Responsible Mineral Sourcing | Responsible Manufacturing

The United States passed the "Dodd-Frank Wall Street Reform and Consumer Protection Act" in 2010. Section 1502 of the Act requires the U.S. Securities and Exchange Commission to enact legislation on "conflict minerals" to disclose whether the minerals used in the production are sourced from the Democratic Republic of the Congo (DRC) and adjoining countries that use forced labor and inhumane treatment of labor. The Responsible Minerals Initiative (RMI) research discovered that the rebel groups in these regions use forced labor, child labor, and other illegal means to mine tantalum, tin, tungsten, and gold, and sell them in exchange for weapons, thereby causing regional instability. These four types of minerals obtained through illegal means are referred to as conflict minerals in the international community.

The Application of Minerals

Electronic products use various metal materials with significant functions. Tantalum, tin, tungsten, and gold are materials necessary for the functions of electronic products and can be used to produce resistor-capacitor, CPUs, hard drives, memory, motherboards, and connectors. Cobalt is a key material for the production of batteries. According to the Study on the EU’s list of Critical Raw Materials, one-third of the world’s Cobalt comes from the Democratic Republic of Congo, and the nearby countries also have a risk of illegal profits. RMI listed Cobalt as the fifth conflict mineral in 2019. As Cobalt is a key material for the production of batteries, ASUS also included Cobalt in the management of responsible mineral procurement and conducts annual due diligence investigations. We have formulated a 5-year conversion plan for qualified smelters, requiring suppliers to increase the proportion of qualified smelters year by year, and achieve the goal of purchasing 100% cobalt ore from qualified smelters by 2025.

In the same year, when we negotiated with interested parties, we learned that mica mining in some countries involved illegal child labor with low wages, which became an issue of concern to human rights organizations. Mica is the main component of paint, and it is mostly used for the exterior finishing of electronic products. Due to the risk of supply chain management in mica mining, we will continue to pay attention to the mica management requirements of international organizations and communicate with the supply chain in a timely manner.

ASUS Responsible Minerals Policy

Respect for Human Rights is an ASUS core value reflected in our corporate Code of Conduct policies, which apply to all global operations, including our employees and workers in our supply chain. For the protection of human rights, ASUS is committed to responsible sourcing of materials used in our products. We require our suppliers to comply with ASUS Responsible Minerals Policy as well as the Responsible Business Alliance (RBA) Code of Conduct and all other applicable laws by signing our “Code of Conduct Compliance Declaration”.

ASUS Responsible Minerals Policy

ASUS follows the OECD Due Diligence Guidance for Responsible Supply Chains from Conflict-Affected and High-Risk Areas to investigate our supply chain and engage with suppliers.

Establishment of Management Mechanism	Identify and assess risks	Develop risk improvement tasks	Conduct third-party independent audits	Disclose management results
ASUS Responsible Minerals Policy Suppliers purchase tantalum, tin, tungsten, gold and cobalt 100% from qualified smelters Comply with the ASUS Responsible Minerals Policy and establish its Responsible Minerals Policy and communicate it to its next-tier suppliers	Due Diligence Identify suppliers using tantalum, tin, tungsten, gold and cobalt, and conduct annual responsible mineral surveys Conduct Reasonable Country of Origin Inquiry Identify smelters compliant with RMI Responsible Minerals Assurance Process, RMAP certified smelters, and risk suppliers	Conformant smelter conversion plan Assisting meeting to communicate ASUS requirements Suppliers carry out conversion of conformant smelters Track conversion progress quarterly	Onsite Audit Two-party/three-party on-site audit of the supplier’s responsible mineral management mechanism; inspection of the quality of information provided by the supplier	Publication of the list of smelters Publish the list of smelters used by ASUS supply chain on the CSR website and sustainability report

Establishment of Management Mechanism

Identify and assess risks

Develop risk improvement tasks

Conduct third-party independent audits

Disclose management results

ASUS Responsible Minerals Policy

Suppliers purchase tantalum, tin, tungsten, gold and cobalt 100% from qualified smelters
Comply with the ASUS Responsible Minerals Policy and establish its Responsible Minerals Policy and communicate it to its next-tier suppliers

Due Diligence

Identify suppliers using tantalum, tin, tungsten, gold and cobalt, and conduct annual responsible mineral surveys
Conduct Reasonable Country of Origin Inquiry
Identify smelters compliant with RMI Responsible Minerals Assurance Process, RMAP certified smelters, and risk suppliers

Conformant smelter conversion plan

Assisting meeting to communicate ASUS requirements
Suppliers carry out conversion of conformant smelters
Track conversion progress quarterly

Onsite Audit

Two-party/three-party on-site audit of the supplier’s responsible mineral management mechanism; inspection of the quality of information provided by the supplier

Publication of the list of smelters

Publish the list of smelters used by ASUS supply chain on the CSR website and sustainability report

Beyond the Responsible Minerals

In our stakeholder engagement in the same year, we learned that the extraction of mica in certain countries involved the use of low-wage child labor and illegal operations, and it has become an issue of concern for human rights organizations. Mica is the main component of coating used mostly for decorating the exterior of electronics. As the extraction of mica involves supply chain management risks, we will continue to pay close attention to the management requirements of international organizations for mica, and communicate with the supply chain whenever necessary.

According to the RMI survey results and the “Conflict Affected and High-Risk Areas” (CAHRAs) of the EU that became effective in 2022, ASUS surveyed a total of 325 suppliers in our supply chain for information on smelters’ distribution and the compliance of supply of materials for products in 2022.

The analysis results showed that most of them were located in Asia which accounted for 65%. They were followed by those in Europe with 13% and those in Africa with 4%. They are verified as qualified smelters in the survey.

The Distribution of Smelters Used by ASUS Products

Percentage of Minerals Sourced From Qualified Smelters

ASUS continues to cooperate with the Conflict-Free Minerals Program to investigate the source of minerals in the supply chain. All the smelters and refiners disclosed in the list are from the smelters and refiners used by ASUS supply chain.

Please refer to the Conflict-Free Smelter Program website for the latest list of smelter announcements.

We participate continuously in the quarterly work meetings of the Responsible Minerals Initiative (RMI) for the certification of qualified smelters to obtain the latest information and provide suppliers with qualified procurement sources. We also help them carry out investigations and corrections for non-compliant items and ensure the implementation of the qualified smelter conversion program to maintain and achieve the goal of sourcing 100% of Tantalum, Tin, Tungsten, and Gold from the conformant smelters.

Avoiding the use of conflict minerals obtained from illegal operations is ASUS’ social responsibility for the protection of human rights and environmental protection as a brand company. We established the Responsible Mineral Procurement Policy, implement supplier management, and require them to gradually shift purchases of minerals to qualified smelters to prevent illegal operations that result in labor oppression, coercion, child labor abuse, and damage to the ecology.

Tin is another essential metal used in electronics, and tin mining is often associated with environmental issues. As part of the Responsible Mineral Sourcing Policy, ASUS guidelines require that suppliers source tin responsibly. ASUS also participates as a member of the Tin Working Group (TWG) to support programs in Indonesia, one of the world’s largest sources of tin, which are dedicated to responsible and sustainable mining practices. Part of the Responsible Minerals Initiative, TWG is an initiative consisting of technology companies, tin mining companies, industry groups, and NGOs that work on addressing unsustainable mining’s impacts on local environments in Indonesia.

Please visit the website below for more details:

ASUS utilizes tools provided by the Responsible Minerals Initiative (RMI) to investigate mineral sources within the ASUS supply chain. All smelters in the following RMI list are part of the ASUS supply chain:

http://www.responsiblemineralsinitiative.org/smelters-refiners-lists/

[Case] Responsible Mineral Analysis of Laptops and Desktop Computers

ASUS uses Full Material Disclosure (FMD) to learn about the composition of ASUS products and we also learn about the use of tantalum, tin, tungsten, gold, and cobalt in products. We manage the risks of shortages of key metals and identify parts with value for recycling.

In order to promote responsible mineral procurement, we identify our key suppliers and analyzed the use of tantalum, tin, tungsten, gold, and cobalt in laptops and mini computers. The main parts and applications are specified on the table right.