EX-1.01 2 d723541dex101.htm EX-1.01 EX-1.01

EXHIBIT 1.01

The Dow Chemical Company

Conflict Minerals Report

BACKGROUND

This Conflict Minerals Report (this “Report”) of The Dow Chemical Company (“TDCC” or the “Company”), is being filed pursuant to Rule 13p-1 under the Securities Exchange Act (17 CFR 240.13p-1) for the reporting period from January 1, 2018 to December 31, 2018. This Report provides information with respect to the products manufactured, or contracted to be manufactured, during calendar year 2018 for which gold, columbite-tantalite, cassiterite, and wolframite minerals, and these specific derivatives: tantalum, tin, tungsten, and gold (“Conflict Minerals”) are “necessary to the functionality or production of” such products. The information in this report covers all products manufactured, or contracted to be manufactured, during calendar year 2018, for which Conflict Minerals are “necessary to the functionality or production of” such products, by the Company and all majority-owned subsidiaries over which the Company exercises control. Please refer to Rule 13p-1, Form SD and the 1934 Act Release No. 3467716 for definitions for the terms used in this Report, unless otherwise defined herein.

In July 2010, the U.S. Government signed the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”). Section 1502 of the Dodd-Frank Act (the “Conflict Minerals Provision”) was enacted because of concerns that the exploitation and trade of minerals that originate in the Democratic Republic of the Congo and adjoining countries (the “Covered Countries”) by armed groups is helping to finance conflict in the Democratic Republic of the Congo and is contributing to a humanitarian crisis. The final regulation (the “Conflict Minerals Regulation”) adopted by the U.S. Securities and Exchange Commission (“SEC”), which became effective November 13, 2012, requires all SEC registrants to file a specialized disclosure report on Form SD with the SEC regarding Conflict Minerals that are “necessary to the functionality or production of” products manufactured, or contracted to be manufactured, during a calendar year. For clarification, the term Conflict Minerals broadly encompasses all gold, columbite-tantalite, cassiterite, and wolframite minerals, and these specific derivatives: tantalum, tin, tungsten, and gold, regardless of the country of origin of such minerals and regardless of whether or not the purchase of such minerals actually finances or benefits armed groups in the Covered Countries.

COMPANY OVERVIEW

TDCC combines science and technology to develop innovative solutions that are essential to human progress. TDCC’s market-driven, industry-leading portfolio of advanced materials, industrial intermediates and plastics deliver a broad range of differentiated technology-based products and solutions to customers in high-growth markets such as packaging, infrastructure and consumer care. TDCC is a subsidiary of DowDuPont Inc. (NYSE: DWDP), a holding company comprised of TDCC and DuPont with the intent to form three strong, independent, publicly traded companies in agriculture, materials science and specialty sectors. More information can be found at www.dow.com.

 

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During calendar year 2018, TDCC determined that certain Conflict Minerals were necessary to the functionality or production of certain products manufactured by TDCC, or contracted by TDCC to be manufactured by a third party. Four of TDCC’s principal product groups manufacture products, or contract such products to be manufactured, for which Conflict Minerals, as metals or metal alloys, are “necessary to the functionality or production of” such products (the “In-scope Products”). These four product groups are Electronics & Imaging, Polyurethanes & CAV, Infrastructure Solutions Silicones, and Consumer Solutions.

Separately, there are a total of nine TDCC product groups, including Electronics & Imaging, Polyurethanes & CAV, Infrastructure Solutions Silicones, and Consumer Solutions, that utilize Conflict Minerals, as metals or metal alloys, and/or certain chemical compounds manufactured from Conflict Minerals that are chemically distinct from the metals themselves. The Company includes the use of these organometallic compounds manufactured from tantalum, tin, tungsten, and gold (“Organometallic Compounds”) in the scope of its Conflict Minerals approach described below and conducted its reasonable country of origin inquiry and due diligence on these materials in addition to the metals and metal alloys.

CONFLICT MINERALS APPROACH

TDCC shares the concern that Conflict Minerals sourced from the Covered Countries may come from mines or trading routes controlled by armed groups in the Covered Countries. It is TDCC’s policy not to knowingly purchase any raw materials that contain Conflict Minerals that directly or indirectly finance or benefit armed groups in the Covered Countries. TDCC’s policy with regard to the responsible sourcing of Conflict Minerals is available on its website at corporate.dow.com/about/codes-of-conduct/conflict-minerals.

TDCC is a “Downstream company,” that is, TDCC is part of the supply chain from smelters/refiners down to the eventual retailers, who sell final products to end-consumers. Conflict Minerals are components in some of the supplies that TDCC purchases from its vendors. Because the Conflict Minerals enter the Company’s supply chain many layers removed from TDCC, it is difficult to determine where they originated. The supply chain associated with Conflict Minerals is complex and TDCC has worked with its vendors to determine the sources of the Conflict Minerals in the supplies purchased by TDCC. As noted above, the approach broadly includes not only Conflict Minerals in the form of metals and metal alloys but also Organometallic Compounds.

TDCC has a cross-functional team responsible for implementing processes related to the responsible sourcing of Conflict Minerals, including the purchasing, legal, supply chain, and environmental health and safety functions. TDCC’s due diligence process and its implementation was designed to conform in all material respects to the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (“OECD”), as applicable to Downstream companies.

TDCC purchases of Conflict Minerals and Organometallic Compounds are made only from vendors approved in advance by TDCC, which maintains a list of approved vendors. TDCC expects its vendors to comply with the Conflict Minerals Provision and the Conflict Minerals Regulation, as may be amended over time. In addition, the Company also expects its vendors to provide all necessary information in connection with TDCC’s reasonable country of origin inquiry (“RCOI”) with regard to products supplied to TDCC that contain Conflict Minerals. TDCC incorporates its expectations with regard to sourcing of Conflict Minerals and the vendor’s agreement to provide sourcing information regarding Conflict Minerals in a standard template used for raw materials procurement and in the Company’s Code of Conduct for Suppliers, available on its website at corporate.dow.com/about/suppliers/expectations. TDCC reserves the right to assess and monitor any vendor’s compliance with the Company’s Conflict Minerals practices. Vendors who are not in compliance are expected to implement corrective actions or they may not be considered for future business.

TDCC’s Office of Ethics and Compliance maintains a help line that is available to those who wish to ask questions about TDCC policy, seek guidance on specific situations or report violations of TDCC’s Code of Business Conduct or other unethical business practices. More information is available on its website at corporate.dow.com/about/codes-of-conduct/business.

 

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REASONABLE COUNTRY OF ORIGIN INQUIRY AND DUE DILIGENCE PROCESS

TDCC purchases seventy-four products which incorporate Conflict Minerals, in the form of metal and metal alloys, and/or Organometallic Compounds. These purchases are from fifty-six different vendors.

TDCC conducted, in good faith, a RCOI that was reasonably designed to determine whether any of those Conflict Minerals originated in the Covered Countries or were from recycled or scrap sources. The RCOI implemented by TDCC consisted of a survey of all vendors providing Conflict Minerals or supplies containing Organometallic Compounds. The RCOI is part of, includes and is complemented by the additional due diligence actions described in this Report.

TDCC communicated information about the Conflict Minerals Provision and the Conflict Minerals Regulation, TDCC’s purchasing policy with regard to Conflict Minerals, the Company’s expectations with regard to vendor sourcing of Conflict Minerals, and requested the vendor to provide a completed Conflict Minerals reporting template (the “CMRT”). The Template was created by the Responsible Minerals Initiative, formerly the Conflict-Free Sourcing Initiative, (“RMI”), founded by members of the Responsible Business Alliance and the Global e-Sustainability Initiative. The CMRT includes a number of questions and requires each vendor, as applicable, to identify, among other things, all of the smelters/refiners used to supply any Conflict Minerals contained in materials or products supplied by such vendor.

 

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RCOI AND DUE DILIGENCE RESULTS

The results from the vendor survey are provided below by metal and include smelter names and locations:

 

Metal   

Conflict Free

Smelters

Registered

    Smelter name and location    Smelter Country
Tin    CID001105    Malaysia Smelting Corp.    Malaysia
Tin    CID001477    PT Timah (Persero) Tbk Kundar    Indonesia
Tin    CID001070    China Tin Group Co. Ltd. (Laibin)    China
Tin    CID001482    PT Timah (Persero) Tbk Mentok    Indonesia
Tin    CID001490    PT Tinindo Inter Nusa    Indonesia
Tin    CID002773    Metallo Belgium N.V. (Beerse)    Belgium
Tin    CID001173    Mineração Taboca S.A. (Bairro Guarapiranga)    Brazil
Tin    CID001182    Minsur (Paracas)    Peru
Tin    CID002036    White Solder Metalurgia e Mineracao Ltda.    Brazil
Tin    CID002776    PT Bangka Prima Tin    Indonesia
Tin    CID002455    CV Venus Inti Perkasa    Indonesia
Tin    CID001453    PT Mitra Stania Prima (Sungailiat)    Indonesia
Tin    CID002158    Yunnan Fengfeng Nonferrous Metals Co. Ltd.    China
Tin    CID001898    Thailand Smelting & Refining Co Ltd (Amphur Muang)    Thailand
Tin    CID001539    Rui Da Hung    Taiwan
Gold    CID001152    Metalor Technologies (Singapore) Pte., Ltd.    Singapore

Gold

    CID000920    Asahi Refining USA Inc.    USA

Gold

    CID000924    Asahi Refining Canada Ltd.    Canada

Gold

    CID001534    Royal Canadian Mint    Canada
Gold    CID000694    Heimerle & Meule ( Pforzheim)    Germany
Gold    CID000711    Hereaus Precious Metal (Hanau)    Germany
Gold    CID001153    Metalor Technologies S.A. (Marin)    Switzerland
Gold    CID001149    Metalor Technologies (Hong Kong) Ltd. (Kwai Chung)    China
Gold    CID001147    Metalor Technologies (Suzhou) Ltd. (Suzhou)    China
Gold    CID001157    Metalor USA Refining Corporation (North Atleboro)    USA

 

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TDCC received responses from all of its vendors of Conflict Minerals. In most instances, TDCC only received information about products containing Conflict Minerals and the smelter/refiner. In some instances, the responses the Company received from vendors did not provide information beyond the identification of products containing Conflict Minerals and the related smelter/refiner and mine. Some vendors reported on a corporate level as to all smelters that provided Conflict Minerals to the vendor rather than reporting on a product level as to the particular source of Conflict Minerals provided in products sold to TDCC. As part of the Company’s due diligence on the source and chain of custody on the Conflict Minerals contained in In-scope Products, the Company followed up with vendors who did not provide timely responses to its survey or only provided partial information. TDCC’s vendors, who are also Downstream companies, are also similarly faced with the uncertainty of the ultimate source of Conflict Minerals beyond the smelters/refiners. For all Downstream companies, it is extremely difficult to know where the ultimate country or origin or which mine the Conflict Minerals originated from. After receiving the vendor responses, the Company compared the results to the list of Conflict-Free Smelters maintained by the RMI.

The Responsible Minerals Assurance Process (“RMAP”) uses an independent third-party audit to identify smelters and refiners that have systems in place to assure sourcing of only conflict-free materials. A list of smelters and refiners that meet the standards of the audit are published on the RMI website. The audit standard is developed according to global standards including the OECD and the Dodd-Frank Act. The RMAP validation is a voluntary process and, at this time, all smelters/refiners identified by TDCC, as provided in the table above, have become validated as Conflict-Free Smelters. In determining whether further due diligence is required in a given instance, the Company has in certain instances also relied upon additional vendor certification or participation in the RMAP in determining the source of the Conflict Minerals in its materials or products.

CONCLUSIONS

Based on the RCOI and the due diligence measures performed, TDCC believes that most of the Conflict Minerals that were necessary to the functionality or production of products manufactured, or contracted to be manufactured, by TDCC during calendar year 2018 were from recycled or scrap sources or originated in countries other than the Covered Countries.

The Company is unable to determine country of origin for a portion of the Conflict Minerals reported due to the lack of complete mine information received. A small percentage of the Conflict Minerals purchased from suppliers by TDCC may have originated from the Covered Countries as some of the identified smelters/refiners source from multiple countries or provided incomplete mine information. However, as noted in the table above, all of the identified smelters/refiners are validated as a Conflict-Free Smelter by the RMI.

ONGOING IMPROVEMENTS TO DUE DILIGENCE PROCESS

TDCC’s due diligence processes are based on the necessity of gathering information from the Company’s direct vendors, and then, in turn, the Company’s vendors seeking similar data from other Downstream companies. TDCC, and other Downstream companies, rely on the list of the refiners and smelters maintained by the RMI. TDCC will continue to work with its vendors to improve their completeness and quality of responses, and to improve its ability to track Conflict Minerals in its supply chain. TDCC’s ongoing efforts have resulted in responses from all vendors and their responses indicate full validation of the smelters/refiners under RMAP.

 

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