NETGEAR, Inc.
Conflict Minerals Report
For the Year Ended December 31, 2014
Section 1 - Introduction
NETGEAR, Inc. (“NETGEAR”) is a global networking company that delivers innovative products to consumers, businesses and service providers. NETGEAR products are built on a variety of proven technologies such as wireless, Ethernet and powerline, with a focus on reliability and ease-of-use. The product line consists of wired and wireless devices that enable networking, broadband access and network connectivity. These products are available in multiple configurations to address the needs of the end-users in each geographic region in which NETGEAR's products are sold. NETGEAR products are sold in approximately 44,000 retail locations around the globe, and through approximately 33,000 value-added resellers. NETGEAR's headquarters are in San Jose, California, with additional offices in approximately 25 countries.
NETGEAR uses contract manufacturers, original design manufacturers and key component vendors to supply NETGEAR with components, assemblies or finished products.
NETGEAR products are listed in Attachment A to this Conflict Minerals Report.
Section 2 – Design of Due Diligence Measures
2.1 Due Diligence Framework
NETGEAR developed a due diligence framework aligned with Annex I “Five-Step Framework for Risk-Based Due Diligence in the Mineral Supply Chain” included in the Organization for Economic Cooperation and Development (“OECD”) framework.
2.2 Conflict Minerals Policy
NETGEAR has published its conflict minerals policy on its webpage located at: http://www.netgear.com/images/conflict_minerals_policy_statement.pdf.
2.3 Establish strong company management systems
NETGEAR’s Conflict Minerals Program (the “Program”) is incorporated into NETGEAR’s Environmental Management System. NETGEAR requires that suppliers comply with all applicable government, regulatory and environmental laws and regulations, typically as outlined in a master purchase agreement with NETGEAR.
NETGEAR created an Executive Steering Committee (“ESC”) comprised of the following groups to direct and lead the Program: QMS (Quality Management System), environmental compliance, procurement, legal, finance and internal audit. This group reported to the Senior Vice President of Worldwide Operations and Support.
NETGEAR also created two grievance mechanisms (online or by mail) to allow customers, employees, suppliers and interested parties to document their concerns about the Program.
2.4 Identify and assess risk in the supply chain
The scope of the suppliers assessed for compliance was limited to Tier 1 suppliers, as defined below:
| |
| i. | Tier 1 Supplier - ODM (Original Design Manufacturer), CM (Contract Manufacturer) and NETGEAR’s AVL (Approved Vendor List) over whom NETGEAR has direct control, but excluding the following suppliers: |
| |
| a. | Plastics and software suppliers; |
| |
| b. | Packaging suppliers; and |
| |
| c. | Suppliers whose materials declarations confirm gold, tantalum, tin and tungsten are not contained in the applicable component. |
| |
| ii. | Direct Control – NETGEAR has directly negotiated the pricing with the supplier. |
In 2014, NETGEAR identified 69 Tier 1 suppliers. As part of the Program’s refresh, these suppliers were notified via email regarding NETGEAR’s Conflict Minerals policy and program expectations on June 30, 2014.
2.5 Reasonable Country of Origin Inquiry (“RCOI”)
The goal for 2014 was to receive complete and accurate smelter information from NETGEAR’s Tier 1 suppliers. To facilitate meeting this goal, NETGEAR conducted a survey of those suppliers described above using the template developed by the Electronic Industry Citizenship Coalition (“EICC”) and the Global e-Sustainability Initiative (“GeSI”), known as the CFS Reporting Template (“CFSI Template”).
The CFSI Template is the standardized reporting template developed by the Conflict-Free Sourcing Initiative (“CFSI”).
Upon receipt of the supplier’s responses, NETGEAR undertook the following steps:
| |
| A. | Checked the supplier’s attestations provided for incomplete, contradictory, or missing responses; |
| |
| B. | Analyzed and scored the supplier’s responses; |
| |
| C. | Identified valid smelters. |
As outlined in the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, the internationally recognized standard on which NETGEAR’s system is based, NETGEAR supports the EICC and GeSI’s Conflict-Free Sourcing Initiative that audits smelters’ and refiners’ due diligence activities. The data on which we relied for certain statements in this declaration was obtained through our membership in the CFSI.
As part of RCOI, NETGEAR identified 13 smelters who were sourcing from the Democratic Republic of the Congo (“DRC”) or its adjoining countries.
Section 3 – Due Diligence
3.1 Due Diligence Undertaken
The ESC discussed and agreed that NETGEAR would focus on those Tier 1 suppliers over which it has direct control. The Tier 1 suppliers were responsible for managing the chain of custody for their direct suppliers.
The CFSI template was determined to be the best method to collect information from Tier 1 suppliers in order to identify and assess risks from direct suppliers. NETGEAR collected the CFSI templates from 100% of its 69 Tier 1 suppliers. NETGEAR tracked all responses from suppliers and, based on those responses, assigned a score based on multiple criteria. Any suppliers that exceeded our internal threshold limits then were deemed to have low potential risk. Any supplier falling below our internal threshold limits were deemed to have a potential high risk.
NETGEAR leveraged its membership in the CFSI to obtain the smelter status within the Conflict Free Smelter Program (“CFSP”). NETGEAR then reviewed the smelters and refiners received from Tier 1 suppliers. Any smelters or refiners found not in compliance with the CFSP or equivalent independent third-party audit programs were flagged and NETGEAR notified the Tier 1 suppliers to remove them.
3.2 Results of Due Diligence
Of the 69 Tier 1 suppliers, none achieved scores less than our internal threshold that would identify them as being high risk. Based on the CFSI template responses from NETGEAR’s Tier 1 suppliers, NETGEAR had identified 180 CFSI
Compliant smelters and On Active Smelters. On Active Smelters are smelters currently participating in a CFSP or independent third party audit for Conflict Minerals Compliance. The smelters and/or refiners listed in Attachment B were provided by NETGEAR’s Tier 1 suppliers and were confirmed to be CFSI Compliant or On Active List using CFSI’s Master List dated February 26, 2015, which applied to NETGEAR’s 2014 due diligence activities.
Of the 13 smelters that NETGEAR identified as sourcing from the DRC or its adjoining countries, NETGEAR confirmed all 13 to be CFSI compliant based on CFSI’s RCOI list dated February 26, 2015.
3.3 Carry out independent third-party audit of supply chain due diligence at identified points in the supply chain
At the end of 2014, the majority of NETGEAR’s Tier 1 suppliers have confirmed via the CFSI Template that they are or will require their suppliers to be compliant with the CFSP. NETGEAR’s goal is to have the Tier 1 suppliers be compliant with the Program’s expectations. NETGEAR relied on data provided by the CFSP, equivalent independent third-party audit programs, or publicly available information to drive compliance at the smelter and refiner level. The CFSP is a global program under which an independent third party evaluates a smelter’s procurement activities and determines if the smelter has demonstrated that materials they processed originated from conflict-free sources. Through this industry collaborative effort, smelters are audited globally. The list of compliant smelters and refiners is posted at www.conflictfreesmelter.org.
Attachment B includes a list of the smelters/refiners used by NETGEAR’s suppliers to process 3TG minerals that are CFSI compliant or On Active List.
Section 4 – Risk Mitigation and Future Due Diligence Processes
4.1 Design and implement a strategy to respond to identified risks
Monthly meetings on the progress of surveying NETGEAR’s suppliers were held with the ESC, and meeting minutes were documented. Additional meetings with the ESC were scheduled as necessary. Actions to be taken on the Tier 1 suppliers were also documented. Senior management was updated quarterly or as necessary.
4.2 Future Due Diligence Processes
We intend to take the following steps to improve the due diligence conducted to further mitigate any risk that the necessary conflict minerals in our products could benefit armed groups in the DRC or adjoining countries:
| |
| • | Continue to work with suppliers to ensure that they have robust due diligence practices; |
| |
| • | Continue to request suppliers to provide accurate, valid, and complete smelter information; |
| |
| • | Work with suppliers to fill out CFSI’s Smelter Information Questionnaire (“SIQ”) for their suppliers with any smelters that are not yet identified by the CFSP or equivalent independent third-party audit programs; |
| |
| • | Require Tier 1 suppliers to encourage their smelters or refiners not yet identified by the CFSP or equivalent independent third-party audit to undergo smelter audits and verify compliance; |
| |
| • | Conduct smelter visit(s). |
Management’s intent is to continue surveying NETGEAR’s suppliers annually to obtain the latest update on this status and to perform due diligence on Tier 1 Supplier responses to ensure their accuracy.
On an annual basis, should any risks be identified during the review of the Tier 1 supplier responses or changes in the supplier list, NETGEAR will develop a plan to obtain additional facts or clarification on the materials chain of custody to mitigate the potential risk to NETGEAR.
Section 5 – Independent Private Sector Audit
This Conflict Minerals Report was not subjected to an independent private sector audit, as such was not required by paragraph (c)(1)(iv) of the instructions to Item 1.01 of Form SD.
Attachment A – Product Families
NETGEAR’s product families covered under the Program are listed below:
| |
| • | Ethernet switches, which are multiple port devices used to network computing devices and peripherals via Ethernet wiring; |
| |
| • | Wireless controllers and access points, which are devices used to manage and control multiple WiFi base stations on a campus or a facility providing WiFi connections to smart phones, tablets, laptops and other computing devices; |
| |
| • | Internet security appliances, which provide Internet access through capabilities such as anti-virus and anti-spam; |
| |
| • | Unified storage, which delivers file and block based data into a single shared storage system, meeting the demands of small enterprises, education, hospitality and health markets through an easy-to-use interface for managing multiple storage protocols; |
| |
| • | Gateways, which are routers with integrated modems, for Internet access; |
| |
| • | Hotspots, which are 3G and 4G LTE WiFi access points that enable people to access the Internet on the go, and/or for use at home in place of traditional wired broadband; |
| |
| • | IP telephony products, used for transmitting voice communications over a network; |
| |
| • | Media servers, which store files and multimedia content for access by tablets, laptops, smart phones and other Internet enabled devices; |
| |
| • | Routers, which connect the home or office networks to the Internet via broadband modems; |
| |
| • | WiFi range extenders, which extend the range of the WiFi home network to eliminate dead zones; |
| |
| • | Media adapters, which connect TVs, audio players, and game consoles to a network or wirelessly display the contents of your smart phone, laptop or tablet to a big screen TV; |
| |
| • | Powerline adapters and bridges, which enable devices to be connected to the network over existing electrical wiring; |
| |
| • | Multimedia over Coax Alliance standard (“MoCA”) adapters and bridges, which enable devices to be connected to the network over existing coaxial wiring; |
| |
| • | Remote video security systems, which provide wire-free security accessible by smart phone, tablet or PC and MAC; |
| |
| • | Wireless network interface cards and adapters, which enable devices to be connected to the network wirelessly; and |
| |
| • | Ethernet network interface cards and adapters, which enable devices to be connected to the network over Ethernet wiring. |
Attachment B - Smelter Listing
This list includes the names of all CFSI compliant and On Active smelters or refiners that NETGEAR has identified through the CFSI: |
| | |
| Metal | Smelter Name | Country |
| Gold | Aida Chemical Industries Co. Ltd. | JAPAN |
| Gold | Allgemeine Gold- und Silberscheideanstalt A.G. | GERMANY |
| Gold | AngloGold Ashanti Córrego do Sítio Minerção | BRAZIL |
| Gold | Argor-Heraeus SA | SWITZERLAND |
| Gold | Asahi Pretec Corp | JAPAN |
| Gold | Asaka Riken Co Ltd | JAPAN |
| Gold | Atasay Kuyumculuk Sanayi Ve Ticaret A.S. | TURKEY |
| Gold | Aurubis AG | GERMANY |
| Gold | Boliden AB | SWEDEN |
| Gold | C. Hafner GmbH + Co. KG | GERMANY |
| Gold | CCR Refinery - Glencore Canada Corporation | CANADA |
| Gold | Cendres & Metaux SA | SWITZERLAND |
| Gold | Chimet S.p.A. | ITALY |
| Gold | Dowa | JAPAN |
| Gold | ECO-SYSTEM RECYCLING | JAPAN |
| Gold | Heimerle + Meule GmbH | GERMANY |
| Gold | Heraeus | SWITZERLAND |
| Gold | Heraeus Precious Metals GmbH & Co. KG | GERMANY |
| Gold | Ishifuku Metal Industry Co., Ltd. | JAPAN |
| Gold | Istanbul Gold Refinery | TURKEY |
| Gold | Japan Mint | JAPAN |
| Gold | Johnson Matthey Inc | UNITED STATES |
| Gold | Johnson Matthey Limited | CANADA |
| Gold | JSC Ekaterinburg Non-Ferrous Metal Processing Plant | RUSSIAN FEDERATION |
| Gold | JX Nippon Mining & Metals Co., Ltd | JAPAN |
| Gold | Kazzinc Ltd | KAZAKHSTAN |
| Gold | Kennecott Utah Copper | UNITED STATES |
| Gold | Kojima Chemicals Co. Ltd | JAPAN |
| Gold | L' azurde Company For Jewelry | SAUDI ARABIA |
| Gold | LS-Nikko Copper Inc | KOREA, REPUBLIC OF |
| Gold | Materion | UNITED STATES |
| Gold | Matsuda Sangyo Co. Ltd | JAPAN |
| Gold | Metalor HK | HONG KONG |
| Gold | Metalor Technologies (Singapore) Pte. Ltd. | SINGAPORE |
| Gold | Metalor | UNITED STATES |
| Gold | Metalor USA | UNITED STATES |
|
| | |
| Metal | Smelter Name | Country |
| Gold | METALÚRGICA MET-MEX PEÑOLES, S.A. DE C.V | MEXICO |
| Gold | Mitsubishi Materials Corporation | JAPAN |
| Gold | Mitsui & Co. Precious Metals Inc. Hong Kong Branch | HONG KONG |
| Gold | Nadir Metal Rafineri San. Ve Tic. A.Ş. | TURKEY |
| Gold | Nihon Material Co. LTD | JAPAN |
| Gold | Ohio Precious Metals | UNITED STATES |
| Gold | Ohura Precious Metal Industry Co., Ltd | JAPAN |
| Gold | OJSC “The Gulidov Krasnoyarsk Non-Ferrous Metals Plant” (OJSC Krastvetmet) | RUSSIAN FEDERATION |
| Gold | PAMP SA | SWITZERLAND |
| Gold | PT Aneka Tambang (Persero) Tbk | INDONESIA |
| Gold | PX Précinox SA | SWITZERLAND |
| Gold | Rand Refinery (Pty) Ltd | SOUTH AFRICA |
| Gold | Royal Canadian Mint | CANADA |
| Gold | Sabin Metal Corp. | UNITED STATES |
| Gold | Schone Edelmetaal | NETHERLANDS |
| Gold | SEMPSA | SPAIN |
| Gold | Shandong Zhaojin Gold & Silver Refinery Co. Ltd | CHINA |
| Gold | SOE Shyolkovsky Factory of Secondary Precious Metals | RUSSIAN FEDERATION |
| Gold | Solar Applied Materials Technology Corp. | TAIWAN |
| Gold | Sumitomo Metal Mining Co., Ltd. | JAPAN |
| Gold | Tanaka Kikinzoku Kogyo K.K. | JAPAN |
| Gold | Shandong Gold Mining Co., Ltd | CHINA |
| Gold | Tokuriki Honten Co. Ltd | JAPAN |
| Gold | Umicore Brasil Ltda | BRAZIL |
| Gold | Umicore SA Business Unit Precious Metals Refining | BELGIUM |
| Gold | United Precious Metal Refining Inc. | UNITED STATES |
| Gold | Valcambi SA | SWITZERLAND |
| Gold | Western Australian Mint trading as The Perth Mint | AUSTRALIA |
| Gold | YAMAMOTO PRECIOUS METAL CO., LTD. | JAPAN |
| Gold | Yokohama Metal Co Ltd | JAPAN |
| Gold | Umicore Precious Metals Thailand | THAILAND |
| Tantalum | Changsha South Tantalum Niobium Co., Ltd. | CHINA |
| Tantalum | Conghua Tantalum and Niobium Smeltry | CHINA |
| Tantalum | Duoluoshan | CHINA |
| Tantalum | Exotech Inc. | UNITED STATES |
| Tantalum | F&X Electro-Materials Ltd. | CHINA |
| Tantalum | Guangdong Zhiyuan New Material Co., Ltd. | CHINA |
| Tantalum | Hi-Temp | UNITED STATES |
| Tantalum | Jiujiang Jinxin Nonferous Metals Co., Ltd | CHINA |
| Tantalum | JiuJiang Tambre Co. Ltd. | CHINA |
|
| | |
| Metal | Smelter Name | Country |
| Tantalum | King-Tan Tantalum Industry Ltd | CHINA |
| Tantalum | LSM Brasil S.A. | BRAZIL |
| Tantalum | Metallurgical Products India (Pvt.) Ltd. | INDIA |
| Tantalum | Mineração Taboca S.A. | BRAZIL |
| Tantalum | Mitsui Mining & Smelting | JAPAN |
| Tantalum | Molycorp Silmet A.S. | ESTONIA |
| Tantalum | Ningxia Orient Tantalum Industry Co., Ltd. | CHINA |
| Tantalum | QuantumClean | UNITED STATES |
| Tantalum | RFH | CHINA |
| Tantalum | Solikamsk Magnesium Works OAO | RUSSIAN FEDERATION |
| Tantalum | Taki Chemicals | JAPAN |
| Tantalum | Telex | UNITED STATES |
| Tantalum | Ulba | KAZAKHSTAN |
| Tantalum | Zhuzhou Cement Carbide | CHINA |
| Tantalum | Yichun Jin Yang Rare Metal Co., Ltd | CHINA |
| Tantalum | Global Advanced Metals | UNITED STATES |
| Tantalum | Hengyang King Xing Lifeng New Materials Co., Ltd. | CHINA |
| Tantalum | Guizhou Zhenhua Xinyun Technology Ltd., Kaili branch | CHINA |
| Tantalum | KEMET Blue Metals | MEXICO |
| Tantalum | Plansee SE Liezen | AUSTRIA |
| Tantalum | H.C. Starck Co., Ltd. | GERMANY |
| Tantalum | H.C. Starck GmbH Goslar | GERMANY |
| Tantalum | H.C. Starck GmbH Laufenburg | GERMANY |
| Tantalum | H.C. Starck Hermsdorf GmbH | GERMANY |
| Tantalum | H.C. Starck Inc. | UNITED STATES |
| Tantalum | H.C. Starck Ltd. | JAPAN |
| Tantalum | H.C. Starck Smelting GmbH & Co.KG | GERMANY |
| Tantalum | Plansee SE Reutte | AUSTRIA |
| Tantalum | Global Advanced Metals Boyertown | UNITED STATES |
| Tantalum | Global Advanced Metals Aizu | UNITED STATES |
| Tantalum | Kemet Blue Powder | UNITED STATES |
| Tin | China Rare Metal Materials Company | CHINA |
| Tin | Alpha | UNITED STATES |
| Tin | Cooper Santa | BRAZIL |
| Tin | CV Gita Pesona | INDONESIA |
| Tin | CV JusTindo | INDONESIA |
| Tin | CV Nurjanah | INDONESIA |
| Tin | CV Serumpun Sebalai | INDONESIA |
| Tin | CV United Smelting | INDONESIA |
| Tin | Dowa | JAPAN |
| Tin | EM Vinto | BOLIVIA |
|
| | |
| Metal | Smelter Name | Country |
| Tin | Fenix Metals | POLAND |
| Tin | Geiju Non-Ferrous Metal Processing Co. Ltd. | CHINA |
| Tin | China Tin Group Co., Ltd. | CHINA |
| Tin | Malaysia Smelting Corp | MALAYSIA |
| Tin | Metallo Chimique | BELGIUM |
| Tin | Mineração Taboca S.A. | BRAZIL |
| Tin | Amalgamet | UNITED STATES |
| Tin | Mitsubishi Materials Corporation | JAPAN |
| Tin | O.M. Manufacturing (Thailand) Co., Ltd. | THAILAND |
| Tin | OMSA | BOLIVIA |
| Tin | PT Artha Cipta Langgeng | INDONESIA |
| Tin | PT Babel Inti Perkasa | INDONESIA |
| Tin | PT Bangka Putra Karya | INDONESIA |
| Tin | PT Bangka Tin Industry | INDONESIA |
| Tin | PT Belitung Industri Sejahtera | INDONESIA |
| Tin | PT BilliTin Makmur Lestari | INDONESIA |
| Tin | PT Bukit Timah | INDONESIA |
| Tin | PT DS Jaya Abadi | INDONESIA |
| Tin | PT Eunindo Usaha Mandiri | INDONESIA |
| Tin | PT Karimun Mining | INDONESIA |
| Tin | PT Mitra Stania Prima | INDONESIA |
| Tin | PT Panca Mega Persada | INDONESIA |
| Tin | CV Prima Timah Utama | INDONESIA |
| Tin | PT REFINED BANGKA TIN | INDONESIA |
| Tin | PT Sariwiguna Binasentosa | INDONESIA |
| Tin | PT Stanindo Inti Perkasa | INDONESIA |
| Tin | PT Sumber Jaya Indah | INDONESIA |
| Tin | PT Tambang Timah | INDONESIA |
| Tin | PT Timah | INDONESIA |
| Tin | PT Tinindo Inter Nusa | INDONESIA |
| Tin | Rui Da Hung | TAIWAN |
| Tin | Soft Metais, Ltda. | BRAZIL |
| Tin | Thailand Smelting & Refining Co., Ltd. | THAILAND |
| Tin | White Solder Metalurgia e Mineração Ltda. | BRAZIL |
| Tin | Yunnan Chengfeng | CHINA |
| Tin | YUN NAN TIN CO.LTD | CHINA |
| Tin | Magnu's Minerais Metais e Ligas LTDA | BRAZIL |
| Tin | Melt Metais e Ligas S/A | BRAZIL |
| Tin | PT ATD Makmur Mandiri Jaya | INDONESIA |
| Tin | O.M. Manufacturing Philippines, Inc. | PHILIPPINES |
| Tin | PT Inti Stania Prima | INDONESIA |
| Tin | Cooper Santa | BRAZIL |
|
| | |
| Metal | Smelter Name | Country |
| Tungsten | Guangdong Xianglu Tungsten Co., Ltd. | CHINA |
| Tungsten | Chongyi Zhangyuan Tungsten Co Ltd | CHINA |
| Tungsten | Fujian Jinxin Tungsten Co., Ltd. | CHINA |
| Tungsten | Global Tungsten & Powders Corp | UNITED STATES |
| Tungsten | Hunan Chunchang Nonferrous Metals Co., Ltd. | CHINA |
| Tungsten | Japan New Metal | JAPAN |
| Tungsten | Ganzhou Non-ferrous Metals Smelting Co., Ltd. | CHINA |
| Tungsten | Ganzhou Huaxing Tungsten Products Co., Ltd. | CHINA |
| Tungsten | Vietnam Youngsun Tungsten Industry Co., Ltd | VIETNAM |
| Tungsten | Wolfram Bergbau und Hutten AG | AUSTRIA |
| Tungsten | Xiamen Tungsten Co Ltd | CHINA |
| Tungsten | Xinhai Rendan Shaoguan Tungsten Co., Ltd. | CHINA |
| Tungsten | Ganzhou Jiangwu Ferrotungsten Co., Ltd. | CHINA |
| Tungsten | Malipo Haiyu Tungsten Co., Ltd. | CHINA |
| Tungsten | Xiamen Tungsten (H.C.) Co., Ltd. | CHINA |
| Tungsten | Jiangxi Gan Bei Tungsten Co., Ltd. | CHINA |
| Tungsten | Ganzhou Seadragon W & Mo Co., Ltd. | CHINA |
| Tungsten | Chenzhou Diamond Tungsten Products Co., Ltd. | CHINA |
| Tungsten | H.C. Starck Smelting GmbH & Co.KG | GERMANY |
| Tungsten | Nui Phao H.C. Starck Tungsten Chemicals Manufacturing LLC | VIETNAM |
| Tungsten | Jiangwu H.C. Starck Tungsten Products Co., Ltd. | CHINA |
