Maryland | 001-33202 | 52-1990078 | ||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
1020 Hull Street, Baltimore, Maryland | 21230 | |||
(Address of principal executive offices) | (Zip Code) |
UNDER ARMOUR, INC. | ||
/s/ James H. Hardy, Jr. | June 1, 2015 | |
By: James H. Hardy, Jr. | Date | |
Chief Supply Chain Officer |
• | Adopt and commit to a supply chain policy for minerals originating from conflict-affected and high-risk areas: The Company has adopted a formal policy that reflects Under Armour's desire to ensure only responsible sourcing of parts and products containing necessary conflict minerals. |
• | Structure internal management systems to support supply chain due diligence: Under Armour has established a governance model to oversee the implementation and ongoing management of its conflict minerals compliance program. The governance model consists of two groups: the Steering Committee, which is comprised of business leaders at the Company, and the Core Team, which is comprised primarily of key supply chain employees. The objective is to develop, document and maintain a governance structure which enables sustainable compliance and actively mitigates the risk of not meeting regulatory requirements. |
• | Establish a system of controls and transparency over the mineral supply chain: Under Armour will implement a process to evaluate parts and suppliers in the supply chain for potential conflict minerals risk. Supplier agreements will be updated to require suppliers and licensees to provide information on their use and source of conflict minerals. Under Armour will participate with industry associations to enhance transparency and traceability in the supply chain. Under Armour uses a standardized documentation format to capture key program decisions, processes, and procedures. Under Armour will maintain conflict minerals records for a period of five years. |
• | Strengthen company engagement with suppliers: Under Armour will communicate its policy regarding conflict minerals to all suppliers and will provide those suppliers identified as “at-risk” with compliance training. |
• | Establish a company level grievance mechanism: Under Armour will provide a feedback mechanism on its website available to all interested parties to provide information or voice their concerns regarding the Company’s sourcing and use of conflict minerals in its products. |
• | Identify high-risk parts and suppliers: Under Armour analyzed parts or products for conflict minerals and assessed the risks they contained conflict minerals from the affected areas. |
• | Survey the suppliers: Under Armour required suppliers to complete a survey based on the Electronic Industry Citizen Coalition/Global e-Sustainability Initiative’s Conflict Free Sourcing Initiative (“CFSI”) Conflict Minerals Reporting Template (“CMRT”). |
• | Collect responses: Under Armour conducted a review of supplier responses to determine that all required questions and sections of the supplier survey were completed and followed up with any supplier that did not complete all required questions. |
• | Review supplier responses: Under Armour reviewed survey responses, validated them for completeness and sufficiency and followed up with suppliers as necessary. Based on this review each survey was assigned a conflict minerals status code, which categorized the supplier into groups for internal reporting, supplier education and remediation purposes. |
• | Aggregate supplier survey responses: Under Armour reviewed aggregate supplier survey responses and reported key metrics to members of the Steering Committee and/or Core Team as part of the conflict minerals reporting process. |
• | Review and assess smelter information: Under Armour conducted a review of summary smelter information to determine if the smelter was certified as conflict free or presents a “red flag” as defined by the OECD Guidance. To make the determination of each smelter’s conflict status, Under Armour relied upon information provided by the CFSI. CFSI conducts a Conflict-Free Smelter Program, in which it certifies smelters and refiners worldwide as being conflict free after confirming specific information including country of origin for 3TGs that the smelter/refiner may purchase for its operations. CFSI makes available to the public the list of smelters/refiners that have been certified by CFSI as conflict free. |
• | Report findings to designated senior management outlining the information gathered and the actual and potential risks identified in the supply chain risk assessment: Under Armour will complete an OECD gap analysis annually and provide a summary of the identified risks and gaps to the Steering Committee with recommended action plans to reduce risks and close gaps. |
• | Devise and adopt a risk management plan: Under Armour is developing a risk mitigation plan with the goal of systematically reducing the extent of exposure to certain risk and the likelihood of its occurrence. |
• | Implement the risk management plan, monitor and track performance of risk mitigation, report back to designated senior management and consider suspending or discontinuing engagement with a supplier after failed attempts at mitigation: Under Armour is beginning to implement its risk management plan and monitoring its execution. Unresponsive suppliers will be evaluated for corrective action that may include removal from the Company’s list of approved vendors. |
• | Undertake additional fact and risk assessments for risks requiring mitigation, or after a change of circumstances: Additional fact finding, risk assessments, and changes in circumstances will take place as part of Under Armour's annual review of its conflict minerals compliance program. |
• | In accordance with the OECD Guidance, Under Armour intends to participate in industry organizations or through other suitable means with industry efforts to appoint auditors and define the terms of the audit in line with the standards and processes set out in the OECD Guidance. Under Armour will seek to join or build partnerships with these industry organizations as their activities align with Under Armour’s conflict minerals program, however, based on its position in the supply chain, Under Armour is not positioned to conduct audits of smelter/refiner’s due diligence practices directly and would rely upon organizations such as the CFSI for information on certified smelters. |
• | Annually report or integrate, where practicable, into annual sustainability or corporate responsibility reports, additional information on due diligence for responsible supply chains of minerals from conflict-affected and high-risk areas: Under Armour implemented a process to summarize, review, and approve compliance results and complete the Form Specialized Disclosure and the Conflict Minerals Report and timely file this report with the SEC. |
• | Under Armour is unable to determine and to describe all of the facilities used to process those conflict minerals necessary to the functionality or production of its products. |
• | Certain suppliers responding to Under Armour’s inquiries indicated in their responses that the information provided was at a company or divisional level and did not include a list of smelters; therefore, Under Armour was unable to determine their country of origin. |
• | Consistent with the OECD Guidance for downstream companies, Under Armour’s efforts to determine the mine or location of origin of necessary conflict minerals with the greatest possible specificity encompassed the due diligence measures described above. This included a review of whether the smelters reported to be in the supply chain of Under Armour’s direct suppliers were verified as compliant with the Conflict Free Smelter Program. The results of these due diligence measures were not conclusive. |