Cost-Benefit Analysis and the Conflict Minerals Rule

In § 1502 of Dodd-Frank, Congress instructed the SEC to draft rules requiring public companies to disclose their use of “conflict minerals” originating in and around the Democratic Republic of the Congo (DRC). Coined the Conflict Minerals Rule, the statute is based on the notion that investor accountability paves the way for socially conscious corporate behavior. The suspicion was that money from U.S. companies was flowing to warlord-controlled mines in the region and thereby fueling human rights abuses by such groups. The hope was that improved transparency ushered in by the Rule would cause companies to turn off the spigot.… Read more