Proving the Business Case for the Internet of Things

Intel promises conflict-free supply chain in 2016

Steve Rogerson
January 7, 2016
 
Intel will have a conflict-free supply chain in 2016, announced CEO Brian Krzanich in his keynote speech at this week’s Consumer Electronics Show in Las Vegas. Third-party audits and direct validation by Intel's supply chain organisation will confirm that the company's broader product base – beyond just microprocessors – is conflict free. Maintaining accountability in the supply chain is an ongoing process for Intel.
 
This milestone is the result of Intel’s seven-year effort to remove conflict minerals from its supply chain and prevent profits from the sale of these minerals from funding the ongoing conflict in the Democratic Republic of the Congo (DRC).
 
Through its latest conflict-free milestone, Intel aims to educate more people about this issue and inspire other companies to join its mission by proving that going conflict-free is not only the right thing to do, it’s good for business. A recent Intel-commissioned survey, conducted in partnership with Penn Schoen Berland, indicated that millennials cared about the issue of conflict-free and that it influenced their buying decisions. The survey also found that millennials hold technology companies most accountable for taking action on conflict minerals.
 
For years, conflict minerals – gold, tin, tantalum and tungsten – have been mined through the exploitation of low-paid mine workers and used to fund violence, genocide and other crimes against humanity in the DRC, resulting in the deaths of millions. As these minerals are found in a wide range of electronic devices, from phones to tablets to PCs, Intel felt an obligation to implement changes in its supply chain to ensure that its products weren’t inadvertently funding human rights abuses in the DRC.
 
In 2008, Intel embarked on an ambitious mission to achieve an entirely conflict-free supply chain. At first, it seemed like a near-impossible challenge, but instead of avoiding the issue by sourcing minerals from other countries, Intel made a commitment to continue sourcing from the DRC. Intel worked hard for several years to find creative answers and to implement the systems required to achieve a conflict-free supply chain. To date, Intel’s conflict minerals team has met with more than 100 smelters in 21 countries to develop an effective supply chain audit process, which paved the way for the global Conflict-Free Sourcing Initiative.
 
Intel was one of the first companies to set public goals related to conflict minerals and, in January 2014, the company began manufacturing and shipping the world’s first commercially available conflict-free microprocessors. In May 2014, Intel submitted one of the only third-party audited conflict minerals filings in accordance with the Dodd-Frank Act, which requires publicly traded companies to report conflict minerals in their supply chain and investigate the source of the minerals.
 
While Intel has achieved its goals to validate more and more products as conflict-free, its journey is far from complete. Maintaining accountability in the supply chain is an ongoing process. Intel is continuing to educate consumers about conflict minerals and share its practices with industry peers to make faster and deeper strides towards conflict-free products worldwide.
 
In November 2015, Intel partnered with Penn Schoen Berland to conduct an online survey of 500 US millennials’ awareness of and attitudes towards the issue of conflict-free and how it impacts their buying decisions. The survey findings indicate that when educated about conflict minerals, millennials care about the issue and say it influences their buying decisions. The survey also found that millennials held technology companies most accountable for taking action on conflict minerals. 
 
Notable findings from the survey include:
 

  • Millennials highly value social responsibility and hold both consumers and companies accountable for making socially responsible choices.
  • Nearly all millennials surveyed (97 per cent) believed it was important for companies to act in a way that benefited society.
  • 90 per cent of millennials surveyed believed that large companies had the potential to have a positive impact; however, only 23 per cent believed large companies were fulfilling that potential today.
  • 81 per cent of millennials surveyed believed consumers had a responsibility to make sure products they bought didn’t use resources that harmed society or the environment.
  • 69 per cent of millennials surveyed avoided buying products from companies that negatively impacted society.
  • There is still a need for greater awareness around conflict minerals. Millennials believe more education about the issue is necessary and say it would make them more likely to buy conflict-free products.
  • Only 35 per cent of millennials surveyed had heard of conflict minerals and even after learning more about the issue, 38 per cent still weren’t sure if they owned products that contained conflict minerals.
  • 75 per cent of millennials surveyed believed more people needed to be educated about conflict minerals, and 53 per cent would like to learn even more about the issue.
  • Surveyed millennials said their top obstacle to buying conflict-free products was not being able to tell easily which products contained conflict minerals, and cited clear labelling as the factor that would make them most likely to buy conflict-free products.
  • Once they’ve been educated about conflict minerals, millennials care about the issue and say it influences their buying decisions.
  • 67 per cent of millennials surveyed said they were more likely to buy conflict-free products the next time they shopped.
  • 49 per cent of millennials surveyed wanted to buy conflict-free products to feel better about where their money was going, while 45 per cent wanted to buy them to help defund militants in areas of conflict.
  • Millennials believe technology companies have the most responsibility to act on conflict minerals and are more loyal to and willing to buy from companies that offer conflict-free products.
  • More than half of millennials surveyed believed technology companies were responsible for taking action on the issue of conflict minerals – more than mineral suppliers, governments, consumers or NGOs.
  • 69 per cent of millennials surveyed said this issue influenced their decision on from which companies to buy products.