Rob Bates
Last weekend, I moderated a panel on conflict gold. One audience member chastised us for speaking too much about the Democratic Republic of Congo and Dodd-Frank when there are so many other problems with gold extraction. To which Signet’s David Bouffard replied that organizations like World Gold Council take all the related issues “very seriously.”
Now, imagine if certain diamond industry leaders were on that panel. Many don’t seem to take any of the other issues surrounding diamonds—be it the ongoing concerns about Marange, human rights violations in other diamond fields, or the industry “system of warranties”—seriously at all. For far too many, reform efforts begin and end with the Kimberley Process. They point with justifiable pride to the end of conflict diamonds, but then they don’t think anything more needs to be done.
Am I exaggerating? I wish! Here is the reported quote of an industry leader during the debate over the Diamond Source Protocol:
We seem to be all the time engaged in discussions on more disclosure, more restrictions, more regulations. We hardly have any time to devote efforts to marketing a beautiful product. There are hardly any conflict diamonds left in the world, and there is hard evidence consumers are happy. They don’t ask from what mine or processing plant a diamond originates.
With all due respect to this gentleman, who is simply giving voice to what a lot of people in the trade think, shouldn't industry leaders be trying to increase consumer confidence, rather than blithely dismissming it? As for consumer attitudes, I don't think there is much "hard evidence" one way or another. I do know that retailers who sell the Forevermark have told me—repeatedly—that the “responsibly sourced” angle has been far more powerful than they realized. (There's a reason De Beers now includes it in its ads.) And even if most consumers aren’t paying tons of attention to these problems now, they might someday. When your industry is premised on consumer apathy and callousness, that’s not much of a business model.
Let's not forget diamonds currently have the worst image of any jewelry material, and are, not coincidentally, losing market share. These are unpleasant realities the industry needs to deal with.
Which brings me to another reported quote from a different industry leader, reacting to news of an OECD meeting that will build on the KP:
Diamonds are the most controlled commodity in the world. I don’t understand what we have to learn from others. As you know, this view is shared by almost everyone in our trade. It is time somebody in the U.S. and the EU started listening to it!
What strikes me about this quote is how defensive it is; the speaker doesn’t feel the industry should be open to anything new. Moreover, this statement is more concerned with how the trade views itself—not surprisingly, we think we’re great—rather than how consumers view us, which is a lot more important, particulary since diamonds are a product no one has to buy.
Sadly, these aren’t isolated comments. Many otherwise smart folks feel that if just one troublesome soul leaves the State Department or industry association, or if business shifts to India and China, or if we could just explain for the 100th time how great the KP is, the industry will no longer have to consider these topics. Nonsense. These issues are not going away. This is the new world we are living in—and these concerns affect not just our industry, but every other business on our planet. In fact, not only are these concerns here to stay, they are increasing in importance. Think of how many more of these topics we deal with today than we did five years ago. Compare that to 10 years ago, and the difference is even more dramatic.
When the industry agreed to the Kimberley Process, it was ahead of the curve. Now it’s behind it. At last week’s panel, we learned that great strides had been made in developing a gold chain of custody, as well as for minerals like col-tan that are used in electronics. The International Colored Gemstone Association is working on a system to track the origin of colored gemstones. But a diamond chain of custody is considered too radical a proposal for some industry leaders to even discuss. (Given that some industry leaders also deal in Marange goods, there is also a not-insignificant economic motivation here.)
This business has a lot of great leaders who work selflessly and tirelessly on behalf of the industry, often on a volunteer basis. Yet some need to start thinking a little more about the future of this industry, of ways to engage new customers, of working towards a trade that they are proud to leave to their children. Sadly, instead of big issues, industry politics is now all about egos and snubs and slights and fights that make the trade look small. And certain groups and actors, instead of creating new accomplishments, now take greater pride in knocking things down.
If this industry doesn’t keep up with larger trends in society, it will be buried by them. People who feel they have nothing to learn are sometimes taught some very unpleasant lessons.
A reacção da DMIA - Diamond Manufacturers and Importers Association of America
New York, New York, USA - April 29, 2013: The Diamond Manufacturers & Importers Association of America (DMIA) issued a statement today spurred by the recent article, entitled "The Diamond Industry's Sad Lack of Leadership,"written by JCK Magazine's eminent senior editor Rob Bates. Bates takes the diamond industry to task for not dealing with the burning reputational issues that are on the agenda, expressing concern that if these reputational issues are not confronted, the industry may find itself lagging behind and losing market share.
DMIA President Ronnie VanderLinden welcomed Bates' remarks, saying the industry needs editors of his stature to send the occasional "wake-up call." However, he pointed out that DMIA has consistently and continuously been at the forefront of the American diamond industry's efforts to address and eliminate reputational risks.
"Bates wrote that 'sadly, instead of big issues, industry politics is now all about egos and snubs and slights and fights that make the trade look small. And certain groups and actors, instead of creating new accomplishments, now take greater pride in knocking things down,'" VanderLinden said.
"While he makes valid points, at the DMIA we have steadfastly acted for generations not only to protect our industry but also to be proactive on ethics. We abhor violence and are very concerned about human rights beyond 'reputational risks.' During the past decade, DMIA has worked collaboratively with fellow American organizations. These include the Jewelers Vigilance Committee (JVC), Jewelers of America (JA), the Gemological Institute of America (GIA), the Manufacturing Jewelers and Suppliers Association (MJSA), the American Gem Society (AGS) and other organizations not only discussing issues but in writing, for example, clear and unambiguous policies regarding the Kimberley Process Certification System. This is exemplified by the active and leading role DMIA took in co-authoring the Diamond Source Warranty Protocol," he stated.
"It is important to note that that we have been heavily criticized by some members of the international diamond community for taking this position and advocating it as a voluntary protocol that we feel should be adopted globally. But we will not compromise on this issue" he added.
Rick Cohen, DMIA Director of Communications, added: "DMIA's generational leadership should be commended for the selfless and tireless work they have done and continue to do on behalf of the industry. Our honorary president Jeffrey Fischer currently serves as JVC's president and GIA Governor after fulfilling several terms as DMIA president during times of serious crisis - reputational, economical, and moral. Indeed a high percentage of our leadership is made up of 3rd or 4th generation DMIA members, who have learned from our fathers and grandfathers lessons of working in the global community," he said.
"Our most recent past president, Ronny Friedman and our incumbent president, have been and continue to commute regularly to Washington D.C. at the invitation of the United States Department of State which seeks out DMIA to actively participate in order to move the process forward. Our involvement with JVC, JA, the Diamond Development Initiative (DDI), the United Nations' Women for Peace, Project Rise, along with our work with NGOs, among them Global Witness, PAC and others, offer tangible proof of our commitment and actions to bring about positive change, " he elaborated.
Cohen concluded that "...every board member of DMIA works as a volunteer. Our work is for the benefit of our membership, the American diamond and jewelry industry, and the global community."
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