UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM SD

Specialized Disclosure Report

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GENTHERM INCORPORATED

(Exact name of registrant as specified in its charter)

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Kenneth J. Phillips, Vice-President and General Counsel, (248) 504-0500

(Name and telephone number, including area code, of the person to contact in connection with this report)

 

Check the appropriate box to indicate the rule pursuant to which this form is being filed, and provide the period to which the information in this form applies:

 

☒  Rule 13p-1 under the Securities Exchange Act (17 CFR 240.13p-1) for the reporting period from January 1 to December 31, 2016.

 

 

 

 

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Section 1 – Conflict Minerals Disclosure

Item 1.01 Conflict Minerals Disclosure and Report  

 

A copy of the Conflict Minerals Report of Gentherm Incorporated for the reporting period January 1, 2016 to December 31, 2016 is provided as Exhibit 1.01 hereto and is publicly available at http://www.gentherm.com/en/page/sec-filings. The information included in such Conflict Minerals Report is incorporated herein by reference herein.  This Form SD, including Exhibit 1.01 attached hereto, contains references to our website; however, the information on our website is not incorporated by reference into this Form SD or Exhibit 1.01.

 

Item 1.02 Exhibit

The Conflict Minerals Report as required by Item 1.01 of Form SD is filed herewith as Exhibit 1.01.

 

Section 2 – Exhibits

Item 2.01 Exhibits

Exhibit 1.01 Conflict Minerals Report as required by Items 1.01 and 1.02 of this Form SD.

 

 

 

 

 

 

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the duly authorized undersigned.

 

 

 

Date:  May 24, 2017

 

 

 

Exhibit Index

 

Exhibit 1.01

 

 

Conflict Minerals Report of Gentherm Incorporated

 

This Conflict Minerals Report of Gentherm Incorporated (“Gentherm”, “we”, or the “Company”) covers the reporting period from January 1 to December 31, 2016.  This report was prepared in accordance with Rule 13p-1 under the Securities Exchange Act of 1934.  

 

Business Overview

 

The Company is a global technology and industry leader in the design, development, and manufacturing of innovative thermal management technologies. Our primary products, which provide thermal conditioning of seats, can be found on the vehicles of nearly all major automotive manufacturers.  We also use similar technologies on other products that provide thermal comfort or create power from thermal sources.  

 

Due Diligence Framework and Overview

 

We undertook due diligence on the source and chain of custody of the tantalum, tin, tungsten, and gold (“Conflict Minerals” or “3TG”) we use when producing our products.  We designed our due diligence to conform to an internationally recognized due diligence framework, the Organization for Economic Co-operation and Development (OECD) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, Second Edition, and related supplements (“OECD Framework”).

 

The OECD Framework divides the entire conflict mineral supply chain into upstream and downstream entities.  An upstream entity is within the conflict minerals supply chain from the mine to the smelter or refiner and includes miners, local traders, and exporters from the country of mineral origin, international concentrate traders, mineral processors, smelters and refiners.  A downstream entity is within the conflict minerals supply chain from when the mineral leaves the smelter or refiner to when it arrives at the retailer and includes metal traders and exchanges, component manufacturers, product manufacturers, original equipment manufacturers, and retailers.  

 

The Company is a downstream entity and is typically several tiers removed from the smelter or refiner and mineral origin.  We have limited visibility beyond our direct suppliers to entities within the supply chain.  Therefore, we rely principally on our direct suppliers to provide us with sourcing information.  

 

We conduct a portion of our due diligence using tools and relying on information provided by the Conflict-Free Sourcing Initiative (“CFSI”), an industry group that works to address Conflict Minerals issues within supply chains.  One tool we use is the Conflict Minerals Reporting Template (“CMRT”), which facilitates the collection of information on the source of Conflict Minerals.  We also rely on information from the Conflict-Free Smelter Program, a voluntary initiative in which an independent third party audits the procurement activities of a smelter or refiner to determine with reasonable confidence that the minerals it processes originated from conflict-free sources.    

 

Due Diligence Process  

 

The OECD Framework provides a five-step framework for risk-based due diligence in the mineral supply chain.  Using this framework, we list below the actions we took to exercise due diligence on the sourcing of Conflict Minerals we used when manufacturing our products.

 

Step 1 - Establish strong company management systems

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Step 2 - Identify and assess risks in the supply chain

 

Step 3 - Design and implement a strategy to respond to identified risks

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Step 4 - Carry out independent third-party audits of suppliers due diligence practices

Step 5 - Report annually on supply chain due diligence

 

RCOI and Due Diligence Measures Performed

 

The Company’s Reasonable Country of Origin Inquiry (“RCOI”) was designed to determine whether the Conflict Minerals, which are necessary to the functionality or production of a product manufactured (or contracted to be manufactured) by the Company, originated in the Covered Countries. The Company performed a good faith, risk-based, global scoping exercise to identify suppliers that were considered in-scope and subject to RCOI in the 2016 calendar year. Through communications with these suppliers, the Company attempted to identify smelters and refiners of Conflict Minerals that may be utilized in its products.

 

The Company’s RCOI and due diligence employed a combination of measures to determine whether the necessary Conflict Minerals in Gentherm’s products originated from the Covered Countries. For automotive-related products, the Company identified suppliers of commodity groups with high potential of containing Conflict Minerals using an industry-leading tool, IMDS. In other cases, the materials supplies were analyzed by other means.  All identified Conflict Mineral suppliers were surveyed to ascertain for each of these Conflict Minerals (a) the smelter or refiner where it was processed, (b) its country of origin and (c) the mine or location of origin, using the Electronic Industry Citizenship Coalition and the Global e-Sustainability Initiative (“EICC/GeSI”) template.

  

The Company did not receive responses from all of its suppliers and, in some cases, responses were incomplete or did not appear to be accurate. Furthermore, the majority of our suppliers that did provide names of smelters/refiners and country of origin information, did so only on an entity-wide basis without distinguishing between 3TG purchased for goods supplied to Gentherm and 3TG purchased for other purposes. The Company received 592 responses to the 636 inquiries sent to its suppliers, a response rate of 93.1%. Of the 592 supplier responses, 364 suppliers (61.5% of respondents) stated they do not use Conflict Minerals, and 228 suppliers (38.5% of respondents) stated they use Conflict Minerals not from the Covered Countries. Because we did not receive full and complete responses from every supplier in every case, we were unable to determine the country of origin of Conflict Minerals for our products or whether such products were from recycled or scrap sources.

Due Diligence Enhancements

We plan to undertake the following steps during the next compliance periods to (1) determine the country of origin of the Conflict Minerals and the facilities used to mine and refine the Conflict Minerals used in, and necessary to, the functionality or production of our products and (2) further mitigate the risks that necessary Conflict Minerals contained in the Company’s products finance or benefit armed groups in the Democratic Republic of the Congo or an adjoining country:

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