EXHIBIT 1.01
Conflict Minerals Report
This is the Conflict Minerals Report of Spectrum Brands Holdings, Inc. and its consolidated subsidiaries, including SB/RH Holdings, LLC and its consolidated subsidiaries (the “Company,” “Spectrum,” “we,” “us,” or “our”), for January 1, 2023 through December 31, 2023 (“Calendar Year 2023”) in accordance with Rule 13p-1 (“Rule 13p-1”) under the Securities Exchange Act of 1934, as amended (the “1934 Act”). Please refer to Rule 13p-1, Form SD and the 1934 Act Release No. 34-67716 for definitions of the terms used in this Report, unless otherwise defined herein.
Applying the Dodd-Frank Act to Spectrum Brands Holdings, Inc.
The Securities and Exchange Commission’s (the “SEC”) conflict minerals rules require a three-step compliance approach. The first step is determining applicability of the conflict minerals rules to Spectrum; the second step is a reasonable country of origin inquiry (“RCOI”) to determine whether we have reason to believe that conflict minerals from the Democratic Republic of Congo (the “DRC”) or adjoining countries (the “Covered Countries”) that are necessary to the functionality or production of products manufactured by us, or contracted to be manufactured by us, are present in our products; and the third step (referred to as “due diligence” in the SEC rules) is to determine the source and origin of any such conflict minerals and the facilities in which they were processed.
As a downstream company, Spectrum is several tiers removed from mining operations and smelters or refiners (“SORs”) in dealing with its direct suppliers. Spectrum hired a third-party provider to assist it in performing conflict mineral supply chain due diligence (the “Provider”). Using our Provider as well as our supply chain due diligence processes and focusing on accountability within the supply chain by using the industry standard Responsible Minerals Initiative’s (“RMI”) Conflict Minerals Reporting Template (“CMRT”) and reaching out to our suppliers, we hope to gain greater transparency in our supply chain.
Due Diligence Framework and Resources
Spectrum undertook due diligence to determine if conflict minerals were necessary to the production or functionality of its products. In conducting its due diligence, Spectrum implemented the Organization for Economic Co-Operation and Development Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (the “OECD Framework”), an internationally recognized due diligence framework, and related supplements for each of the conflict minerals. Accordingly, the steps taken by Spectrum in preparing this Conflict Minerals Report were in accordance with the OECD Framework. As such, we used the RMI’s CMRT, which includes standard supply chain survey and information tracking methods to: (i) determine if our manufactured products contained conflict minerals necessary to their functionality or production, (ii) perform a RCOI to determine whether such minerals originated in the DRC or a Covered Country, or are from recycled or scrap sources, and (iii) assess our supply chain’s adherence to due diligence measures stated by the OECD Framework.
Reasonable Country of Origin Inquiry
Our Steering Committee reviewed the products manufactured or contracted to be manufactured by the Company in order to determine which products might contain conflict minerals that are necessary to their functionality or production; the list of products is contained on Attachment A to this Conflict Minerals Report. The Company conducted this review at a product level. A list of the suppliers determined to be in-scope for purposes of the conflict minerals rules was compiled and the RCOI was conducted as follows:
a. | Spectrum sent initial inquiries to 136 suppliers and instructed them to complete the CMRT and return it to Spectrum. |
b. | During Fiscal Year 2024 (October 1, 2023 through September 30, 2024) (“Fiscal Year 2024”), Spectrum hired the Provider to engage its suppliers to collect information about the presence and sourcing of conflict minerals used in the products and components supplied to Spectrum in the |
1 |
Calendar Year 2023 and by doing so add more transparency to Spectrum’s supply chain with the ultimate goal of identifying the related smelters or refiners and associated mine countries of origin.
c. | Spectrum and the Provider conducted up to eight follow-up inquiries of the initially unresponsive suppliers. |
d. | Spectrum and the Provider also conducted follow-ups with suppliers for further information if initial responses were incomplete or unclear. |
e. | Spectrum performed follow-ups (up to two times) with suppliers who returned an incomplete CMRT; all issues were addressed. |
f. | The Provider also evaluated the completed CMRTs for plausibility, consistency and gaps. Additional supplier contacts were conducted to attempt to resolve “quality control” flags, such as: (a) Smelters or Refiners (SORs) were not provided for a used metal, (b) Supplier listed one or more SORs for an unused metal, (c) supplier indicated that it had not identified all SORs for the in-scope products, (d) supplier indicated it had not received conflict minerals data for each metal from all of its relevant suppliers, or (e) supplier indicated that all of its conflict minerals were from recycled or scrap sources, but one or more of the SORs listed are not known to be exclusive recyclers. |
g. | After follow-up, Spectrum had a 90% supplier response rate, with 29.41% of the responding suppliers indicating that one or more of the conflict minerals are necessary to the functionality or production of the products they supply to Spectrum. |
Due Diligence Steps Performed
1. | Steps Taken to Establish Strong Company Management Systems |
a. | Spectrum continued disseminating conflict minerals information and updates through its Steering Committee, which implements and manages Spectrum’s conflict minerals compliance program. |
b. | Spectrum is committed to sourcing components and materials from companies that share its values about human rights, ethics and environmental responsibility. Spectrum’s employees and the Steering Committee continue to enforce its Conflict Minerals Policy, which is available on the Company’s website at https://spectrumbrands.com/about-us/our-company/corporate-compliance/conflict-minerals.html. As required by our Conflict Minerals Policy, all of our suppliers are required to sign Spectrum’s Supplier Code of Conduct, which includes requirements relating to conflict minerals and responsible sourcing. A copy of Spectrum’s Supplier Code of Conduct can be found at https://www.spectrumbrands.com/about-us/suppliers/supplier-code-of-conduct.html. Spectrum’s Supplier Code of Conduct (the “Code”) incorporates requirements related to conflict minerals so that current and future suppliers are obligated to comply with Spectrum’s policies on conflict minerals, including participation in related due diligence activities. |
c. | Spectrum educates its employees and, in addition the Steering Committee, disseminates conflict minerals information through division heads, supply chains, and sales forces. |
d. | Spectrum maintains a grievance mechanism to enable the reporting of grievances related to conflict minerals and other supply chain matters. |
e. | Spectrum retains conflict minerals program documentation in accordance with the Company’s record retention policies. |
2 |
2. | Steps Taken to Identify Risks in the Supply Chain and Strategies to Respond to Identified Risks. |
a. | Spectrum identified the products it manufactured or contracted to manufacture in Calendar Year 2023. |
b. | Spectrum identified 40 suppliers from whom it purchases components used in the production of those products, and which could contain conflict minerals necessary to the functionality or production of such products and solicited information from such suppliers as part of its RCOI. Spectrum, with the assistance of the Provider, compared the list of the SORs collected to the Provider’s SOR database, which incorporates information from the lists publicly published by the RMI. Attached hereto as Exhibit A is a list of SORs identified by our suppliers with valid smelter certification identification numbers. |
Spectrum performed, and continues to perform, risk mitigation efforts to bring suppliers into conformity with its Conflict Minerals Policy and contractual requirements. These efforts included working with direct suppliers during Spectrum’s supplier meetings to consider alternative sources of components or supplying components which contain conflict minerals from OECD-conformant sources based on the internationally recognized certifications. Spectrum publicly communicated its Conflict Minerals’ Policy on its website at https://spectrumbrands.com/about-us/our-company/corporate-compliance/conflict-minerals.html.
3. | Carry out independent third-party audit of smelter/refiner due diligence practices. |
The Company uses information provided by independent third party audit programs, including the (RMI), London Bullion Market Association (LBMA), and Responsible Jewelry Council (RJC), to confirm the existence and verify the OECD conformance status of SORs identified during due diligence. We are many steps removed from the mining of conflict minerals. We do not purchase raw ore or unrefined conflict minerals, and we do not conduct any purchasing activities directly in the Covered Countries.
4. | Mitigation Steps Spectrum Has Taken or Will Take Since the End of Calendar Year 2023. |
We undertook the following steps since the end of Calendar Year 2023 to mitigate the risk that our products may contain conflict minerals that benefit armed groups within the Covered Countries, including steps to improve our due diligence:
a. | Continued to enforce our Conflict Minerals Policy, which is embedded in our Code, and disseminate the Code to those suppliers who provide raw materials and components in Spectrum’s manufacturing operations and Spectrum’s contract manufacturers. |
b. | Continued to enforce the process within Spectrum’s manufacturing operations/procurement function to notify new vendors of our conflict minerals policy within the Code. |
c. | Published a copy of our current Form SD and this Conflict Minerals Report on our website at https://spectrumbrands.com/about-us/our-company/corporate-compliance-and-social-responsibility.html. |
d. | Continued our supply chain due diligence with the assistance of our Provider, on the source and chain of custody of raw materials and components purchased for Spectrum’s manufacturing operations. Spectrum plans to continue to enhance supplier communication and training on conflict minerals. Spectrum values its supplier relationships, but if any supplier is at risk to or violates Spectrum’s Conflict Minerals Policy or its Code, Spectrum plans to require a corrective action plan from the supplier and move towards conflict free sourcing. Spectrum will not ban sourcing from the Covered Countries, but it seeks to procure materials from responsible sources in the region to assist legitimate, conflict-free businesses there. |
3 |
e. | Because of Spectrum’s size, the complexity of its products, and the depth, breadth and constant evolution of its supply chain, it is difficult to identify sub-tier suppliers downstream from its direct suppliers. Spectrum does not purchase products directly from any suppliers, smelters, refiners or mines in the Covered Countries and has no direct contractual relationships with smelters and refiners, as previously noted. Instead, it relies on its direct suppliers to gather and provide specific information about the source of conflict minerals contained in the components supplied to it. Spectrum’s direct suppliers are similarly reliant upon information provided by their suppliers. Therefore, the Provider’s assistance with unresponsive first tier suppliers will be valuable to continue to add transparency to the Spectrum supply chain. Our suppliers identified 134 smelters/refiners potentially in the Spectrum supply chain that our Provider’s database indicated as having valid smelter certification identification numbers. Additional investigation was undertaken to determine the source of and chain of custody of the regulated metals. The following internationally accepted audit standards were checked to determine the OECD conformance status of the SORs: the RMI Responsible Minerals Assurance Process (“RMAP”), the London Bullion Market Association Responsible Gold Guidance and the Responsible Jewelry Council Chain-of-Custody Standard. If the SOR was not certified by these internationally-recognized schemes, Provider attempted to contact the SOR to encourage their participation with the RMI’s RMAP or a cross-recognized program. Additionally, communications were sent to suppliers to encourage them to engage with smelters and refiners that have not been audited and encourage these smelters to undergo an independent third-party audit (e.g., RMAP or equivalent). |
f. | Attached to this Conflict Minerals Report as Attachment A is a list of the 134 smelters with valid smelter certification numbers identified by our suppliers that provided product specific information; a list of the products covered by this Conflict Minerals Report; and a list of countries of origin associated with these smelters for the metals that are necessary to the production of our products. For the remainder of Spectrum’s Fiscal Year 2024, Spectrum plans to continue to emphasize to its suppliers the importance of sourcing responsibly and from conflict-free sources if the suppliers desire to retain Spectrum’s business |
Pursuant to SEC rules and guidance, this Conflict Minerals Report was not subjected to an independent private sector audit.
Spectrum’s review of its Conflict Minerals Report for January 1, 2022 through December 31, 2022 (“Calendar Year 2022”) found that Spectrum had included African Gold Refinery among the smelters in its supply chain. The inclusion of African Gold Refinery in Spectrum’s Conflict Minerals Report for Calendar Year 2022 was in error; Spectrum has not and does not knowingly source any conflict minerals from African Gold Refinery within its global supply chain.
4 |
Attachment A
List of Products
The following products are more fully described in Spectrum Brands Holdings, Inc. Form 10-K, which may be found publicly on our website at: https://investor.spectrumbrands.com/sec-spectrum-brands-holdings-inc
· | Electric shavers and accessories |
· | Grooming products and hair care appliances |
· | Small household appliances |
· | Personal care products |
· | Hardware |
· | Home improvement and plumbing products |
· | Residential locksets |
· | Builders’ hardware |
· | Faucets |
· | Herbicides |
· | Insecticides and repellants |
· | Specialty pet supplies |
· | Household cleaning products |
5 |
List of Identified Smelters
Metal | Standard Smelter Name | Country Location | Smelter ID |
Gold | Shandong Zhaojin Gold & Silver Refinery Co., Ltd. | CHINA | CID001622 |
Gold | Zhongyuan Gold Smelter of Zhongjin Gold Corporation | CHINA | CID002224 |
Gold | Heraeus Metals Hong Kong Ltd. | CHINA | CID000707 |
Gold | MKS PAMP SA | SWITZERLAND | CID001352 |
Gold | Kennecott Utah Copper LLC | UNITED STATES OF AMERICA | CID000969 |
Gold | Metalor Technologies (Suzhou) Ltd. | CHINA | CID001147 |
Gold | Western Australian Mint (T/a The Perth Mint) | AUSTRALIA | CID002030 |
Gold | LS MnM Inc. | KOREA, REPUBLIC OF | CID001078 |
Gold | Matsuda Sangyo Co., Ltd. | JAPAN | CID001119 |
Gold | Mitsubishi Materials Corporation | JAPAN | CID001188 |
Gold | Heraeus Germany GmbH Co. KG | GERMANY | CID000711 |
Gold | Tanaka Kikinzoku Kogyo K.K. | JAPAN | CID001875 |
Gold | Asahi Refining USA Inc. | UNITED STATES OF AMERICA | CID000920 |
Gold | Aida Chemical Industries Co., Ltd. | JAPAN | CID000019 |
Gold | Asahi Pretec Corp. | JAPAN | CID000082 |
Gold | Ishifuku Metal Industry Co., Ltd. | JAPAN | CID000807 |
Gold | JX Nippon Mining & Metals Co., Ltd. | JAPAN | CID000937 |
Gold | Kojima Chemicals Co., Ltd. | JAPAN | CID000981 |
Gold | Mitsui Mining and Smelting Co., Ltd. | JAPAN | CID001193 |
Gold | Nihon Material Co., Ltd. | JAPAN | CID001259 |
Gold | Sumitomo Metal Mining Co., Ltd. | JAPAN | CID001798 |
Gold | Tokuriki Honten Co., Ltd. | JAPAN | CID001938 |
Gold | AngloGold Ashanti Corrego do Sitio Mineracao | BRAZIL | CID000058 |
Gold | Argor-Heraeus S.A. | SWITZERLAND | CID000077 |
Gold | Asahi Refining Canada Ltd. | CANADA | CID000924 |
Gold | Asaka Riken Co., Ltd. | JAPAN | CID000090 |
Gold | Aurubis AG | GERMANY | CID000113 |
Gold | Bangko Sentral ng Pilipinas (Central Bank of the Philippines) | PHILIPPINES | CID000128 |
Gold | C. Hafner GmbH + Co. KG | GERMANY | CID000176 |
Gold | CCR Refinery - Glencore Canada Corporation | CANADA | CID000185 |
Gold | Chimet S.p.A. | ITALY | CID000233 |
Gold | Dowa | JAPAN | CID000401 |
Gold | Eco-System Recycling Co., Ltd. East Plant | JAPAN | CID000425 |
Gold | Heimerle + Meule GmbH | GERMANY | CID000694 |
Gold | Istanbul Gold Refinery | TURKEY | CID000814 |
Gold | Jiangxi Copper Co., Ltd. | CHINA | CID000855 |
Gold | Materion | UNITED STATES OF AMERICA | CID001113 |
Gold | Metalor Technologies (Hong Kong) Ltd. | CHINA | CID001149 |
Gold | Metalor Technologies (Singapore) Pte., Ltd. | SINGAPORE | CID001152 |
Gold | Metalor Technologies S.A. | SWITZERLAND | CID001153 |
Gold | Metalor USA Refining Corporation | UNITED STATES OF AMERICA | CID001157 |
Gold | Metalurgica Met-Mex Penoles S.A. De C.V. | MEXICO | CID001161 |
Gold | Nadir Metal Rafineri San. Ve Tic. A.S. | TURKEY | CID001220 |
Gold | NH Recytech Company | KOREA, REPUBLIC OF | CID003189 |
6 |
Metal | Standard Smelter Name | Country Location | Smelter ID |
Gold | Ogussa Osterreichische Gold- und Silber-Scheideanstalt GmbH | AUSTRIA | CID002779 |
Gold | Ohura Precious Metal Industry Co., Ltd. | JAPAN | CID001325 |
Gold | PT Aneka Tambang (Persero) Tbk | INDONESIA | CID001397 |
Gold | PX Precinox S.A. | SWITZERLAND | CID001498 |
Gold | Rand Refinery (Pty) Ltd. | SOUTH AFRICA | CID001512 |
Gold | Royal Canadian Mint | CANADA | CID001534 |
Gold | SEMPSA Joyeria Plateria S.A. | SPAIN | CID001585 |
Gold | Sichuan Tianze Precious Metals Co., Ltd. | CHINA | CID001736 |
Gold | Solar Applied Materials Technology Corp. | TAIWAN, PROVINCE OF CHINA | CID001761 |
Gold | Umicore S.A. Business Unit Precious Metals Refining | BELGIUM | CID001980 |
Gold | United Precious Metal Refining, Inc. | UNITED STATES OF AMERICA | CID001993 |
Gold | Valcambi S.A. | SWITZERLAND | CID002003 |
Gold | Yamakin Co., Ltd. | JAPAN | CID002100 |
Gold | Yokohama Metal Co., Ltd. | JAPAN | CID002129 |
Tantalum | TANIOBIS GmbH | GERMANY | CID002545 |
Tantalum | TANIOBIS Smelting GmbH & Co. KG | GERMANY | CID002550 |
Tantalum | TANIOBIS Co., Ltd. | THAILAND | CID002544 |
Tantalum | Materion Newton Inc. | UNITED STATES OF AMERICA | CID002548 |
Tantalum | TANIOBIS Japan Co., Ltd. | JAPAN | CID002549 |
Tantalum | Mitsui Mining and Smelting Co., Ltd. | JAPAN | CID001192 |
Tantalum | Global Advanced Metals Boyertown | UNITED STATES OF AMERICA | CID002557 |
Tantalum | Global Advanced Metals Aizu | JAPAN | CID002558 |
Tantalum | Ulba Metallurgical Plant JSC | KAZAKHSTAN | CID001969 |
Tantalum | Ningxia Orient Tantalum Industry Co., Ltd. | CHINA | CID001277 |
Tantalum | Taki Chemical Co., Ltd. | JAPAN | CID001869 |
Tantalum | D Block Metals, LLC | UNITED STATES OF AMERICA | CID002504 |
Tantalum | F&X Electro-Materials Ltd. | CHINA | CID000460 |
Tantalum | FIR Metals & Resource Ltd. | CHINA | CID002505 |
Tantalum | Hengyang King Xing Lifeng New Materials Co., Ltd. | CHINA | CID002492 |
Tantalum | JiuJiang JinXin Nonferrous Metals Co., Ltd. | CHINA | CID000914 |
Tantalum | Jiujiang Tanbre Co., Ltd. | CHINA | CID000917 |
Tantalum | Metallurgical Products India Pvt., Ltd. | INDIA | CID001163 |
Tantalum | NPM Silmet AS | ESTONIA | CID001200 |
Tantalum | XIMEI RESOURCES (GUANGDONG) LIMITED | CHINA | CID000616 |
Tantalum | AMG Brasil | BRAZIL | CID001076 |
Tantalum | Mineracao Taboca S.A. | BRAZIL | CID001175 |
Tantalum | Telex Metals | UNITED STATES OF AMERICA | CID001891 |
Tin | Yunnan Chengfeng Non-ferrous Metals Co., Ltd. | CHINA | CID002158 |
Tin | Malaysia Smelting Corporation (MSC) | MALAYSIA | CID001105 |
Tin | PT Timah Tbk Mentok | INDONESIA | CID001482 |
Tin | Alpha | UNITED STATES OF AMERICA | CID000292 |
Tin | Tin Smelting Branch of Yunnan Tin Co., Ltd. | CHINA | CID002180 |
7 |
Metal | Standard Smelter Name | Country Location | Smelter ID |
Tin | Gejiu Non-Ferrous Metal Processing Co., Ltd. | CHINA | CID000538 |
Tin | China Tin Group Co., Ltd. | CHINA | CID001070 |
Tin | Metallic Resources, Inc. | UNITED STATES OF AMERICA | CID001142 |
Tin | Tin Technology & Refining | UNITED STATES OF AMERICA | CID003325 |
Tin | PT Timah Tbk Kundur | INDONESIA | CID001477 |
Tin | Thaisarco | THAILAND | CID001898 |
Tin | Minsur | PERU | CID001182 |
Tin | EM Vinto | BOLIVIA (PLURINATIONAL STATE OF) | CID000438 |
Tin | Mineracao Taboca S.A. | BRAZIL | CID001173 |
Tin | PT Bangka Serumpun | INDONESIA | CID003205 |
Tin | PT Refined Bangka Tin | INDONESIA | CID001460 |
Tin | Dowa | JAPAN | CID000402 |
Tin | Mitsubishi Materials Corporation | JAPAN | CID001191 |
Tin | PT Mitra Stania Prima | INDONESIA | CID001453 |
Tin | Rui Da Hung | TAIWAN, PROVINCE OF CHINA | CID001539 |
Tin | O.M. Manufacturing Philippines, Inc. | PHILIPPINES | CID002517 |
Tin | Aurubis Beerse | BELGIUM | CID002773 |
Tin | Aurubis Berango | SPAIN | CID002774 |
Tin | Chifeng Dajingzi Tin Industry Co., Ltd. | CHINA | CID003190 |
Tin | Fenix Metals | POLAND | CID000468 |
Tin | Guangdong Hanhe Non-Ferrous Metal Co., Ltd. | CHINA | CID003116 |
Tin | Jiangxi New Nanshan Technology Ltd. | CHINA | CID001231 |
Tin | Magnu's Minerais Metais e Ligas Ltda. | BRAZIL | CID002468 |
Tin | O.M. Manufacturing (Thailand) Co., Ltd. | THAILAND | CID001314 |
Tin | Resind Industria e Comercio Ltda. | BRAZIL | CID002706 |
Tin | White Solder Metalurgia e Mineracao Ltda. | BRAZIL | CID002036 |
Tungsten | A.L.M.T. Corp. | JAPAN | CID000004 |
Tungsten | Xiamen Tungsten Co., Ltd. | CHINA | CID002082 |
Tungsten | Wolfram Bergbau und Hutten AG | AUSTRIA | CID002044 |
Tungsten | Xiamen Tungsten (H.C.) Co., Ltd. | CHINA | CID002320 |
Tungsten | Chongyi Zhangyuan Tungsten Co., Ltd. | CHINA | CID000258 |
Tungsten | Ganzhou Seadragon W & Mo Co., Ltd. | CHINA | CID002494 |
Tungsten | Jiangwu H.C. Starck Tungsten Products Co., Ltd. | CHINA | CID002551 |
Tungsten | Hunan Shizhuyuan Nonferrous Metals Co., Ltd. Chenzhou Tungsten Products Branch | CHINA | CID002513 |
Tungsten | Guangdong Xianglu Tungsten Co., Ltd. | CHINA | CID000218 |
Tungsten | H.C. Starck Tungsten GmbH | GERMANY | CID002541 |
Tungsten | Hunan Jintai New Material Co., Ltd. | CHINA | CID000769 |
Tungsten | Japan New Metals Co., Ltd. | JAPAN | CID000825 |
Tungsten | Jiangxi Tonggu Non-ferrous Metallurgical & Chemical Co., Ltd. | CHINA | CID002318 |
Tungsten | Jiangxi Xinsheng Tungsten Industry Co., Ltd. | CHINA | CID002317 |
Tungsten | Kennametal Huntsville | UNITED STATES OF AMERICA | CID000105 |
Tungsten | Masan High-Tech Materials | VIET NAM | CID002543 |
Tungsten | Niagara Refining LLC | UNITED STATES OF AMERICA | CID002589 |
Tungsten | TANIOBIS Smelting GmbH & Co. KG | GERMANY | CID002542 |
Tungsten | Ganzhou Jiangwu Ferrotungsten Co., Ltd. | CHINA | CID002315 |
8 |
Metal | Standard Smelter Name | Country Location | Smelter ID |
Tungsten | Hunan Chenzhou Mining Co., Ltd. | CHINA | CID000766 |
Tungsten | Jiangxi Gan Bei Tungsten Co., Ltd. | CHINA | CID002321 |
Tungsten | Kennametal Fallon | UNITED STATES OF AMERICA | CID000966 |
9 |