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2019 ANNUAL R E P OR T

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Contents 1 From the Executive Director 2 Presidential Award 3 Responsible Labor Initiative 8 Responsible Minerals Initiative 15 Environmental Sustainability 17 Chemical Management 17 Public Procurement 18 Public Policy 20 Stakeholder Engagement 21 Training and Capability-Building 24 Responsible Business 2019 26 Compass Awards 27 Meetings and Events Worldwide 30 RBA-Online 31 RBA Risk Assessment Platform 32 Validated Assessment Program (VAP) 33 VAP Audits: By the Numbers 36 Annual Sensing Results 40 Membership Growth 41 2019 Financial Highlights 42 Senior Leadership, Board and Staff 44 RBA Members

R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT

From the Executive Director Dear Colleagues, The Responsible Business Alliance celebrated its 15th anniversary at its annual conference in the fall of 2019. While there is still much work to be done, it is difficult to overstate how far the organization has come since its inception, thanks to the sustained efforts and support of its members. The journey began in 2004 when a small group of forward-thinking companies sought to create an industry-wide standard on social, environmental and ethical issues in supply chains. Today the RBA and its initiatives have nearly 400 members with combined annual revenues of greater than $7.7 trillion, directly employing over 21.5 million people, with products manufactured in more than 120 countries. Our influence and reach are global, with members in numerous industries, countries, and tiers of the supply chain, and RBA offices in Asia, Europe and North America. As you will see in the following pages of this annual report, in 2019 we continued to make significant strides to better serve the membership with expanded programmatic support, increased government and stakeholder advocacy, new capabilities and improved tools and trainings. We also partnered with other notable organizations, governments and civil society to advance responsible business conduct, ethical recruitment and employment, and the responsible sourcing of minerals. The RBA made substantial improvements to its Validated Assessment Program, RBA-Online, Risk Assessment Platform, Responsible Workplace and Recruitment Programs, Responsible Minerals Assurance Process, and many other resources to help members meet evolving expectations worldwide. In 2019 we also saw a record number of VAP audits conducted, trainings completed, and members participating in the organization, further increasing our impact and improving conditions for workers and the environment. The year was capped with a major recognition by the U.S. government when the RBA received the 2019 Presidential Award for Extraordinary Efforts to Combat Trafficking in Persons. In short, 2019 was an extraordinary year for our organization. None of us anticipated the devastating social and economic effects of the global health crisis that would follow, but the investments in infrastructure and new capabilities that we made in 2019 are enabling us to continue to advance the RBAâ€™s vision and mission, and have positioned us for success in 2020 and many years to come. We hope you will join us on this continuing journey. Sincerely,

Rob Lederer Executive Director

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Presidential Award In October 2019 the Responsible Business Alliance was honored to receive the 2019 Presidential Award for Extraordinary Efforts to Combat Trafficking in Persons. The U.S. Secretary of State presented the award to the RBA at a ceremony during a cabinet-level meeting of the President’s Interagency Task Force to Monitor and Combat Trafficking in Persons (PITF) in the historic Indian Treaty Room at the White House. The RBA received this award for its “innovative work and leadership within the global business community to push for industry-wide change to enhance worker protections, transform the market for ethical recruitment practices, and promote strong management systems to prevent human trafficking and trafficking risks in global supply chains.” For more details, read the full RBA announcement on our website.

“We are honored to receive this prestigious award and appreciate the validation of our work on human trafficking, including forced labor. We are proud to represent a multiindustry group of companies that have come together to use business as a force for good.” Rob Lederer

Executive Director of the Responsible Business Alliance.

RBA in the Oval Office at the White House

RBA Receiving the 2019 Presidential Award

R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT

FROM LEFT TO RIGHT:

RLI at Modern Slavery Conference – Sydney, Australia RLI at Bali Process Symposium – Jakarta, Indonesia.

Responsible Labor Initiative As international business and stakeholder communities accelerate their commitments to address the risks of trafficked and forced labor in supply chains, the need to collaborate on common approaches continues to be crucial for success. Regulations, market access requirements and stakeholder focus related to modern slavery continued to grow in 2019, as well as the understanding of new and emerging risks, making it even more important for the private sector to invest in solutions. However, organizations, industries and even governments cannot tackle these challenges in isolation. They must work together to succeed. This is one of the driving principles behind the RBA’s Responsible Labor Initiative (RLI): using collective influence to affect change.

Collective influence through membership growth and partnerships: In 2019, the RLI saw significant progress in expansion of both industry membership and partnerships to further collaboration. Leading companies in the entertainment, consumer goods, and security sectors joined the initiative to strengthen the efforts of our existing members in the electronics, automotive, toy, retail, food and beverage, footwear and apparel, and telecommunications sectors. In addition, the RLI advanced key partnerships with influential organizations to conduct activities such as:

FURTHERING THE INITIATIVE’S STRATEGIC PRIORITIES

• Co-hosted roundtables in Malaysia and Myanmar with the Consumer Goods Forum and the Institute for Human Rights and Business’ Leadership Group for Responsible Recruitment, including government engagement and advocacy for responsible recruitment • Co-hosted a forced labor due diligence forum in Sydney, Australia with the Walk Free Foundation • Developed and piloted enhanced investigative skills training for forced labor auditors with the International Justice Mission • Implemented on-the-ground engagement with recruitment partners and workplaces in Vietnam with the International Organization for Migration (IOM) and International Labour Organization (ILO)

Following the development of the RLI’s Strategic Framework in 2018, the RLI made progress toward its embedded strategic priorities, including:

Geographic expansion: The RLI expanded its presence through forums, audits, resource coverage and engagement to key

In 2019, the RLI made progress in a number of key areas, including: • Furthering the initiative’s strategic priorities • Formalizing multi-stakeholder governance • Creating impact on the ground through the Responsible Workplace and Recruitment Programs • Planning for accelerating progress

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RLI-IHRB-CGF Responsible Recruitment Roundtable – Kuala Lumpur, Malaysia

countries in East and Southeast Asia, Europe, North America and beyond in 2019. Transparency and impact measurement: The RLI completed its work with the Global Reporting Initiative (GRI) in 2019 to provide a toolkit to advance reporting on modern slavery. This resource guides companies on the components of effective disclosure on this topic and encourages iterative improvement of public reporting over time. Ten RLI member companies and multiple external stakeholders contributed to the development of the toolkit. In 2019, the RLI and its members combined to demonstrate progress on key indicators including: • Increased use of Supplemental Validated Audit Process (SVAP) on Forced Labor audits by 91% • Repayment of recruitment fees in excess of $35M USD

MULTI-STAKEHOLDER GOVERNANCE AND ENGAGEMENT Recognizing that diverse perspectives create more holistic and impactful outcomes, the RLI established its governance in 2017 to include stakeholder voices through an Advisory Board. In October 2019, the RBA Board of Directors and RLI Steering Committee approved the expansion of the Steering Committee to include six voting stakeholder seats from the following organization types: investor community, intergovernmental organization, non-governmental organization, academic community, implementing

R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT

partner, and a worker rights organization. In addition, the RLI staff engaged with a diverse set of additional stakeholders, including government, intergovernmental organizations, investors and civil society to share perspectives, provide information on RLI programs, tools and services as well as partner where appropriate to further shared objectives regarding the prevention of forced labor.

RESPONSIBLE WORKPLACE AND RECRUITMENT PROGRAMS Launched in January 2018 and implemented through the RBA Foundation, the Responsible Workplace and Recruitment Programs aim to help break the cycle of exploitation in foreign migrant worker recruitment and employment experiences in Southeast Asia by transforming the market for ethical business practices and including workers in the development of effective solutions to persistent labor migration challenges. The Responsible Workplace Program (RWP) focuses on improving workers’ awareness of their labor rights, developing worker-management communication and amplifying workers’ voices to improve working conditions and mitigate issues that contribute to forced labor. To complement the expected outcomes from the RWP in reducing the risk of forced labor in supply chains, the Responsible Recruitment Program (RRP) targets its efforts in the recruitment industry by providing labor providers with a development path toward meeting the ethical recruitment standards of today’s leading industry customers, as well as public recognition for their progress. Both the RWP and RRP were expanded from the RLI’s earlier pilot programs

RLI and Members at AntiTrafficking Conference – Kuala Lumpur, Malaysia

through a generous grant from the Walmart Foundation. As part of the grant’s aim to share progress and learnings from the RWP and RRP, the RBA Foundation welcomed more than 260 participants from RBA and RLI members, non-member companies, suppliers, recruitment agencies, government, intergovernmental and non-governmental organizations to a Regional Forum on Forced Labor in February 2019 in Penang. The forum received public prominence with participation of high-ranking officials from the governments of Australia, Malaysia and the United States. The grant is also supporting the production of the Journey of a Worker video aimed at illustrating the benefits of RWP and RRP. A teaser for the video was launched at the RBA’s Annual Conference in Santa Clara and the full video will be released in 2020.

PROGRESS: RESPONSIBLE WORKPLACE PROGRAM Five new workplaces enrolled in the RWP in 2019, increasing the total in the program to 23. These workplaces range from small to medium to large and are spread across five states in Malaysia. Collectively they employ close to 6,000 foreign migrant workers from Nepal, Indonesia, Bangladesh, Vietnam, Myanmar, India, Philippines, Sri Lanka, Pakistan, China and Singapore. Apart from supplying 10 RBA/ RLI members, they also supply seven non-RBA/RLI members in the paper and forest, textile and apparel, retail, food and beverage, and consumer goods industries.

RLI at SDG Summit – Kuala Lumpur, Malaysia

In terms of training, the RBA Foundation delivered a total of six workshops in Penang, Kuala Lumpur, Johor and Melaka in February and September 2019. This entailed two workshops on Worker-Manager Communications and four on Pre-Departure Orientation (PDO). An e-learning video called “What to Know Before You Go” in Bengali, Indonesian, Nepali, Burmese and English was shared with the participants to facilitate the workshop on PDO. The video features important facts workers should know before they migrate to Malaysia such as local laws pertaining to working hours, minimum wage, leave entitlement, passport possession, the RBA’s “Suara Kami” helpline, etc. This video is available to members in the RBA eLearning Academy. The RBA Foundation and ELEVATE developed mobile messages on key topics on ethical recruitment practices such as the prohibition of passport retention by employers, freedom to leave, zero recruitment fees and access to the RBA helpline, all designed to help workers understand their rights as a migrant worker based on insights captured from the baseline worker survey. In total, over 30,000 voice recorded messages were sent to more than 2,000 workers’ mobile phones from February to July. The messages were available in eight languages: Bahasa Indonesia, Nepali, Bengali, Hindi, Tamil, Burmese, Vietnamese, and English. A public report highlighting the key learnings from the RWP as well as analysis of aggregated worker survey data will be shared in 2020.

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

PROGRESS: RESPONSIBLE RECRUITMENT PROGRAM After significant enrollment in 2018, which saw 45 labor providers (15 more than initially targeted) from Indonesia, Malaysia and Nepal join the pilot RRP, the remaining places allowed under the program were filled by April 2019. The total enrollment in the RRP is 61 labor providers, exceeding the program target of 60. Of the 61 labor providers, 28 are from Nepal, 21 are from Malaysia, and 12 are from Indonesia. The RBA Foundation organized a second ethical recruitment training in Kuala Lumpur, Malaysia in April 2019 to cover all Wave Two participants. The training, delivered in partnership with The Fair Hiring Initiative, was held for labor providers from Indonesia, Malaysia and Nepal. The RLI saw a heightened interest in the subject of ethical recruitment in 2019, particularly from the labor providers in Nepal as the program grew in prominence among the labor providers there as well as being spurred by regulatory changes and implementation of bilateral MOUs. To support the growing interest, an additional session of ethical recruitment training was organized in Kathmandu in November 2019. The labor providers from Wave One were asked to participate in a verified Self-Assessment Questionnaire (SAQ) activity. SAQ submissions from Wave Two labor providers were also completed and are awaiting final assessment results. In order to progress to the next level, RRP participants that were deemed to

have performed well in earlier stages are invited to undergo the Supplemental Validated Audit Process (SVAP) on Forced Labor. The RBA Foundation also provided additional learning support to those that did not perform well during the self-assessment stage, including supplementary training and one-on-one consultations.

“ENHANCING FAIR AND ETHICAL RECRUITMENT TO ADDRESS MODERN SLAVERY” PROJECT As part of the RLI’s efforts to assist members in addressing forced labor in their global supply chains, it launched an inception phase project in December 2018 funded by the Global Funds to End Modern Slavery (GFEMS) to develop pilot activities and test strategies within the Vietnam–Chinese Taipei migration corridor to increase insight and clarity on recruitment practices along this corridor, establish a network of ethical recruitment actors to build a business case for ethical recruitment and determine whether pilots such as the RRP and worker survey component can be replicated in Vietnam and Chinese Taipei beyond the inception phase. The 12-month project, extended to February 2020, is implemented in collaboration with the International Labour Organization (ILO) and the International Organization for Migration (IOM) for activities in Vietnam. Project Outreach Meeting As a follow-up to the project’s first outreach meeting in December 2018, a second outreach meeting was

RLI-IHRB-CGF Responsible Recruitment Roundtable – Kuala Lumpur, Malaysia

R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT

organized by the RLI in Taipei in June 2019, targeted specifically at a smaller group of suppliers of RBA and RLI members and their labor providers. This event encouraged involvement in project activities such as ethical recruitment orientation, worker surveys and a feasibility study on the effectiveness of ethical recruitment programs. Ethical Recruitment Introduction The project piloted an Introduction to Ethical Recruitment for Labor Recruiters training in Hanoi, coorganized by the RLI and IOM in collaboration with the ILO in September 2019. In Chinese Taipei, an Ethical Recruitment Orientation was piloted by the RLI in Taipei. Worker Survey Two survey instruments targeting 600 Vietnamese workers were designed to understand their recruitment experiences prior to departure from Vietnam and upon arrival in Chinese Taipei. The survey was designed to collect information related to recruitment fees, freedom to leave, deceptive practices such as contract substitution, and access to grievance mechanisms. They were available in a mobile-enabled, web-based format as well as through an Interactive Voice Response (IVR) toll-free channel in Vietnamese, Tagalog and English.

significant time in planning for accelerating progress in 2020 toward its goals. These next steps include: • An increase in deep government advocacy to promote responsible recruitment and employment policies and practices in key sourcing regions • The launch of a cooperative audit program and supporting initial audit fund to catalyze industry investigations into forced labor risks • Forging key partnerships with partner organizations and stakeholders through the initiative’s multistakeholder governance model and other opportunities • Developing and enhancing programs, tools and services to enable member company due diligence, including comprehensive guidance on implementing no fees policies, detailed recruitment fee information, enhanced audit and assessment protocols and auditor capacity and supplier level due diligence training and resources • Expanding responsible recruitment activities further into host countries and additional geographies • Establishing an impact assessment framework to measure progress year-over-year Visit ResponsibleLabor.org for more information on the RLI. Visit RBAFoundation.org for more information on the RWP and RRP programs.

PLANNING FOR ACCELERATING PROGRESS As part of its 5-year strategic plan, the RLI invested

FROM LEFT TO RIGHT:

RBA Foundation Regional Forum – Penang, Malaysia RBA Foundation Ethical Recruitment Training – Kuala Lumpur, Malaysia

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RMI at OECD Forum – Paris, France

Responsible Minerals Initiative The RBA’s Responsible Minerals Initiative (RMI) hit several milestones in 2019, in terms of the breadth of its service offerings and resources developed, membership size and in the internal team growth. A significant portion of the RMI’s work in 2019 was accomplished in collaboration with existing and newly forged partnerships, through a number of critical MOU agreements with minerals associations, as well as other collaborations with civil society, governments and key stakeholders. The RMI also added three new team members, building on its commitment to deliver quality and assurance, and expanding further into emerging risk areas and the ever-expanding list of minerals important to members and stakeholders.

PROGRAM INDICATORS

The RMI’s Upstream Membership Program was introduced in 2019 and provides a range of membership benefits exclusively for mining, smelting and refining companies, focusing on opportunities for mineral and metal producers to engage directly on supply chain responsibility matters with their customers and end-users. Seven companies joined the new Upstream Membership Program in 2019.

2019 was the second year of implementation for the revised Responsible Minerals Assurance Process (RMAP) 3TG standards. RMAP participation remained steady among tin, tantalum, tungsten and gold (3TG) smelters and refiners and grew greatly among cobalt refiners through the addition of a cobalt assessment offering. 260 out of 352 known tin, tantalum, tungsten, gold and cobalt smelters and refiners (SORs) were either active or conformant to the RMAP or a crossrecognized program. A total of 122 SORs completed on-site assessments in 2019, with additional SORs completing on-site or desk-top corrective action plans (CAP). Of those, 18 were cobalt refiners that completed an on-site assessment in 2019, with additional refiners on the horizon for 2020. By the end of 2019, 50 percent of identified eligible cobalt refiners were participating in RMAP, compared to 17 percent at the end of 2018.

The Vendor Membership category also continued to see solid growth with the addition of three new service provider members. The RMI’s year-end membership total was 381.

In 2019, RMAP expanded its cobalt program to include cobalt crude refiners located in the Democratic Republic of the Congo (DRC). Through engagement with industry and on-the-ground research, the RMI

MEMBERSHIP OVERVIEW The RMI welcomed 45 new members in 2019, with strong representation from the automotive, electronics and healthcare sectors. The RMI continues to receive positive membership feedback on its supply chain assurance tools and collaborative workgroup activities.

With the uptick in interest from the RMI’s Upstream Members, we expanded opportunities for discussions along mineral value chains to tackle responsible sourcing challenges. Our Mining Engagement Team provides a prime example of such collaboration – bringing together major downstream brands, mining companies, metals associations and standards-setting bodies to identify and implement practical steps to strengthen linkages, facilitate communication and promote the recognition of responsible practices among mineral supply chain actors.

R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT

Of 352 known tin, tantalum, tungsten, gold, and cobalt smelters and refiners, 260 were either active or conformant to the RMAP or a cross-recognized program in 2019.

has confirmed 10 crude refiners are eligible to undergo RMAP. Of these, three are currently active in RMAP. In 2019, the RMI identified 33 new SORs, 21 of which were cobalt refiners. 36 SORs were considered no longer eligible due to a change in operations. 17 SORs became conformant for the first time in 2019, and 21 joined the active list. All 21 active smelters had an on-site assessments scheduled and completed in 2019. The RMI issued updates to the Conflict Minerals Reporting Template (CMRT) in April 2019 and the Cobalt Reporting Template (CRT) in October 2019.

RMI at Expert Forum on Sustainable Materials – Turin, Italy

Updates to the CRT aligned the tool to IPC-1755 amendments made in May 2019, which included cobalt and the upcoming EU regulation within its scope. The Downstream Assessment Program (DAP) saw increased inquiries from downstream producers of tin, tantalum, tungsten and gold ahead of the upcoming EU regulation. Five downstream assessments were completed in 2019 and several are on the horizon for 2020. All assessments in 2019 were conducted against the RMI Revised Standards for Tin, Tantalum, Tungsten and Gold (issued in 2017).

RMI at GreenBiz 19 – Phoenix, Arizona

RMI at Asia Tin Week – Xi’an, China

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

QUALITY ASSURANCE AND CONTINUAL IMPROVEMENT

MOST COMMON NON-CONFORMANCES 5% •

• 12%

5% •

To ensure quality and consistency in the implementation of the assessment standards requirements and methodology, the RMI continued quality review of RMAP and DAP reports and corrective action plans, rolled out an auditor scorecard, and conducted a number of shadow assessments. Since the implementation of the revised standard, the RMI conducted a total of 14 shadow assessments, five of them in 2019, as part of its quality assurance for RMAP assessments.

6% • • 11% 6% •

6% • • 10% 7% •

Of the RMAP assessments conducted in 2019, 63 resulted in corrective action plans (CAPs). For 2019, the most common non-conformances included: • Procedure to Identify Conflict-Affected and HighRisk Areas (CAHRAs) missing critical elements • No Step 5 Public Due Diligence Report • Supply Chain Policy missing critical elements • No process to receive, review and respond to supply chain grievances

• 9%

7% • • 8%

• 8%

n CAHRA procedure is missing critical elements (criteria, resouces, frequency of review, etc. n There is no “Step 5” public due diligence report n The auditee did not have a robust (or any) process in place to receive, review, and respond to grievances n Supply chain policy doesn’t meet requirements of Standard (Annex II risks, geographic scope limited, etc.) n Supply chain policy, expectations, or intended consequences of failing to meet expectations on responsible supply chains not communicated to suppliers n No process for management review of due diligence management system n There is no KYC process n There is no CAHRAs procedure n No process to review supplier files for discrepancies n The procedure to identify CAHRAs is not reasonable. n The KYC process is not consistently implemented n CAHRA procedure not consistently implemented n Not all transaction documentation requirements met

NUMBER OF CONFORMANT SMELTERS AND REFINERS

Number of conformant smelters

70 60

To support auditees’ successful closure of nonconformances, as part of the OECD-aligned approach to continual improvement, the RMI developed trainings specific to common findings, continued free smelter and refiner access to its Country Risk Assessment and Grievance Mechanism tools, and offered extensive technical assistance to support auditees’ development of policies and procedures that would satisfy the Standard’s requirements.

By Geography

Latin America

Other

0 China

Europe

Indonesia

Japan

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Asia Other Geography

USA

MARKET ACCEPTANCE In 2019, the RMI applied for recognition of the RMAP and DAP under the EU Delegated Act for Recognition of Industry Schemes. The RMI was the first industry scheme to apply for the recognition in June of 2019 and the European Commission (EC) formally accepted the RMI application in August of 2019. The EC-appointed assessors conducted documentation review as well as staff and stakeholder interviews in late 2019. The EC assessment process is expected to conclude by 2021.

CAPACITY-BUILDING, TRAINING AND SMELTER SUPPORT In addition to the online training courses available to RMI members, auditees, auditors and other stakeholders, the RMI hosted nine in-person trainings. These were held in China, the United Kingdom, Mexico, Japan and the United Arab Emirates, and included advanced auditor training courses for participating auditors in London and Dubai, coorganized by the OECD. Coupled with free in-person one-on-one technical assistance, these resources helped prepare smelters and refiners for the assessment process. The RMI launched a new Upstream Smelter Due Diligence Fund in late 2018 and by October 2019 reached the minimum donation threshold for disbursement. The purpose of the Fund is to support responsible sourcing from conflict-affected and high-

RMI at ASI Meeting â€“ Molde, Norway

risk areas (CAHRAs) for which there is not currently a recognized upstream assurance mechanism available. Recipients are required to provide deliverables that serve a public good including, for example, on-theground risk assessments of mine sites, ongoing monitoring, capacity-building of local communities, development of template questionnaires or reports, or the publication of case studies. The RMI also launched a new Financial Assistance Program that pays for 75 percent of the cost of reassessments for smelters with low volumes. The RMI disbursed financial assistance to three smelters and refiners in 2019. The RMI continued to disburse funds under the Initial Audit Fund, paying for the full costs of all initial assessments. Since 2014, the RMI has disbursed over $1.5 million USD to smelters under the Initial Audit Fund and disbursed approximately $355,000 in 2019.

PARTNERSHIPS The RMI made major breakthroughs in facilitating due diligence in the cobalt supply chain in partnership with the Responsible Cobalt Initiative (RCI). The two organizations share objectives to promote the responsible production, trade and processing of cobalt and seek to enhance the capabilities of companies with third-party assessments, training and capabilitybuilding. These efforts have greatly facilitated validation of due diligence activities by companies in China and the DRC. By the end of 2019, 51 percent of

RMI and RCI Sign MOU to Promote Due Diligence in Cobalt Supply Chains

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RMI Training – Tokyo, Japan

RMI Visit to Tin Sites – Belitung & Bangka, Indonesia

identified eligible cobalt refiners were participating in RMAP, compared with 17 percent at the end of 2018. In addition, 2019 was marked by new collaboration opportunities with key metals industry associations. The RMI and the International Copper Association signed a memorandum of understanding to jointly advance the responsible production and trade of copper, aiming to harmonize expectations for responsible practices in the copper value chain by applying existing industry norms covering major environmental, social and governance issues. To this end, the organizations worked together with the Mining Engagement Team, in a formal review process for the Risk Readiness Assessment (RRA) to ensure the standards used, issue areas, and industry norms reflect current industry expectations. In 2019, the RMI updated the RRA to reflect these changes and engaged in a standards equivalency process with ITA, ASI, ICMM, TSM, and IRMA to provide recognition for those standards in the RRA online platform. The RMI also issued the first Trends Paper on the RRA usage and results from the first year of implementation. To address crucial child labor issues in the mica supply chain, the RMI entered into a formal agreement with the Responsible Mica Initiative to work toward ending the use of child labor and to improve working conditions in mica industry supply chains globally. In 2019, the Responsible Mica Initiative joined RMI’s Mica Workgroup to develop a global standard to validate responsible mica supply chains. Lastly, the RMI and the International Tin Association (ITA) formed a joint Task Force pursuant to an MOU to enhance cooperation across the entire tin value

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

RMI Auditor Training – Mexico

chain and further strengthen progress on responsible production and sourcing of tin. Over the course of 2019, the organizations developed and published new “Assessment Criteria for Tin Smelting Companies,” which clarify a common upstream and downstream view of due diligence requirements for the tin supply chain. These Criteria are designed to align with the internationally recognized OECD due diligence guidance, assist with the new London Metal Exchange (LME) responsible sourcing requirements, and satisfy other upcoming requirements such as the EU Minerals Due Diligence Regulation.

SUPPORTING DUE DILIGENCE ACROSS THE SUPPLY CHAIN The RMI and the Global Reporting Initiative (GRI) launched a toolkit to advance reporting on sourcing minerals from conflict-affected and high-risk areas. This resource helps companies report on their commitments, due diligence processes and actions related to social impacts in the supply chain. It highlights the benefits of disclosure and identifies challenges and opportunities. The toolkit also encourages increased and improved reporting, referencing regulatory and stakeholder expectations, with examples of reporting practices and relevant tools. The RMI maintained active engagement with upstream partners and stakeholders in advising and leadership roles, including in critically important programs that support the ASM sector as a member of the DELVE Steering Committee, a member of the OECD Multi-Stakeholder Group, a board member of

the European Partnership on Responsible Minerals (EPRM), and a member of the Public-Private Alliance for Responsible Minerals Trade (PPA). Additionally, the RMI continued serving on the Code of Risk mitigation for ASM engaging in Formal Trade (CRAFT) Advisory Group and Standard Committee that assisted with the rollout of CRAFT 1.0 in 2018, focusing on scope determination and prioritization for CRAFT 2.0 in 2019, with the rollout of CRAFT 2.0 planned for 2020. Over the course of 2019, RMI reviewed and enhanced its Blockchain Guidelines in collaboration with RMI members and major blockchain solution providers with a particular focus on foundational principles for interoperability. These Guidelines represent the first industry effort to define a common set of principles, attributes and definitions for the application of blockchain technology to support mineral supply chain due diligence.

RMI and Members in Kolwezi and Lubumbashi in DRC

RMI at OECDSponsored Stakeholder Meeting in DRC

In-Country Engagement In Indonesia, the RMI concluded activities under the Tin Working Group (TWG), which works closely with key local industry players and local communities, to identify and act on opportunities to advance land reclamation projects, policy reform, and worker health and safety improvements. Through funding received from the EPRM, the TWG supported two pilot project activities for sustainable land reclamation as well as occupational health and safety capacity building. In July 2019 the RMI, TWG members and pilot participants held an RMI-AETI Joint Workshop on Responsible Tin Production, supported implementation of pilot projects, and revised the TWG roadmap, which provides a practical approach to realizing a responsible tin economy in Indonesia. In November 2019 the RMI and a delegation of its members traveled to Kolwezi and Lubumbashi, DRC. The group held meetings with cobalt crude refiners, large-scale mines (LSM), semi-mechanized mines, livelihood and community development projects, and also visited artisanal and small scale mine sites (ASM) and the cobalt trading depots under construction. Through this engagement, the RMI increased understanding of human rights conditions and challenges in cobalt production and trade, learned more about how the cobalt supply chain works, engaged directly with local government, business and civil society on key challenges and solutions to responsible minerals production and trade, communicated the RMIâ€™s objectives and downstream expectations for and commitment to responsibly sourced cobalt, and learned about progress and

RMI in PPA Delegation to DRC and Rwanda

RMI delegation at OECD Workshop â€“ Delhi, India

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RMI Responsible Sourcing Summit â€“ Berlin, Germany

challenges from stakeholder meetings and site visits. In December 2019 the RMI participated in the PPA delegation, which took place in the DRC and Rwanda. The delegation visited artisanal mine sites and engaged key stakeholders across Kinshasa, Goma, Idjwi Island, Bukavu and Kigali. The focus of the trip was to discuss the importance of credible due diligence systems and better understand upstream initiatives that are impacting miners, communities and mining operations in tin, tantalum, tungsten and gold (3TG) production. A delegation of the RMI and its members also participated in the OECD and India Policy Center joint Indian Responsible Gold Sourcing Workshop in Delhi, India in December 2019. During the workshop India gold supply chain actors, including refiners, agreed to utilize existing OECD-aligned assessment programs, such as the RMI, and committed to undergo a responsible mineral sourcing audit by April 2021. The RMI held a side meeting to share information on the RMI Responsible Minerals Assurance Process with the gold refiners. The RMI delegation also organized preassessment visits to two new Indian gold refineries, as well as a follow-up visit to the first RMAP-conformant refiner in India, and a meeting with a cross-recognized LBMA refiner to discuss the RMAP and due diligence for responsible sourcing of minerals.

RISK MANAGEMENT The RMI further enhanced its Minerals Grievance Platform, which is a channel for identification, review and resolution of grievances, offering a connected

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

and efficient system that benefits a wide range of stakeholders and builds on existing mechanisms. In 2019 the initial platform scope covered 3TG smelters and refiners, the OECD Annex II risks, with plans for mineral scope and risk areas expansion in 2020, in alignment with the RRA. By the end of 2019 the platform included 15 downstream company users as well as RMI, LBMA, and RJC. The platform was formally launched in October 2019 at the RMI Annual Conference in Santa Clara, California, with the testing environment made available to users throughout 2019. The RMI continued to manage its own Grievance Mechanism with a standardized incident receipt and response process, and published data summaries for 2019 to RMI members. In 2019 the RMI logged 14 grievances as part of this process. The grievances included complaints against smelters/refiners, crude refiners, upstream and downstream actors, and mining operations, with risks including human rights issues, worst forms of child labor, 3TG from illegitimate sources, smuggling, other OECD Annex II risks, Dodd-Frank Act conflict risk, and various legal risks. The RMI worked with the parties in question to verify and mitigate issues raised in accordance with the Grievance Mechanism, including reviewing corrective actions, commencing in-depth assessments, conducting legal reviews, facilitating stakeholder engagement, addressing the issues through the RMAP audit process, encouraging respondents to issue public statements, and referring to the new grievance platform or partner mechanisms for resolution where appropriate.

Environmental Sustainability In 2019 the RBA continued to convene the industry around the concept of environmental maturity, a framework that outlines an environmental program’s ability to implement increasingly complex practices, achieve more robust and resilient programs, and quickly adapt new practices. Programmatic maturity follows a developmental “maturity curve” that spans from basic understandings, to leading practices. Additionally, maturity differs among programs, companies, and industries because of the unique obstacles they each must overcome. When a company is able to reflect on their own capacity, and identify where in their maturity journey their program is currently operating, they are empowered to create a clearer pathway for programmatic development that will achieve greater performance, resiliency to system failures, and ability to adapt to new challenges. When an industry pursues increased maturity together, they are able to achieve cleaner, more stable and reliable supply chains. In addition to developing a qualitative survey to help companies identify their environmental program’s maturity across a range of topics, the RBA developed an accompanying Environmental Resource Library, which organizes widely available environmental resources by topic and level of maturity. In combination, the RBA’s Environmental Maturity Profile will allow companies at all levels within the industry create their own developmental pathways to become better environmental stewards.

LEADER

ADVANCED

ESTABLISHED

EVOLVING

BASIC

Innovative approaches are implemented consistently across the company, and integrated into business offerings and culture. Programs are clearly structured with many leading practices consistently applied throughout the organization. Practices are considered a business differentiator.

Programs are pragmatically defined and consistently applied on several levels of the organization. Best practices achieve financial and business returns.

Some programmatic elements exist, but might be inconsistently applied or unstructured. Programs might use some industry-recognized best practices.

The program has some essential elements and primarily focuses on regulatory compliance. Ample opportunity exists for program development and improved resource efficiency.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

CIRCULARITY AND E-WASTE After an extended consultation with members and stakeholders, the RBA launched its first vision and mission specific to the topics of e-waste, the circular economy, and circular material movement. CIRCULARITY VISION: An integrated international supply chain that supports circular material use and protects human rights and the environment. CIRCULARITY MISSION: Convene members, suppliers, and stakeholders within forward and reverse supply chains to advance circular material use through joint initiatives that enable greater transparency into practices and measurement of material movements; advance supply chain capacity and networks for extended material viability and use; and drive responsible business conduct throughout circular material value chains.

The RBA’s circularity vision and mission reflect a strong focus on creating reliable supply chains of responsibly recycled and reclaimed materials and components for reintegration into manufacturing supply chains. The RBA believes it can create meaningful impacts in this phase of the circular economy by adding its vast experience in human rights, working conditions, and environmental protection in forward supply chains, to the constantly expanding reverse supply chains of the industry. The RBA has identified three initial focus areas that it will explore throughout 2020, with intent to begin building industry resources and programs into the future: • Data Standardization: Harmonize data metrics, methodologies, and inquiries to drive greater transparency and measurement into reverse supply chains’ performance and material movement, so that gaps and opportunities for safe expansion of circular material use can be identified. • Supply Chain Design: Convene actors across forward and reverse supply chains to evolve practices that lower barriers and optimize processes to achieve more efficient circular material use. • Greater Assurance: Provide greater assurance of adequate protection of human rights and the environment, allowing actors to make more informed decisions and create more globally inclusive circular supply chains. Because achieving a truly circular economy is complex, and requires the cooperation of industry actors and stakeholders at all levels and phases, the RBA will engage in meaningful partnerships where deeper analyses of the recycling and material sourcing challenges of the industry can be integrated into a wholly comprehensive circular economy that includes product design, consumer takeback, and other critical phases of a decoupled economy.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Chemical Management In addition to convening members and developing internal resources, the RBA engages stakeholders and partners on important issues of chemical management to develop pathways that advance industry practices and provide better protection for workers. Since 2016, the RBA has worked with the Clean Electronics Partnership Network (CEPN) as a multistakeholder forum of companies, academics, government and NGOs, to identify and develop solutions to common chemical management challenges throughout the industry. Through this partnership RBA has contributed to the development of resources that advance chemical management programs throughout all tiers and capacities of the industry’s supply chains. In 2019 the RBA offered two resources, developed through the collaboration with CEPN, to the broader industry through our membership and their supply chains to increase hazard assessments and the ability to perform risk assessments based on process chemical use. The Qualitative Exposure Assessment toolkit is a standardized and simplified hazard assessment that has been designed to remove the barriers of user experience and cost to promote industry-wide increases in initial assessment of potential chemical hazards.

The RBA also piloted a Process Chemical Data Collection tool as the first industry-wide data standard for reporting and sharing process chemical data, allowing companies to conduct advanced risk assessment on their own supply chains, demonstrate compliance to increasingly complex process chemical requirements, and provide industry-level insights on the amount of chemicals used and their applications. In addition to our partnerships that focused on the development of solutions, the RBA also hosted discussions to advance the integration of chemical management with the principles of workers’ rights. The RBA annual conference hosted Baskut Tuncak, the UN Special Rapporteur on hazardous substances and wastes, to engage in discussion on the UN Human Rights Council’s Principles on Human Rights and the Protection of Workers from Exposure to Toxic Substances. RBA members and workers’ rights groups discussed the challenges and imperatives in adequately protecting especially vulnerable populations of workers from hazardous exposure, without excluding them from opportunities within the workforce.

Public Procurement Changes are taking place across the world to support responsible business conduct, including public buyers using their purchasing powers to reflect the social and environmental values of their countries. These efforts are bolstered by laws that require mandatory due diligence, multi-country working groups on human rights, and the rise of government requirements to ensure responsible sourcing of minerals and labor. In 2019 the RBA hosted a roundtable that brought together nearly 100 people from around the world from governments, industry and civil society. The outcome of that meeting was a request for the RBA to harmonize the many indicators of transparency and make recommendations to companies on what they should publicly disclose. As a result, in the fall of 2019, the RBA published its Practical Guide to Transparency in Procurement. This guide goes beyond listing the indicators that companies should consider publicly disclosing; it provides a roadmap to transparency with

specific steps for companies to move up the maturity model from Good, to Better, to Best. The guide is available on the RBA website in five languages: English, French, German, Spanish and Swedish. In 2020 the RBA plans to create additional pathways for industry and public buyers to work together to achieve the shared goal of driving positive impact deeper into supply chains.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RBA at US Embassy in Kuala Lumpur, Malaysia

Public Policy With increasing pressure on companies to demonstrate responsible business conduct and due diligence in supply chains across the world, the RBA has correspondingly increased its public policy efforts with governments and intergovernmental organizations to highlight the value of industry collaboration in addressing supply chain issues. In 2019 the RBA increased advocacy in key regions, developed public-private partnerships and made the case that only through sustained collaboration with industry partners like the RBA can governments truly address key human rights challenges. The RBA also kept members informed of increasing requirements around human rights due diligence, particularly in Europe, and encouraged governments to build on existing industry tools and seek harmonization across new requirements.

HIGHLIGHTS OF 2019 INCLUDED: • Sustained engagement with the Malaysian government, encouraging them to meet international standards on forced labor due diligence and leverage RBA and RLI tools for firms employing foreign migrant workers.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

• Engaged the U.S. Department of Homeland Security regarding implementation of the ban on the importation of goods made with forced labor into the U.S., keeping them informed of industry best practices and efforts. Hosted a meeting between DHS officials and the RBA Board of Directors and RLI Steering Committee. • Developed a European advocacy effort across key member states, European Commission officials and members of the European Parliament, around their efforts on mandatory human rights due diligence, both at the EU and national levels. RBA efforts have sought to inform EC officials and EU legislators that member companies are working to expand effective human rights due diligence and that it is critical that any future EU-level effort incentivize and work on industry tools and best practices. • Met regularly with U.S. government officials charged with implementing the Federal Acquisition Regulation (FAR) to discuss issues related to human trafficking.

RBA-U.S. Government Meeting – Alexandria, Virginia

RBA at Modern Slavery Conference – London, England

• Partnered with the OECD and the United Nations Development Program (UNDP) to host a presession for industry, represented industry in the opening plenary and led a supply chain due diligence panel at the Bangkok Responsible Business and Human Rights Forum (RBHR). • Provided input into various government consultations including with the United Kingdom regarding reform of the UK Modern Slavery Act, with the Canadian government on efforts to address forced labor, with the U.S. government on its Trafficking in Persons (TIP) report, and with the Finnish government during its Business and Human Rights: Towards a Common Agenda for Action conference.

RBA at ILO Event – Bethlehem, Pennsylvania

• Deepened collaboration with inter-governmental organizations such as the OECD and ILO, highlighted by cooperation with the OECD Responsible Business Center in various areas such as responsible business conduct in Asia and Latin America, public procurement, minerals, forced labor and the environment. • Successfully engaged stakeholders and legislators in Oregon to ensure the Oregon Conflict Minerals bill affecting contractors to Oregon state procurement was in line with OECD standards.

• Participated in the 2019 United Nations Forum for Business and Human Rights, speaking in a high-profile session on public procurement and responsible business conduct.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Stakeholder Engagement Seeking outside input, understanding stakeholder perspectives, and sharing industry points of view are crucial to finding common ground and identifying viable solutions that can affect positive change in global supply chains. In 2019 the RBA continued its engagement with civil society groups, trade unions and other worker-focused groups, academia and research institutions, socially responsible investors, and governmental and multilateral institutions.

KEY EFFORTS IN 2019 INCLUDED: • Met with numerous public buyers, especially in Europe, to encourage the use of RBA tools for procurement purposes related to social and environmental criteria in contracts. • Held stakeholder roundtables at RBA and other external events. • Facilitated discussions between member companies, their suppliers and stakeholders to resolve specific and facility-level issues affecting workers. • Increased engagement with institutional investors around environmental, social and governance (ESG) issues. • Hosted stakeholder webinars on relevant reports, developments and emerging issues. • Engaged various benchmarks, including Know the Chain (KTC) on its 2020 ICT Benchmark study, and the Corporate Human Rights Benchmark (CHRB) for its pilot studies on the ICT and automotive industries.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

By the end of 2019, there were 45,466 total user accounts and 90,500 course completions since the Learning Academy launched in 2014.

Training And Capability-Building RBA LEARNING ACADEMY In 2019 there were 3,982 new accounts created and 17,846 courses completed in the RBA Learning Academy, bringing the total to 45,466 user accounts and 90,500 course completions since the Academy launched in 2014. On average, there were 653 monthly active users. In 2019, more members took advantage of the custom-branding feature, member material hosting and new RBA learning paths. Feedback on the underlying system and the relevancy and usefulness of the courses continues to be very positive.

New Courses The RBA launched several new online courses in the Learning Academy in 2019, on topics including: the RBA’s Supplemental VAP (SVAP) on Forced Labor; RBA Introduction and RBA Risk Assessment Process; a Pre-Departure Orientation series (“What to Know Before You Go”), focused on Malaysia and available in several languages; Forced Labor Prevention for Factories; and Introduction to Human Rights. The existing RBA Code of Conduct course was also translated into additional languages.

THE TOP 10 COURSES IN 2019

In late 2019 development work began on new RBA courses around working hours and no-fees guidance, which will be made available in 2020. Also in 2020, the RBA will launch its Factory Lead Certification Level 2 and plans additional development or updates in conjunction with the Code of Conduct review process taking place in 2020.

(in order of completions)

RBA COURSE 6: RBA Corrective Action Plans RBA COURSE 5: RBA Validated Audit Process RBA CODE OF CONDUCT - Environment RBA CODE OF CONDUCT - Ethics RBA CODE OF CONDUCT - Labor RBA CODE OF CONDUCT - Health and Safety RBA CODE OF CONDUCT - Management Systems FORCED LABOR 1: Recognizing Forced Labor FORCED LABOR 2: Preventing Forced Labor HEALTH & SAFETY 1: Health and Safety Management Systems

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

IN-PERSON TRAININGS The RBA holds in-person trainings around the world on its Code of Conduct, VAP Audits, and Supplemental VAP on Forced Labor. In 2019 we held trainings for 666 participants, compared with approximately 431 in 2018 and 260 in 2017. The trainings in 2019 were held in: Bangkok, Thailand; Bengalaru, India; Guadalajara, Mexico; Ho Chi Minh, Vietnam; Penang, Malaysia; Prague, Czech Republic; Seoul, South Korea; Shanghai, China; Shenzhen, China; Taipei, Chinese Taipei; Tokyo, Japan; and Virginia, USA.

Guadalajara, Mexico

Prague, Czech Republic

Bengalaru, India

Penang, Malaysia

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Ho Chi Minh City, Vietnam

Arlington, USA

Bangkok, Thailand

Shenzhen, China

Shanghai, China Penang, Malaysia

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Responsible Business 2019 The RBA and RMI 2019 annual conferences and member meetings that took place at the Santa Clara Convention Center in Santa Clara, California had more than 700 registrants. Thank you to all who came, spoke and represented their organizations as we discussed crucial issues related to responsible business conduct and sustainability in global supply chains. October 21 began with a new member breakfast, where companies that had joined since the previous conference were able to meet with staff and other members to hear the latest updates on RBA programs and tools and the many opportunities to actively participate in the organization such as through work groups and task forces. RBA Executive Director Rob Lederer kicked off the RBA conference in the main ballroom, highlighting the 15-year anniversary of the RBA and outlining the agenda for the days ahead. He then introduced Dave Mosley, CEO of Seagate, who spoke about trends and challenges facing the industry.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Malaysia’s Minister of Human Resources, YB Tuan M. Kula Segaran, gave a high-level address about his government’s efforts to implement reforms and work with key stakeholders and the RBA as part of his country’s war on forced labor. Dr. Xiaolu Hsi, a senior staff psychologist and neuropsychologist at MIT’s Mental Health and Counseling Services and a clinical supervisor in psychology at Massachusetts Mental Health Center/ BIDMC, Harvard Medical School, gave the keynote address at Responsible Business 2019. Dr. Hsi spoke about the changing makeup of workers in manufacturing and the changing mindset of today’s workers in Asia. The keynote was followed by a panel discussion on the role of retailers in driving responsible business conduct, with representatives from Walmart, The Home Depot, and Best Buy. As the RBA conference moved into concurrent breakout sessions following the retail panel, the

Responsible Minerals Initiative kicked-off its annual conference, providing an update on the RMI, and introduced the Responsible Minerals 2019 keynote speaker. RMI keynote speaker Nuskmata (Jacinda Mack) from the Secwepemc and Nuxalk indigenous peoples, of modern day British Columbia, Canada talked about Indigenous Systems Change and Social Corporate Responsibility. General panel sessions followed the RMI keynote, on topics ranging from expectations for responsible mineral production and sourcing, to scaling on-theground projects. The panel on global regulatory and policy updates featured representatives from the the DRC Ministry of Mines, the U.S. Department of State, and the ICGLR.

October 22 was filled with numerous, concurrent breakout sessions at both the RBA and RMI conferences. The closing keynote speaker Sara Vetter, from the Soul of Money Institute, challenged the audience to expand their philanthropy efforts. That evening, the RBA held its second annual Compass Awards ceremony and the RBA and RMI Members-Only Meetings were held the following day. View photos from Responsible Business 2019 and Responsible Minerals 2019 on our Flickr page and watch the RBAâ€™s 15th Anniversary Video on our website.

That evening, everyone gathered in the exhibit hall/ registration area for a welcome reception celebrating the 15th anniversary of the Responsible Business Alliance.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Compass Awards

The finalists and winners of the second annual RBA Compass Awards were honored during a ceremony at the Responsible Business 2019 annual conference in Santa Clara, California. Once again, the Compass Awards were very competitive in 2019. The finalists and winners were chosen by an independent panel of judges from among many strong submissions based on their demonstrated efforts and results that exemplified the vision and mission of the RBA.

FINALISTS: Leadership Finalists: Cisco, Dell and Signify. Innovation Finalists: Best Buy, Microsoft, and Volvo Car Group. Implementation Finalists: Flex, Micron, and Microsoft. WINNERS: Leadership Winner: Dell – Accelerating the Circular Economy with Rare Earths Minerals Innovation Winner: Volvo Car Group – Pioneering Complete Traceability for Cobalt Used in Electronic Vehicles Implementation Winner: Microsoft – Climate Change Leadership Through Collaboration and Capacity Building

2019

The RBA launched the Compass Awards for members, their suppliers and factories, in 2018. Its primary objective is to recognize and encourage efforts that lead to meaningful, positive change in line with the RBA’s vision and mission. The awards program celebrates corporate social responsibility excellence across three categories: Leadership, Innovation, and Implementation. In the Leadership category, RBA members must demonstrate a high-level commitment to corporate social responsibility (CSR), embedding it as a core business practice and supporting it with a large investment in time, money or other resources. The Innovation category requires members, with or without partners, to show a highly effective program that represents an innovative solution to a CSR challenge. The Implementation category is open to any factory, member or supplier facility that can demonstrate an impressive application of CSR at the site level that is well-documented and repeatable by other sites.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Meetings And Events Worldwide Hosting and participating in events around the world are two of the many ways the RBA supports the mission and vision of the organization while promoting its Code of Conduct, programs, initiatives and tools as well as the great work of its members. The below are just a small sample of the meetings and events the RBA held or participated in during 2019. For upcoming RBA events, please visit the events section of our website.

RBA OUTREACH MEETINGS AND EVENTS

Throughout the year the RBA held outreach meetings and other events geared toward members, non-member companies and suppliers in: Bengalaru, India; Berlin, Germany; Brussels, Belgium; Guadalajara, Mexico; Penang, Malaysia; Sydney, Australia; Taipei, Chinese Taipei; Tokyo, Japan and elsewhere.

RBA Outreach Meetings

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RBA AT UN FORUM ON BUSINESS AND HUMAN RIGHTS Geneva, Switzerland The RBA participated in the annual United Nations Forum on Business and Human Rights, which took place from November 25-27 in Geneva, Switzerland. The RBA presented its work on public procurement in a high-level session, “Promoting respect for human rights through sustainable public procurement,” organized by the OECD and the Danish Institute for Human Rights on November 26. The RBA also cohosted, along with other business organizations, the Business Briefing and Networking Event on November 25 at ILO Headquarters.

RBA AT IJM CONFERENCE Berlin, Germany On November 14 the RBA participated in an International Justice Mission (IJM) conference in Berlin, Germany that examined how business and non-governmental organizations can work together to combat slavery in global supply chains. The event was an opportunity for the RBA to provide examples of successful partnerships with civil society and efforts to tackle forced labor. The RBA also facilitated

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

a breakout session on success factors for business and NGO partnerships and met with the German government to discuss its plans for potential due diligence regulations.

RBA at CESA CSR Summit Beijing, China The RBA participated in the China Electronics Standardization Association’s 7th Annual China Electronics and Information Technology Industry CSR Summit in Beijing, China on August 28. The RBA presented an overview of the organization, its Code of Conduct, programs, initiatives and tools to support responsible supply chains in China and globally.

RBA AT OECD-ILO-UN FORUM Bangkok, Thailand From June 11-13 the RBA participated in the Responsible Business and Human Rights Forum in Bangkok, Thailand. The Forum was co-organized by the OECD, ILO and United Nations and supported by the government of Thailand. During the opening plenary, the RBA provided views on the role of business in helping to achieve the Sustainable Development Goals (SDGs), stressing the importance of collaboration among all actors to address sustainability challenges.

RBA-JEITA MEETING Tokyo, Japan

RBA AUDITOR SUMMIT Hong Kong, China

While in Japan for an RBA Outreach meeting, staff met with approximately 25 representatives from the Japanese Electronics and Information Technology Industries (JEITA) membership. Staff provided an update on current RBA activities and answered questions, ranging from RBAâ€™s perspective on emerging issues in the responsible minerals sourcing space, to best practices for complying with specific provisions of the RBA Code of Conduct.

On March 6, the RBA held an Audit Partners Engagement Summit in Hong Kong, China. The summit was an opportunity for discussions with the RBAâ€™s audit firm partners and to provide information about the VAP Operations Manual, Auditor Guidebook, tools and technology, and other programmatic updates. One of the highlights of the summit was a breakout session where audit firms and RBA staff discussed key areas for collaboration.

RBA AT MODERN SLAVERY CONFERENCE London, England On March 27 RBA staff participated in the 2019 International Conference on Tackling Modern Slavery, Forced Labour and Human Trafficking in Public Sector Supply Chains. The event was co-sponsored by the Organization for Security and Co-operation in Europe (OSCE), Ethical Trading Initiative and the UK government. The RBA spoke during the high-level plenary session and in a breakout session on the electronics sector, providing an overview of its public procurement efforts to align public buyers, civil society and companies around RBA tools and programs.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RBA-Online Continuing our commitment to provide high quality, advanced technology solutions to members and their suppliers, a project to implement a major upgrade to RBAOnline, our primary online sustainability data management system, was well underway during 2019. One of the hallmarks of the RBA-Online system is that the platform allows factories to perform a single assessment or audit and share it with many customers. This allows them to devote more resources to performing improvement actions and capability-building, instead of preparing for additional assessments. The new RBA-Online system launched in the first quarter of 2020 with a series of enhanced features designed to provide greater support for companies’ due diligence and social responsibility efforts: • A new, more intuitive user interface • Improved system performance • A new Data Analytics module • Full integration of RMI Assessment workflows • RBA Membership Compliance reporting • Streamlining of the VAP Audit operations • E-signature capabilities for processing workflow documents • Specialized support for RLI and RFI Members as well as RBA members • Customizable surveys with targeted deployment

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

RBA Risk Assessment Platform In 2019, the RBA launched a new online system that enables members to quickly perform high-level risk assessments on a large number of companies in their supply chains. By completing and uploading a template into the system with some basic information about each supplier, such as product or service provided, location of the facility, and spend level, the RBA Risk Assessment platform provides an immediate inherent risk score for each company. The risk scores are computed using a proprietary methodology that combines geographic risk indices, third-party audit results, and a combination of leverage factors to produce a risk rating that can be used to benchmark

suppliers against the norm. These results are used by members to provide decision support regarding where to apply their resources for supply chain sustainability efforts. There are a number of additional high-value features in the system, including: • Customizable risk maps, which color-code global regions based on specified risk factors • Advanced analytics to help pin-point high-risk suppliers • Integration with RBA-Online to provide risk ratings for suppliers in other RBA systems • Country risk comparison tools

RELATIVE RISK

SEGMENTED RISK

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Validated Assessment Program For the Validated Assessment Program (VAP), 2019 was a year of continued collaboration with members and audit firm partners on improvements to meet the growing expectations of our flagship audit program in a continually evolving environment. The VAP saw its largest volume to date in 2019, completing 1,007 audits across 38 countries. This represents a 23 percent increase from the total number of VAP audits conducted in 2018. The growth was attributed in part due to the increasing needs of members and the addition of new members, maturation of the SVAP on Forced Labor audit, and the Audit Cooperation Program (ACP). In 2019, the RBA enhanced its Audit Cooperation Program (ACP), which allows members to nominate suppliers for a shared VAP audit to reduce audit redundancy and fatigue, to extend the categories of suppliers and improve the process for participation. As a result, 22 members nominated 1,520 suppliers for the ACP, with a final outreach to 817 unique suppliers. Of those, 351 completed audits in 2019. Efforts to reduce VAP audit report cycle time without sacrificing quality continued as a major priority in 2019. Changes to report writing, internal quality control efforts, and the revision of the standardized report template resulted in substantial decreases in report cycle times by more than 30 percent. To further improve the quality of VAP audits, RBA staff and the RBA-approved audit firms engaged in regular meetings to discuss KPIs, common issues and updated guidance. In addition to a focus on auditor issues, the RBA enhanced its feedback loop process for auditees, providing four mechanisms for auditees to provide input, dispute findings or ask guidance-related questions related to the audit. All of these learnings were integrated into a comprehensive training program, comprised of 18 in-person auditor training sessions worldwide in 2019. The RBA also updated its auditor guidebook to ensure the highest level of quality, local language and legal knowledge, and subject matter expertise. In order to meet the increasing demand for VAP audits, the RBA increased the number of approved audit firms from 10 to 12, representing nearly 450 auditors in 22 countries. To mirror the expanding market outside of China, the RBA focused capacity-building efforts in Southeast Asia, the Americas, and parts of the Middle East.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

VAP Audits: By The Numbers VAP AUDITS PERFORMED

AVERAGE AUDIT SCORE

1,007

n INITIAL AUDITS n CLOSURE AUDITS

656

764

162

160

818 531

143

530 125

122 110

351 287 234

2017

2018

2017

2019

2018

2019

The total number of VAP audits performed in 2019 increased to 1,007 versus 822 in 2018 and 786 in 2017.

2019 AUDITS BY LOCATION 53%

CHINA

CHINESE TAIPEI MALAYSIA

THAILAND

INDIA

MEXICO

UNITED STATES

JAPAN

SINGAPORE

SOUTH KOREA

OTHER COUNTRIES

12%

In 2019, factories in China continued to represent the majority (53 percent) of all audits conducted, with the next highest percentages of audits conducted in Chinese Taipei (7 percent), Malaysia (6 percent), and Thailand (6 percent).

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

VAP Audits: By The Numbers 2019 VAP FINDINGS BY SECTION

Occupational • Safety

• Wages and Benefits

6.19%

8.48%

• Freely Chosen Employment

5.55%

• SupplierResponsibility

Emergency • Preparedness

5.14%

10.24%

• Occupational Injury and Illness

4.75%

• Hazardous Substances

3.95%

Working Hours •

• Food, Sanitation and Housing

14.70%

2.98%

• Energy Consumption and Greenhouse Gas Emissions

2.57%

• Legal and Customer Requirements

2.08%

• Industrial Hygiene

2.08%

• Non-Discrimination

2.51%

Other (30 Sections Below)

Training

1.21%

Physically Demanding Work

0.59%

Worker Feedback and Participation

1.20%

Privacy

0.53%

1.85%

Communication

1.19%

Responsible Sourcing of Minerals

0.53%

1.63%

Health and Safety Communication

1.05%

Disclosure of Information

0.51%

Risk Assessment And Risk Management

1.57%

Pollution Prevention and Resource Reduction

Humane Treatment

0.47%

0.91%

Audits And Assessments

1.52%

Company Commitment

0.44%

Machine Safeguarding

0.91%

Improvement Objectives

1.47%

Intellectual Property

0.42%

Solid Waste

0.90%

No Improper Advantage

1.32%

Documentation and Records

0.42%

Freedom of Association

1.29%

Protection of Identity and Non-Retaliation

0.66%

Corrective Action Process

0.41%

Storm Water Management

1.26%

Business Integrity

0.65%

Materials Restrictions

0.10%

Environmental Permits and Reporting

1.23%

Fair Business, Advertising and Competition

0.62%

Air Emissions

Management Accountability and Responsibility Child Labor Avoidance

1.93%

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

VAP Audits: By The Numbers TOP FINDINGS IN COUNTRIES WITH THE MOST RBA AUDITS COUNTRY

SECTION

Working Hours

19%

CHINA

Emergency Preparedness

10%

Occupational Safety

Wages and Benefits

Emergency Preparedness

20%

CHINESE TAIPEI

Working Hours

15%

Occupational Safety

Freely Chosen Employment

15%

MALAYSIA

Working Hours

10%

Supplier Responsibility

Food, sanitation and housing

Working Hours

20%

THAILAND

Occupational Safety

10%

Emergency Preparedness

10%

Freely Chosen Employment

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Annual Sensing Results As in past years, the RBA worked with BSR to conduct its annual sensing project, which is one of the many inputs the RBA uses monitor issue areas important to members and stakeholders. Inputs included quantitative surveys of RBA members and stakeholders, VAP and SAQ results, in-depth interviews with industry and issue experts, analyses of NGO and IGO reports, and media coverage, as well as other qualitative assessments.

The top 4 issues overall in 2019 were the same as in 2018. Forced Labor and Human Trafficking remained the top-rated issue for the fourth year in a row and has been in the top 5 for the past 5 years. It also rose in position on the heat map in 2018 and then again in 2019 (see opposite page). In 2019 Climate Change became the first environmental issue ever to make it into the top 5, narrowly edging out Occupational Safety.

In 2019 we tested 32 issues across the four broader categories of Labor and Human Rights, Health and Safety, the Environment, and Governance and Ethics. Every one of these issues is important, but some were more relevant to our membersâ€™ supply chains in 2019 and thus more of a focus than others. In the sensing maps on the opposite page, the further to the right an issue is, the more important it is to our members and the higher it is, the more important it is to stakeholders. For the purposes of this exercise, we are therefore most interested in identifying issues that are in, or are moving toward, the upper-right quadrant because those are most important to members and stakeholders alike.

The biggest movers in a positive direction (upward and/or toward the right) in 2019 were: Climate Change; Forced Labor and Human Trafficking, which also rose in 2018; Diversity and Equal Opportunity, which almost made it into the upper-right quadrant; and Energy Management. The biggest movers in a negative direction (downward and/or to the left) in 2019 were: Waste and Effluents; Water Management and Stewardship; Anti-Corruption; and Ethical Sourcing of Raw Materials, which despite trending downward remained in the top quadrant and rose higher on the Y axis.

TOP 5 OVERALL ISSUES FOR 2019 AND 2018 in descending order

2019

2018

1. Forced Labor and Human Trafficking

2. Working Hours

3. Safe Use of Hazardous Substances and Chemicals

4. Conflict Minerals

5. Climate Change

5. Occupational Safety

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Importance to Supply Chain Sustainability

2019 RBA SENSING ASSESSMENT MAP

Importance to RBA Member Companies n Labor and Human Rights

n Health and Safety

n Environment

n Governance and Ethics

Importance to Supply Chain Sustainability

2018 RBA SENSING ASSESSMENT MAP

Importance to RBA Member Companies n Labor and Human Rights

n Health and Safety

n Environment

n Governance and Ethics

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

New Websites for RBA and RMI Although the RBA and RMI websites were updated in 2017 with basic content, color and logo changes in conjunction with the rebrand from EICC to RBA and CFSI to RMI that October, both sites were due for more substantial overhauls in terms of structure and aesthetics. The new RBA and RMI websites launched in January and October of 2019, respectively, with more intuitive navigation, updated content, advanced features and improved search-engine optimization. Member feedback was very positive as users found the sites more modern, easier to navigate, and a better reflection of our brand.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

New Communications Capabilities To further enhance and diversify communications with members, prospective members, suppliers and stakeholders, we launched a video series and podcast in 2019. The video series, RBA Today, features a short news program format for updates on the RBA and its initiatives. It uses green-screen capabilities to overlay virtual studio graphics and is filmed in a studio at the RBAâ€™s headquarters. The videos are available on the RBA website, Vimeo and YouTube channels.

View the latest RBA Today episodes at responsiblebusiness.org/video Our podcast, RBA On Air, is an interview-style program featuring in-depth conversations with guests from industry, civil society and government. The podcast studio is located at RBAâ€™s headquarters, but we also do remote and on-location interviews around the world. The podcasts are available on the RBA website as well as via major streaming services: Android, Apple Podcasts, Google Play, iHeart Radio, Spotify, Stitcher, and Tunein. Listen to the latest RBA On Air episodes at responsiblebusiness.org/podcast

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Membership Growth The RBA continued to experience tremendous membership growth in 2019, welcoming 26 new members and ending the year with 150, not counting the members of RBA initiatives. New members for 2019 are headquartered in Australia, Brazil, Canada, Germany, Japan, Malaysia, Netherlands, Sweden, and the United States.

RBA MEMBERS’ HEADQUARTERS IN 2019

UNITED KINGDOM •

CHINESE TAIPEI •

11%

SWITZERLAND 1% • SWEDEN •

SINGAPORE •

NETHERLANDS •

2019

MALAYSIA •

KOREA •

JAPAN •

HONG KONG •

GERMANY • FRANCE •

ENGLAND •

• CHINA

• CANADA

• AUSTRALIA

• BRAZIL

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

• USA

54%

FY 2019 Financial Highlights 15%

•

OTHER

17%

•

RMI

2019 OPERATING REVENUE

$16,628,340

•

35%

MEMBERSHIP DUES

•

33%

VAP AUDITS

29% •

ISSUES MANAGEMENT

2019 OPERATING EXPENSES

•

$15,732,314

48%

COMPLIANCE

10% •

LEARNING & CAPABILITIES

9% •

ADMINISTRATION

•

MARKETING & COMMUNICATIONS

*The RBA’s fiscal year runs from January 1 through December 31.

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

Senior Leadership, Board and Staff BOARD OF DIRECTORS 2019 Paula Pyers

Head of Sustainability, Google Hardware, Google

Joan Motsinger

Vice President, International Human Resources, Western Digital Corporation

RBA Board Vice-Chair, and Senior Vice President, Business Excellence, Seagate Technology, LLC

Eric Austermann

Michael Meston

Eric-Paul Schat

RBA Board Treasurer, and Vice President, Jabil

Senior Director, Sustainability, Environmental Health & Safety, NXP Semiconductors

Jennifer Allison

Adam Schafer

RBA Board At-Large Representative, and Vice President, Supply Chain Sustainability, Dell Technologies

Director, Supply Chain Sustainability, Intel Corporation

Anthony DePaoli

Director, Supply Chain Sustainability, Ford Motor Company

Vice President, Compliance, Amkor Technology

Harinder Jeet Kaur

Global Social Responsibility Director, Molex

Anna Meegan

RBA Board Chair, and Senior Director, Supplier Responsibility, Apple Inc.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Jacklyn Watt

RBA STAFF AS OF M AY 2 0 2 0 Rob Lederer

Ka Ea Lim

Deborah Albers

Alexandra Cech

Bob Mitchell

Catherine Tyson

Leah Butler

Sherlin Shi

Christine Briscoe

Mann Chyun Sim

Executive Director Vice President Vice President Vice President

Vice President, Member Services and Human Resources

Jarrett Bens

Director of Communications

Carlos Busquets

Director of Public Policy

Kenneth Anderson

Director of Information Technology

Jack Cutts

Director of Data Science and Research

Juan Carlos Martinez

Director of Audit Operations

Laura Landrau

Director of Meetings

David Yeung

Director of Training Services

Andy Chiu

Director of Audit Assurance

Marianna Smirnova

Director of Standards and Assurance

Lawrence Heim

Director of Innovation and Partnerships

Bart Devos

European Director

Daniel Reid

Senior Environmental Program Manager

Khai Yau Chua

Senior Program Manager Senior Project Manager Program Manager

Senior Account Manager Senior Account Manager

Nirmaladevi Krishnamoorthy Quality Assurance Manager

Cinlla Huang

Quality Assurance Manager

Whitney Chan

Quality Assurance Manager

Ross Landis

Database Project Manager

Surya Herny Mahdzir VAP Program Manager

Karina Beltran Romero Membership Coordinator

Gavin Wu

Program Coordinator

Diana Trigo

RMI Program Specialist

Charles Teh

VAP Program Associate

Kyle Rand

Software Support Technician

Steve Moloney

Chief Financial Officer

Anastasiia Olvera Accounting Manager

Antionette Adams

Accounting/Database Clerk

Senior Program Manager

RES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

RBA Members AS OF MAY 2020 AcBel Polytech Inc.

Facebook

NetApp

Acer Inc.

Fairphone B.V.

Netgear

Advanced Micro Devices

Fitbit, Inc.

New Kinpo Group

Advania AB

Flex

Nexperia

Allegro MicroSystems, LLC

Ford Motor Company

Nielsen

Alphabet Inc.

Foxconn

Nikon Corporation

Altria Client Services LLC

Fujitsu Limited

Nvidia Corporation

Amazon.com Inc.

Funai Electric Co., Ltd.

NXP Semiconductors

Amkor Technology, Inc.

GlobalFoundries

ON Semiconductor

3M Electronics and Energy Business Group

Amphenol Corporation

Hasbro, Inc.

Oracle America, Inc.

Tokyo Electron Limited

Analog Devices, Inc.

Hewlett Packard Enterprise

Orbotech Ltd.

TomTom International BV

Apple, Inc.

Hi-P (Xiamen) Precision Plastics Manufacturing Co., Ltd.

Pegatron

Toshiba Corp.

Hisense USA Corporation

Philips

TT Electronics Plc

Plexus Corp.

V.S. Plus Sdn Bhd

Poly

Veritas

Positivo Tecnologia S.A.

VIAVI Solutions Inc.

Powertech Technology Inc.

Vishay Intertechnology, Inc.

Pure Storage, Inc.

VIZIO Inc.

Qorvo, Inc.

Volvo Car Group

Qualcomm

Walmart

Quanta Computer Inc.

Western Digital

Ricoh Company Ltd.

Wistron Corp.

Samsung Electronics

Xerox

Sanmina

XP Power LLC

Schneider Electric

Zebra Technologies Corporation

Seagate Technology

ZTE (USA), Inc.

Applied Materials Arista Networks, Inc. Arlo Technologies, Inc. ARRIS ASE Technology Holding Co., Ltd. ASM International ASML Holding ASUSTeK Computer Inc. Atea ASA Avaya Inc. BCE Inc. Best Buy BMW Group Bose Corporation Brother Industries Ltd. BT plc Cadence Design Systems Canon Inc. Celestica Chicony Electronics Co., Ltd. Ciara Technologies Ciena Limited Cirrus Logic, Inc. Cisco Systems Inc. Citrix Systems Compal Electronics, Inc. Cypress Semiconductor Corp. Dell Technologies Dustin AB Edwards Ltd EIZO Corporation EMEA Ericsson Fabrinet

HP Inc. Huawei Technologies Co., Ltd. IBM Corporation Infineon Technologies Americas Corp. Insight Enterprises, Inc. Intel Corporation Inventec Corporation iRobot Corporation Jabil Jasco JB HI-FI Limited JK Imaging Ltd. Juniper Networks Keurig Dr Pepper Keysight Technologies, Inc. Kingston Technology KLA Tencor Konica Minolta, Inc. Lam Research Corporation Lenovo Lexmark LG Electronics Logitech Inc. Longwell Company Lumentum Holdings Inc. Marvell Technology Group Ltd Media-Saturn-Holding GmbH Micron Technology, Inc. Microsoft ModusLink Molex Incorporated Motorola Solutions, Inc.

R E S P O N S I B L E B USINE SS AL L IANCE 2019 ANNUAL REPORT

Seiko Epson Corporation Semtech Corporation Senju Metal Industry Co., Ltd. Sierra Wireless, Inc. Signify Siltronic AG Simatelex Manufactory Co. Ltd. SK Hynix Inc. - Icheon Sky CP Ltd Skyworks Solutions, Inc. SMART Modular Technologies, Inc. Snap, Inc. Sony Corporation STMicroelectronics N.V. International Sumitomo Electric Industries, Ltd. Symantec Synopsys, Inc. Taiwan Chinsan Electronics Industrial Co., Ltd.

Taiwan Semiconductor Manufacturing Company, Ltd. (TSMC) TCL North America TDK Corporation Technicolor SA Tesla, Inc. Texas Instruments

To learn more about the RBA, visit ResponsibleBusiness.org and contact us at membership@responsiblebusiness.org.

R ES PONS IBLE BUSINES S A LLIA NCE 2019 ANNUAL REPORT

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R E S P O N S I B L E BUSINE SS AL L IANCE 2019 ANNUAL REPORT