NSF 426 Ballot Comments – Section 13

For Discussion at June 25-26 Joint Committee Meeting

Criteria Summary

13 Corporate responsibility
13.1 Prerequisites
13.1.1 Environmental management system (EMS) (Corporate)
13.1.2 Public disclosure of use of conflict minerals in products (Corporate)
13.1.3 Manufacturer conformance with occupational health and safety performance
13.2, 13.3, 13.4 & 13.5 Optional Criteria
13.2.1 Environmental management system (EMS) certification / 1
13.2.2 Environmental and social responsibility reporting on supply chain - nine suppliers / 2
13.2.3 Environmental and social responsibility reporting on tier 1 suppliers / 2
13.3.1 Public reporting of toxics release data / 2
13.4.1 Conflict minerals sourced only from validated conflict free smelters / 1
13.4.2 Participation in in-region conflict-free sourcing program / 2
13.5.1 Supply chain certification to occupational health and safety performance standards / 2
13.5.2 Certification to social responsibility performance standard / 2

Ballot Comment Summary – from JC members and Public Review

  • Total comments: 41(Note: some comments addressed multiple criteria.)
  • S. 13 overarching:1 comment
  • 13.1.1: 2 comment
  • 13.1.2: 5 comments
  • 13.1.3: 4 comments
  • 13.2.2: 6 comments
  • 13.2.3: 4 comments
  • 13.3.: 7 comments
  • 13.4.1: 9 comments
  • 13.4.2: 6 comments
  • 13.5.1: 3 comments
  • 13.5.2: 2 comments
  • Add additional criterion: 1 comment
  • Some common themes
  • Social responsibility criteria beyond scope of environmental standard (20 comments)

Proposed Discussion Topics for June 25-26 F2F

High Priority

1)To what extent should this standard include social responsibility criteria? Discuss criteria pertaining to conflict mineral (13.1.2, 13.4.1, 13.4.2) reporting of social performance metrics for suppliers (13.2.2, 13.2.3), and certification to social performance standards (13.5.1, 13.5.2)

2)Remaining comments on conflict mineral criteria (pending outcome of above discussion – criteria 13.1.2, 13.4.1, 13.4.2)

3)Concerns and value of toxics release reporting (13.3)

Assign to NSF, Individual or Small Group

4)Management systems criteria (3.1.1, 3.2.1, 13.13)

5)Supply chain reporting criteria (13.2.2, 13.2.3)

6)Certification to social responsibility standards (13.5.1, 13.5.2)

7)Consider new criterion: SmartWay transportation

Discussion Topic 1: To what extent should this standard include social responsibility criteria?

Discuss criteria pertaining to conflict mineral (13.1.2, 13.4.1, 13.4.2) reporting of social performance metrics for suppliers (13.2.2, 13.2.3), and certification to social performance standards (13.5.1, 13.5.2).

Name / Comment / Proposal / Proposed Response
Section 13 – general
Stephanie Voyles/IPC / The purpose of the standard states, “The purpose of this standard for servers is to establish product environmental performance criteria and corporate performance metrics that exemplify environmental leadership in the market? (emphasis added). Corporate Social Responsibility (CSR) is a very broad topic area and not all aspects of CSR are within the scope of an environmental leadership standard. CSR, as a general topic area, goes beyond a company?s environmental performance. If CSR is included as a section in this draft standard, then only criteria pertaining to environmental leadership should be included. Specifically, conflict minerals, occupational health and safety and labor, and societal issues are outside the scope of environmental leadership and should be deleted. / Conflict minerals, occupational health and safety and labor, and societal issues are outside the scope of environmental leadership and the critieria related to these issue areas should be deleted.
Conflict minerals
13.1.2Public disclosure of use of conflict minerals in products (Corporate)
13.4.1 Conflict minerals sourced only from validated conflict free smelters
13.4.2 Participation in in-region conflict-free sourcing program
Tim Mann/IBM / (13.1.2) We are OK with this criterion, although we do not consider this an environmental requirement.
Stephanie
Voyles/IPC / (13.1.2) This criteria is outside the scope of this environmental leadership standard and should be deleted. Further, this criteria should not be a prerequisite. / Delete criteria.
Criteria should not be a prerequisite.
Stephanie Voyles/IPC / (13.1.2) The atrocities occurring in the DRC and adjacent countries are deplorable. Section 1502 of the Dodd-Frank Act and SEC conflict minerals regulations are comprehensive and extensive requirements that attempt to address the atrocities. The conflict minerals issue is largely complex and therefore deserves its own standard. It should not be truncated into a few criteria within a standard whose scope is on environmental leadership. / Criteria should be deleted.
Steve Risotto/ACC / The requirement for disclosure of conflict-mineral content in 13.1.2 and the optional certification under 13.4.1 and 13.4.2 appear to have little to do with environmental leadership. Delete these provisions unless they can be related to environmental performance.
Public disclosure already is required under regulations adopted in 2012 to implement the Dodd-Frank Act. If the provisions are maintained, they should be carefully reviewed to ensure consistency with legal requirements in the US and elsewhere. / Delete thisprovision unless they can be related to environmental performance. If the provisions are maintained, they should be carefully reviewed to ensure consistency with legal requirements in the US and elsewhere.
Also applies to 13.4.1 and 13.4.2.
Stephanie Voyles/IPC / (13.4.1, 13.4.2) The atrocities occurring in the DRC and adjacent countries are deplorable. Section 1502 of the Dodd-Frank Act and SEC conflict minerals regulations are comprehensive and extensive requirements that attempt to address the atrocities. The conflict minerals issue is largely complex and therefore deserves its own standard. It should not be truncated into a few criteria within a standard whose scope is on environmental leadership. / Delete criteria.
Stephanie Voyles/IPC / (13.4.1, 13.4.2) This criteria is outside the scope of this environmental leadership standard and should be deleted. / Delete criteria.
Supply chain reporting of social responsibility issues
13.2.2 Environmental and social responsibility reporting on supply chain - nine suppliers
13.2.3 Environmental and social responsibility reporting on tier 1 suppliers
Steve Risotto/ACC / (13.2.2, 13.2.3) The requirement for public disclosure of social responsibility performance has little to do with environmental leadership. Although it may be reasonable to award optional credit for manufacturers wishing to provide this information, public disclosure of performance on social responsibility parameters should not be a prerequisite in the standard. / Make criteria optional. Also applies to 13.2.3
Stephanie Voyles/IPC / (13.2.2, 13.2.3) This criteria is outside the scope of this environmental leadership standard and should be deleted. / Delete criteria.
Stephanie Voyles/IPC / (13.2.2) Table 13.1 contains indicators that are not indicative of environmental leadership and therefore should be deleted. These indicators are HR4 Freedom of association and collective bargaining, HR6 Operations with risk for forced or compulsory labor, and HR5 Operations with risk for incidents of child labor. / Delete inappropriate indicators in Table 13.1
Stephanie Voyles/IPC / (13.2.3) Table 13.2 contains indicators that are not indicative of environmental leadership and therefore should be deleted. These indicators are LA14 Percentage of new suppliers screened with labor practice criteria, LA15 Significant impacts for labor practices in supply chain, SO9 Percentage of new suppliers screened using criteria for impacts on society, and SO10, Significant negative impacts on society in supply chain. / Delete inappropriate indicators from Table 13.2
13.5.1 Supply chain certification to occupational health and safety performance standards
Tim Mann/IBM / We do not support this criterion. This is not an environmental criterion.
Stephanie Voyles/IPC / This criteria is outside the scope of this environmental leadership standard and should be deleted. / Delete criteria.
13.5.2 Certification to social responsibility performance standard
Stephanie Voyles/IPC / This criteria is outside the scope of this environmental leadership standard and should be deleted. / Delete criteria.

Revision options for social responsibility-related criteria:

1)Retain all of criteria listed above

2)Delete some or all of those listed above

a)Conflict mineral (13.1.2, 13.4.1, 13.4.2)

b)Reporting of social performance metrics for suppliers (13.2.2, 13.2.3)

c)Certification to social performance standards (13.5.1, 13.5.2)

Note: comments on other issues/requested modifications to above criteria will be discussed below.

Discussion Topic 2: Remaining comments on conflict mineral criteria (pending outcome of above discussion – criteria 13.1.2, 13.4.1, 13.4.2)

13.1.2 Public disclosure of use of conflict minerals in products (Corporate) - Prerequisite

First Name / Comment / Proposal / Proposed Response
Michael Kirschner/ Design Chain Associates / 13.1.2 – Privately held manufacturers (e.g. Dell) and those whose stock is not traded on a US exchange (e.g. many European, Japanese and Chinese manufacturers) will have a major challenge complying with this requirement but publicly held US manufacturers will already be doing this so may be considered to have unfair advantage to meet this requirement. There may be an indirect social benefit (debatable, given the current information on the situation in DRC), but there is no environmental benefit to this criterion.
Steve Risotto/ ACC / The requirement for disclosure of conflict-mineral content in 13.1.2 and the optional certification under 13.4.1 and 13.4.2 appear to have little to do with environmental leadership. Delete these provisions unless they can be related to environmental performance.
Public disclosure already is required under regulations adopted in 2012 to implement the Dodd-Frank Act. If the provisions are maintained, they should be carefully reviewed to ensure consistency with legal requirements in the US and elsewhere. / Delete thisprovision unless they can be related to environmental performance. If the provisions are maintained, they should be carefully reviewed to ensure consistency with legal requirements in the US and elsewhere.
Also applies to 13.4.1 and 13.4.2.

13.1.2 [PD1]Revision options:

1)Retain as is

2)Make optional or modify to address private companies (Kirschner comment)

3)Delete criterion

13.4.1 Conflict minerals sourced only from validated conflict free smelters

Server Manufacturer / We recommend the following changes in red to the criterion for the following reasons:
1. To be consistent with language in US law
2. The included text aligns with what is realistically feasible (it’s not possible for companies to have 100% certainty of all the conflict mineral sources in their supply chain)
3. Because the CFSI mutually recognizes compliant smelters in the LBMA and RJC program, we recommend including footnote (1).
4. Because the EU is developing a responsible importer regulation which may be slightly different, it is important to tie this criterion to the SEC rule for now. / “Manufacturers shall conduct due diligence in good faith to determine the source of all conflict minerals used in all their products and conclude that they are from either:
• Recycled or scrap sources; or
• Smelters and, or refiners which have been determined to be compliant1 with the Conflict-Free Smelter Program (CFSP) by the Conflict-Free Sourcing Initiative (CFSI), and appear on CFSI’s list of validated smelters and refiners, consistent with the definitions provided for in Rule 13p-1 under the U.S. Securities Exchange Act of 1934.
NOTE – For this criterion, “recycled or scrap sources” are defined as recycled metals are reclaimed end-user or post-consumer products, or scrap processed metals created during product manufacturing. Recycled metal includes excess, obsolete, defective, and scrap metal materials which contain refined or processed metals that are appropriate to recycle in the production of tin, tantalum, tungsten and, or gold. Minerals partially processed, unprocessed or a bi-product from another ore are not recycled metals.94
1Note – Compliant with the CFSI’s Conflict-Free Smelter Program (CFSP) or one of CFSP’s mutually recognized assessment programs such as the Responsible Jewellery Council’s (RJC) Chain-of-Custody Certification Program, or the London Bullion Market Association’s (LBMA) Responsible Gold Programme.
NOTE – For CFSI list, see “
Chris Cleet/ITI / To be consistent with US law, language should say “conduct due diligence in good faith”. Additionally “compliant with the” CFSP should be added text for smelter/refiner requirements
(second bullet)
Stephanie Voyles/IPC / Although we believe conflict minerals criteria is out of scope of this standard, should the criteria be included, the criteria should not include a requirement for a third party audit. It is an unnecessary, overly burdensome requirement that is not a requirement for conflict minerals disclosures and reports to the US SEC. / Delete requirement to conduct a third party audit.
Stephanie Voyles/IPC / Although we believe conflict minerals criteria is out of scope of this standard, should the criteria be included, CFSI should not be the only program referenced. There are other programs that validate smelters that should be included. The programs include: the London Bullion Market (LBMA) good gold delivery system, the Responsible Jewelers Council (RJC), the World Gold Council's(WGC) Conflict-Free Gold Standard, the Dubai Multi Commodities Centre (DMCC) and the International Conference on the Great Lakes Region (ICGLR). / Either list other examples of programs that validate smelters or delete reference to CFSI.

13.4.1Revision options:

1)Retain as is

2)Consider revisions

  1. Edits proposed by server manufacturer and Chris Cleet
  2. Remove requirements for 3rd party audit (Stephanie Voyles comment)
  3. List additional programs that validate smelters or delete reference to CFSI (Stephanie Voyles comment)

3)Delete criterion (comments by Stephanie Voyles and other comments reviewed earlier)

Option A (also addresses b & c)

OPTION B – Slight modification to edits proposed by manufacturer, and update to footnote 94

13.4.1[PD2]Conflict mineral sourced only from validated conflict free smelters (corporate)

Manufacturers shall conduct due diligence in good faith to determine the all sources of all conflict minerals used in all their products and concludethat they are from either:

Recycled or scrap sources; or

Smelters and, or refiners which have been determined to be compliant1 with the Conflict Free Smelter Program (CFSP) by the Conflict Free Sourcing Initiative (CFSI), or one of CFSP’s mutually recognized assessment programs, and appear on CFSI’s list of validated smelters and refiners, consistent with the definitions provided for in Rule 13p-1 under the U.S. Securities Exchange Act of 1934.

Starting in 2016 or 2018 (for smaller companies), if claiming “conflict-free”, an iIndependent private sector audit (IPSA) is required to verify manufacturer’s control systems and justification for determination, conducted in accordance with Rule 13p under the U.S. Securities Exchange Act of 1934.

NOTE – For this criterion, “recycled or scrap sources” are defined as recycled metals are reclaimed end-user or post-consumer products, or scrap processed metals created during product manufacturing. Recycled metal includes excess, obsolete, defective, and scrap metal materials which contain refined or processed metals that are appropriate to recycle in the production of tin, tantalum, tungsten and, or gold. Minerals partially processed, unprocessed or a bi-product from another ore are not recycled metals. 94

1 Note – Compliant with the CFSI’s Conflict-Free Smelter Program (CFSP) or one of CFSP’s mutually recognized assessment programs. such as the Responsible Jewellery Council’s (RJC) Chain-of-Custody Certification Program, or the London Bullion Market Association’s (LBMA) Responsible Gold Programme.

NOTE – For CFSI list, see <

94 OECD, Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (Second Edition), p12 n.12 (20131)

13.4.2Participation in in-region conflict-free sourcing program

Server Manufacturer / We recommend the following changes in red to the criterion for the following reasons:
1. Kemet Partnership for Social and Economic Sustainability is a current in-region program option
2. Allow for future program options
3. Specify region / “Manufacturer shall support and participate in one in-region conflict free controlled chain-of-custody sourcing programs, such as Solutions for Hope, the Kemet Partnership for Social and Economic Sustainability, Conflict Free Tin Initiative, or another program developed in the future which is committed to sourcing the minerals from conflict free sources in the Great Lakes region. “
Footnote 94 (in Section 13.4 Conflict mineral sourcing) – the most current version of the OECD should be referenced.
Chris Cleet/ITI / May not be necessary if a comprehensive program for conflict minerals is already in place. No real benefit for those companies that are already diligent about conflict free sourcing.
- It is not clear what constitutes “supports and participates” in a program.
Patty Dillon / Criterion 13.4.2 requires a manufacturer to "support and participate in" an in-region sourcing program. Would financial support only meet this criterion? If not, need to clarify what qualifies as "support and participation" or does not. / No solution proposed since thesolution depends on theintent of JC.

13.4.2Revision options:

1)Retain as is

2)Consider revisions

  1. Edits proposed by server manufacturer
  2. Clarify “support and participate” (comments from Chris Cleet, Patty Dillon)

3)Delete criterion (based on comments previously reviewed)

Option a

OPTION B[PD3] Same as A, addreseses need for definition for “support and participate in” by better language, other clarifying.

Discussion Topic 3: Concerns and value of toxic release reporting.

13.3 Public reporting of toxics release data(note: number should be 13.3.1)

First Name / Comment / Proposal / Proposed Response
Server Manufacturer / 13.2.2, 13.2.3, 13.3 - It’s not clear what the purpose of these criteria is; they do not achieve any of the principles outlined at the beginning of this document. Further, major manufactures generally contract with common commodity suppliers; therefore achievement by one manufacturer effectively enables all manufacturers, which does not allow for differentiation of the manufacturers.
Tim Mann/IBM / 13.2.2, 13.2.3, 13.3 - We do not support these criteria. We do not think it is appropriate to require manufacturers to report data from specific suppliers. Most suppliers are providing components and parts to many different clients, and for many types of products that server manufacturers may not be using in their products. As such, in most cases, data reported would not be specific or relevant to the components used in the actual server.
Chris Cleet/ITI / 13.3 - Many jurisdictions do not have a TRI requirement, so obtaining this data will be difficult. This is (despite the reference to UN protocol) a US-centric criterion. Also, it is not clear how this data would benefit an individual product on the registry.
- Obtaining specific location of release and identity and volume for each release may be difficult if manufacturing is outsourced.
Richard Krock/ Vinyl Institute / 13.3 - This is information provides no value for the manufacturer or the certifying standard organization. The VI recommends that this criteria be eliminated because it cannot be directly attributed to the production of any of the server manufacturer’s components. The rationale for this recommendation is explained further:
• Reporting toxics release data does not necessarily correspond to the manufacture of the component used in the server. Some facilities may produce dozens of different components and have higher emissions as a result when compared to a smaller producer that may make only a single component used by the server manufacturer. In this case the data would not be comparable.
• The amount of toxics released may or may not be directly tied to efficiency of the component producer. For instance, if one component producer has a highly efficient and low emitting facility that makes 4 times the component volumes of a low efficiency and high emitting facility that might as a result of its inefficiencies have the same quantity of emissions, then both producers appear to emit the same amounts when indeed the larger producer is by far the preferred one from an environmental emissions perspective.
• If one component producer includes emissions from utilities on site, while another component producer purchases all of its utilities, or shares them with other producers, the emissions data will not be comparable for the two sites.
A more pragmatic approach to obtaining this type of information would be to require a cradle to gate life cycle inventory for the components of interest and let highly skilled life cycle assessors use sound engineering principles and judgement to develop this emissions information on a unit basis. Unit efficiencies and unit environmental burdens can more reasonably be determined using this approach.
Steve Risotto/ ACC / 13.3 - U.S. EPA Toxics Release Inventory (TRI) data are publicly available by substance, location, and company. Compliance with this provision for US facilities will not increase the amount of information already readily available. Requirements in other regions are not comparable to those in the US. As a consequence, the provision will require US-based facilities to disclose more information than facilities located elsewhere. / The provision should be deleted. If the provision is maintained as an optional credit, manufacturers should be allowed the option to provide a link to EPA’s TRI data base (or a comparable UN site) rather than duplicate the information on their own web sites.
Stephanie Voyles/IPC / 13.3 - This criteria should be deleted as there is no environmental benefit to reporting Toxic Release inventory (TRI) data from suppliers. The TRI data is already publically available and can be accessed should that information be needed. / Delete criteria.
Brian Martin/ Seagate / 13.3 - Names of suppliers are considered business confidential information within the electronics industry. Disclosure of top supplier names (by spend or by volume) would violate most manufacturer’s BCI restrictions. Suggest deleting requirement for naming suppliers, and related requirements (links to supplier GRI, etc.)

13.3Revision options: