Introduction
On July 21, 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law. The Dodd-Frank Act and related 2012 U.S. Securities and Exchange Commission rules require certain companies to disclose whether the products they manufacture or contract to manufacture contain Conflict Minerals necessary for the production or the functionality of the products that are sourced from mines in the Democratic Republic of the Congo or adjoining countries. Conflict Minerals are Tantalum, Tin, Tungsten and Gold.
As many of our suppliers and customers have acknowledged publicly, the Dodd-Frank Act created a new expectation for product manufacturers, which may be far removed from the source of the raw minerals in their products.
HAI supplies hundreds of branded and private label products that are raw material sourced by other companies located around the world.
HAI is committed to acting in a socially and environmentally responsible manner, to comply with the law, to meet customer commitments, and to support its customers’ businesses.
This document sets forth HAI’s policy regarding Conflict Minerals.
Overview
As a responsible company, HAI supports the goal of the Dodd-Frank Act of preventing armed groups in the Democratic Republic of the Congo and adjoining countries from benefitting from the sourcing of Conflict Minerals from that region.
As an industrial manufacturer and supplier of hundreds of branded and private label products that may be raw material sourced by other manufacturers located around the world, HAI is in some cases many levels away from the beginning of the supply chain for its products.
This Policy demonstrates HAI’s commitment and its expectations for its product suppliers regarding actions to address Conflict Minerals.
OUR COMMITMENT:
- 1. Support the aim and objectives of the Dodd-Frank Act concerning Conflict Minerals sourcing by working to educate the manufacturers of the products they sell to HAI.
- 2. Help our suppliers understand the due diligence steps they can take to investigate the source of any Conflict Minerals in the products they sell to HAI.
- 3. Not to continue to source from a supplier any product that contains Conflict Minerals
if HAI determines the product is not DRC Conflict Free and the supplier fails to implement reasonable steps to transition to DRC Conflict Freesources.
Commitment to Responsible Sourcing
HAI supports the humanitarian goals of the Dodd-Frank Act and encourages the manufacturers of the products sold to HAI to adopt that same policy for their businesses.
As a manufacturer and supplier of products raw material manufactured by other companies, HAI does not directly purchase any raw Conflict Minerals from any source and may be many levels removed from the mines, smelters, and refiners that produce these metals used in the products produced by HAI’s suppliers.
The supply chain for Conflict Minerals is complex and lacks an established structure for product manufacturers to trace the minerals in their goods and sold to HAI.
HAI is committed to working with its suppliers to educate them on these matters and assist in providing steps they can take to obtain increased transparency regarding the origin of minerals contained inthe products they produce and sell to HAI.
Supplier Code
HAI has the following expectations of its suppliers:
- Suppliers shall not include in any products sold to HAI any Conflict Minerals that are not DRC Conflict Free;Products are "DRC Conflict Free"? if they contain only Conflict Minerals that did not originate in the DRC or an adjoining country, are from recycled or scrap sources, or have not benefitted the armed groups identified as perpetrators of the abuses that are the subject of the Dodd-Frank Act.
- Suppliers should develop Conflict Minerals policies, due diligence frameworks, and management systems that are designed to prevent Conflict Minerals that are not DRC.
- Conflict Free from being included in the products sold to HAI; and
- HAI’s suppliers are expected to source Conflict Minerals only from sources that are DRC Conflict Free.
In doing so, suppliers will be expected to:
- implement and communicate to their personnel and suppliers’ policies that are consistent with this Policy and require their direct and indirect suppliers to do the same.
- put in place procedures for the traceability of Conflict Minerals, working with their direct and indirect suppliers as applicable.
- use reasonable efforts to source Conflict Minerals from smelters and refiners validated as being DRC Conflict Free and require their direct and indirect suppliers to do the same.
- advise HAI of any determination that the supplier either has concluded or has a reasonable basis to believe that products it currently sells or has sold to HAI are not DRC Conflict Free.
- maintain reviewable business records supporting the source of Conflict Minerals and
- from time to time, at HAI’s request, provide HAI with information concerning the origin of Conflict Minerals included in products sold to HAI, which HAI shall be entitled to use or disclose in satisfying any legal or regulatory requirements or in any customer or marketing communications, not withstanding the terms of any confidentiality agreements that do not specifically reference this paragraph.
Suppliers also are encouraged to support industry efforts to enhance traceability and responsible practices in Conflict Minerals supply chains.
Consequences of Supplier Non-Compliance
HAI evaluates its relationships with its suppliers on an ongoing basis.
HAI reserves the right to evaluate the extent to which a supplier has failed to reasonably comply with this Policy.
HAI reserves the right to request additional documentation from its suppliers regarding the origin of any Conflict Minerals included in any products sold to HAI.
Suppliers who do not reasonably comply with this Policy shall be reviewed by HAI’s supply chain organization for future business.
In the event HAI determines that a supplier’s efforts to comply with this Policy have been deficient and the supplier fails to cooperate in developing and implementing reasonable remedial steps, HAI reserves the right to take appropriate actions up to and including discontinuing purchases from the supplier.
Nothing in this Policy is intended to in any way grant any additional rights or expectations to a HAI supplier or in any way modify or otherwise limit in any way any of HAI’s contractual or legal rights.
Grievance Mechanism and Reporting
Our employees, suppliers and other parties can report concerns and alleged violations of this Policy as follows:
- (i) Write us at HAI: Attn: Conflict Minerals, HAI, 1688 Sierra Madre Circle, Placentia CA 92870
- (ii) Email us at: info@Haiinc.com; or
- Call us at: 1-877-411-8971.
Reports can be made anonymously and will be kept confidential to the fullest extent practicable and allowed by law.
We will not take any retaliatory action against our employees, suppliers, or other parties who make a report in good faith.
Our suppliers are encouraged to contact info@HAIinc.com if they wish to seek guidance on the application of this Policy.
Conclusion
HAI fully understands the importance of this issue to its customers and is committed to supply chain initiatives and overall corporate social responsibility and sustainability efforts that work towards a DRC Conflict Free supply chain. We encourage all our suppliers to likewise support these efforts.