Introduction

This assessment aims to mitigate risks in mineral supply chains and promote responsible sourcing. This report evaluates five industry programmes—DMCC, ITSCI, LBMA, RJC, and RMI—assessing how well they align with the OECD Guidance. The focus is on smelter and refiner assurance mechanisms, critical for ensuring responsible mineral sourcing from conflict-affected regions.

Methodology

The assessment evaluates programmes on two fronts: incorporation of OECD recommendations into programme standards and the effectiveness of their implementation. The methodology covers five areas: overarching due diligence principles, risk assessment, risk mitigation, independent audits, and public reporting. Programmes are rated as fully aligned, partially aligned, or not aligned, with findings leading to recommendations for improvement.

Cross-cutting findings from the OECD alignment assessment

The assessment identified several common areas needing improvement:

• Risk Assessment: Many programmes inadequately assess risks, often limiting due diligence to Tier 1 suppliers and failing to cover the full scope of Annex II risks. On-the-ground assessments in high-risk areas are frequently absent, weakening the effectiveness of due diligence.
• Risk Mitigation: Companies often disengage from suppliers when risks are identified, rather than working to mitigate these risks. This approach contrasts with OECD Guidance, which encourages progressive risk mitigation. Auditors rarely challenge this practice, leading to gaps in implementing due diligence.
• Audit Process: Auditors often lack the necessary knowledge and critical analysis skills, focusing too much on documentation rather than challenging management practices. There is a need for better auditor training and oversight to ensure audits are rigorous and aligned with OECD expectations.
• Public Reporting: Transparency in reporting due diligence activities is lacking. Many programmes do not require consistent, annual public reporting, and available reports often lack detailed information on risks and risk management effectiveness. Improved reporting standards are essential for public confidence.

Programme-specific results

• Dubai Multi Commodities Centre (DMCC): Partially aligned, with strengths in audit oversight and responsible sourcing engagement. However, it needs better auditor vetting and more explicit guidelines on conducting on-the-ground risk assessments in high-risk supply chains.
• International Tin Supply Chain Initiative (ITSCI): Partially aligned, excelling in practical application of OECD Guidance and on-the-ground activities. However, it needs to enhance member companies’ capacity for risk assessment and governance, and improve the timeliness of communications.
• London Bullion Market Association (LBMA): Partially aligned, with strong governance but needing better oversight of auditors and extended due diligence beyond Tier 1 suppliers. Transparency on refiner de-listing decisions and non-conformance findings needs improvement.
• Responsible Jewellery Council (RJC): Partially aligned, with significant reach in the jewellery sector. However, responsible sourcing requirements are mostly in a standard adopted by only 6% of members. More robust sourcing requirements in the main Code of Practices are needed, along with improved auditor competencies.
• Responsible Minerals Initiative (RMI): Partially aligned, with strengths in stakeholder engagement and transparency. However, it needs a robust assessment mechanism to evaluate third-party due diligence and better implementation of revised standards by companies and auditors.

Recommendations

The report makes several key recommendations for enhancing alignment with the OECD Guidance:

• Expand the breadth and depth of risk assessments: Programmes should ensure that due diligence covers all Annex II risks, including those beyond direct suppliers in red-flagged supply chains. On-the-ground assessments should be conducted in high-risk areas to provide a comprehensive understanding of potential risks.
• Enhance risk mitigation practices: Programmes should encourage companies to engage in progressive risk mitigation rather than defaulting to supplier disengagement. This includes building or leveraging existing relationships within the supply chain and collaborating with external stakeholders, such as civil society organisations, to develop effective mitigation strategies.
• Strengthen auditor training and oversight: Programmes should implement more rigorous accreditation processes for auditors, focusing on individual competencies rather than generic firm-level qualifications. Regular training on programme requirements and mineral supply chain due diligence should be mandatory for all auditors. Additionally, programmes should improve oversight by requiring auditors to report in detail on their audit procedures and findings.
• Ensure transparent reporting: All companies should be required to publish detailed, annual reports on their due diligence activities. These reports should include comprehensive descriptions of management systems, risk assessment findings, and risk mitigation actions. Publicly accessible audit reports should also be standardised, providing clear insights into compliance and areas needing improvement.