World Diamond Council Aims to Improve Industry Understanding of Kimberley ProcessMay 15, 16
(IDEX Online News) – In advance of the upcoming World Diamond Congress and Kimberley Process intercessional meeting in Dubai, IDEX Online Deputy Editor David Brummer posed some questions to the World Diamond Council, asking about its role within the diamond industry and its relationship with the Kimberley Process.
David Brummer: The stated goal of the WDC is to eradicate the use of conflict diamonds. What impact has the WDC had since its inception, and how much of a problem is diamond smuggling?
World Diamond Council: The WDC represents the industry as an Observer at the Kimberley Process – a UN-mandated international forum with an operational mandate, and a rough diamond certification system, the well-known Kimberley Process Certification Scheme (KPCS). Moreover, the WDC has established the System of Warranties (SoW), a voluntary system of industry self-regulation, which extends the effectiveness of the Kimberley Process beyond the export and import of rough diamonds.
The KPCS has been very successful in reducing the flow of conflict diamonds in the marketplace to less than 1 percent. Nevertheless, we must continue to ensure that diamonds are not subverted to finance conflict.
DB: Where are the principal areas of concern regarding the trade of conflict diamonds? Is it mainly Africa because so many diamonds are sourced there?
WDC: It is true that conflict diamonds originate for the most part in the African Continent. We must always remember that conflict diamonds affect first and foremost the local populations and weaken economies of these regions. However, it is wrong to say that it is only an “African problem.” The possibility of buying a conflict diamond worries consumers of jewelry all over the world, erodes their confidence in the entire diamond market. From this point of view, conflict diamonds are a problem of the entire diamond pipeline – rough diamond producers, diamond traders, diamond polishers, diamond wholesalers, diamond jewelry manufacturers, diamond jewelers and consumers.
Consumers’ perception of our product is a global concern for the entire pipeline. Therefore, the WDC developed the System of Warranties (SoW), aimed to extend the effectiveness of the KPCS and transmit the confirmation of conflict-free origin of diamonds further down the diamond pipeline to the jewelry consumer. In the framework of the SoW, all buyers and sellers disclose information about guaranteed conflict-free origin of the diamond. This condition is not obligatory, and we are pleased to see that market participants disclose this information voluntarily, thereby joining the work on improving consumer confidence.
DB: The transition of power in CAR has been less than smooth, how is that affecting the frameworks that WDC and KPCS have put in place?
WDC: The Kimberley Process CAR Monitoring Team continues its work in fulfilling the KP-sanctioned Operational Framework of the Administrative Decision around resumption of exports of rough diamonds from CAR that was finalized in June 2015. At present the situation in CAR is still very fragile and the economy is devastated. But it is important, and the stated WDC’s policy, to keep any rough diamonds originating from CAR out of the mainstream as long as the minimum KP requirements are not fulfilled. It may be possible that in the near future one or more mining areas in CAR might be declared “KP compliant.”
DB: Was the 2015 Amnesty International report into conflict diamonds just the opening salvo of a concerted NGO movement to put pressure on the diamond industry? Will it take the form of lobbying at governmental/UN level?
WDC: The WDC has been actively reaching out to Amnesty International to try to get them re-engaged with the KP and the situation in CAR, but we can’t speak to what any of the NGOs will do or say. The KP Civil Society Coalition NGO’s are part of the CAR Monitoring team and so the NGOs are actively taking part in the efforts to find a sustainable solution.
DB: CAR was Amnesty’s first target, are you aware of others that might be next on the list?
WDC: There are always challenges that are drawing attention to the KP. This year the situation in CAR is one of them. It is part of the normal workflow of the KP, allowing it to improve the situation with conflict diamonds, to promote responsible mining and selling of diamonds, and the quality of life of local communities.
DB: Is there likely to be a change in the definition of what constitutes a conflict diamond? Is that likely to be an area where NGOs will try and create change? Which countries might that affect if they succeed?
WDC: The issue and proposal of changing the “conflict diamond” definition is in the hands of the member Governments of the KPCS. As an Observer, i.e., a non-voting participant to the KP, the WDC has no vote in the decisions of the KP. That being said, we are continually looking for ways to strengthen and meet our goal of curbing conflict diamonds entering the supply chain. The mentioned SoW is one of them. The definition of conflict diamonds impacts all diamond producing, trading and consuming countries.
DB: Signet Jewelers has launched its Responsible Sourcing Protocol for Diamonds and the American Gem Trade Association updated its Code of Ethics and Principles of Fair Business Practice, both of which stress due diligence in global supply chain integrity. What practical steps can be taken to ensure wider acceptance of what will hopefully become industry norms?
WDC: As a baseline, it is essential that all the existing industry-wide code of conducts and compliance regulations are strictly and fully enforced. Responsible sourcing initiatives from all parts of the diamond pipeline are welcome, but should take into consideration the already existing systems and complement them. The common goal of all the diamond pipeline participants is to ensure the responsible sourcing of non-conflict diamonds for the consumers’ confidence. The industry attitude to responsible sourcing and transparent supply chain should be consistent, not to put the consumer before the need to understand the differences in approaches. Education and communication are key to industry acceptance of due diligence practices within the supply chain. The WDC, in promoting its own work on the SoW, is making a concerted effort in 2016 to communicate to the global industry stakeholders and ultimately the consumer the importance of the work of the KP and acceptance of responsible sourcing practices.
DB: How can the industry as a whole, better understand the work of both the WDC/KP?
WDC: We understand that continuous dialogue with all industry stakeholders is key to the success of diamond pipeline transparency. The WDC is developing an active communications strategy in order to better inform the industry and make clear what the KP and the WDC are doing to support mining countries and their populations and keep the supply chain “clean.” The WDC is also actively seeking and securing speaking opportunities throughout the global industry to enhance the industry understanding of the fundamental role of the KP, its standards, and how it positively impacts their businesses.