Responsible Sourcing Policy
“ PT Artha Cipta Langgeng (ACL) has implemented a due diligence management system on conflict free cassiterite , according to OECD’s due diligence 5 step framework aiming to avoid trade that may directly or indirectly finance or benefit armed groups or organizations that contribute to any type of human rights abuse.
Responsible Sourcing Policy
PT Artha Cipta Langgeng (ACL) is an Indonesian-incorporated company with both onshore and offshore mining locations, as well as smelting and refining facility.
ACL has implemented a due diligence management system on conflict free cassiterite , according to OECD’s due diligence 5 step framework aiming to avoid trade that may directly or indirectly finance or benefit armed groups or organizations that contribute to any type of human rights abuse.
ACL has assessed its sources and suppliers of minerals according to the OECD guidance and considers that even though at this moment any further due diligence towards third parties is not necessary , it will be fully committed to do so, should new sourcing strategies, including sourcing from new regions are implemented.
We are aware that the due diligence is an on-going, proactive and reactive process, even though ACL does not source cassiterite from countries or suppliers of conflict affected or high-risk areas CAHRA’ s, since we source entirely from our own mines located in Indonesia.
ACL has made its relevant personnel, such as smelter managers and supervisors as well as its commercial and logistic staff aware of this policy and their responsibilities to uphold it. ACL will communicate this policy to its customers through its commercial manager and commercial agents, and to its suppliers through its service adjudication processes.
We recognize issues with supply from CAHRA’s and is committed, to adhere to a policy on artisanal and small-scale mining that includes a commitment by each member company not to purchase cassiterite with potential contribution to conflict or any type of human rights abuse. We fully support the Tin Supply Chain Initiative (iTSCi) program, that commit to avoid mineral trade that may be financing conflict and contributing to human rights abuses.
Through a combination of these efforts, despite having no direct involvement in sourcing from CAHRA’s, we therefore aim to:
- Implement a companywide strong management system to support supply chain due diligence.
- Avoid the trade of cassiterite that indirectly or directly finances areas of conflict or contributes to human rights abuses.
- Constantly identify and assess risk in its supply chain and design and implement a strategy to respond to identified risks.
- Publicly report on our supply chain due diligence policies and practices.
PT. Artha Cipta Langgeng has undergone a RMAP assessment on 25~26th Juli 2019, as part of the recertification process of Responsible Minerals Initiative 2019 Tin Standard with company our commitment, the company has established a robust process to identify risks in the supply chain.
PT. Artha Cipta Langgeng has established a procedure to identify CAHRAs. The objective of the following procedure is to allow the company to identify possible affected and high-risk areas (CAHRAs) and will apply to all cassiterite providers (including origin and transit routes for all primary material and the identification of any conflict-affected and high-risk areas in their supply chains).
PT. Artha Cipta Langgeng qualified from the management team determines once a year or if there are any relevant occurrences, whether or not the country of operation of the location of the mine is considered a CAHRA, based on the following criteria as identified by the OECD Due Diligence Guidance.
- Armed conflict: The presence of armed conflict, widespread violence, or other risks of harm to people. Armed conflict may include conflict of international or non-international character.
- Weak governance: Areas of political instability or repression, institutional weakness, insecurity, collapse of civil infrastructure, and widespread violence.
- Widespread human rights violations: Areas characterized by widespread human rights abuses and violations of national or international law.
Resources and thresholds. The Due Diligence Manager will consider an area to be conflict-affected or high-risk according to the following resources and thresholds. If two of the three resources result in a finding of high-risk, the area will be considered a CAHRA.
Firstly, The procedure includes the scope, resources used, the criteria to define a “conflict affected and high-risk area” and to identify red flags in our supply chain as well as the responsibility of the Compliance Officer. The company will use the following resources to determine CAHRAs:
a) The Heidelberg Conflict Barometer: this indicator allows PT. Artha Cipta Langgeng to detect the presence of armed conflict and generalized violence through the use of annually updated conflict maps.
The country (or sub-region) is classified as a CAHRA if :
- Has a subnational classification of 3 or more in the region of origin (mine or transit routes).
- If a country in its supply chain is considered CAHRA due to a country-level list in the Heidelberg Conflict Barometer (greater than 3), the Compliance Officer will evaluate it at a subnational level using information reported by the barometer to identify if the conflict is related to the tin mining sector.
- If it turns out that this assumption is true, that location will result in a CAHRA, it will be considered a red flag.
b) Human Rights and Rule of Law Indicator of the Fragile States Index: This indicator detects risks of harm to human rights. The country (or sub-region) is classified as a CAHRA if :
- Has a score of 8 or more for the Human Rights and Rule of Law (HR) indicator.
- The review will be carried out only at the country level. The Compliance Officer will consider a red flag when the score is 8.
- If red flags are found,Compliance Officer would immediately compile a list of red flags that guarantee an additional evaluation or other actions.
Secondly, the company designed a Know Your Supplier (KYS) to include information concerning supplier legal status and identity, supplier mapping and potential risks.
It is important to mention that our company has also stablished a procedure to identify possible suppliers of concentrates that comply with standards required by our company to be able to establish businesses in continue or long-term manner. This procedure includes relevant aspects of RMI and OECD’s Annex II.
Due to the nature of our company business it sources only from its own mining operations therefore the our company is able to have accurate origin information for each material transaction having exceptional understanding of the transaction origin, transportation route, as well as direct suppliers’ names and locations.
Thirdly, the company requested origin information for each material transaction and ensured that it was able to understand the transaction origin, transportation route, as well as direct suppliers’ names andlocations.
Fourthly, all information collected was reviewed by the company against Conflict Affected-High Risk Areas (CAHRAs), sanction lists, local laws and internal sourcing require.
In the event that ACL identify suppliers that are noncompliant with this policy, further corrective actions will be expected to take place in the short term. Continuous noncompliance with ACL policy as described above will result in a cease of commercial activities.