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I was thinking about how best to approach the subject of risk management for used asset disposition for a week or so.  Then last week I tuned into 60 minutes and was glad to see they aired a story on exportation of e-waste titled "Following The Trail of Toxic E-Waste".

The article starts, "It is one of the most toxic places on Earth - a place government officials and gangsters don't want you to see. It's a town in China where you can't breathe the air or drink the water, a town where the blood of the children is laced with lead." At a high level, Scott Pelley from CBS showed how electronics are exported overseas and placed in open air dumps in China where they are picked through by poor people in worst conditions imaginable in an attempt to reclaim precious metals. There are several points to make about this that are all connected to risk management. Here they are:

Chain of Custody is the Best Insurance

Nothing replaces a documented chain of custody in terms of managing the risk of something going wrong. What if the 60 minute crew were allowed to comb through the dump and found your computers? Would they find assets that previousely belonged to you?  Would they find monitors which can contain several pounds of lead which according to US laws is illegal to ship overseas without specific permission?  Chances are if you have a good handle on chain of custody this wouldn’t happen.  But if it did, you would at least have evidence to prove you were deceived by the recycler to aid in hedging your legal risk.

Recycling is Not free

Responsible electronics recycling is not free although most of us have come to expect recycling to be free. We’re used to placing our recycling bin on the curb and having someone pick it up. Even if there is a charge it’s usually not much. We made a deliberate decision early on in our business to steer away from municipal events and from companies that did not see the value in recycling properly. In both situations their priority was the lowest cost option and that mindset leads to cutting corners including the exportation of waste. In the electronics recycling industry, it costs money to transport, disposition, and dispose of the equipment properly. Expect to pay to get your old electronics recycled in a way that you don’t have to worry about.

There’s no Substitute for On Site Audits of Recyclers

Websites can say anything and there are very low barriers to entry in the business so anyone can get into the business with relative ease. It is your responsibility to vet the recycler. On site auditing of their operations is the best way to accomplish this. Your goal should be to find a recycler that can provide an auditable chain of custody.

Check my blog next time for a discussion on Chain of Custody.

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