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Can mined diamond engagement rings be ethical?

May 9, 2022 • 14 min read • #kimberley process


Depending on the jeweller you talk to, they will try and convince you that a mined diamond is ethical or unethical. The answer to this question requires a good understanding of what's changed in the last 20 years to properly answer the question. This guide will show how the mined diamond industry is becoming more ethical but is not ethical as a whole.

Summary

  • The Kimberley Process was set up to stop the financing of violence by rebel movements seeking to undermine legitimate governments.
  • Most of the people that set up the Kimberley Process have resigned from their posts and have criticised it for its lack of transparency, swift action and ability to regulate.
  • The Kimberley Process is not stopping poor working conditions or terrible pay. Nor does it stop “legitimate” governments from suppressing their own people or funding wars against other countries.
  • The Kimberley Process does not take the environment into account whatsoever.
  • Overall the Kimberley Process is a very weak instrument. Basic human rights are still abused by mining organisations and checks are rarely ever conducted to the degree needed to ensure that the diamonds are genuinely ‘conflict-free.’
  • While the Kimberley Process is a step in the right direction for a mined diamond to be ethical, it has a long way to go.

The Kimberley Process

Mined diamonds ethics starts with the Kimberly Process. The Kimberley Process Certification Scheme was set up in 2003 to stop conflict diamonds from entering the rough diamond market. The process was established so that "diamond purchases were not financing violence by rebel movements and their allies seeking to undermine legitimate governments."

Why was the Kimberley process set up?

To know why the Kimberley process was set up, we need to look back to the Angolan War of Independence in 1961. Angola was fighting for its independence from Portugal. War started with an uprising against the forced planting of cotton. It was led by the Popular Movement for the Liberation of Angola (MPLA). And in 1966, another political party was set up called the National Union for the Total Independence of Angola (UNITA). During the Angola War of Independence, both MPLA and UNITA fought alongside each other.

Wars are expensive and to fight for independence, both MPLA and UNITA needed funding. Initially, MPLA received funding from the Soviet Union and its allies (such as Cuba). UNITA received military aid initially from China up till 1975, and then the United States after that.

The Angolan War of Independence came to an abrupt end in 1974 when there was a coup in Lisbon, Portugal. The dictatorship at the time was overthrown, and the new regime stopped all military action in African colonies — declaring its intention to grant them independence.

After gaining independence in 1975, Angola was left with a power vacuum with two players: MPLA and UNITA. Both had foreign funding and it led to a civil war. But UNITA realised it couldn't just rely on foreign military aid. Up until 1996, UNITA was also funded through the Angolan diamond mines. The sale of the diamonds would be used to finance the ongoing conflict. The process of using diamonds to fund a war or insurgency is called a blood diamond.

The term blood diamond is used to highlight the fact that the profits derived from the sale of diamonds are used to fund wars. Blood diamonds are not exclusive to Angola. The Ivory Coast, Democratic Republic of Congo, Liberia, Sierra Leone, Republic of Congo and Zimbabwe are either origins or markets for blood diamonds which are then bundled together with conflict-free diamonds and their origin is convoluted.

UNITA was so successful with its blood diamond trade that reports suggested that as much as 21% of the total diamond production in the 1980s was being sold for funding nefarious purposes and 19% was specifically conflicted in nature.

The United Nations (UN) recognised the MPLA as the legitimate government in Angola. The UN imposed sanctions against UNITA in 1998 through a UN Security Council Resolution for not implementing parts of peace agreements and restoring state authority in areas like Andulo, Bailundo and Nharea. But a report by Robert Fowler presented to the UN in March 2000 demonstrated that UNITA's diamond trade with other countries (who broke the sanctions) meant it could continue to fund its military.

The Fowler report suggested naming the countries, companies and individuals involved. And this led to a meeting in a town in South Africa called Kimberley in May 2000. In December 2000, the UN General Assembly formally supported the creation of an international certification scheme for rough diamonds. It was then supported by the UN Security Council in January 2003. The Kimberley Process Certification Process was born.

Source: [United Nations Security Council Verbotim Report 3891S/PV/3891 page 4. Mr. Amorim Brazil 12 June 1998. Retrieved 2008-08-28.]


How does the Kimberley process work?

The Kimberley Process Certification Scheme is a membership. Membership is typically associated with countries. But there are institutions such as the World Diamond Council and civil society organisations, such as the Partnership-Africa Canada that also participate as a member.

The scheme is open to all countries that are willing and able to put in place Kimberley Process requirements. The requirements enable them to certify rough diamonds as ‘conflict-free’ and prevent conflict diamonds from entering the global supply chain.

For this to happen, countries that sign up need to put laws, internal controls and a level of transparency to be certified. This is then open to being audited. Annual reports can also be peer-reviewed by other members.

Members can only trade with other members who have met the minimum requirements of the scheme. Rough diamonds from these membership countries come with a Kimberley Process certificate guaranteeing that they are conflict-free.

The scheme has 56 members representing 82 countries. For countries that do not meet the minimum requirements, they can still be part of the Scheme but as an observer or participant. Kimberley Process members account for about 99.8% of the global production of rough diamonds.

To be a member you need to adopt the following principles:

  • Only trade with companies that include warranty declarations on their invoices (Kimberley Process Certificate for rough diamonds)
  • Not to buy diamonds from a suspect or unknown suppliers; or, countries that have not adopted the Kimberley Process
  • Not knowingly buy or sell or assist others to buy or sell conflict diamonds
  • Not buy diamonds from a region that has violated government regulations restricting the trade of conflict diamonds
  • Ensure all company employees that buy or sell diamonds within the diamond trade are well informed regarding regulations restricting the trade in conflict diamonds.

Failure to do so risks losing their membership, which has happened to the Republic of Congo in 2004. It couldn’t prove the origin of its gems and it was believed that most of them came from the Democratic Republic of Congo.

The Kimberley Process is chaired on a rotating basis with members and observers meeting twice a year. Working groups meet more regularly. The implementation of the Kimberley Process in each of the member countries is done “through ‘review visits,’ annual reports and regular exchanges and analysis of statistical data.”

New Zealand became a member in 2006. As mentioned above, to be a member, there needs to be corresponding law. In New Zealand, the law was set up in 2004. It is called the United Nations Sanctions (Kimberley Process) Regulations 2004 and can be found here.

The law is managed by The Ministry of Foreign Affairs and Trade. If a New Zealand entity wanted to export rough diamonds, the process is outlined here. Also, because the scheme promotes transparency, each country’s import and export of rough diamonds is searchable. You can see New Zealand’s import and export of rough diamonds here.


Does the Kimberley Process mean that a diamond is ethically sourced?

The Kimberley Process has helped to make mined diamonds more ethical. But its narrow definition of conflict diamonds does not mean a mined diamond is ethically sourced.

Below is the formal definition used in the Scheme (as defined by the United Nations):

  • Conflict Diamond: Is any diamond that is mined in areas by forces opposed to the legitimate, internationally recognised government of a country, and that is sold to fund military action against that government.

This definition is problematic.

Problem 1: Abuse of political power

Just because a diamond does not fund a war against a recognised government doesn’t mean that it is ethical. The narrow definition means that blood can still be found on a diamond. The scheme does not stop members from causing environmental damage, funding violence or denying workers human rights.

For example, In 2013, Khadija Sharife found around a billion dollars (USD) in diamond revenues were used to rig the 2009 Zimbabwean elections in Mugabe’s favour.

The government used their control over legal diamond operations to preserve their power—often at the expense of diamond miners and workers with poor working conditions and denied basic human rights.

Problem 2: Rules not enforced

This is not the only problem with the Kimberley Process. While on paper, the processes behind the scheme seem robust, it is not true in practice.

For example, representatives of the Kimberley Process claimed officials were unaware of tortures and killings exposed in a documentary. Officials stated that they were only aware of incidents uncovered by their brief field visits. This implied that they didn’t have the capabilities to do in-depth investigations.

Another example is, Zimbabwe remaining part of the Kimberley Process, even after Khadija’s election exposure. Further countries were exposed like Code d`Ivoire. But they also remained in the scheme. There were no penalties for their infringements.

This has led founding members to walk out of the Scheme in 2011. It said, “Despite having all the tools in place, the Scheme was failing to effectively address issues of non-compliance, smuggling, money laundering and human rights abuses in the world’s diamond.

Another one of the founding members, Ian Smillie (Partnership Africa Canada) also resigned. He suggested that he could no longer contribute to the “pretence that failure is a success.”

Problem 3: Tax Havens

Khadja Sharife and John Grobler’s 2013 investigative report showed that $3.5 billion of Kimberley Process certified diamonds from Angola and the Democratic Republic of Congo had moved through tax havens such as Dubai and Switzerland, effectively “whitewashing” the violence.

This was in collaboration with self-regulating Kimberley Process approved governments including Angola, arms dealers such as Arkadi Gaydamak, diamond magnate Lev Leviev and certain international banks.

The authors concluded that tax havens should not be allowed to handle resource revenues because they provide infrastructure to enable illicit activities. And that “this has enabled a 99% clean diamond industry to exist largely because the real violence of the industry is whitewashed, ignored or excluded entirely from the framework — the criminal portion of which continues to exist entirely on the periphery.” The interest surrounding blood and unethical diamonds are widespread. So much so, that even Kanye West made a song about it that won him numerous awards.

In 2010, a key draftsman of the Kimberley Process, and also Africa’s highest-ranking diamond official, Dr, Andre A, Jackson from the African Diamond Council persuaded African diamond-producing nations to renounce the support for the Kimberley Process Certification Scheme.

Jackson criticised the ongoing ineffectiveness of the Kimberley Process and said “the system has failed to thwart trading of diamonds mined as a result of human suffering”. Just before this denunciation, the African Diamond Council released an infomercial exposing the internal problems of the African diamond industry.

In the same year, Time Magazine published an article discussing the rough diamond trade in Zimbabwe. The article brought into question the legitimacy of the Kimberley Process Certification Scheme, stating that it was unable to prevent Zimbabwean blood diamonds from entering the Kimberley Process membership market.

Are the ethics of mined diamonds too big of a problem to solve?

From the mines to your ring, a rough diamond travels through a complicated supply chain that involves it being sorted, processed, cut and sent around the world. Because of the many hands, each diamond needs to travel through, and the way the diamond changes in form throughout this process, traceability from beginning to end is practically impossible. There is no incentive to report unethical diamonds, especially with the weak oversight of the Kimberley Process.

Additionally, as you move through the supply chain, the number of centres available to sort and cut diamonds decreases, so all the world’s diamonds move through a select number of cutting centres.

‘Provenance’ refers to the geographical origin and source of the diamond, which in theory should be where it was mined and which mining source (i.e. pipe vs alluvial). However, even within a single mine, rough diamonds can pass between several people, from the person who finds the diamond, to the person who officially documents the diamond as being from that specific mine.

Regions of the world may impart unique chemical fingerprints on the diamonds produced there, but these require forensic analysis to determine. To further complicate things, once a diamond has been cut and polished, these ‘fingerprints’ are no longer identifiable and it becomes impossible to validate the provenance. All these variables come together to create a supply chain that is really difficult to track and validate.

Where to from here?

Other initiatives have been implemented to prevent conflict diamonds from entering the supply chain. This includes the Diamond Development Initiative (DDI), which was spun out of the Kimberley Process discussions in 2006. It is focused on improving the social and economic conditions of diamond mine workers, in particular those working in artisanal mines.

To further support the work of the DDI, the initiative partnered with an NGO called RESOLVE in 2020 to tackle some of the hefty challenges within the diamond industry including poverty, biodiversity reduction, conflict, and supply chains.

While this partnership has a grand vision, it is still in its infancy, so we will have to wait and see what changes may come from it.

The avoid the moral hazard of buying a mined diamond, it is worth considering a lab grown diamond. While made in a lab rather than formed in the ground, these diamonds are exactly that – chemically and optically identical in every way. Trained gemologists cannot tell the difference between the two without special machinery. For a deeper look into mined and lab-grown diamonds, see here.

Four Words ensure all our lab grown diamonds and gemstones are climate positive. To read more about the environmental impacts of mined diamonds, see here.

We will never sell or use mined diamonds in our rings. Why? Because lab grown diamonds are exactly the same as mined diamonds (down to the atom) and we strongly believe that there is absolutely no reason to choose mined diamonds over lab grown diamonds.

They are more sustainable (with a 7x lower carbon footprint), have no ethical questions or concerns and allow you to get a 30 - 40% bigger diamond compared to their mined equivalent.

Lab grown diamonds are a superior product and better than mined diamonds in every single way.

What are your values?

Buying an engagement ring will be one of the most important decisions in your life. So when you do buy one, it is a great idea to be as informed as possible. This article is intended to support your decision making.

Your love is not built on violence and trauma. So why should you risk your ring to be?

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