Due Diligence Report Of 2023
1、Company information(ALL SOURCES)
The company is called RFH RECYCLING METALS COMPANY LIMITED. CID:003159.
The company was established in 2016 with its office address is in located in 1507 Huijie Plaza, No.268 Zhongshan Road, Nanjing Jiangsu Province and its factory is located in No.98 Changjiang Northwest Road, Nangjing Economy & Technology Development District, Nanjing. RFH is specialized in Strategic rare metals supply chain integration management, production and processing and international trade, including the processing of physical forged to Tantalum raw materials into Tantalum chunks. Our company always adheres to the "quality first" policy and fully implement the ISO9001 quality system and also has good business trading relationships with many well-known companies in International Metal Industry to meet the requirements of the customers and ensure a 100% satisfaction.
2、RMAP Assessment Summary (ALL SOURCES)
As a responsible company. We are committed to helping the upstream supply chain share social responsibility. Strictly abide by the relevant laws and regulations of our country and international rules. On November 28, 2023, we conducted a DAP audit by UL, an independent third-party audit firm, with the Assessment Period date of 04/25/2021- 07/31/2023, with Roc Liao, the lead auditor. This assessment summary report was posted on the RMI website:
https://www.responsiblemineralsinitiative.org/media/docs/downstream/Downstream_Audit_Summary_Report_RFH.pdf .
In 2023, our company complied with the “OECD Due Diligence Guidelines for Responsible Global Supply Chains for Minerals from Conflict-affected and High-risk Regions” and only purchased RMI-approved company raw materials. The entire process was strictly controlled and firmly implemented in accordance with the OECD five-step framework and the requirements of the Supplement on Tin, Tantalum and Tungsten and the Responsible Minerals Inspection Process. This report was posted on the company's website:
3、Company Supply Chain Policy (ALL SOURCE)
Our company implements an open and transparent purchasing policy for raw materials. In compliance with the OECD Guidelines on Responsible Global Supply Chain Due Diligence on Minerals from Conflict-affected and high-risk Areas, in order to avoid the use of minerals that directly or indirectly finance or benefit armed groups and/or are involved in other serious human rights violations in high-risk and conflict-affected areas, Illegal taxation or extortion, money laundering, conflict minerals in violation of the Extractive Industries Transparency Action Plan (EITI), the development of a Supply Chain Policy and the integration of supply chain policy into contracts/agreements with suppliers. This policy is in full compliance with the Model Policy on Global Responsible Supply Chains for Minerals from Conflict-Affected and High-risk Regions (Appendix II of the OECD Guidance), which covers all the risks identified in Appendix II of the OECD Guidance and applies globally. The Company undertakes to address any Appendix II risks as soon as they are identified. This policy has been reviewed by senior managers and approved by General Manager. Management is committed to supporting the implementation of this policy. This policy has been to the stakeholders (suppliers, customers, employees, etc.), in the company's web site： https://en.rfh-metals.com/news_2.html
4、Company Management System (ALL SOURCES)
4.1 Our company is committed to the policy in supply chain and formulate the following process of due diligence.
● The General Manager is responsible to oversee the due diligence program and risk management design and implementation.
● Sun Wei be appointed as Senior Manager to implement the due diligence system and coordinate the work of relevant departments (including Social Responsibility, Supply and Marketing, Production and Technology, General Affairs and Quality) to ensure that all departments perform their duties, conduct due diligence and report any warning signs and potential risks they find.
● Company only purchases tantalum raw materials from suppliers approved by RMI, confirmation of inclusion in the approved list can be found in the smelter list or in the downstream assessment program participants.
Tantalum Smelters List：
Downstream Assessment Program Participants：
●According to the requirements of the due diligence system, our company has conducted due diligence management system training for the main personnel of all relevant departments, and included it in the induction training for new employees. If the system is updated, the company will carry out additional training as required. On February 20, 2023 and June 30, 2023, onboarding training was conducted for one new employee respectively. On April 10, 2023, a full-staff training was carried out in accordance with the training plan.
● The senior manager shall organize management review at least once a year. Analyze the changes of internal and external factors, the needs and expectations of stakeholders, the realization degree of company policies and commitments, management process performance, the status of improvement measures, the results of internal and external audit, resource adequacy, etc., and report the audit results and continuous improvement plan to the general manager.
4.2 Internal System of Control
● Our company has established its due diligence management system and formulate the “Due Diligence Management Manual”. by carrying out “Supplier Management Procedure”, “Internal Raw Material Control Procedure” and “Identifying and Traceability Procedure” to control the choosing/permission and the flow of materials. So to get a balance evaluation and keep pace with OECD Guidance and RMAP during the whole process.
● The company has conveyed the latest supply chain policies and procurement requirements to all direct suppliers through means such as phone calls, emails and training. The company only purchases tantalum raw materials from suppliers recognized by RMI. The company has incorporated its supply chain policy into specific legally binding agreements reached with direct suppliers. In March 2023, the company assisted a supplier in passing the DAP audit. The company inspects 100% of its direct suppliers once a year, accounting for 100% of the annual sales volume, and conveys the risk assessment report to the suppliers. We spare no effort to improve the performance of suppliers. When necessary, we organize relevant personnel to provide training and capacity building for suppliers.
● Our company has established the Grievance Management Procedure and publicly disclosed the contact information of senior managers as a grievance channel on the website （https://en.rfh-metals.com/news_4.html） to accept supervision from all sectors of society.
4.3 Record Keeping System
● The company requires that all records relating to the due diligence program are maintained at least for five years. Carrying out “Documents and Records Control Procedure”.
● All paper documents must be classified and stored in the filing cabinet, and measures shall be taken to prevent moisture, mildew and moth. Electronic documents and records shall be processed and backed up by computer, and anti-virus shall be carried out on schedule to ensure the safety of documents and records.
5、Risk Identification (ALL SOURCES)
5.1 The Company implements Risk Management Procedure to identify risks in the supply chain. Review all information collected against internal procurement requirements such as the UN Sanctions List, the US Sanctions List, the EU Sanctions List, local laws and Supplier Management Procedure. All direct suppliers conduct risk assessments at least once a year.
5.2 Our company designed “Supplier Management Program” to understand suppliers, include information concerning supplier legal status and identity, supplier mapping and potential risks. The all of our suppliers have completed and returned a KYC form. Senior manager reviewed the provided information and the Sanction List with the Purchasing Team. Whenever inconsistencies, errors or incomplete information were identified in the KYC form, the company communicated the improvement areas to suppliers and requested an updated form. If red flags were identified, the company would further engage with its suppliers to clarify and improve the documents as needed. During this reporting period, no red flags were identified related to submitted KYS forms.
5.3 The company only purchases tantalum raw materials from suppliers recognized by RMI, implements the "Risk Management Procedure" to conduct basic due diligence on suppliers, logs in to RMI's website to view the List of Conforming smelters and List of Downstream Assessment Participants to confirm and verify their identities. Log in to the supplier's website to view the "Supply Chain Policy" and the "Due Diligence Report"; View full Supplier Evaluation Reports and CMRT, etc. Assess and mitigate risks in the supply chain and verify the presence of the warning signals mentioned in OECD Appendix II to check compliance with our supply chain policy.
5.4 For each transaction, the Company requires the supplier to provide the production date analysis certificates of each batch of goods and the complete set of traceability documents for comparison. Conduct further due diligence if inconsistencies or discrepancies are found.
5.5 In the context of raw material procurement or supplier activities, there are a range of circumstances that require further due diligence:
a) The batches provided by the material are not within the compliant production period;
b) Lack of traceability documents;
c) Providing products beyond the previous production capacity;
d) Supplier's latest information is not updated and reported in time;
e) Other recognizable warning signals.
5.6 Use the network or field visits and other channels to spot check from time to time, if found inconsistent and the situation will affect the risk assessment results, suspend the cooperation with the supplier. Suspend or continue to work with the supplier based on the results of the re-risk assessment.
6、Risk Reduction
6.1 The Company implements Risk Management Procedures to assess and mitigate risks in the supply chain.
6.2 In accordance with the above risk identification methods, conduct enhanced due diligence on raw materials and supply chains identified as "high risk", where necessary, on-the-ground assessments are carried out to develop feasible risk mitigation plans in consultation with suppliers, local and central authorities and affected stakeholders.
6.3 Risk reduction strategies include:
a) Continuing trade throughout measurable risk management.
b) Suspend trade while continuing to reduce risk.
c) Terminate the cooperation with the supplier if risk mitigation measures are not feasible or acceptable.
6.4 This risk management plan shall be reported to the general manager and transmitted to the supplier, and relevant departments shall supervise the implementation regularly.
6.5 During this evaluation period, the Company has no "high risk" procurement and no risk mitigation plan in execution for the time being.