thermo fisher conflict mineral program overview

Thermo Fisher Q&A Session

Scott Gordon, Thermo Fisher

Jonathan Hughes 3/5/2015 Conflict Minerals Q&A

Agenda

•Intro to Thermo Fisher’s Program

•Pre-submitted questions

•Questions from the Audience

[email protected] | www.assentcompliance.com | TEL: 1(866)964-6931 Slide 4

Thermo Fisher’s Conflict Minerals Program

Scott Gordon Title: Senior Project Leader, Supply Chain Regulatory ComplianceOrganization: Corporate Legal Location: 81 Wyman Street, Waltham, MA 02454Telephone: (781) 419-5211Email: [email protected], [email protected] of service: 9

mailto:[email protected]

mailto:[email protected]



•Currently partnered with Assent Compliance for Turnkey services•Thermo Fisher Conflict Minerals Policies: http://www.thermofisher.com/en/responsibility/resources.html

•Current Timeline:•First Survey Request - December 9th•Escalations - February 16th

•Final Email - March 9th

•Data Compilation - April 15th

•Due Diligence - Ongoing

http://www.thermofisher.com/en/responsibility/resources.html



•Data Validation Process

•All CMRTs are programmatically checked by Assent’s portal for errors against Industry accepted Data

Validation schema

•When a CMRT contains errors, an email is sent to the Supplier automatically by Assent’s portal

•This Email contains an Error Code along with an explanation of the error

•Once the CMRT is corrected, it can be resubmitted to the Assent Portal

• Assent’s QA team will call all suppliers with invalid data in order to help correct the issue



•Due Diligence Process

•All CMRTs are scored for strength and weakness based on Company level section and Smelter data

quality

•When a CMRT achieves a low score (Ex: No to Questions A, E, G, H and I) or Smelter inconsistencies,

Assent’s QA team will reach out to Suppliers directly to identify the risks and work towards a resolution

•A Supplier’s willingness to improve their program will be tracked and measured in the Assent system

and incorporated into Thermo Fisher’s future Conflict Minerals program including Procurement

decisions.


Question 1

We are a distributor and not in scope of the Conflict Minerals regulation - why do I need to submit a CMRT?

Even though you are not manufacturing product, and not subject to the SEC conflict mineral disclosure rule, you are providing parts that we use for resale. We are an SEC registrant. We are requesting that all our direct suppliers that we believe provide at least one part that may contain tin, tungsten, tantalum or gold, both manufacturers and distributors, are taking reasonable steps to ensure that the parts you supply to Thermo Fisher are conflict free.


Question 2

We are a small business and find it difficult to determine the source of our minerals or we are not a publically traded company - why do we need to reply to this request?

You need to reply to this request because Thermo Fisher Scientific, through a structured risk based assessment, determined that one of more of the parts that one or more Thermo Fisher companies’ buys from you may contain tin, tantalum, tungsten or gold.


Question 2 – part ii

What can I do to help comply with Thermo Fisher's request? If you know that your parts do not contain any of the minerals, then you can email

Thermo Fisher a declaration stating that the parts you provide do not contain 3TGs.

If you are unsure if your parts contain any of the minerals, then we ask you to survey your own suppliers using the CMRT version 3.02 template. Earlier versions of the template are no longer accepted.

Your supplier must comlplete the declaration tab. If they answer ‘yes’ to question 1 and 2 for any minerals, then they must answer questions 3-7 and list the identified smelters on the smelter tab. Smelter info must be accurate and validated.


Question 3

We do not sell to Thermo Fisher USA, we only sell to a Thermo Fisher business unit outside of the USA - do we need to comply with this request?

Yes. You will need to comply with the request even if you only supply thermo Fisher Businesses outside the USA. As an SEC registrant, we are obligated under law to disclose whether any of the metals we use are sourced from the DRC or adjoining country. This obligation includes products manufactured by our international sites.


Question 4

None of my parts have tin, tungsten, tantalum or gold in them. Am I done?

No. Thermo Fisher sent you a survey because we could not rule out that your parts contained any of the minerals. Therefore, we ask you to provide Thermo Fisher with either a completed CMRT answering ‘no’ to either question 1 or 2 for all four minerals OR by providing Thermo Fisher with a declaration on letterhead stating that none of the products you supply to Thermo Fisher contain any tin, tungsten, tantalum or gold.


Question 5

It will take me months to pull this information together; how am I supposed to respond in time?

We suggest that you start compiling all information available by April 1st (a “pencil’s down” date). This will provide you with enough time to pull the information together in order to respond by our April 15th deadline.


Question 6

How does Thermo Fisher assess and ensure Smelter data accuracy?

All Smelter information is validated by Assent Compliance’s Master Smelter database.

A smelter with a CID number is a known valid smelter with available audit information.

All other smelters must first be gated for validity and duplication (IE: Merge & Purge) and contacted directly by Assent’s Global Smelter team.


Question 7

What does Thermo Fisher consider "reasonable" for an RCOI? Reasonable can mean different things to different companies.

It might be more reasonable for a small company that has a small number of suppliers to survey each supplier.

Conversely, a large company using hundreds or thousands of suppliers might find it more reasonable to first identify the smaller subset of suppliers that are more likely to contain one or more of the suppliers.

We consider a reasonable RCOI process to be 3 email attempts and 3 phone attempts to more than one contact at a company in order to obtain the information.


Question 8

What criteria does Thermo Fisher use to conduct Due Diligence on Supplier Responses?

We will contact any supplier that states that they source one or more of the minerals from the DRC or an adjoining country from smelter that are not validated compliant by the CSFI or the LBMA.

We will also contact Suppliers to provide additional smelter information if a company listed as a smelter is an invalid.

We also review your company level answers on the declaration page to assess whether the information you provided can be relied upon.


Question 9

What are some best practices that Thermo Fisher can recommend to other companies?

Commitment to source conflict free 3TG minerals from the “covered countries”.

A contractual obligation from suppliers to enact reasonable processes to ensure products are conflict free

Commitment to using 3TG minerals from smelters that have been audited and verified conflict free or smelters that are low risk based on their geography

Validating Smelter names provided to you by suppliers


Question 10

Do all Thermo Fisher Suppliers receive a confirmation email? Yes. Assent Compliance’s Supplier Portal immediately sends Suppliers a receipt that

shows a summary of responses made on the CMRT as well identifies errors and corrective actions needed.

In the future, this will expand to detailed Smelter information for each Smelter listed by the Suppliers


Question 11

What will change in the event of Audit in 2016? Not very much. Thermo Fisher’s program was built to handle an audit from the

ground up. This includes the approaches taken to Scoping, RCOI and Reporting that will allow Thermo Fisher to meet all the requirements of an Audit.

In addition, Assent’s platform provides a full Audit Trail that enables Thermo Fisher full transparency on all activities and information down to the part level.

Thermo Fisher has designed a program that meets the requirements of an Audit and can demonstrate through its Audit Trail that it executed its program good faith according to its design.

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