Title: Impact of RoHS Legislation and Resulting Customer Requirements on Industry
1Impact of RoHS Legislation and Resulting Customer
Requirements on Industry
- Anne Johnson
- Regulatory Affairs Associate
- 3M Optical Systems Division
- June 24, 2007
2Agenda
- Background
- RoHS
- 3M and Optical Systems Division
- Actions that 3M took to verify compliance
- Scope of compliance
- Unexpected effects
- Customer requirements
- JIG/JGPSSI strategies help
- Effects of a new/different RoHS law
3RoHS Restriction of Hazardous Substances
- European Union Directive on the Restriction of
Hazardous Substances (RoHS) in Electrical and
Electronic Equipment, 2002/95/EC - Prohibits six hazardous substances above certain
de minims levels - Four heavy metalslead, mercury, cadmium,
hexavalent chromium - Two polybrominated flame retardant classesPBBs
and PBDEs - EXCEPT for certain exempt applications
- De minimis levels
- Cadmium 0.01 (100 ppm)
- All others 0.1 (1000 ppm)
- De minimis thresholds apply to any homogeneous
material - E.g., a material that cannot be mechanically
disjointed into different materials -
43M Background
- 3M is a diversified technology company with a
worldwide presence in the following markets - Consumer and office
- Display and graphics
- Electro and communications
- Health care
- Industrial and transportation
- Safety, security and protection services
- All 3M businesses have been impacted by RoHS laws.
53M Optical Systems Division
- Tier 3 supplier to the electronics industry OEMs
- Manufacture optical films to increase brightness
of LCD displays - Work with all tier levels of the electronics
industry - Our suppliers are chemical manufacturers and
article manufacturers
6Activities 3M Completed to Ensure Compliance
- 3M developed a new RoHS General Specification
that is required for all new materials - Involves
- Legal
- Sourcing
- Supply Chain
- Raw Material Coordinators
- Regulatory
7Activities 3M Completed to Ensure Compliance
- Modified chemical data management systems to
allow for RoHS Certifications and created
additional databases to store supporting data and
for compliance tracking - Involves
- IT
- Software company
- Legal
- Regulatory
8Activities 3M Completed to Ensure Compliance
- Created a supplier questionnaire to request RoHS
certifications and additional information. - Involved
- Legal
- Regulatory
- Sourcing
9Activities 3M Completed to Ensure Compliance
- Researched and evaluated 3rd party analytical
labs that would be approved for 3M to use for
RoHS testing when supplier information can not be
gathered or for high risk materials - Involved
- 3M Environmental Science and Assessment Lab
- 3M Corporate Analytical Research Lab
- Regulatory
10Activities Divisions Completed to Ensure
Compliance
- Establish list of products sold in Europe or
components sold for equipment that may be sold
into Europe - Involves
- Business management
- Export services
- European business teams
- Regulatory
11Activities Divisions Completed to Ensure
Compliance
- Determine all homogeneous inputs to product and
the suppliers for those inputs - Involves
- Product development
- Manufacturing
- Regulatory
- Raw material coordinators
- Sourcing
- Supply Chain
12Activities Divisions Completed to Ensure
Compliance
- Send Compliance letter to suppliers of each
input, review responses, follow-up, and store
information - Involves
- Regulatory
- Sourcing
- IT
13Activities Divisions Completed to Ensure
Compliance
- Identify non-compliant and compliant materials.
If materials are non-compliant determine if
supplier will re-formulate, if 3M needs to find a
new supplier or 3M will discontinue product - Involves
- Regulatory
- Sourcing
- Business teams
14Activities Divisions Completed to Ensure
Compliance
- Establish a control plan to maintain compliance.
- Involves
- Raw material coordinators
- Sourcing
- Manufacturing
- Supply Chain
- Quality engineers
- Regulatory
15Activities Divisions Completed to Ensure
Compliance
- Communicate RoHS Status of products when
requested - Involves
- Marketing Communications
- Customer Service
- Tech Service
- Regulatory
16Reality Check
- All of these activities had to be done by 3M
Optical Systems Division to ensure compliance. - 3M Optical Systems did not have any film products
that were out of compliance with RoHS to start
with.
17Additional Impacts Due to RoHS
- Adding staff to verify and manage
- Increased factory costs- experimental costs
- Additional inventory /Scrap costs
- Supplier/ raw material costs
- Customers prefer the cost of RoHS compliance NOT
to be passed on to them! - Manufacturing costs new equipment
- Product numbering/ naming changes
- New requirement for new products
- Resources from new product development
re-distributed to re-formulation teams - Long lead times to get compliant raw materials
- Supplier challenges- hard to get information!
18Part Number/ Product Name Challenges
- Changing part numbers for compliant products/
parts may be many part numbers for one item - Need to change all prints and documentation
- Involves IT, supply chain, marketing
communications groups - Resistance by some Businesses to do this but...
- In some cases, customers demand this.
- Changes are needed to make documentation clean.
- Helps differentiate between non compliant and
compliant product line.
19Product Launch Challenges
- New Product Development
- Resource issue for labs
- New product teams are being slowed down or
cancelled - The same engineers, designers, and chemists are
pulled off new product teams to work on RoHS
compliance for existing models.
20Supply Chain Challenges
- Long lead times to get compliant inputs
- May have to find alternate suppliers
- Inventory management- compliant and non-compliant
part separation - Can slow down supply chain compliant parts may be
provided later than expected
21Supplier Challenges
- Suppliers do not understand RoHS or do not
response to requests for information - Process steps may involve
- Following up with suppliers this may require
weekly or daily communication - Simplifying requirements or requests
- Visiting the supplier
- Escalating the response up the management chain
and involving sourcing organizations
22Scope Question Seen by 3M as a Supplier and a
Customer
- Companies often get requests for products where
the intended use is not intended to be WEEE- - What are the legal responsibilities by responding
to RoHS requests for these types of products? - What is the affect on competitiveness not to
respond?
23Additional Outcomes of RoHS that have Impacted
Optical Systems Division
- RoHS and the introduction of regulation in the
electronics industry has caused our customers to
develop their own EHS requirements far beyond the
requirements of RoHS legislation - Complying with the law is not enough to
participate in the electronics industry
24Additional Customer Requirements
- Green agreement and auditing programs from
customers - These programs are very extensive and require a
full time person to complete and manage - Alternately, many are developing their own
environmental management systems to avoid a
multitude of customer systems
25Additional Customer Requirements
- Increased customer requests to respond with
information about products, manufacturing,
packaging, internal systems, etc. - Customer requirements go beyond RoHS Chemicals
and RoHS Threshold limits - Banned/ Restricted/ Investigation lists
- Can include hundreds of materials
- Typically, 3-10 a day reach Optical Systems
Regulatory and Legal for customers that will not
accept standard responses
26Additional Customer Requirements
- Customers are requiring testing for RoHS
materials and others as frequently as every 6
months - Not required by law
- Customers are requiring RoHS status
identification on packaging, packing slips,etc.
for all materials - Not required by law
- China Law now requires for final EEE placed on
the market
27Additional Activities Optical Systems Completes
based on Customer Requirements
- Increased regulatory staff 300
- Developed a new database for product EHS
information - Developed a database for handling, tracking, and
monitoring customer requests - Test all products for 50 chemicals of interest
when launched - Re-test all products for RoHS, halogens, and new
chemicals of concern every 6 months
28Additional Activities Optical Systems Completes
based on Customer Requirements
- Added a 3M Environmental Marketing Claims
Committee approved RoHS Directive Compliant Label
to product packaging - Require a customer EHS requirement review of all
products in development - Developed a Chemicals of Interest Team to monitor
customer EHS requirements and evaluate their use
in our products
29Current Activities to Help Manage the Customer
Requirements
- Optical Systems is active in Joint Industry Guide
(JIG) / JGPSSI activities - JIG sets a list of EHS requirements for products
in the electronics industry - If more companies will use this list of
requirements management of EHS issues in the
industry will be much simpler - It is highly recommended to support this and
other harmonization efforts
30Impacts of Future Regulations
- If new laws add a chemical, lower a limit for
existing RoHS chemicals or change the scope, the
entire process for compliance will start over - New supplier requests
- New reformulation efforts
- New communication efforts
- If new laws add labeling requirements, this will
add an extra dimension. Different labeling
requirements by different countries may become
very difficult to manage.
31Impacts of Future Regulations
- Adding packaging to the RoHS scope adds another
replicates the process for compliance as adding a
chemical would. - However, packaging suppliers are most likely
different than product raw materials suppliers so
supplier education may be required and lead to
long lead-times for compliance
32Summary
- There has been an incredible amount of work
completed and money spent by industry to be in
compliance with EU RoHS. - Customer requirements are having a significant
impact on industry and harmonization of
requirements is encouraged - Additional RoHS laws or changes to the EU RoHS
law would have a heavy impact on industry
33Questions?