Friday, September 28, 2012

Australia Choosing Not To Follow U.S. Lead On Conflict Minerals

MELBOURNE, AUSTRALIA (THECONVERSATION.EDU) -- The SEC brought in new legislation last month that prohibited the use of 'conflict' minerals. After setting the precedent, countries around the world are now deciding whether or not they should be following suit. Australia, however, is not one of them.
The source of much debate. Minerals mined in conflict
zones such as the DRC are funding militia groups.
The SEC recognizes the role of US companies in exploiting workers and trade of resources in the Democratic Republic of Congo and also its direct impact on funding militia groups. The SEC conflict minerals legislation aims to keep US companies accountable by making the dealings more transparent and shaming companies into not participating.
Australia, however, has huge mining interests in Africa and is not willing to follow suit. In 2011 alone, Australia had seven firms actively working in the DRC. Furthermore, Australia has more ventures in Africa than it does in any other place in the world.
Given the lack of infrastructure in the DRC, companies that do business there are expected to regulate their own behavior. It is therefore their responsibility to act accordingly in relation to the people, standards and impact that their company is having. This is not happening due to companies concentration on profits and not on ethically sourced minerals. Australia has a large stake in mining in the DRC and is unwilling to risk their enterprises by following up and implementing similar legislation to the Dodd-Frank bill.
Source: Australia Needs To Act On Conflict Minerals. (Reliability: Medium)

Comment: US businesses could be at a distinct disadvantage if the Dodd-Frank bill has the desired affect. If companies in the US withdraw or switch to conflict free sources of minerals, then Australia, and other countries that choose not to source ethically, could be at an advantage with a big supply of minerals at a lower price.

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