New Analysis on Public Opinion About Conflict Minerals Impact on Consumer Electronics Sales

Feb. 1, 2012 - PRLog -- The Elm Consulting Group International LLC has released an analysis of whether a discernible correlation exists between consumer sentiment on conflict minerals and consumer buying decisions in the electronics industry.  The paper can be downloaded at http://elmgroup.com/2012/02/01/conflict-minerals-financial-risk-report/

Lawrence Heim, Director at Elm:  “A dramatic convergence of US federal rulemaking, state/international initiatives and viral social media campaigns related to conflict minerals occurred in 2011, generating client interest in what, if any, sales trends could be identified as a result of the consumer sentiment/activism.”

The Enough Project’s Raise Hope for Congo initiative Getting to Conflict Free rankings were used as the consumer perception indicators.  These rankings, published December 2010 and frequently referenced through 2011 in social and traditional media, rated twenty-one major electronics companies on their progress towards achieving a verified “conflict-free” status.  Five of the twenty-one were excluded due to product mix, company reorganization and financial reporting periods.

Publicly-available corporate reports for fiscal year 2011 were then reviewed for the sixteen companies, screening out revenue from sources other than consumer sales.  A comparison to fiscal year 2010 figures for the same revenue sources resulted in year-over-year revenue change on a percentage basis.  Financial results were graphed in conjunction with consumer perception indicators.  

The analysis concluded

“… no obvious connectivity was identified between perceptions relating to conflict minerals and financially material consumer sales performance.  A strong indication of connectivity was seen in only 19% of the sample, with 25% indicating weak connectivity and 56% indicating no relationship of the factors analyzed.  Different matters appear to have defined consumer buying behavior in 2011…  

Based on the findings from this small sample, consumers are not likely to differentially punish or reward companies (in financially material sales figures) in response to conflict minerals disclosures or programs, at least in the near term.”

Supporting this conclusion, the paper highlights a contrast between HP and Apple.  For 2011, HP ranked number 1 in the Enough Project ratings; Apple ranked in the middle tier of the ratings and also was the subject of intense public criticism over corporate social responsibility matters, specifically including its conflict minerals status.  Yet HP’s consumer products revenues fell 2% (2011 compared to 2010), in contrast to Apple’s 66% increase in the same period.

Heim continued:  “We recognize that 2011 is the first year of broad public awareness about conflict minerals.  It is possible the topic has not yet permeated consumer consciousness and priorities, or that the Enough rankings are not considered credible by consumers.  These points are valid, but this is currently the best available information.  The apparent decoupling of sentiment from spending behavior during this first year is valuable insight to companies planning conflict minerals management programs, public messaging initiatives and associated internal expectations.”


As defined by Section 1502 of the US Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law in July 2010, conflict minerals are tin, tantalum, tungsten and gold, and the ores from which they are derived.  Section 1502 requires publicly traded companies in the US, and certain foreign companies doing business in the US, to conduct and publicly disclose supply chain due diligence efforts and identify if any materials originate from the Democratic Republic of Congo (DRC) and adjoining countries.  The intent of Section 1502 is to prevent funding of armed groups who commit human rights violations in association with mining activities.

Inclusion of and references to the Enough Project, Raise Hope for Congo and Getting to Conflict Free within this analysis is not an endorsement, nor do we imply the rankings are valid, credible or accurate.  Use of the rankings within the analysis only reflects (a) the limitation that no other specifically-targeted indicators currently exist and (b) that they are intended for the general public/consumers.

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Founded in 2001, The Elm Consulting Group International LLC provides health, safety, environmental and sustainability services with 14 offices (US, Mexico, Argentina, Columbia, Peru, Venezuela, New Zealand, Indonesia, China) and over 100 affiliates in 22 other countries.