Exhibit 1.01
Integrated Device Technology, Inc.
Conflict Minerals Report for the Calendar Year Ended December 31, 2016
Company Overview:
Integrated Device Technology, Inc. (the “Company” or “IDT”) designs, develops, has manufactured and markets integrated circuit system solutions for the advanced communications, computing, consumer and automotive industries. Its broad range of semiconductor solutions combines analog and digital technology to develop system-level innovations that optimize customers' applications and enrich the end-user experience. IDT uses its market leadership in wireless power, timing, serial switching, sensors and interfaces, and adds analog and systems expertise to provide complete application-optimized, mixed-signal solutions for the market segments in which it competes. Headquartered in San Jose, California, IDT has design, test and sales facilities throughout the world. IDT stock is traded on the NASDAQ Global Select Stock Market® under the symbol "IDTI."
IDT uses third-party foundries that are primarily located in the APAC region to manufacture all of its products. IDT assembles and/or packages products using several different subcontractors in the APAC region. This enables the Company to negotiate lower prices, and limits the risk associated with production concentration in one country or company. The criteria used to select assembly subcontractors include, but are not limited to, sourcing from conflict mineral free sources, cost, quality, delivery, and subcontractor financial stability. IDT performs a vast majority of its test operations at its test facility located in Malaysia. A relatively small number of test operations also are performed at third-party subcontractors in the APAC region.
All IDT products incorporate at least one of the minerals regulated by section 1502: tungsten, tantalum, gold and tin (“3TG Minerals”). Tungsten is present in 100% of the products we sell, and tantalum is present in those products produced through three of our foundries from whom we purchase advanced technology. Gold and tin are used in certain packages for IDT products assembled by the APAC subcontractors with whom IDT contracts.
Our Conflict Minerals Policy:
IDT is committed to complying with the letter and the spirit of the conflict minerals disclosure requirements adopted by the Securities and Exchange Commission (“SEC”) under Section 13 (p) of the Securities and Exchange Act, as amended (the “Act”), in the form of Rule 13p-1 and Form SD (the “Rule”). IDT has considered the Rule’s requirements, guidance from the Organization for Economic Cooperation and Development (the “OECD”) that has been recognized as authoritative by the SEC, and related measures being taken by the EICC/GeSI Extractives Work Group and other organizations, and is implementing and enhancing its formal Conflict Minerals compliance program accordingly. Our Conflict Minerals Policy Statement is available on the IDT.com website at:
http://www.idt.com/about/corporate-responsibility-citizenship/conflict-free-metals-policy
To support this policy, IDT 1) conducts a reasonable country of origin inquiry of its suppliers and, if required by the Rule (as it was for calendar year 2016), implements a program of due diligence on the source and chain of custody of 3TG Minerals necessary to the functionality or production of IDT products; 2) Expects our suppliers to have policies and procedures in place which are in compliance with the IDT Conflict Free Metals Policy Statement, and will enable transparency of the IDT supply chain to facilitate our compliance with the Rule; 3) provides and expects our suppliers to cooperate in providing reasonable country of origin and due diligence information with regard to use of 3TG Minerals in our supply chain.
Efforts to Determine the Mine or Location of Origin of the 3TG Minerals in Our Products
Tracing the 3TG Minerals used in our products back to the mine and source country of origin of each such mineral is a complex but important aspect of responsible sourcing. To help establish our supply chain sourcing programs, we have followed currently established industry guidelines such as the Conflict Free Sourcing Initiative of the EICC and the GeSI (“CFSI”), which are taking action to address responsible sourcing through the development of the Conflict-Free Smelter (“CFS”) program which enables companies to source minerals from conflict-free sources.
Through our reasonable country of origin inquiry (“RCOI”) survey process, we adopted the CFSI’s industry approach and traced back the origin of 3TG inerals by identifying smelters, refineries or recyclers and scrap supplier sources. We also utilized the CFSI and its CFS program to trace the mine of origin of the 3TG minerals when the information was available. The CFS program audits smelters and refineries to ensure that all certified smelters and refineries only use the ore that are conflict free from the DRC and covered countries.
Facilities Used to Process the 3TG Minerals in IDT Products
The table below lists the facilities which, to the extent known, were identified by our supply chain as sourcing smelters or refineries for one or more of the 3TG Minerals in our products.
|
| | | | | |
| | Metal (*) | Smelter Name (*) | Smelter Country (*) | Smelter Identification | |
| | Gold | Aida Chemical Industries Co., Ltd. | JAPAN | CID000019 | |
| | Gold | Allgemeine Gold-und Silberscheideanstalt A.G. | GERMANY | CID000035 | |
| | Gold | AngloGold Ashanti Córrego do Sítio Mineração | BRAZIL | CID000058 | |
| | Gold | Argor-Heraeus SA | SWITZERLAND | CID000077 | |
| | Gold | Asahi Pretec Corporation | JAPAN | CID000082 | |
| | Gold | Asahi Refining Canada Limited | CANADA | CID000924 | |
| | Gold | Asahi Refining USA Inc. | UNITED STATES | CID000920 | |
| | Gold | Asaka Riken Co., Ltd. | JAPAN | CID000090 | |
| | Gold | Atasay Kuyumculuk Sanayi Ve Ticaret A.S. | TURKEY | CID000103 | |
| | Gold | Aurubis AG | GERMANY | CID000113 | |
| | Gold | Bangko Sentral ng Pilipinas (Central Bank of the Philippines) | PHILIPPINES | CID000128 | |
| | Gold | Boliden AB | SWEDEN | CID000157 | |
| | 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. | JAPAN | CID000425 | |
| | Gold | Elemetal Refining, LLC | UNITED STATES | CID001322 | |
| | Gold | Heimerle + Meule GmbH | GERMANY | CID000694 | |
| | Gold | Heraeus Ltd. Hong Kong | CHINA | CID000707 | |
| | Gold | Heraeus Precious Metals GmbH & Co. KG | GERMANY | CID000711 | |
| | Gold | Ishifuku Metal Industry Co., Ltd. | JAPAN | CID000807 | |
| | Gold | Istanbul Gold Refinery | TURKEY | CID000814 | |
| | Gold | Jiangxi Copper Company Limited | CHINA | CID000855 | |
| | Gold | JX Nippon Mining & Metals Co., Ltd. | JAPAN | CID000937 | |
| | Gold | Kennecott Utah Copper LLC | UNITED STATES | CID000969 | |
| | Gold | Kojima Chemicals Co., Ltd. | JAPAN | CID000981 | |
| | Gold | LS-NIKKO Copper Inc. | KOREA, REPUBLIC OF | CID001078 | |
| | Gold | Materion | UNITED STATES | CID001113 | |
| | Gold | Matsuda Sangyo Co., Ltd. | JAPAN | CID001119 | |
| | Gold | Metalor Technologies (Hong Kong) Ltd. | CHINA | CID001149 | |
| | Gold | Metalor Technologies (Singapore) Pte., Ltd. | SINGAPORE | CID001152 | |
| | Gold | Metalor Technologies SA | SWITZERLAND | CID001153 | |
| | Gold | Metalor USA Refining Corporation | UNITED STATES | CID001157 | |
| | Gold | METALÚRGICA MET-MEX PEÑOLES, S.A. DE C.V | MEXICO | CID001161 | |
| | Gold | Mitsubishi Materials Corporation | JAPAN | CID001188 | |
| | Gold | Mitsui Mining and Smelting Co., Ltd. | JAPAN | CID001193 | |
| | Gold | Nadir Metal Rafineri San. Ve Tic. A.ª. | TURKEY | CID001220 | |
| | Gold | Nihon Material Co., Ltd. | JAPAN | CID001259 | |
| | Gold | Ohura Precious Metal Industry Co., Ltd. | JAPAN | CID001325 | |
| | Gold | PAMP SA | SWITZERLAND | CID001352 | |
| | Gold | PT Aneka Tambang (Persero) Tbk | INDONESIA | CID001397 | |
| | Gold | PX Précinox SA | SWITZERLAND | CID001498 | |
| | Gold | Rand Refinery (Pty) Ltd. | SOUTH AFRICA | CID001512 | |
| | Gold | Republic Metals Corporation | UNITED STATES | CID002510 | |
| | Gold | Royal Canadian Mint | CANADA | CID001534 | |
|
| | | | | |
| | Gold | SEMPSA Joyería Platería SA | SPAIN | CID001585 | |
| | Gold | Shandong Zhaojin Gold & Silver Refinery Co., Ltd. | CHINA | CID001622 | |
| | Gold | SOE Shyolkovsky Factory of Secondary Precious Metals | RUSSIAN FEDERATION | CID001756 | |
| | Gold | Solar Applied Materials Technology Corp. | TAIWAN | CID001761 | |
| | Gold | Sumitomo Metal Mining Co., Ltd. | JAPAN | CID001798 | |
| | Gold | Tanaka Kikinzoku Kogyo K.K. | JAPAN | CID001875 | |
| | Gold | The Refinery of Shandong Gold Mining Co., Ltd. | CHINA | CID001916 | |
| | Gold | Tokuriki Honten Co., Ltd. | JAPAN | CID001938 | |
| | Gold | Umicore Brasil Ltda. | BRAZIL | CID001977 | |
| | Gold | Umicore Precious Metals Thailand | THAILAND | CID002314 | |
| | Gold | Umicore SA Business Unit Precious Metals Refining | BELGIUM | CID001980 | |
| | Gold | United Precious Metal Refining, Inc. | UNITED STATES | CID001993 | |
| | Gold | Valcambi SA | SWITZERLAND | CID002003 | |
| | Gold | Western Australian Mint trading as The Perth Mint | AUSTRALIA | CID002030 | |
| | Gold | Yamamoto Precious Metal Co., Ltd. | JAPAN | CID002100 | |
| | Gold | Yokohama Metal Co., Ltd. | JAPAN | CID002129 | |
| | Gold | Zhongyuan Gold Smelter of Zhongjin Gold Corporation | CHINA | CID002224 | |
| | Gold | Zijin Mining Group Co., Ltd. Gold Refinery | CHINA | CID002243 | |
| | Tin | Alpha | UNITED STATES | CID000292 | |
| | Tin | China Tin Group Co., Ltd. | CHINA | CID001070 | |
| | Tin | Cooperativa Metalurgica de Rondônia Ltda. | BRAZIL | CID000295 | |
| | Tin | CV Ayi Jaya | INDONESIA | CID002570 | |
| | Tin | CV Gita Pesona | INDONESIA | CID000306 | |
| | Tin | CV Serumpun Sebalai | INDONESIA | CID000313 | |
| | Tin | CV United Smelting | INDONESIA | CID000315 | |
| | Tin | CV Venus Inti Perkasa | INDONESIA | CID002455 | |
| | Tin | Dowa | JAPAN | CID000402 | |
| | Tin | Elmet S.L.U. (Metallo Group) | SPAIN | CID002774 | |
| | Tin | EM Vinto | BOLIVIA | CID000438 | |
| | Tin | Fenix Metals | POLAND | CID000468 | |
| | Tin | Gejiu Non-Ferrous Metal Processing Co., Ltd. | CHINA | CID000538 | |
| | Tin | Jiangxi Ketai Advanced Material Co., Ltd. | CHINA | CID000244 | |
| | Tin | Magnu's Minerais Metais e Ligas Ltda. | BRAZIL | CID002468 | |
| | Tin | Malaysia Smelting Corporation (MSC) | MALAYSIA | CID001105 | |
| | Tin | Melt Metais e Ligas S/A | BRAZIL | CID002500 | |
| | Tin | Metallic Resources, Inc. | UNITED STATES | CID001142 | |
| | Tin | Metallo-Chimique N.V. | BELGIUM | CID002773 | |
| | Tin | Mineração Taboca S.A. | BRAZIL | CID001173 | |
| | Tin | Minsur | PERU | CID001182 | |
| | Tin | Mitsubishi Materials Corporation | JAPAN | CID001191 | |
| | Tin | O.M. Manufacturing (Thailand) Co., Ltd. | THAILAND | CID001314 | |
| | Tin | O.M. Manufacturing Philippines, Inc. | PHILIPPINES | CID002517 | |
| | Tin | Operaciones Metalurgical S.A. | BOLIVIA | CID001337 | |
| | Tin | PT Aries Kencana Sejahtera | INDONESIA | CID000309 | |
| | Tin | PT Artha Cipta Langgeng | INDONESIA | CID001399 | |
| | Tin | PT ATD Makmur Mandiri Jaya | INDONESIA | CID002503 | |
| | Tin | PT Babel Inti Perkasa | INDONESIA | CID001402 | |
| | Tin | PT Bangka Prima Tin | INDONESIA | CID002776 | |
|
| | | | | |
| | Tin | PT Bangka Tin Industry | INDONESIA | CID001419 | |
| | Tin | PT Belitung Industri Sejahtera | INDONESIA | CID001421 | |
| | Tin | PT BilliTin Makmur Lestari | INDONESIA | CID001424 | |
| | Tin | PT Bukit Timah | INDONESIA | CID001428 | |
| | Tin | PT Cipta Persada Mulia | INDONESIA | CID002696 | |
| | Tin | PT DS Jaya Abadi | INDONESIA | CID001434 | |
| | Tin | PT Eunindo Usaha Mandiri | INDONESIA | CID001438 | |
| | Tin | PT Inti Stania Prima | INDONESIA | CID002530 | |
| | Tin | PT Justindo | INDONESIA | CID000307 | |
| | Tin | PT Mitra Stania Prima | INDONESIA | CID001453 | |
| | Tin | PT Panca Mega Persada | INDONESIA | CID001457 | |
| | Tin | PT Prima Timah Utama | INDONESIA | CID001458 | |
| | Tin | PT Refined Bangka Tin | INDONESIA | CID001460 | |
| | Tin | PT Sariwiguna Binasentosa | INDONESIA | CID001463 | |
| | Tin | PT Stanindo Inti Perkasa | INDONESIA | CID001468 | |
| | Tin | PT Sumber Jaya Indah | INDONESIA | CID001471 | |
| | Tin | PT Timah (Persero) Tbk Kundur | INDONESIA | CID001477 | |
| | Tin | PT Timah (Persero) Tbk Mentok | INDONESIA | CID001482 | |
| | Tin | PT Tinindo Inter Nusa | INDONESIA | CID001490 | |
| | Tin | PT Wahana Perkit Jaya | INDONESIA | CID002479 | |
| | Tin | Resind Indústria e Comércio Ltda. | BRAZIL | CID002706 | |
| | Tin | Rui Da Hung | TAIWAN | CID001539 | |
| | Tin | Soft Metais Ltda. | BRAZIL | CID001758 | |
| | Tin | Thaisarco | THAILAND | CID001898 | |
| | Tin | VQB Mineral and Trading Group JSC | VIET NAM | CID002015 | |
| | Tin | White Solder Metalurgia e Mineração Ltda. | BRAZIL | CID002036 | |
| | Tin | Yunnan Tin Group (Holding) Company Limited | CHINA | CID002180 | |
| | Tin | PT Sukses Inti Makmur | INDONESIA | CID002816 | |
| | Tungsten | A.L.M.T. TUNGSTEN Corp. | JAPAN | CID000004 | |
| | Tungsten | Chenzhou Diamond Tungsten Products Co., Ltd. | CHINA | CID002513 | |
| | Tungsten | Chongyi Zhangyuan Tungsten Co., Ltd. | CHINA | CID000258 | |
| | Tungsten | Fujian Jinxin Tungsten Co., Ltd. | CHINA | CID000499 | |
| | Tungsten | Ganzhou Huaxing Tungsten Products Co., Ltd. | CHINA | CID000875 | |
| | Tungsten | Ganzhou Seadragon W & Mo Co., Ltd. | CHINA | CID002494 | |
| | Tungsten | Global Tungsten & Powders Corp. | UNITED STATES | CID000568 | |
| | Tungsten | Guangdong Xianglu Tungsten Co., Ltd. | CHINA | CID000218 | |
| | Tungsten | H.C. Starck GmbH | GERMANY | CID002541 | |
| | Tungsten | Hunan Chuangda Vanadium Tungsten Co., Ltd. Wuji | CHINA | CID002579 | |
| | Tungsten | Hunan Chunchang Nonferrous Metals Co., Ltd. | CHINA | CID000769 | |
| | Tungsten | Hydrometallurg, JSC | RUSSIAN FEDERATION | CID002649 | |
| | Tungsten | Japan New Metals Co., Ltd. | JAPAN | CID000825 | |
| | Tungsten | Kennametal Huntsville | UNITED STATES | CID000105 | |
| | Tungsten | Jiangwu H.C. Starck Tungsten Products Co., Ltd. | CHINA | CID002551 | |
| | Tungsten | Niagara Refining LLC | UNITED STATES OF AMERICA | CID002589 | |
| | Tungsten | Nui Phao H.C. Starck Tungsten Chemicals Manufacturing LLC | VIET NAM | CID002543 | |
| | Tungsten | Tejing (Vietnam) Tungsten Co., Ltd. | VIET NAM | CID001889 | |
| | Tungsten | Wolfram Bergbau und Hütten AG | AUSTRIA | CID002044 | |
| | Tungsten | Xiamen Tungsten (H.C.) Co., Ltd. | CHINA | CID002320 | |
|
| | | | | |
| | Tungsten | Xiamen Tungsten Co., Ltd. | CHINA | CID002082 | |
| | Tungsten | H.C. Starck Smelting GmbH & Co.KG | GERMANY | CID002542 | |
| | Tungsten | Jiangxi Gan Bei Tungsten Co., Ltd. | CHINA | CID002321 | |
| | Tungsten | Jiangxi Tonggu Non-ferrous Metallurgical & Chemical Co., Ltd. | CHINA | CID002318 | |
| | Tungsten | Jiangxi Xinsheng Tungsten Industry Co., Ltd. | CHINA | CID002317 | |
| | Tantalum | H.C. Starck Co., Ltd. | THAILAND | CID002544 | |
| | Tantalum | H.C. Starck GmbH Goslar | GERMANY | CID002545 | |
| | Tantalum | H.C. Starck GmbH Laufenburg | GERMANY | CID002546 | |
| | Tantalum | H.C. Starck Hermsdorf GmbH | GERMANY | CID002547 | |
| | Tantalum | H.C. Starck Inc. | UNITED STATES | CID002548 | |
| | Tantalum | H.C. Starck Ltd. | JAPAN | CID002549 | |
| | Tantalum | H.C. Starck Smelting GmbH & Co.KG | GERMANY | CID002550 | |
| | Tantalum | Ningxia Orient Tantalum Industry Co., Ltd. | CHINA | CID001277 | |
| | Tantalum | Ulba Metallurgical Plant JSC | KAZAKHSTAN | CID001969 | |
| | Tantalum | Changsha South Tantalum Niobium Co., Ltd. | CHINA | CID000211 | |
| | Tantalum | Global Advanced Metals Boyertown | UNITED STATES | CID002557 | |
| | Tantalum | F&X Electro-Materials Ltd. | CHINA | CID000460 | |
| | Tantalum | Solikamsk Magnesium Works OAO | RUSSIAN FEDERATION | CID001769 | |
| | Gold | Inner Mongolia Qiankun Gold and Silver Refinery Share Company Limited | CHINA | CID000801 | |
| | Gold | JSC Uralelectromed | RUSSIAN FEDERATION | CID000929 | |
| | Gold | Jiangxi Copper Co., Ltd. | CHINA | CID000855 | |
| | Tin | An Vinh Joint Stock Mineral Processing Company | VIET NAM | CID002703 | |
| | Tin | Yunnan Chengfeng Non-ferrous Metals Co., Ltd. | CHINA | CID002158 | |
| | Tantalum | Global Advanced Metals Aizu | JAPAN | CID002558 | |
| | Tantalum | Conghua Tantalum and Niobium Smeltry | CHINA | CID000291 | |
| | Tantalum | Duoluoshan | CHINA | CID000410 | |
| | Tantalum | Exotech Inc. | UNITED STATES | CID000456 | |
| | Tantalum | Guangdong Zhiyuan New Material Co., Ltd. | CHINA | CID000616 | |
| | Tantalum | Hengyang King Xing Lifeng New Materials Co., Ltd. | CHINA | CID002492 | |
| | Tantalum | Hi-Temp Specialty Metals, Inc. | UNITED STATES | CID000731 | |
| | Tantalum | JiuJiang JinXin Nonferrous Metals Co., Ltd. | CHINA | CID000914 | |
| | Tantalum | Jiujiang Tanbre Co., Ltd. | CHINA | CID000917 | |
| | Tantalum | LSM Brasil S.A. | BRAZIL | CID001076 | |
| | Tantalum | Mineração Taboca S.A. | BRAZIL | CID001175 | |
| | Tantalum | Plansee SE Liezen | AUSTRIA | CID002540 | |
| | Tantalum | Plansee SE Reutte | AUSTRIA | CID002556 | |
| | Tantalum | Taki Chemicals | JAPAN | CID001869 | |
| | Tantalum | Telex Metals | UNITED STATES | CID001891 | |
| | Tantalum | Zhuzhou Cemented Carbide | CHINA | CID002232 | |
| | Tantalum | Mitsui Mining and Smelting Co., Ltd. | JAPAN | CID001192 | |
| | Tantalum | D Block Metals, LLC | UNITED STATES OF AMERICA | CID002504 | |
| | Tantalum | Yichun Jin Yang Rare Metal Co., Ltd. | CHINA | CID002307 | |
| | Tungsten | Chenzhou Diamond Tungsten Products Co., Ltd. | CHINA | CID002513 | |
| | Tungsten | Ganzhou Jiangwu Ferrotungsten Co., Ltd. | CHINA | CID002315 | |
| | Tungsten | Ganzhou Non-ferrous Metals Smelting Co., Ltd. | CHINA | CID000868 | |
|
| | | | | |
| | Tungsten | H.C. Starck Smelting GmbH & Co.KG | GERMANY | CID002542 | |
| | Tungsten | Hunan Chenzhou Mining Co., Ltd. | CHINA | CID000766 | |
| | Tungsten | Kennametal Fallon | UNITED STATES | CID000966 | |
| | Tungsten | Pobedit, JSC | RUSSIAN FEDERATION | CID002532 | |
| | Tungsten | Dayu Weiliang Tungsten Co., Ltd. | CHINA | CID000345 | |
| | Tungsten | Vietnam Youngsun Tungsten Industry Co., Ltd. | VIET NAM | CID002011 | |
IDT Due Diligence Framework
IDT has exercised due diligence on the source and chain of custody of our 3TG Minerals to identify minerals originating from the Covered Countries that are not from scrap or recycled materials. IDT’s due diligence process has been designed and implemented based on the framework set forth by the OECD in its due diligence guidance materials. Our 3TG Minerals due diligence process in calendar year 2016 included each of the five OECD-recommended steps:
| |
| 1. | Establishment of Strong Company Management System. |
IDT has established a management system for complying with the applicable rules and industry guidelines. Overseeing this system is the Conflict Minerals Compliance Committee which includes representatives from Legal, Quality, Manufacturing, Environmental-Health & Safety, and Supply Chain/Procurement. Supplier outreach and data collection is handled by the subject-matter expert within the Quality organization, who receives significant support from numerous cross-functional team members. The Quality team leader also is responsible for implementation and oversight of the due diligence process. He is supported by the Legal Department, and the Supply Chain and Procurement teams in his efforts to ensure timely gathering of customer responses and other supply chain data, and in performing his validation and documentation responsibilities.
| |
| 2. | Identify and assess risks in the supply chain. |
IDT has made reasonable efforts to identify suppliers that supply products that may potentially contain 3TG Minerals by conducting a supply chain survey using the EICC and GESI Conflict Minerals Reporting Template, requesting suppliers to identify smelters and refiners and countries of origin of the 3TG Minerals in products they produce or supply for/to IDT; following up with suppliers that do not respond to our request to complete the template until they do; comparing smelters and refiners identified by the supply chain survey against the list of facilities that have received a “conflict free” designation from the CFS program; and maintaining documentation of reasonable efforts we have made to complete these risk assessment steps. Responses also are reviewed and flagged for further follow up if they raise any concerns, and key risks in the supply chain are identified and addressed so that such concerns and risks can be eliminated.
| |
| 3. | Design and implement a strategy to respond to identified risks. |
IDT has and will continue to make reasonable efforts to encourage suppliers who are sourcing from non-conflict free smelters to use conflict free smelters and refiners (as identified in the CFS program and other industry-developed third-party audit mechanisms). If a supplier fails to remedy the risks identified by our risk assessment, the Conflict Minerals Compliance Committee will escalate to executive management for a determination on whether the supplier should be rejected. Factors that will be considered in such a decision will include: i) dedication to continued efforts to become compliant; ii) whether an alternative supplier is available; iii) cost of using a new supplier; iv) existing competitive bids; v) whether the supplier is a single source; vi) other relevant risk factors or potential risk factors. In the event IDT were to continue use of a non-compliant supplier due to inherent limitations of the supply chain, IDT would use reasonable efforts to require supplier to generate a correction plan and to work with CFS compliant smelters and refiners.
| |
| 4. | Encourage independent, third-party audits of smelters’ and refiners’ due diligence practices. |
IDT does not have a direct relationship with any 3TG Mineral smelters or refiners. Thus, IDT is not able to perform a direct audit of the entities that put 3TG Minerals into our supply chain. However, IDT does rely upon industry efforts, including EICC and CFSI efforts to influence smelters and refiners to undergo audits and become certified through CFSI’s certification program. We rely upon summary audit reports on compliance status for smelters generated by the CFS program to validate the responses received from suppliers to our RCOI process and address red flags identified in Step 2, above. We believe our efforts meet the diligence requirements set out in the OECD guidance.
| |
| 5. | Report annually on supply chain due diligence. |
IDT files its Form SD and Conflict Minerals Report annually, in compliance with the Act and the Rule. In addition to this annual report, IDT publishes its conflict free sourcing policy statement on the IDT.com website at:
http://www.idt.com/about/corporate-responsibility-citizenship/conflict-free-metals-policy
Inherent Limitations on Due Diligence Measures
As a downstream purchaser of 3TG Minerals, IDT’s due diligence measures can provide only reasonable, not absolute, assurance regarding the source and chain of custody of the 3TG Minerals in or used to produce our products. Our due diligence processes necessarily rely on the data supplied by our direct suppliers. Those direct suppliers, in turn, rely on similar information provided within their supply chains to identify the original sources of the 3TG Minerals. In addition, IDT relies on information collected and provided by independent third-party audit programs.
Results of Due Diligence Measures Taken
Due to the level of complexity of our products and the respective supply chains, it will take additional time and resources for a number of our suppliers to verify the source mines and country of origin of all of the 3TG Minerals used by their smelters. We are committed to continuing the use of our supply chain due diligence processes, leveraging the industry standard CFS program, and updating our supplier RCOI information on an ongoing basis as we continue to develop additional transparency into our supply chain. However, as of the date of this filing, based on the performance of our due diligence procedures noted above for the calendar year ended December 31, 2016, we are not able to accurately trace and identify the source mine, country of origin and chain of custody of all the 3TG Minerals that are necessary to the functionality or production of our products.
CONFLICT MINERALS REPORT
The Conflict Minerals Report (“CMR”) for calendar year ended December 31, 2016 is filed with the SEC as Exhibit 1.01 to Form SD and is available at
http://ir.idt.com/sec.cfm?DocType=&DocTypeExclude=&SortOrder=FilingDate%20Descending&Year=&Pagenum=4&FormatFilter=
