The Dodd-Frank Wall Street Reform and Consumer Protection Act, passed in July 2010, directed the Securities and Exchange Commission (SEC) to issue rules requiring publicly traded companies to disclose publicly the extent to which their products contain so-called "conflict minerals" (i.e. tantalum, tin, tungsten and gold, and otherwise referred to as “3TG”) sourced from conflict mines in the Democratic Republic of the Congo (DRC) or adjoining countries. The concern underlying this requirement is that the use of these metals, derived from minerals mined in the DRC or adjoining countries, has helped to fuel war and human rights abuses in eastern Congo. The SEC issued implementing rules in August 2012. They require companies to file an annual report on their use of conflict minerals.
TI understands that the purchase of minerals from illicit mines located in the DRC or adjoining countries is an important concern globally and is committed to ensuring that our products do not contain minerals derived from sources that finance or benefit armed groups in the DRC or adjoining countries. We are working diligently with our supply chain, including subcontracted manufacturers, to determine the mineral source for the materials containing 3TG, so we can identify and eliminate non-compliant sources.
In 2008, the Electronics Industry Citizenship Coalition (EICC) and Global e-Sustainability Initiative (GeSI) established a group now known as the Conflict Minerals Sourcing Initiative (CFSI). The group is composed of technology companies and suppliers and aims to help advance effective policies that address conflict minerals concerns while taking into account the complexities of the global supply chain. In 2010, TI joined the CFSI. Through TI’s participation we have helped to create and test tools that track the sourcing of the 3TG’s, helped conduct smelter outreach and contributed to the CFSI Initial Audit Fund.
TI has established a conflict minerals policy, management systems and due diligence procedures as a basis for supply chain management and disclosure compliance relating to conflict minerals. We designed this process with the intent to conform in all material respects with the OECD Due Diligence Guidance for Responsible Supply Chain from Conflict-Affected and High-Risk Areas which requires the establishment of policies, structures and procedures, risk management and communications mechanisms. In addition, we undertook a number of actions with our suppliers requiring them to report to us the sources of the 3TG materials we purchase from them, analyzing that information, comparing it with other information available from the Conflict Free Smelter Program (CFSP) and reviewing it against other source materials.
Integrated Circuits (“ICs”)1 accounted for approximately 90 percent of TI’s revenue in 2015, and we have determined that all of our ICs were conflict free. Our determination is based on the finding that all the Smelters identified to us by our suppliers as being potentially in the supply chain for these ICs in 2015 supplied CMs exclusively from conflict-free sources.
In 2015, we made progress in our due diligence efforts. Our communications with suppliers yielded more complete and specific information than in 2014 about the Smelters in our supply chain. That information, combined with the expanded information available through the CFSP, has given us greater insight into the conflict status of conflict minerals identified as potentially in our supply chain for 2015 as compared to the prior year.
On May 31, 2016, TI filed its third conflict minerals report with the SEC (covering 2015). The filing consists of a "Form SD" and a "Conflict Minerals Report." The report states that TI performed "due diligence" on the origin of conflict minerals in TI products and concluded that:
Smelter Status – Overview
Smelter Status – By Metal
TI’s 2016 Conflict Minerals Goals