Caso - Intel Undermining The Conflict Mineral Industry

case W94C11
February 20, 2015
Intel: Undermining the Conflict Mineral Industry1
Introduction
The Consumer Electronics Show (CES) was the worlds premier technology exhibition. It acted as the
main forum for companies seeking attention within the industry. Held annually in January in Las Vegas, the
event attracted more than 100,000 attendees interested in learning about the latest products and ideas in
the consumer electronics industry.2 Of those in attendance, more than 40% were senior-level executives of
electronics companies.3 In fact, more journalists covered the 2014 CES than that years Super Bowl in New
York City.4,5
Intels CEO, Brian Krzanich, was slated to give the conferences 2014 opening keynote address.6 The eyes
of the entire consumer electronics industry would focus on him. Since assuming the role in May 2013, this
was his first opportunity to speak to the entire industry about Intels vision for the future of the consumer
electronics market.7
Krzanich began his address by announcing the companys significant move into wearable technologies
by demonstrating a new smart watch and earbuds with a built-in heart rate monitor.8 He went on to talk
about new digital security initiatives and a dual-OS platform that would allow customers to run Windows
and Android. Krzanichs final revelation was to think about the impact of the supply chain and the
potential issues[the industry] caus[es]. This [was] not an issue [Intel] would normally be talking about at
CESconflict minerals.i,9 Krzanich was passionate about opening an industry-wide discussion of conflict
minerals. Every Intel microprocessormanufacture[d] in 2014 will be conflict-free. [Intel is] inviting the
entire industry to join [Intel] in this journey.10
Sitting in the audience, Gary Niekerk, Intels director of corporate citizenship, couldnt help but reflect.
Krzanich was commenting to the entire consumer electronics industry and its global audience about conflict
minerals in technology supply chains, which reflected the value Intel placed on social responsibility.
i
Conflict minerals are minerals or its derivatives as determined by the secretary of state that finance conflict in the Democratic
Republic of the Congo or an adjoining country.
Published by WDI Publishing, a division of the William Davidson Institute (WDI) at the University of Michigan.
2015 Camila Espaa, Ian Robinson, Hassan Bukhari, and Dannan Hodge. This case was written under the supervision of Andrew Hoffman
(Holcim Professor of Sustainable Enterprise at the Ross School of Business) at the University of Michigan by graduate students Camila
Espaa, Ian Robinson, Hassan Bukhari, and Dannan Hodge as the basis for class discussion, not to illustrate the effective of ineffective
handling of a situation.
This document is authorized for use only in Uniandes MBATP Gerencia Logistica (2016-II) JPS by Juan Pablo Soto, Universidad de Los Andes - Colombia (UniAndes) from July 2016 to
September 2016.
Intel: Undermining the Conflict Mineral Industry1 W94C11
Conflict Minerals Supply Chain
In 2009, Niekerk came to his office to find a letter written by the Enough Project, a human rights
organization, with a memo attached from then-Chief Operating Officer Krzanich assigning him to fix the
problem. The letter asserted that minerals found in the technology, automotive, and aerospace supply
chains were supporting bloodshed and crimes against humanity in the Democratic Republic of the Congo
(DRC). This mineral supply chain had aided in financing the deadliest conflict since World War II. Niekerk set
out to identify if these claims were true.
The minerals in question were found in every cell phone, computer, television, and video game console.11
With the consumer electronics industry expected to grow with the rise in disposable income in developing
countries (projected at 4.1% for 2014 alone), this problem would only become exacerbated in years to come
without an intervention.12
Niekerk asked himself, what did Intels supply chain truly look like? He considered the ramifications if
minerals from rebel mines were discovered in Intels supply chain. Could Intel cut the DRC out of its supply
chain? If sourcing elsewhere was available, should Intel do so? Or should Intel use its influence to address
the problem industry-wide? Niekerk wondered how this may affect Intels original equipment manufacturer
(OEM) customers. Niekerk had a feeling that the problem of addressing conflict minerals in the supply chain
spanned not only across Intel operations, but through multiple industries.
His head was spinning as he set off to tackle the seemingly impossible, knowing there were more
questions than answers and that time was of the essence. With no road map to follow and a lack of Intel
employees in the DRC, where was he to start to address this issue and how would he proceed once started?
The Conflict in the Democratic Republic of Congo
The DRC is one of the largest countries in sub-Saharan Africa by landmass (see Exhibit 1). In terms of
minerals, it is one of the richest on the continent and one of the worlds leading producers of diamonds and
cobalt.13 The countrys total minerals reserves are an estimated USD $24 trillion,14 but a seemingly never-
ending cycle of violence has made it one of the poorest countries on the planet.15
The conflict in the DRC was linked to several other regional conflicts. After the 1994 genocide in
Rwanda, the Rwandan army invaded the DRC to pursue militant groups responsible for the genocide.16 Ethnic
conflict between the army, government-backed militias, and rebel groups continued unabated for years.
Differentiating between government and militia groups grew murky as army leaders defected or switched
allegiances. Nine countries and 40 rebel groups were involved in the DRC civil war. A United Nations report
identified 617 violent incidents in the civil war that were considered war crimes, crimes against humanity,
and/or acts of genocide. The report also chronicled a climate of impunity with rampant sexual violence and
the unsettling prevalence of child soldiers. A tenuous peace was brokered in 2003, but the calm did not
extend to the DRCs eastern border with Rwanda.17
Rival factions continued to fight a proxy war in the DRC. The Rwandan and Congolese governments
had tried to broker a peace treaty with each other as well as with rebel groups, but a different rebel group
came to power in the unstable region.18 A 2013 United Nations-brokered agreement officially ended the
conflict.19 Despite the peace, the region remained extremely volatile. Rebel groups exerted influence and
the preagreement climate of lawlessness persisted. Violence, starvation, and disease caused by the conflict
led to 5.4 million deaths as of 2014.20
September 2016.
Exhibit 1
Map of Africa
Source: Democratic Republic of the Congo Wikimedia Commons. 2 Aug. 2013. Web. 23 Feb. 2015. <http://commons.wikimedia.org/wiki/File:Location_DR_Congo_AU_
Africa.svg>.
The conflicts human toll was impossible to quantify and even more difficult to state in words. Millions
of people were forced to migrate because of ethnicity, with the United Nations reporting over 200,000 rapes
from 19982013.21 The extraction of minerals provided three-quarters of the stimulus that fueled the DRC
conflict, leading to the coining of the term conflict minerals.22
The constant state of violence severely impacted the governments ability to successfully protect its
citizens and play a governing role in society. The World Governance Indicators Project, which measured the
ability of national governments to effectively govern, ranked the DRC in the bottom 5% for rule of law,
government effectiveness, and political stability in comparison with Finland, which ranked in the top 5%.23
Conflict Minerals in the Technology Industry
The eastern region of the DRC was one of the most mineral-rich regions in the world. Armed rebel groups
accounted for nearly 35% of the countrys mining profits.24 Exhibit 2 shows the distribution of minerals in
the DRC.
3
September 2016.
Exhibit 2
Major Mineral Deposits in the DRC
Source: Warren, Tracy. Background Report on Eastern Democratic Republic of Congo. Oak Ridge National Laboratory. UT-BATTELLE Department of Energy, Mar. 2011. Web. 7 Feb.
2015. <https://www.hsdl.org/?view&did=726843>.
The four main conflict minerals were tantalum, tin, tungsten, and gold, also known as 3TG. Each mineral
has a unique character, both in terms of use and extraction. Table 1 outlines the global amount of each
mineral originating in the DRC, its total revenue generation, and the amount it contributes to the growing
conflict. See Appendix A for information about 3TGs use in the technology industry and Table 2 for a
breakdown of the percentage of global 3TG supplies used by the electronics industry.
Table 1
Mineral Production and Revenue in 2009 for the DRC
Mineral Mined (tons) Global Production Price per Ton Total Revenue Funding Toward Conflict
Percentage (in $10,000) (in millions) (in millions)
Tantalum 87 12.99% $73,110 $6.4 $3.8
Tin 9,400 3.62% $14,200 $133 $80
Tungsten 170 0.28% $25,700 $4.4 $2.6
Gold 2 0.08% $31,300,000 $62.6 $37.6
Source: Conflict Minerals 3TG. Venkel LTD, n.d. Web. Dec. 2014. motrizmarketing.com/images/xl-infographic-example.pdf.
September 2016.
Table 2
Percentage of Global Mineral Supply Used by Electronics Industry
Mineral Percentage
Tungsten 30%
Tantalum 60%
Tin 36%
Gold 9%
Source: Niekerk, Gary. Responsible Supply ChainsAFCSR 2014.
23 Sep. 2014. PowerPoint Presentation.
The Mineral Supply Chain
The DRC conflict has disrupted many industrial mining operations, leading to an increase in artisanal
mining operations. Artisanal mining involved little or no machinery and relied on manual labor to dig narrow,
deep, steep tunnels.25 Minerals from artisanal mines in the DRC passed through multiple intermediaries before
exportation to a smelter. There were few smelters and sources of raw materials available in the global market.
Once at the smelter, each shipment of raw material was mixed into a larger batch with shipments from
other sources. This led to a near-impossible scenario wherein the identification of the origin for materials
became indecipherable. Smelters then supplied refiners, who sold the refined minerals to manufacturers, such
as Intel. Minerals had a horizontal supply chain with many actors and little transparency.
Intel Background
Since its founding in 1968, Intel has become the leading manufacturer of computer, networking, and
communications products. In 2013, Intel brought in USD $52.78B in revenue as compared with the total
USD $641.8B generated in the global semiconductor and electronics parts manufacturing industry.26 This
accounted for 8.2% of the industrys revenue and represented 7.3% of the market.
The other significant player in the semiconductor and electronics parts manufacturing industry was
Samsung. Samsung accounted for 5.3% of the total market and had USD $41.7B in revenue in 2013,27 which
was 5.5% of total industry revenue. Intels global supply chain included over 90 commodity products, over
16,000 suppliers, and nearly 500 supplier factories in 22 countries.28
Also in 2013, Intel had over 100,000 employees and offices in 66 countries.29 Interbrand named Intel
one of the Top Ten Most Valuable Brands in the World in 2012,30 and Fortune magazine recognized Intel as
one of the 100 Best Companies to Work For based on its employee training and development initiatives.31
Social responsibility was a key pillar of Intels approach to business. According to the Environmental
Protection Agency, Intel was the largest voluntary purchaser of green power since 2008.32 Community
involvement was also important to Intel, as noted by the accumulation of 4 million employee volunteer
hours over the last decade and its investment of $100 million annually in education throughout more than
100 countries.33 In its 2013 Corporate Sustainability Report, Krzanich states that he was especially proud
of [Intels] leadership in the area of conflict minerals.34
September 2016.
Stakeholder Involvement in the Conflict Mineral Industry
RESOLVE
RESOLVE, a Washington, DC-based independent not-for-profit, was founded in 1977 to promote the
collaboration and consensus building of public decisions to help diverse interest groups engage in dialogue.35
The group was one of the pioneers in the institutionalization of dispute resolution techniques for natural
resource, environmental, and public health issues.36 Its operations were funded through a combination of
grants, donations, and earned income from fee-for-service consulting and innovative, solutions-oriented
programs. The organizations work focused on themes of clean air and water, healthy people and communities,
natural resource conflict, resilient ecosystems, smart energy, and sustainable development. See Appendix B
for a sampling of projects engaged in by RESOLVE.37
Enough Project
Enough Project, a Washington, DC-based not-for-profit, began in 2006 by concerned policy makers and
activists seeking to end genocide and crimes against humanity through on-the-ground analyses, dispersal
of strategy papers, and briefings on global atrocities in an effort to end such events from occurring.38
Its main campaigns dealt with conflicts in the DRC, Darfur, and South Sudan. In 2009, Enough Project
sent out a briefing on conflict minerals and their role in the DRC conflict to major electronic and jewelry
manufacturers around the world. It was this letter that arrived on Krzanichs and, subsequently, Niekerks
desks and prompted Intel to address the issue of conflict minerals in its supply chain.
Global Witness
Global Witnesss three founders established the not-for-profit in 1993 after identifying a link among
natural resources, conflict, and corruption. Its mission was to show how the connection of these three
areas perpetuated poverty, created instability, and furthered environmental degradation. Its first campaigns
related to tapering funding for the Khmer Rouge and exposing the relationship between blood diamonds and
civil war in Angola. Global Witness was a key third-party partner in spreading the news of conflict minerals
and the conflict in the DRC to the public.39
United Nations (UN)

The UN was founded in 1945 as an international organization to maintain worldwide peace, develop
friendly relations among nations, facilitate cooperation among nations to improve the lives of the
underprivileged, and act as a facilitator to help nations achieve these goals.40 It maintained a strong
presence in the DRC. The UN helped manage the DRCs first democratic election in 2006.41 With regards to
conflict minerals, the organization published authoritative reports about on-the-ground conditions. A 2010
UN Group of Experts reports said that almost every mineral deposit was controlled by armed groups.42 These
reports served as credible information in a region where information was often difficult to verify.
United States State Department

The State Department was part of the United States executive department and was in charge of the
countrys international relations. The DRC conflict was one of the US State Departments main focuses at
the beginning of Barack Obamas first presidential term. Secretary of State Hillary Clinton visited the DRC
on August 11, 2009, and directed the US State Department to develop a holistic strategy on the DRC. At
the United Nations Security Council, the United States expanded economic sanctions against the DRC to
include those supporting illegal armed groups through the illicit trade of natural resources. The US State
Departments objective was to end the DRC conflict. The economic offices within the State Department
worked with American companies to support their business interests overseas.43
September 2016.
United States Agency for International Development (USAID)44

USAID was the US governments main agency engaging in providing disaster assistance to recovering
countries, striving toward eradicating poverty, and strengthening democratic institutions.45 In 2014, USAID
spent USD $20.4B to support its development goals globally.46 In the DRC, USAID had a USD $12.5 million
Responsible Minerals Trade Program that promoted conflict-free supply chains, civilian control of minerals,
protection of vulnerable populations, and enhanced auditing for minerals from the Great Lakes Region.47
Pact was a development NGO that worked to promote healthy lives, decent livelihoods, and sustainable
natural resource use in its communities. Founded in 1971, Pact has a long history of supporting USAID
projects around the world. In the DRC, Pact operated as an on-the-ground presence in artisanal mining
communities to implement USAID programs, strengthen due diligence mechanisms, and promote peaceful
economic growth within its communities. It has also partnered with USAID to teach literacy, financial
management, and small business support to women in artisanal mining communities.
In addition, USAID, Intel, and other stakeholders created the Public-Private Alliance (PPA) to support
supply chain solutions through funding and coordination support to organizations already working within
the DRC to address this problem.48 The success of the PPA led to further USAID involvement in conflict-free
minerals programs.
International Conference of the Great Lakes Region (ICGLR)49

Established in 2000 and headquartered in the Republic of Burundi, ICGLR was an intergovernmental
organization of 12 African countries in the Great Lakes Region (GLR) that worked on the ground to reduce
illegal exploitation of natural resources from the GLR and protracted armed conflict in the DRC.50 An ICGLR
Certification Scheme was in development as of 2015 that would ensure mines were conflict-free and that
minerals were not tampered with between the mine and smelters. This was done through the classification
of mines as conflict-free, bag-and-tag practices, and a third-party audit system. As of October 2013, there
were 55 certified conflict-free mines.
The Conflict-Free Sourcing Initiative51

Industry organizations proved integral in identifying conflict minerals in supply chains. Two industry
organizations working toward eliminating the use of conflict materials were the Electronic Industry
Citizenship Coalition (EICC) and the Global E-Sustainability Initiative (GeSI). Founded in 2004, the
EICC represented nearly 100 electronics companies seeking to create industry-wide social, ethical, and
environmental standards.52 GeSI was the collaboration between companies and organizations that provided
impartial information, resources, and best practices toward achieving sustainability within the information
and communication technology sector.
Together, the EICC and GeSI launched the Conflict-Free Sourcing Initiative (CFSI), which created the
Conflict-Free Smelter Program (CFSP). CFSP provided an audit system designed for the conflict mineral
standards in the Organization for Economic Co-operation and Development (OECD) and the Dodd-Frank
Act, a due diligence requirement mandated in the 2010 US financial reform legislation. The audit was used
by independent third-party auditors to identify smelters and refiners that had systems in place to ensure
conflict-free material sourcing. Companies confidently used this data to inform sourcing choices. The 2008
CFSI white paper outlined the global supply for minerals coming from the DRC and asserted that EICC
and GeSI members could influence social and environmental performance in the mining sector, but that
individual companies needed to first better understand individual supply chains.53
September 2016.
Intels Stakeholder Engagement and Contributions54
Without business and staff directly in the DRC, Intel reached out to nongovernment organizations
(NGOs) in the region to provide firsthand information, analysis, and insight to assist it with identifying
its mineral supply chains, establishing smelter audits, and lobbying other industries, governments, and
organizations to take part in sourcing conflict-free minerals.
Initial research revealed that supply chain transparency was limited. Niekerk realized transparency
required industry-wide effort and involvement from multiple stakeholders. He and his team then convened a
meeting of 52 tantalum company representatives at Intels headquarters.55 After that meeting, Intel decided
that researching the issue was not enough; it needed to develop supply chain solutions to address conflict
minerals for the entire electronics industry to implement. Intels vice president of manufacturing tasked
company engineers with leading this industry action.56
GeSIs first white paper led to Intels decision to partner with it on producing a second white paper, in
addition to working with RESOLVE. This second paper mapped the supply chain for minerals coming from
the DRC. Through a deep engagement, this work identified smelters as the pinch point in the supply chain,
or where the supply chain narrowed to a manageable scope and designing a solution was feasible. Because
of this discovery, Intel saw an audit system as a possible solution. Identifying smelters as the point for
visibility in the supply chain was a pivotal step in developing industry-wide solutions.57
Post-publication of the second white paper on conflict minerals, players in the global tin industry
collaborated to create a system where minerals were bagged and tagged at the mine stage in an attempt
to increase transparency in the minerals supply chain.58 This proved that traceability and due diligence was
possible. The bag and tag model was expanded to both tungsten and tantalum supply chains and was still
used as of 2015, alongside auditing systems such as the Conflict-Free Sourcing Initiative (CFSI) to ensure
Dodd-Frank and OECD regulation requirements were met.59 Despite the apparent success of this initiative,
these tags were surfacing on the black market, resulting in armed groups still profiting from the sale of
supposedly conflict-free minerals.
Intel realized that there were varying degrees of opacity in smelters knowledge of mines of origin. There
were no smelters located directly in the DRC, which only complicated this step in the supply chain. Thus,
Intel engineers visited 20 countries and 63 smelters in order to develop an effective method for inspecting
and verifying mineral sources.60 With many middlemen involved with transporting of minerals from mines
to smelters, determining whether or not minerals came from conflict-free mines was nearly impossible.61 See
Exhibit 3.
CFSI provided a system for third-party auditors to use when performing smelter audits to verify
nonconflicted minerals were used. While working to implement the CFSI, Intel realized that the cost of
auditing presented a large barrier for many smelters. Intel brought this finding back to the EICC and worked
with its members to create the Early-Adopters Fund that awarded any smelter in the world willing to
participate up to $5,000 toward implementing a first audit.62
Intel was one of many active partners including EICC, Enough Project, Pact ICGLR, and other electronics
companies that, along with the US Department of State and USAID, launched the Public-Private Alliance for
Responsible Minerals Trade (PPA). The PPA began in 2011 to fund organizations already working on the issue in
the DRC to develop verifiable conflict-free supply chains, align due-diligence practices, encourage responsible
sourcing from the DRC, promote transparency, and bolster in-region civil society and governmental capacity.63
September 2016.
Exhibit 3
Mineral Supply Chain Pinch Point
Mine Trading Manu- Customer

house facturer
Critical point
for supply chain
traceability
Number of players
Source: Strohmer, Michael. Conflict Minerals: Yet Another Supply Chain Challenge. A.T. Kearney. A.T. Kearney, Jun. 2012. Web. 3 Dec. 2014. <http://www.atkearney.com/
paper/-/asset_publisher/dVxv4Hz2h8bS/content/conflict-minerals-yet-another-supply-chain-challenge/10192>.
Launching in March 2012, the initial program cost USD $400,000, wherein Intel contributed $150,000.64
Other corporations also provided funding, including HP and the GE Foundation, which contributed USD $50,000
and $25,000 respectively.65 Intel and other industry leaders partnered with RESOLVE to manage the $400,000
fund and avoid the perception of paying off smelters. RESOLVE remained responsible for managing the fund as
of 2014 to increase transparency and distance from sponsoring corporations such as Intel.66
With an audit system in place and the involvement of other electronics corporations, NGOs performing
on-the-ground assessment saw a decline in the amount of conflicted minerals flowing out of the DRC. This
raised awareness toward conflict minerals and expanded conflict-free initiatives within and outside the
electronics industry.
Regulation through Legislation
The same year Niekerk found that memo on his desk, US lawmakers proposed conflict minerals
legislation.67 This first effort failed in 2009, but the US Congress in 2010 passed the Dodd-Frank Act, which
required publicly traded companies to verify whether or not their supply chains contained conflicted minerals
from the DRC and to disclose these findings in a Securities and Exchange Commission report.68 The intent
was to ensure that the electronics industry was not, knowingly or unknowingly, supporting the atrocities
associated with the conflict in sub-Saharan Africa.
With this legislation, companies became wary of sourcing from the DRC for fear of a connection with
conflicted minerals. This led to a de facto embargo on materials coming from the DRC. In 2011, mineral exports
from the eastern region of the DRC dropped 75% and prices fell accordingly.69 Companies werent the only ones
worrying about complying with the Dodd-Frank standards. The Congolese government shut down its mining
industry for several months to develop a process that certified minerals leaving the country as conflict-free.70
The Dodd-Frank Act unintentionally harmed honest miners that no longer had a market for their products.
In response, RESOLVE established the Solutions for Hope project in 2011 as a platform for supply chain
initiatives designed to support local communities, while also promoting transparency.71 By tracing and
tracking minerals from the mines to the smelter, Solutions for Hope created a transparent and closed-loop
system. This project worked with a preidentified mine and tracked its minerals from the extraction site to
the smelter.
September 2016.
The intention of the Solutions for Hope program was twofold: to ensure conflict-free minerals and to
promote economic stability. The project validated that supply chains could be transparent and conflict-
free. Proof of concept was enhanced when the Dutch Foreign Ministry, Philips, Motorola Solutions, and
other partners replicated the model for the Conflict-Free Tin Initiative. Also, Motorola teamed up with AVX
Corporation, an electronics component manufacturer and supplier, to test the feasibility of responsible,
traceable sourcing of tantalum from the DRC.72
Intel lobbied the US government to create a program that would build capacity and find quality mines
to continue to support the Congolese economy without fueling conflict. This resulted in a USD $3.2 million
USAID initiative to provide support for multistakeholder validation of mine sites in the eastern DRC,73 security
monitoring via United Nations collaboration, pilot phases of trading centers and traceability in the eastern
DRC, development of artisanal cooperatives, and strengthening of state authority in mining areas.
Intel continued to improve the transparency of its supply chain by visiting more smelters, convincing
each to commit to annual audits. In 2012, all of Intels products contained conflict-free tantalum. In 2013,
it achieved its goal of producing the worlds first conflict-free microprocessor. By January 2014, 85 smelters
in 21 countries had been visited, and 64 of those smelters and refiners were identified as compliant with the
CFSP audit protocol.74 To spread awareness, information, and resources about conflict minerals to companies
and consumers worldwide, Intel began a website to aggregate resources and insight on the topic of conflict
minerals.75
Intels efforts with the CFSI continued to gain traction across industries. By 2014, nearly 200 companies
had signed the CFSI.76 The Enough Project had developed a company ranking system to educate and empower
industry consumers to make responsible purchasing decisions regarding conflict minerals. Within this ranking,
Intel topped the list with a 60% rating. See Appendix C. By September 2014, 90% of the worlds procured
tantalum was conflict-free.77
As the deadline for complying with the Dodd-Frank Acts auditing standards approached in 2014, Intel
was the first company to file a due diligence report with the SEC regarding its conflict mineral audits.78Many
industry groups, including the Chamber of Commerce, National Association of Manufacturers, and Business
Roundtable, felt the SEC reporting guidelines were an unnecessary burden and filed a petition for judicial
review.79 Though Intel belonged to some of the organizations that challenged the new regulations and
knew showing support for the Dodd-Frank Act would ruffle feathers, it signed the Multi Stakeholder Group
Statement on the Challenge of Conflict Minerals Rule,80 a letter with multiple stakeholders in favor of the
conflicted material reporting guidelines. This letter also supported the purpose of creating greater supply
chain transparency by holding industries accountable. For additional information, see Appendix D.
Conclusion
As Krzanich finished his speech, his audience burst into a standing ovation. As Niekerk joined the crowd
in applause, he wondered what this meant for Intels efforts in conflict-free minerals sourcing. Did this
applause mean that the entire industry was on board? Had Intel been successful in creating multistakeholder
engagements that created a transparent supply chain that could be adopted throughout the industry? As
Niekerk left the CES, he felt empowered that positive change was on its way in the industry, but how would
this impending change impact Intel going forward?
10
September 2016.
Appendices
Appendix A
Use of Conflict Minerals in Consumer Electronics
Conflict Minerals in Your Daily Digital Life

Charging Battery (Tantalum)
Over the years our electronic devices have slimmed
down dramatically. A key mineral to thank for this is
Tantalum. Tantalum stores electronic charge, packing
high capacitance into a small volume.
@
Camera (Tin, Tantalum)
Taking a picture activates the camera's logic board which
is soldered together with tin. Tantalum Oxide also helps
create thinner, smaller lenses.
Texting/Emailing (Tin, Tantalum)

With each message sent, we transmit data through a circuit
board. Tin is used to solder the circuit board. Tantalum
helps keep highly conductive materials in check and helps
signals pass swiftly through the device.
Viewing Contacts (Gold)

Gold is highly conductive. Though used sparingly, your
silicon chip SIM card may contain a layer of gold thinner than a strand
Microprocessor package
of hair, assisting every time you pull up a phone number.
(cross-section)
Packed inside an Intel

processor are many complex Tantalum and Tungsten are part of the wiring connecting
Vibration (Tungsten)
layers. These key metals are transistors and act as a barrier to maintain the integrity of the Tungsten creates the familiar vibrating alert of an
used to make power efficient transistors inside the chip itself. incoming call or message. Beyond vibrations, Tungsten is
electrical connections within
the silicon chip itself, from
Tin is used to connect the chip out to the package and the a dense, wear-resistant metal used in everything from
package out to the device board. golf clubs to instrument strings.
chip to the package which
carries it, and from package Gold is highly conductive and used in wires and films when a
to the circuit board. very pure connection between components is required.
Tungsten Tantalum Tin Gold intel.com/conflictfree
Source: Conflict Minerals in Your Daily Digital Life. Intel. Intel Corporation, n.d. Web. Dec. 2014. <http://www.intel.com/content/dam/www/public/us/en/include/conflict-
free/pdf/conflict-free-daily-digital-life-infographics.pdf>.
11
September 2016.
Appendix B
Selected RESOLVE Projects
Agriculture and Water Stewardship Initiative:i

The initiative will expand public and private commitments to improve water quality and quantity in the United
States by engaging multiple stakeholders to advance policies that improve the performance outcomes from
conservation investments and utilize supply chain mechanisms to create market incentives to advance water
outcomes.
Public Health Leadership Forum:ii

Through a partnership with the Robert Wood Johnson Foundation, this initiative is a forum to engage leaders
and stakeholders in the public health sector in a dialogue about challenges and opportunities faced by the
industry. Its two major tasks are defining a set of foundational health services that all government public
health departments should provide and creating a vision for what a high-achieving government health program
will look like in 2020.
National Environmental Health Partnership Council:iii

The council engages stakeholders to expand and sustain environmental health awareness, education, and
policies and practices by creating a common voice of support for issues, coordinating activities to advance
causes, disseminating new information, exploring strategies to leverage resources, and raising public awareness
to the role of environmental health.
New Brunswick Forest Collaborative:iv

RESOLVE is fostering engagement between a timber company and provincial environmental NGOs in
New Brunswick, Canada, to develop consensus recommendations to balance economic, community, and
environmental sustainability.
Collaborative Sciences Program:v

Resolve is working to find existing scientific information on the environmental and health risks that may
emerge due to hydraulic fracturing, to help develop more information on the topic, and to provide strategic
cooperative approaches to resolving disputes.
Source:
i Agriculture and Water Stewardship Initiative. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/site-awsinitiative/>.
ii Public Health Leadership Forum. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/site-healthleadershipforum/>.
iii National Environmental Health Partnership Council. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/site-nehpc/>.
iv New Brunswick Forest Collaborative. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/site-nbfc/>.
v Collaborative Science Program. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/site-collaborativescience/issue-areas/hydraulic-facturing/>.
12
September 2016.
Appendix C
Ranking of Responsible Electronics Companies*
Company Tracing Auditing Certification Stakeholder Support for Total Overall
Name Engagement Legislation Points Score
Intel 7 13 7 2 0 29 60%
HP 4 10 8 2 2 26 54%
Phillips 6 8 7 2 0 23 48%
SanDisk 7 10 5 1 0 23 48%
AMD 2 7 7 2 3 21 44%
RIM 4 7 7 2 0 20 42%
Acer 5 8 3 1 2 19 40%
Dell 2 8 5 2 2 19 40%
Apple 6 8 2 2 0 18 38%
Microsoft 2 7 3 2 4 18 38%
Motorola
2 7 6 1 1 17 35%
Mobility
Nokia 2 7 6 2 0 17 35%
Panasonic 5 2 5 2 2 16 33%
IBM 3 7 2 1 0 13 27%
LG 4 7 1 1 0 13 27%
Samsung 4 7 1 1 0 13 27%
Sony 2 7 3 1 0 13 27%
Toshiba 2 4 3 1 0 10 21%
Lenovo 0 7 1 0 0 8 18%
Canon 1 2 0 1 0 4 8%
Nikon 1 2 0 1 0 4 8%
Sharp 2 2 0 0 0 4 8%
HTP 0 2 0 0 0 2 4%
Nintendo 0 0 0 0 0 0 0%
*as related to the Enough Projects involvement with conflict-free minerals
Source: Hellmuth, Alex, and Sasha Lezhnev. Taking Conflict Out of Consumer Gadgets: Company Rankings on Conflict Minerals 2012. Enough Project. Enough Project, Aug. 2012.
Web. Dec. 2014. <http://www.enoughproject.org/files/CorporateRankings2012.pdf>.
13
September 2016.
Appendix D
Illustration of Mineral Supply Chain
Source: Gerritsen, Laura. Tin and Tantalum Road Trip. Fairphone. Fairphone, 8 Nov. 2013. Web. 3 Dec. 2014. <http://www.fairphone.com/2013/11/08/tin-and-tantalum-road-trip/>.
14
September 2016.
Endnotes
1
This case was written with the majority of information provided by: Gary Niekerk, director of corporate sustainability at Intel.
Personal interview. 3 Nov. 2014 and 21 Nov. 2014.
2
Attendee Audit Summary Results. CESweb. Consumer Electronics Association, 2014. Web. 3 Dec. 2014. <http://cesweb.org/CES/
media/2014/landing%20pages/why%20attend%20ces/2014AuditSummary_web0626.pdf.>.
3
Ibid.
4
Coffee, Patrick. 6,329 Credentialed Journalists Will Cover Super Bowl XLVII. PRNewser. Adweek, 29 Jan. 2014. Web. 3 Dec.
2014. <http://www.mediabistro.com/prnewser/6329-credentialed-journalists-will-cover-super-bowl-xlviii_b83969>.
5
Attendee Audit Summary Results.
6
New Intel CEO Brian Krzanich to Open Exciting Week of Tech Innovation with Preshow Keynote at 2014 International CES.
International CES. CEA, 17 Sep. 2013. Web. 3 Dec. 2014. <http://www.cesweb.org/News/Press-Releases/CES-Press-Release.
aspx?NodeID=4759e529-947c-419e-8c2e-57de885d8842>.
7
Intel Executive Biography. Intel. Intel Corporation, n.d. Web. 3 Dec. 2014. <http://www.intel.com/newsroom/assets/bio/
CorpOfficers.htm>.
8
Guglielmo, Connie. CES Live: Intel CEO Makes Big Move Into Wearables, Says No More Conflict Minerals In Chips.Forbes. Forbes.
com LLC, 1 Jan. 2014. Web. 07 Dec. 2014. <http://www.forbes.com/sites/connieguglielmo/2014/01/06/ces-live-intel-ceo-brian-
krzanich-delivers-opening-keynote/>.
9
The source for footnote i is: What are Conflict Minerals? Source Intelligence. Source 44 LLC, n.d. Web. Dec. 2014. <http://www.
sourceintelligence.com/what-are-conflict-minerals.>.
10
Guglielmo, Connie.
11
Look Inside: Caroline Duran and the Pursuit of Conflict-Free. Intel. Intel Corporation, n.d. Web. 3 Dec. 2014. <http://www.
intel.com/content/www/us/en/corporate-responsibility/pursuit-of-conflict-free-minerals.html>.
12
Khan, Sarah. IBISWorld Industry Report C2524-GL Global Semiconductor & Electronic Parts Manufacturing. IBISWorld.
IBISWorld, 2014. Web. Dec. 2014. <http://clients1.ibisworld.com/reports/gl/industry/default.aspx?entid=960>.
13
Diamond Heist. The Washington Post. The Washington Post Company, n.d. Web. 8 Feb. 2015. <http://www.washingtonpost.
com/wp-adv/specialsales/spotlight/congo/diamond.html>.
14
UNEP Study Confirms DR Congos Potential as Environmental Powerhouse but Warns of Critical Threats. UNEP News Centre.
United Nations Environment Programme, 10 Oct. 2011. Web. 07 Dec. 2014. <http://www.unep.org/NEWSCENTRE/default.
aspx?DocumentId=2656&ArticleId=8890>.
15
Pasquali, Valentina. The Poorest Countries in the World. Global Finance. Global Finance Magazine, n.d. Web. 8 Dec. 2014.
<https://www.gfmag.com/global-data/economic-data/the-poorest-countries-in-the-world>.
16
Q&A: DR Congo Conflict. BBC News. BBC, 20 Nov. 2012. Web. 3 Dec. 2014. <http://www.bbc.com/news/world-
africa-11108589>.
17
The information in this paragraph came from the source: War Crimes, Crimes against Humanity and Genocide. United Nations.
United Nations Human Rights Office of the High Commissioner, n.d. Web. 3 Dec. 2014. <http://www.ohchr.org/Documents/
Countries/CD/FS-2_Crimes_Final.pdf>.
18
Q&A: DR Congos M23 Rebels. BBC News. BBC, 5 Nov. 2013. Web. 7 Feb. 2015. <http://www.bbc.com/news/world-
africa-20438531>.
19
MONUSCO Background. United Nations Organization Stabilization Mission in the Democratic Republic of Congo. United Nations,
n.d. Web. 8 Feb. 2015. <http://www.un.org/en/peacekeeping/missions/monusco/background.shtml>.
20
Eastern Congo. Enough. Center for American Progress, n.d. Web. 8 Feb. 2015. <http://www.enoughproject.org/conflicts/
eastern_congo.>.
21
Tran, Mark. It Was Like Dying: A Raped Woman in Congo DRC Speaks Out. The Guardian. Guardian News and Media Limited, 14
Feb. 2013. Web 3 Dec. 2014. <http://www.theguardian.com/global-development/2013/feb/14/dying-raped-woman-congo-drc>.
22
What Are Conflict Minerals?
23
Worldwide Governance Indicators. Worldwide Governance Indicators. The World Bank Group, 2014. Web. 07 Dec. 2014. <http://
info.worldbank.org/governance/wgi/index.aspx#home>.
24
What Are Conflict Minerals?
25
Gerritsen, Laura. Tin and Tantalum Road Trip. Fairphone. Fairphone, 8 Nov. 2013. Web. 3 Dec. 2014. <http://www.fairphone.
com/2013/11/08/tin-and-tantalum-road-trip/>.
26
2013 Annual Report. Intel. Intel Corporation, 2014. Web. 3 Dec. 2014. <http://intc.client.shareholder.com/intel-annual-
report/2013/Intel_ARand10K_13.pdf>.
15
September 2016.
27
Graziano, Dan. Samsung Beat out Apple on Fortunes Global 500 List. BGR. BGR Media LLC, 8 Jul. 2013. Web. Feb. 2015.
<http://bgr.com/2013/07/08/samsung-revenues-apple-fortune-global-500-list/>.
28
Information in this paragraph was gathered from the source: Khan, Sarah.
29
2013 Annual Report.
30
The Best Global Brands Interbrand. Interbrand, n.d. Web. 3 Dec. 2014. <http://bestglobalbrands.com/previous-years/2012>.
31
Best Companies 2014: Intel. Fortune. Time INC. Network, n.d. Web. 3 Dec. 2014. <http://fortune.com/best-companies/
intel-84//>.
32
2014 Award Winners Green Power Leadership Awards. Environmental Protection Agency. United States, 25 Nov. 2014. Web. Dec.
2014. <http://www.epa.gov/greenpower/awards/winners.htm#intel>.
33
2013 Annual Report.
34
Ibid.
35
Mission. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/about/mission>.
36
Projects. RESOLVE. RESOLVE, n.d. Web. 3 Dec. 2014. <http://www.resolv.org/projects>.
37
The information in this paragraph came from the source: About Us. Resolve. Resolve, n.d. Web. 3 Dec. 2014. <http://www.
resolv.org/about>.
38
About Us. Enough. Center for American Progress, n.d. Web. 3 Dec. 2014. <http://www.enoughproject.org/about>.
39
The information in this paragraph came from the source: 20 Years of Global Impact. Global Witness. Global Witness, n.d. Web. 3
Dec. 2014. <http://new.globalwitness.org/20yearsimpact.php>.
40
UN at a Glance. United Nations. United Nations, n.d. Web. 3 Dec. 2014. <http://www.un.org/en/aboutun/>.
41
MONUSCO Background.
42
Conflict Minerals and the Democratic Republic of Congo. Business for Social Responsibility (BSR). BSR, May 2010. Web. Dec. 2014.
43
The information in this paragraph came from the source: Arieff, Alexis. Democratic Republic of Congo: Background and
U.S. Policy. Congressional Research Service (CRS). CRS, 24 Feb. 2014. Web. 3 Dec. 2014. <http://fpc.state.gov/documents/
organization/223464.pdf>.
44
Information in this section was gathered from the source: Carolyn Duran, Conflict Minerals Program manager and supply chain
director at Intel. Personal interview. 16 Jan. 2015.
45
Who We Are. USAID. USAID, 29 Jan. 2014. Web. 3 Dec. 2014. <http://www.usaid.gov/who-we-are>.
46
Fact Sheet: FY 2014 Development and Humanitarian Assistance Budget. USAID. USAID, n.d. Web. Dec. 2014. <http://www.
usaid.gov/sites/default/files/documents/1869/FY2014_DevelopmentBudgetFactSheet.pdf>.
47
Jurewicz, Patricia. Resource Sharing in the DRC: Exploring the Role of Trusts. Responsible Sourcing Network. Responsible
Sourcing Network, 2013. Web. Feb. 2015. www.sourcingnetwork.org/.../resource-sharing-drc-rsn-20130115.pdf.
48
Public-Private Alliance for Responsible Minerals Trade (PPA). Devex Impact. Devex, n.d. Web. 7 Feb. 2015. <https://www.devex.
com/impact/partnerships/public-private-alliance-for-responsible-minerals-trade-ppa-490>.
49
Information in this section was gathered from the source: Hall, Aaron, and Sasha Lezhnev. Coming Clean: A Proposal for
Getting Conflict Minerals Certification on Track. Enough Project. Enough Project, Nov. 2013. Web. Dec. 2014. <http://www.
enoughproject.org/files/ComingClean-Getting-Conflict-Minerals-Certification-on-Track.pdf.>.
50
Background. International Conference on the Great lakes Region (ICGLR). ICGLR, n.d. Web. Feb. 2015. <http://www.icglr.org/
index.php/en/background>.
51
Information in this section was gathered from the source: Carolyn Duran, Conflict Minerals Program manager and supply chain
director at Intel. Personal interview. 16 Jan. 2015.
52
Members. Electronic Industry Citizenship Coalition (EICC). EICC, n.d. Web. Dec. 2014. <http://www.eiccoalition.org/about/
members/.>.
53
GHGm. Social and Environmental Responsibility in Metals Supply to the Electronic Industry. GHGm. Electronic Industry
Citizenship Coalition and Global e-Sustainability Initiative, 20 Jun. 2008. Web. Dec. 2014. www.eiccoalition.org/media/docs/.../
SERMetalsSupplyreport.pdf.
54
Information in this section was gathered from the source: Andrea Fava, manager of environmental policy in Intels Global Public
Policy Office. Personal interview. 20 Nov. 2014.
55
Assessing Corporate Action on Conflict Minerals. Electronic Product Design & Test. IML Group PLC, 16 Dec. 2010. Web. Dec.
2014. <http://www.epdtonthenet.net/article/38774/Assessing-corporate-action-on-conflict-minerals.aspx>.
56
Getting to Conflict-Free: Assessing Corporate Action on Conflict Minerals. Enough Project. Enough Project, Dec. 2010. Web. Dec.
2014. www.enoughproject.org/files/corporate_action-1.pdf.
16
September 2016.
57
Peyser, Jen.Tracing a Path Forward: A Study of the Challenges of the Supply Chain for Target Metals Used in Electronics.
Washington, DC. RESOLVE, 2010. Print.
58
Conflict-Free Tin Initiative. Solutions Network. RESOLVE, n.d. Web. 3 Dec. 2014. <http://solutions-network.org/site-cfti/
process/>.
59
Carolyn Duran, Conflict Minerals Program manager and supply chain director at Intel. Personal interview. 16 Jan. 2015.
60
Kaplan, Ken. Helter Smelter No More: Moving to Conflict-Free Minerals. Intel. Intel Corporation, 9 Jan. 2014. Web. 3 Dec. 2014.
<http://iq.intel.com/helter-smelter-no-more-moving-to-conflict-free-minerals-2/>.
61
Sourcing Conflict-Free Minerals from the Kivus No Longer Pipe Dream, Monitoring Must Follow. Enough Project. Enough Project,
26 Feb. 2013. Web. 7 Feb. 2015. <http://www.enoughproject.org/blogs/sourcing-conflict-free-minerals-kivus-no-longer-pipe-
dream-monitoring-must-follow>.
62
The information in this paragraph came from the source: 2013 Corporate Social Responsibility Report. Intel. Intel Corporation,
2014. Web. 3 Dec. 2014. <http://csrreportbuilder.intel.com/PDFFiles/CSR_2013_Full-Report.pdf.>.
63
Information in this paragraph came from the source: Public-Private Alliance for Responsible Minerals Trade. U.S. Department of
State. Office of Website Management, Bureau of Public Affairs, 15 Nov. 2011. Web. 7 Dec. 2014. <http://www.state.gov/r/pa/prs/
ps/2011/11/177214.htm>.
64
Gary Niekerk. Personal interview. 21 Nov. 2014.
65
Ibid.
66
Conflict-Free Smelter Early Adopters Fund.Solutions Network. RESOLVE, n.d. Web. 7 Dec. 2014. <http://solutions-network.org/
site-cfs/>.
67
111th Congress. S. 891-Congo Conflict Minerals Act of 2009. Library of Congress. United States, 23 Apr. 2009. Web. 7 Feb.
2015. <https://www.congress.gov/bill/111th-congress/senate-bill/891?q=%7B%22search%22%3A%5B%22democratic+republic+o
f+congo+minerals%22%5D%7D>.
68
Wilkie, Christina. Conflict Minerals Law Is Heavy Burden on Business, House Republicans Argue. Huff Post Politics.
TheHuffingtonPost.com Inc., 22 May 2013. Web. 3 Dec. 2014. <http://www.huffingtonpost.com/2013/05/22/conflict-minerals-
law_n_3322395.html>.
69
Ibid.
70
Raghavan, Sudarsan. Obamas Conflict Minerals Law Has Destroyed Everything, Say Congo Miners. The Guardian. Guardian News
and Media Limited, 2 Dec. 2014. Web. 3 Dec. 2014. <http://www.theguardian.com/world/2014/dec/02/conflict-minerals-law-
congo-poverty>.
71
A Platform to Support Responsible Sourcing, Peacebuilding, and Community Development. Solutions Network. RESOLVE, n.d.
Web. 3 Dec. 2014. <http://solutions-network.org/site-solutionsforhope/>.
72
Ibid.
73
Public Private Alliance for Responsible Mineral Trade.
74
2013 Corporate Social Responsibility Report.
75
In Pursuit of Conflict-Free. Intel. Intel Corporation, n.d. Web. 3 Dec. 2014. <http://www.intel.com/content/www/us/en/
corporate-responsibility/conflict-free-minerals.html.>.
76
Members and Collaborations. CFSI. EICC and GeSI, n.d. Web. 3 Dec. 2014 <http://www.conflictfreesourcing.org/about/members-
and-collaborations/>.
77
Schwartz, Ariel. Intels CEO Reveals the Companys Plans to Build a Conflict-Free Supply Chain by 2016. Fast Company. Fast
Company & Inc, 3 Sep. 2014. Web. 3 Dec. 2014.
78
Intels Efforts to Achieve a Conflict-Free Supply Chain. Intel. Intel Corporation, May 2014. Web. 3 Dec. 2014. <http://www.
intel.com/content/dam/doc/policy/policy-conflict-minerals.pdf>.
79
Ibid.
80
2013 Corporate Social Responsibility Report.
17
September 2016.
Notes
18
September 2016.
Notes
19
September 2016.
The Erb Institute is committed to creating a socially and environmentally
sustainable society through the power of business. Building on nearly two
decades of research, teaching, and direct engagement, the Institute has become
one of the worlds leading sources of innovative knowledge on the culture,
technologies, operations and governance of business in a changing world.
http://erb.umich.edu
Established at the University of Michigan in 1992, the William Davidson Institute

(WDI) is an independent, non-profit research and educational organization focused on
providing private-sector solutions in emerging markets. Through a unique structure
that integrates research, field-based collaborations, education/training, publishing,
and University of Michigan student opportunities, WDI creates long-term value for
academic institutions, partner organizations, and donor agencies active in emerging
markets. WDI also provides a forum for academics, policy makers, business leaders, and
development experts to enhance their understanding of these economies. WDI is one
of the few institutions of higher learning in the United States that is fully dedicated to
understanding, testing, and implementing actionable, private-sector business models
addressing the challenges and opportunities in emerging markets.
September 2016.

Caso - Intel Undermining The Conflict Mineral Industry

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case W94C11

February 20, 2015

Intel: Undermining the Conflict Mineral Industry1

Conflict Minerals Supply Chain

The Conflict in the Democratic Republic of Congo

Conflict Minerals in the Technology Industry

The Mineral Supply Chain

Stakeholder Involvement in the Conflict Mineral Industry

United Nations (UN)

United States State Department

United States Agency for International Development (USAID)44

International Conference of the Great Lakes Region (ICGLR)49

The Conflict-Free Sourcing Initiative51

Intels Stakeholder Engagement and Contributions54

Mine Trading Manu- Customer

Regulation through Legislation

Conflict Minerals in Your Daily Digital Life

Texting/Emailing (Tin, Tantalum)

Viewing Contacts (Gold)

Packed inside an Intel

Agriculture and Water Stewardship Initiative:i

Public Health Leadership Forum:ii

National Environmental Health Partnership Council:iii

New Brunswick Forest Collaborative:iv

Collaborative Sciences Program:v

Established at the University of Michigan in 1992, the William Davidson Institute

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