Focus on

RESPONSIBLE BUSINESS

DIAMONDS DO GOOD:
A LUXURY PRODUCT WITH A SOCIAL CONSCIENCE

The diamond industry went to the United Nations once again at the beginning of March, as the UN General Assembly conducted a day-long session looking at the role of the most popular of gemstones in fueling conflict. At the end the session, a resolution proposed by the European Union was adopted by consensus. It acknowledged the successful role played over the past 16 years by the Kimberley Process, which is the system created to remove from the chain of distribution diamonds whose proceeds are being used to finance civil war.

The tone of the debate in 2019 was very different to the one that had dominated the UN chamber when the General Assembly had first focused its attention on conflict diamonds, two years after the subject had first been taken up by the Security Council. That was in 2001, and the resolution that was adopted then was short, succinct and forceful, calling on governments of diamond producing, processing, exporting and importing countries, and also the diamond industry, to find ways to break the link between conflict diamonds and armed conflict. At the time, efforts were already underway to establish the Kimberley Process, but the certification system that was created would only be launched in 2003, meaning that the conflict diamond crisis remained in full swing.

Things are very different today, but even then the speakers during the most recent General Assembly session did not concentrate solely on offering congratulations to the diamond industry and the diamond-producing countries. On the contrary, while they recognized that the Kimberley Process had successfully blocked the flow of rough diamonds financing civil war, and in the process helped bring an end to some of Africa longest conflicts, they pointed out that the KP has been less successful in tackling other instances of systemic violence in diamond-mining areas.

 

PLACING A LUXURY PRODUCT IN A NEW LIGHT

But of particular significance during this most recent debate in the UN General Assembly was the growing contention that not only should the Kimberley Process be considered a means of preventing bad things from happening, but that it should also be considered a necessary component in nation building. Its ability to bring peace and enhance security in the regions where it is enforced mean that it has the capacity to create the conditions necessary for the diamond resources in those countries to be used to create sustainable economic and social opportunities.

The United Nations General Assembly in session. (Courtesy of UN Photo/Eskinder Debebe)

While systems like the Kimberley Process, and the accompanying System of Warranties promulgated by the World Diamond Council, require a degree of effort from the industry, they also having the effect of bathing their product in an entirely new light. This is because they underscore the fact that even though diamonds are considered luxury, non-essential items in consuming countries, this certainly is not the case in the developing world, where diamonds are able to unlock the gate to considerably better futures for entire communities.

This was recognized in the resolution passed by the UN General Assembly on March 1, which directly associated the existence of the Kimberley Process with the United Nations Development Plan for 2030 and its Sustainable Development Goals.

For younger Millennial and Generation Z consumers who increasingly demand that their purchases have social as well as monetary significance, this new perspective of the diamonds’ social function provides a degree of added value that previously was rarely considered.

Artisanal diamond miners panning for rough gems in Sierra Leone.

DOING GOOD ON THE GROUND WITH ARTISANAL MINERS

To an ever-greater degree, this growing appreciation of the key economic and social role is playing in developing economies is translating to facts on the ground, often with the direct support of the established diamond industry. Particular attention is a paid to the plight of small-scale and artisanal miners, who under the Kimberley Process regime has traditionally struggled to get their merchandise into the legitimate diamond pipelines.

While exact figures are hard to come by, most analysts agree that the number of artisanal diamond miners exceeds one million, and the number of individuals dependent on the income they generate runs to more than 10 million. Working alluvial deposits predominantly in Africa, but also at isolated location in Latin America, they currently account for about 15 percent of output in terms of value and about 5 percent in terms of value.

A number of organizations are operating in the artisanal mining sector, some supported by the industry, with the goal of providing proper skills, equipment and education about health and safety standards, as well as developing systems for what is referred to as formalizing their production, which means providing a KP-certified access into the chain of distribution. The most prominent of these is the Diamond Development Initiative.

But there also private initiatives being carried out. One of the most interesting is a pilot program in Sierra Leone create by De Beers called Gem Fair. Supplying dedicated tablet computers to artisanal miners working the country’s remote alluvial deposits, it enables them to identify and register their goods online, so that they later can be traded legitimately. What the program also is does is inform the miners what their merchandise is worth on the open market. They do not have to sell it to De Beers, but at least they know if they are receiving a fair price.