Assurance Provider – Oversight and Performance

Overview

Assurance Providers play an essential role by supporting LBMA in the implementation of the Responsible Sourcing Programme. Findings and conclusions made during an assurance engagement offer the market an independent assessment and validation of a Refiner’s conformity against the RGG. They also play a critical oversight role, bringing to LBMA’s attention any significant concerns regarding vulnerabilities in a Refiner’s management systems.

As such, the quality of their opinions and their familiarity with current sourcing threats are important in maintaining public confidence in the integrity and credibility of the RSP. With this in mind, LBMA has significantly improved the communication, training and support provided to Assurance Providers.

Strengthening Engagement with Assurance Providers

As already highlighted in section 2, LBMA introduced several measures this year to support Assurance Providers (APs) in carrying out their duties.

The purpose of these additional tools is to provide further transparency over what happens during an assurance assessment, but also to ensure there is further consistency in how Assurance Providers carry out their assessments.

The pre-assurance checklist, for example, serves as the basis for a check-in call between LBMA and the Assurance Providers prior to the site visit portion of the assurance engagement, particularly for high-risk Refiners or those that may have experienced sourcing challenges over the previous year. The checklist provides LBMA with greater line of sight over the preparedness and understanding by APs of the issues and risks they should raise with Refiners during the actual engagement.

This process resulted in LBMA limiting the geographical remit of one accredited Assurance Provider in March 2024, following concerns on resource allocation. LBMA also required the Assurance Provider to present a Corrective Action Plan before its global scope of practice could be reinstated.

Another benefit of the pre-assurance calls has been to increase the engagement and collaboration between APs and the Responsible Sourcing team. Often times, LBMA may be made aware of risks (either through media scans, conversations with civil society organisations or market intelligence) relating to specific Refiners or source countries. Sharing of this information allows LBMA to gain comfort that any concerns are appropriately tested by APs during the assurance process. In 2024, pre-assurance discussions were held with APs of every high-risk Refiner, as well as those with known adverse indicators.

Assurance Provider Training

In addition to supporting the policy architecture of Assurance Providers, LBMA completely overhauled the annual mandatory training programme by creating an e-learning platform, rather than rely on third-party service providers as in the past.

This training familiarised Assurance Providers with the requirements outlined in the RGG and the TPAG, but also incorporated a separate case study session based on sourcing vulnerabilities that arose during or outside of the previous year’s assurance process. During this session, APs workshopped different scenarios and could interact directly with LBMA staff and the facilitator, a former accredited Assurance Provider. The training also tested the competency and performance of Assurance Providers - increasing the previous minimum pass rate to 80% (up from 70% in previous years) and allowing for their removal should they score below that threshold. LBMA intends to maintain this training model for 2024.

Drop-in Sessions

In July 2024, LBMA also hosted an inaugural ‘Assurance Provider Drop-in Session’ to share observations of the assurance reports reviewed during the course of the first half of the year, reinforce our expectations with respect to the levels of detail and transparency of information, and answer any questions the Assurance Providers had.