2021 Conflict Minerals Report
Lowe’s Companies, Inc. (the “Company” or “Lowe’s”) has included this Conflict Minerals Report as an exhibit to Form SD for the reporting period from January 1 to December 31, 2021, as provided for in Rule 13p-1 under the Securities Exchange Act of 1934, as amended. Unless the context indicates otherwise, the terms “Company,” “we,” “us” and “our” refer to Lowe’s and its consolidated subsidiaries.
I. Overview
Lowe’s has developed and implemented a reasonable and documented due diligence process, consistent with the Organisation for Economic Co-operation and Development (“OECD”) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, Third Edition (the “OECD Guidelines”), to determine the use, source, and origin of columbite-tantalite (also known as coltan), cassiterite, wolframite, gold and their derivatives tantalum, tin and tungsten (collectively, “3TG”) in our global product portfolio, and specifically, whether any of them originated in the Democratic Republic of the Congo or an adjoining country (collectively, the “Covered Countries”).
Based on the due diligence steps described in Section IV, we found no reason to believe that the products in our global product portfolio were produced with necessary 3TG sourced from smelters or refiners (“SORs”) that directly or indirectly financed or benefited armed groups within the Covered Countries.
II. Product Description
Lowe’s evaluated the application of the terms “manufacture” and “contract to manufacture” (as used in Rule 13p-1) as they relate to the Company’s products, including products over which the Company may have specific influence in the manufacturing process and so may be products the Company is deemed to have “contracted to manufacture.” We then identified product groups for which 3TG may be necessary to the functionality or production. Lowe’s determined (i) it may have specific influence in the manufacturing process of, and therefore be deemed to have “contracted to manufacture,” products in the product groups listed in Attachment C to this Conflict Minerals Report and (ii) products in such product groups may include 3TG that is necessary to the functionality or production of those products.
III. Reasonable Country of Origin Inquiry
Lowe’s conducted a good faith reasonable country of origin inquiry (“RCOI”) by sending out the Conflict Minerals Reporting Template (“CMRT”) and reviewing smelter certifications through our membership in the Responsible Minerals Initiative (“RMI”), that we believe was reasonably designed to determine whether any of the necessary 3TG that may be contained in the Company’s products originated in the Covered Countries or came from recycled or scrap sources.
We do not directly source minerals from SORs or mines, nor do we have direct knowledge of the country of origin and chain of custody of 3TG in our supply chain. Our supply chain is complex and there are many intermediaries between us and mines from which participants in our supply chain source minerals. As a result, we must rely on our direct vendors and suppliers for information relating to the 3TG in the products we source from them, who in turn often similarly rely on their own vendors and suppliers as they too are often far removed from the actual source of any 3TG.
In conducting the RCOI, Lowe’s solicited information from vendors who supplied products to Lowe’s for which 3TG may be necessary to the functionality or production regarding the inclusion of 3TG in those products, including but not limited to the location or origin of the 3TG. For this process, Lowe’s used the CMRT published by the RMI, formerly the Conflict-Free Sourcing Initiative.
As a result of the RCOI, Lowe’s has reason to believe that certain of the necessary 3TG that may be contained in our products may have originated in the Covered Countries. Lowe’s therefore conducted further due diligence on the source and chain of custody of the necessary 3TG that may be contained in our products.
Based on the due diligence described below, Lowe’s believes the facilities used to process the necessary 3TG that may be in our products include 140 different SORs, 130 of which are RMAP Conformant (as defined below). None of the remaining 10 SORs, which are not RMAP Conformant, are located in the Covered Countries.
IV. Due Diligence
Due Diligence Design
The design of the Company’s due diligence framework conforms to the five steps of the OECD Guidelines.
Due Diligence Measures Performed
Step 1 - Establish Strong Company Management Systems. Lowe’s Conflict Minerals Compliance Program is under the leadership of the Senior Vice President, Global Merchandising and the Executive Vice President, Merchandising, to whom the working group provides updates regarding the program results. The compliance program is administered by a dedicated cross-functional working group, which works closely with various internal departments and external vendors to manage the process of supply chain due diligence to fulfill Lowe’s 3TG reporting and disclosure requirements. This working group engages with key stakeholders both internally and externally, conducts training, collects and analyzes data, and evaluates 3TG risks to establish the chain of custody and/or traceability of upstream actors, products and materials in the Lowe’s supply chain.
Lowe’s is committed to sourcing materials from socially responsible suppliers, including certified/conflict-free SORs within the Covered Countries. Lowe’s has adopted a Conflict Minerals Statement and communicated the principles thereof to its vendors and the public. The principles of the Lowe’s Conflict Minerals Statement are included in Lowe’s Vendor Code of Conduct, which applies to all vendors who provide services and goods to Lowe’s or any of its subsidiaries. In addition, Lowe’s has a Conflict Mineral Policy, which is publicly available on the Company’s website at: https://corporate.lowes.com/our-responsibilities/corporate-responsibility-reports-policies/lowes-conflict-minerals-policy. Education, engagement and oversight regarding these principles and expectations are essential components of our management systems and are overseen by the working group. Accordingly, we expect our vendors to (i) source materials from socially responsible suppliers, including certified/conflict-free SORs within the Covered Countries, (ii) work with us to determine the potential use of 3TG in our supply chain and (iii) conduct the necessary due diligence and provide us with proper verification of the source of materials used in their products. The Vendor Code of Conduct also details how to file a grievance with the Company and is publicly available at the following website:
https://www.loweslink.com/llmain/pubdocuments/lgsbusinessethics.pdf
Step 2 - Identify and Assess Conflict Mineral Risk in the Supply Chain. Lowe’s established an internal Conflict Minerals Compliance Program, which included the creation of the Company’s 3TG working group and Conflict Minerals Policy. The working group met with representatives from various departments within Lowe’s, identified product groups for which 3TG may be necessary to the functionality or production, as described above, and mapped the products within these product groups to their respective vendors in the supply chain. Based on interviews with representatives from various departments, the working group initially evaluated approximately 11,000 private branded products sourced from approximately 574 vendors to determine whether 3TG may be necessary to the functionality or production of such products. The number of evaluated products and relevant vendors increased as compared to the prior year due to our strategy to increase private branded products. Following this initial evaluation, 79 vendors of approximately 1,640 products received a notification describing the Company’s Conflict Minerals Compliance Program requirements, conflict mineral training documentation, and a link to the 3TG survey.
Thereafter, using the CMRT, the working group solicited information from those vendors regarding the inclusion of 3TG in the products they supply Lowe’s, including but not limited to, the mine or location of origin of such 3TG. Upon distribution of the CMRT, the working group communicated directly with the vendors to explain the CMRT process and Lowe’s expectations.
Non-responsive suppliers received multiple follow-up emails reminding them of the Company’s initial survey response target date in an effort to encourage completion of the CMRT. The working group worked directly with non-responsive suppliers to identify any issue the suppliers had in completing and returning the CMRT.
Lowe’s received CMRT responses from all vendors surveyed, or 100% of the population of products surveyed.
Step 3 - Design and Implement a Strategy to Respond to Identified Conflict Mineral Risks. The working group evaluated all CMRT responses for accuracy and consistency. Additionally, the working group contacted vendors to address issues with the accuracy of their statements regarding the lack of presence of 3TG in their in-scope products, incomplete data, or non-identification of a SOR. If a SOR was identified, the working group determined whether the SOR was certified as “compliant” or the equivalent by the RMI (referred to as “RMAP Conformant”).
The working group also developed a CMRT training document for vendors to reference in order to provide Lowe’s with confidence of the quality and depth of a vendor’s due diligence in their own supply chain. In 2021, Lowe’s was also an active member in the Retail Industry Leaders Association, a multi-year program helping retailers navigate issues, compliance requirements, and solutions through a combination of educational materials, benchmarking, implementation tools, and key partnerships.
Based on the 3TG risks identified in Step 2, the working group (i) analyzed and evaluated vendor responses against an established list of risk indicators to identify potential risks within the Company’s supply chain, (ii) re-evaluated the Company’s standard operating procedure to identify and act upon such risks, (iii) discussed the findings of our risk assessment with the Executive Vice President, Merchandising and the Senior Vice President, Deputy General Counsel, Chief Compliance Officer and Assistant Secretary and (iv) reported the due diligence framework and findings as contained in this Conflict Minerals Disclosure to the Sustainability Committee of the Lowe’s Board of Directors.
Step 4 - Carry Out Independent Third-Party Audit of Supply Chain Due Diligence at Identified Points in the Supply Chain. The standard operating procedure referenced in Step 3 provides for the implementation of steps to conduct audits at identified parts of the supply chain. In connection with our due diligence, the working group compared the identified SORs against the list of RMI certified SORs.
Step 5 - Report on Supply Chain Due Diligence. Lowe’s annually reports the results of its supply chain due diligence by filing this Conflict Minerals Report in accordance with Rule 13p-1 as an exhibit to Form SD.
V. Independent Private Sector Audit (IPSA) In accordance with guidance issued by the Securities and Exchange Commission (the “SEC”) on April 29, 2014, Lowe’s is not required to submit, and is not submitting, an audit report of this Conflict Minerals Report prepared by an independent private sector auditor.
VI. Due Diligence Results Lowe’s encourages all of our vendors to use RMAP Conformant SORs. Based on information provided in vendor surveys and our own reasonable due diligence efforts, we believe the facilities used to process the necessary 3TG that may be in our products include 140 different SORs. Those SORs and their respective country locations are set forth in Attachment A to this Conflict Minerals Report. Based on review of the RMI SOR database, 130 of these SORs are RMAP Conformant, which accounts for approximately 93% of the 140 SORs. Lowe’s intends to continue to encourage those vendors who currently source 3TG from SORs that are not RMAP Conformant to transition to RMAP Conformant SORs or request the SORs they use to become RMAP Conformant. We have no reason to believe any of the 10 SORs that are not RMAP Conformant sourced necessary 3TG from the Covered Countries.
| | | | | |
| Smelters and Refiners Verified as RMI Certified |
| Tin | 38 of 40 (95%) |
| Tantalum | 2 of 2 (100%) |
| Tungsten | 4 of 5 (80%) |
| Gold | 86 of 93 (92%) |
| Total | 130 of 140 (93%) |
Based on information provided by vendors and SORs, as well as from the RMI and other sources, we believe the countries of origin of the necessary 3TG in our products include the countries listed in Attachment B. Vendors provided information on 29 countries of origin.
VII. 2022 Compliance Activities Lowe’s intends to undertake the following steps during 2022 to improve our due diligence to further mitigate any risk that the necessary 3TG that may be in our products benefit armed groups in the Covered Countries, including:
•Continue to engage the Company’s supply chain to obtain current, accurate and complete information about the supply chain, implement responsible sourcing and encourage SORs to obtain conflict free certification from an independent third-party auditor;
•Continue to work with vendors, including any vendors that were new in 2021, sourcing from non-RMAP Conformant mines to alter their supply chain or find new ethically sourcing vendors;
•Continue training internal teams and vendors regarding 3TG and our due diligence process;
•Work with relevant trade associations to define and improve best practices and build leverage over the supply chain in accordance with the OECD guidance; and
•Continue to monitor supply chain developments in the Covered Countries, as well as other similar supply chain issues, and SOR improvements, including a review of previously non-RMAP Conformant SORs to determine if they are now RMAP Conformant.
VIII. Disclosure Regarding Forward-Looking Statements
This Conflict Minerals Report includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements including words such as “believe”, “expect”, “anticipate”, “plan”, “intend”, “will”, “should”, “could”, “would”, “may”, “strategy”, “potential”, “opportunity” and similar expressions are forward-looking statements. Forward-looking statements include, but are not limited to, statements about Lowe’s expected future vendor due diligence and engagement efforts and development of related processes. Although we believe that the expectations, opinions and comments reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and we can give no assurance that such statements will prove to be correct. Actual outcomes may differ materially from those expressed or implied in such statements.
A wide variety of potential risks, uncertainties and other factors could materially affect our ability to achieve the outcomes either expressed or implied by these forward-looking statements, including but not limited to: regulatory changes and judicial developments relating to conflict minerals disclosure; changes in our supply chain or products; and industry developments relating to supply chain diligence, disclosure and other practices. For more information about these and other risks and uncertainties that we are exposed to, you should read the “Risk Factors” section included in our most recent Annual Report on Form 10-K filed with the SEC and the description of material changes thereto, if any, included in our Quarterly Reports on Form 10-Q or subsequent filings with the SEC. All forward-looking statements speak only as of the date of this report. We do not undertake any obligation to update or publicly release any revisions to forward-looking statements to reflect events, circumstances or changes in expectations after the date of this Conflict Minerals Report.
Attachment A
| | | | | | | | |
| Metal | Smelter or Refiner Name | Country Location of Smelter or Refiner |
| Tin | Alpha * | United States |
| Tin | Chenzhou Yunxiang Mining and Metallurgy Co., Ltd. * | China |
| Tin | Chifeng Dajingzi Tin Industry Co., Ltd. * | China |
| Tin | China Tin Group Co., Ltd. * | China |
| Tin | Dowa * | Japan |
| Tin | EM Vinto * | Bolivia |
| Tin | Fenix Metals * | Poland |
| Tin | Gejiu Non-Ferrous Metal Processing Co., Ltd. * | China |
| Tin | Gejiu Yunxin Nonferrous Electrolysis Co., Ltd. * | China |
| Tin | Gejiu Zili Mining and Metallurgy Co., Ltd. * | China |
| Tin | Guangdong Hanhe Non-Ferrous Metal Co., Ltd. * | China |
| Tin | HuiChang Hill Tin Industry Co., Ltd. * | China |
| Tin | Jiangxi New Nanshan Technology Ltd. * | China |
| Tin | Magnu’s Minerais Metais e Ligas Ltda. * | Brazil |
| Tin | Malaysia Smelting Corporation (MSC) * | Malaysia |
| Tin | Melt Metais e Ligas S.A. | Brazil |
| Tin | Metallic Resources, Inc.* | United States |
| Tin | Metallo Belgium N.V. * | Belgium |
| Tin | Metallo Spain S.L.U. * | Spain |
| Tin | Mineração Taboca S.A. * | Brazil |
| Tin | Minsur * | Peru |
| Tin | Mitsubishi Materials Corporation * | Japan |
| Tin | O.M. Manufacturing (Thailand) Co., Ltd. * | Thailand |
| Tin | O.M. Manufacturing Philippines, Inc. * | Philippines |
| Tin | PT Bangka Serumpun * | Indonesia |
| Tin | PT Mitra Stania Prima * | Indonesia |
| Tin | PT Refined Bangka Tin * | Indonesia |
| Tin | PT Stanindo Inti Perkasa * | Indonesia |
| Tin | PT Timah (Persero) Tbk Mentok * | Indonesia |
| Tin | PT Timah Tbk Kundur * | Indonesia |
| Tin | PT Tinindo Inter Nusa * | Indonesia |
| Tin | Resind Indústria e Comércio Ltda. * | Brazil |
| Tin | Rui Da Hung * | Taiwan |
| Tin | Soft Metais Ltda. * | Brazil |
| Tin | Thaisarco * | Thailand |
| Tin | Tin Technology & Refining * | United States |
| Tin | White Solder Metalurgia e Mineracao Ltda. * | Brazil |
| Tin | Yunnan Chengfeng Non-ferrous Metals Co., Ltd. * | China |
| Tin | Yunnan Tin Company Limited * | China |
| Tin | Yunnan Yunfan Non-ferrous Metal Co., Ltd. | China |
| Tungsten | China Molybdenum Tungsten Co., Ltd. * | China |
| Tungsten | Chongyi Zhangyuan Tungsten Co., Ltd. * | China |
| Tungsten | Fujian Jinxin Tungsten Co., Ltd. | China |
| Tungsten | Ganzhou Huaxing Tungsten Products Co., Ltd. * | China |
| Tungsten | Xiamen Tungsten Co., Ltd. * | China |
| Tantalum | Jiangxi Tuohong New Raw Material * | China |
| Tantalum | Kemet de Mexico * | Mexico |
| | | | | | | | |
| Metal | Smelter or Refiner Name | Country Location of Smelter or Refiner |
| Gold | Advanced Chemical Company * | United States |
| Gold | Aida Chemical Industries Co., Ltd. * | Japan |
| Gold | Allgemeine Gold-und Silberscheideanstalt A.G. * | Germany |
| Gold | Almalyk Mining and Metallurgical Complex (AMMC) * | Uzbekistan |
| Gold | AngloGold Ashanti Corrego do Sitio Mineracao * | Brazil |
| Gold | Argor-Heraeus S.A. * | Switzerland |
| Gold | Asahi Pretec Corp. * | Japan |
| Gold | Asahi Refining Canada Ltd. * | Canada |
| Gold | Asahi Refining USA Inc. * | United States |
| Gold | Asaka Riken Co., Ltd. * | Japan |
| Gold | Aurubis AG * | Germany |
| Gold | Bangko Sentral ng Pilipinas (Central Bank of the Philippines) * | Philippines |
| Gold | Boliden AB * | Sweden |
| Gold | C. Hafner GmbH + Co. KG * | Germany |
| Gold | CCR Refinery - Glencore Canada Corporation * | Canada |
| Gold | Cendres + Metaux S.A. * | Switzerland |
| Gold | Chimet S.p.A. * | Italy |
| Gold | DODUCO Contacts and Refining GmbH * | Germany |
| Gold | Dowa * | Japan |
| Gold | DSC (Do Sung Corporation) * | South Korea |
| Gold | Eco-System Recycling Co., Ltd. East Plant * | Japan |
| Gold | Emirates Gold DMCC * | United Arab Emirates |
| Gold | Geib Refining Corporation * | United States |
| Gold | Gold Refinery of Zijin Mining Group Co., Ltd. * | China |
| Gold | Heimerle + Meule GmbH * | Germany |
| Gold | Heraeus Germany GmbH Co. KG * | Germany |
| Gold | Heraeus Metals Hong Kong Ltd. * | China |
| Gold | Inner Mongolia Qiankun Gold and Silver Refinery Share Co., Ltd. * | China |
| Gold | Ishifuku Metal Industry Co., Ltd. * | Japan |
| Gold | Istanbul Gold Refinery * | Turkey |
| Gold | Italpreziosi * | Italy |
| Gold | Japan Mint * | Japan |
| Gold | Jiangxi Copper Co., Ltd. * | China |
| Gold | JSC Novosibirsk Refinery | Russia |
| Gold | JSC Uralelectromed | Russia |
| Gold | JX Nippon Mining & Metals Co., Ltd. * | Japan |
| Gold | Kazzinc * | Kazakhstan |
| Gold | Kennecott Utah Copper LLC * | United States |
| Gold | Kojima Chemicals Co., Ltd. * | Japan |
| Gold | Korea Zinc Co., Ltd. * | South Korea |
| Gold | LS-NIKKO Copper Inc. * | South Korea |
| Gold | LT Metal Ltd. * | South Korea |
| Gold | Marsam Metals * | Brazil |
| Gold | Materion * | United States |
| Gold | Matsuda Sangyo Co., Ltd. * | Japan |
| Gold | Metalor Technologies (Hong Kong) Ltd. * | China |
| Gold | Metalor Technologies (Singapore) Pte., Ltd. * | Singapore |
| Gold | Metalor Technologies (Suzhou) Ltd. * | China |
| | | | | | | | |
| Metal | Smelter or Refiner Name | Country Location of Smelter or Refiner |
| Gold | Metalor Technologies S.A. * | Switzerland |
| Gold | Metalor USA Refining Corporation * | United States |
| Gold | Metalúrgica Met-Mex Peñoles S.A. De C.V. * | Mexico |
| Gold | Mitsubishi Materials Corporation * | Japan |
| Gold | Mitsui Mining and Smelting Co., Ltd. * | Japan |
| Gold | MMTC-PAMP India Pvt., Ltd. * | India |
| Gold | Moscow Special Alloys Processing Plant | Russia |
| Gold | Nadir Metal Rafineri San. Ve Tic. A.S. * | Turkey |
| Gold | Nihon Material Co., Ltd. * | Japan |
| Gold | Ogussa Osterreichische Gold- und Silber-Scheideanstalt
GmbH * | Austria |
| Gold | Ohura Precious Metal Industry Co., Ltd. * | Japan |
| Gold | OJSC "The Gulidov Krasnoyarsk Non-Ferrous Metals
Plant" (OJSC Krastsvetmet) | Russia |
| Gold | PAMP S.A. * | Switzerland |
| Gold | Planta Recuperadora de Metales SpA * | Chile |
| Gold | Prioksky Plant of Non-Ferrous Metals | Russia |
| Gold | PT Aneka Tambang (Persero) Tbk * | Indonesia |
| Gold | PX Précinox S.A. * | Switzerland |
| Gold | Rand Refinery (Pty) Ltd. * | South Africa |
| Gold | Royal Canadian Mint * | Canada |
| Gold | SAAMP * | France |
| Gold | Safimet S.p.A * | Italy |
| Gold | Samduck Precious Metals * | South Korea |
| Gold | SAXONIA Edelmetalle GmbH | Germany |
| Gold | SEMPSA Joyeria Plateria S.A. * | Spain |
| Gold | Shandong Gold Smelting Co., Ltd. * | China |
| Gold | Shandong Zhaojin Gold & Silver Refinery Co., Ltd. * | China |
| Gold | Sichuan Tianze Precious Metals Co., Ltd. * | China |
| Gold | Singway Technology Co., Ltd. * | Taiwan |
| Gold | SOE Shyolkovsky Factory of Secondary Precious Metals | Russia |
| Gold | Solar Applied Materials Technology Corp. * | Taiwan |
| Gold | Sumitomo Metal Mining Co., Ltd. * | Japan |
| Gold | SungEel HiMetal Co., Ltd. * | South Korea |
| Gold | T.C.A S.p.A * | Italy |
| Gold | Tanaka Kikinzoku Kogyo K.K. * | Japan |
| Gold | Tokuriki Honten Co., Ltd. * | Japan |
| Gold | Torecom * | South Korea |
| Gold | Umicore Precious Metals Thailand * | Thailand |
| Gold | Umicore S.A. Business Unit Precious Metals Refining * | Belgium |
| Gold | United Precious Metal Refining, Inc. * | United States |
| Gold | Valcambi S.A. * | Switzerland |
| Gold | Western Australian Mint (T/a The Perth Mint) * | Australia |
| Gold | WIELAND Edelmetalle GmbH * | Germany |
| Gold | Yamakin Co., Ltd. * | Japan |
| Gold | Yokohama Metal Co., Ltd. * | Japan |
| Gold | Zhongyuan Gold Smelter of Zhongjin Gold Corporation * | China |
* Smelter or refiner certified RMAP Conformant by the Responsible Minerals Initiative
Attachment B
Countries of Origin
| | | | | |
| Australia | Malaysia |
| Bolivia | Mexico |
| Brazil | North Kivu Province, DRC* |
| Canada | Peru |
| Chile | Russia |
| China | Singapore |
| France | South Africa |
| Germany | Sweden |
| Guyana | Switzerland |
| India | Taiwan |
| Indonesia | Turkey |
| Italy | United Arab Emirates |
| Japan | USA |
| Kazakhstan | Uzbekistan |
| South Korea | |
* Mines located within the Covered Countries with 3TG processed by RMAP Conformant SORs
Attachment C
Product Groups
The following product groups include items subject to the due diligence described in the Conflict Minerals Report:
| | | | | |
| Air Tools and Accessories | Hammers, Prybars, and Cold Chisels |
| Battery Accessories | Hand Saws |
| Battery Blowers | Handheld Cutting and Grinding |
| Battery Chainsaws | Levels and Squares |
| Battery Hedge Trimmers & Edgers | Measuring Tools |
| Battery Lifestyle | Mechanics Tools |
| Battery Mowers | Miter and Table Saws |
| Battery Snowblowers | Outdoor Lighting |
| Battery String Trimmers | Patio |
| Benchtop Tools | Pliers and Wrenches |
| Ceiling Fans | Pressure Washers |
| Chandeliers | Registers and Grills |
| Compressors DIY and Stationery | Screwdrivers |
| Cordless Drills and Combo Kits | Timers and Surge Protectors |
| Electronic Tools | Tool Storage |
| Flashlights | Utility Knives |
| Flushmounts | Vanity Lighting |
| Garage Organization | Wall Plates |
| Grills | Work Supports |
