, through a three judge panel, ruled August 18, 2015 to affirm its previous ruling on conflict minerals. This ruling does not provide any clarity in regards to who will be required to have an Independent Private Sector Audit (“IPSA”) and leaves in place a majority of the SEC’s rules along with the current stay. It is not known yet whether the SEC will appeal since they have various options, including petitioning the Supreme Court to hear the matter.
In regards to the IPSA for the 2015 reporting period:
• SEC can leave the stay in place and therefore, most companies will not need an IPSA
• The stay can be lifted which would lead to most companies in need of an IPSA
• SEC can provide revised guidance regarding the IPSA
• SEC could propose new rules
Given that it remains unclear as to actions the SEC may take as related to the IPSA for CY2015, KPMG recommends that companies continue to assess their readiness for an IPSAand take appropriate action to prepare documentation to support the adherence to the two audit objectives (see chart to the right).
Evaluating whether the design is in conformity, in
all material respects, with the OECD
framework
Evaluating whether due diligence
measures performed were in line with the
designed process
IPSA Objectives:
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FAQ
Frequently Asked Questions
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FAQ
We are a private and/or foreign company, how does this apply to us?1
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FAQ
I am a distributor – do I still have to complete a CMRT?2
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FAQ
We do not use 3TGs – why/how do I complete the CMRT?3
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FAQ
How do I collect this data from my suppliers?4
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FAQ
What level of smelter information is acceptable?• What if I do not have complete information on my smelters?• Can I claim that a smelter is not listed in the tool?• Why is smelter information important?• What happens if I don’t provide full smelter information?
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Thank You
Further Questions
