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Report Finds Weaknesses in Jewelry Certification System

Responsible Jewellery Council  image

We’ve always wanted the jewelry industry to create a better certification system than the Kimberley Process, the flawed international diamond certification scheme. And in a lot of ways, the certification system launched in 2009 by the Responsible Jewellery Council (RJC), a jewelry industry association, appears to be a step in the right direction.

 

Instead of just focusing on the trade in rough diamonds (diamonds before they are cut and polished), RJC certification is open to companies across the entire diamond, gold, and platinum supply chains. The RJC has developed labor and environmental standards, whereas the Kimberley Process doesn’t even have labor and environmental standards. The RJC also audits companies on an individual basis. The Kimberley Process only decides whether an entire country’s diamonds merit the “conflict free” label.

 

So the RJC certification system would seem to be an improvement over the Kimberley Process. On the other hand, a critical new report casts doubt on whether RJC certification will actually do very much to promote responsible practices in the jewelry industry. The report, released last week by a few organizations – including Earthworks, the group responsible for the successful No Dirty Gold campaign – is titled “More Shine Than Substance: How The RJC Certification System Fails to Create Responsible Jewelry. (The full report can be found here.)

 

More Shine Than Substance

 

The report finds a number of glaring weaknesses in the RJC’s certification standards. For instance, the report notes that the RJC doesn’t prevent companies from operating in conflict zones and doesn’t go beyond the Kimberley Process in defining the term “conflict diamond.” (Under the Kimberley Process, the only diamonds that count as “conflict diamonds” are diamonds used by rebel movements to fund civil wars. This definition leaves out all the diamonds tainted by government violence.) It faults the RJC for not placing limits on air and water pollution, for not requiring a living wage or protecting union rights, and for weak provisions on child labor. The report also points out that the RJC doesn’t require mining companies to get community support – companies must only seek community support, but may go ahead with mining operations if they don’t obtain it.

 

The report discusses other loopholes, such as the fact that RJC member companies do not need to meet RJC standards at every mine or facility. If a company owns less than 50% of a mine, the mine’s record doesn’t matter for certification purposes. Furthermore, the report points to weaknesses in the RJC’s enforcement system. The auditors that monitor compliance are selected and hired by the companies themselves and accredited only by the RJC rather than some independent body. In addition, the auditors are not required to provide detailed audit reports to the RJC. They simply inform the RJC whether the company has complied. All that is released to the public is a document like this.

 

We’ve previously expressed skepticism about the RJC certification system (see our 2010 interview with Triple Pundit). But we’ve also had positive things to say about the RJC’s Chain-of-Custody (CoC) standard, a complementary RJC certification standard for gold and platinum launched in March 2012. Our hope is that this standard will prompt companies to gain a better understanding of their gold and platinum supply chains. Although we believe jewelers should make greater use of recycled precious metals, which we use in our own jewelry, we envision a time when jewelry retailers will be able to tell customers the sources of the newly-mined gold, platinum, and gems in every piece of jewelry. (At Brilliant Earth, we can identify a country of origin for every diamond in our online database.) Consumers could then judge for themselves whether the jewelry being offered meets their ethical standards.

 

However, the report’s analysis suggests that the CoC standard may not promote transparency as much as we hoped. As the report notes, the standard doesn’t require companies to keep track of where specific batches of gold and platinum are from. It only requires companies to put in place a system for separating out gold or platinum from RJC-certified sources from non-RJC sources. By the time gold or platinum reaches the jeweler, retailers may still not know where it was mined.

 

Our Main Concerns

 

We haven’t written too much on this blog about the RJC certification system because, although we were skeptical, we wanted to take a wait-and-see approach. But the RJC has now certified 265 companies. (By contrast, only four companies have met the Coc standard.) We also decided that this new report – the best and most comprehensive analysis we have seen on the RJC certification system – provided a good opportunity to share our thoughts.

 

Overall, we can’t say that the report does much to resolve the skepticism we expressed to Triple Pundit in 2010. We have three specific concerns. First, we think the RJC’s standards may confirm the status quo more than they drive change. The RJC standards may be so weak that companies in the jewelry industry don’t change their practices in any appreciable way.

 

Our second concern goes back to our experience with the Kimberley Process. We believe the diamond industry uses the Kimberley Process to promote the false impression that a “conflict free” diamond is an ethical diamond. We are concerned that the RJC will mislead consumers in a similar way. Many consumers may get the false impression that their jewelry is “responsible” when in fact it may contain diamonds, gold, or platinum that has harmed communities or the environment. The end result may be to reduce consumer pressure for meaningful change.

 

Our third concern is that the RJC certification system may not be good for small-scale producers in the developing world. The greatest area of injustice in the jewelry industry is in artisanal mining, the kind of mining done by individuals in developing countries using simple tools and methods. Most artisanal miners – there are now about 15 million artisanal gold miners and at least one million artisanal diamond miners – live in poverty, and many of these miners use practices that are harmful to their own health, their communities, and the environment. There is a risk that the RJC certification system will privilege large, established companies that are sophisticated enough to obtain certification over small-scale producers. There is also a risk that the RJC system may cause the jewelry industry to become self-satisfied, when in fact it has done little to end most of the misery associated with jewelry.

 

We do think the RJC made the right decision by incorporating fair trade gold into its CoC standard, meaning that fair trade gold will be able to get RJC certification. The fair trade gold system, launched in 2010, is already helping to raise living standards among artisanal gold miners and reduce harmful environmental practices. (Here we disagree with the report’s authors, who are concerned that fair trade gold certification doesn’t guarantee minimal environmental impact. We think the report doesn’t fully appreciate the potential of fair trade gold to combat extreme poverty, eliminate practices like child labor, and promote eco-friendly mining techniques.)

 

But the fair trade gold system is very new – only a few gold mining cooperatives in Latin America have been certified – and RJC recognition of the fair trade gold standard won’t be enough to change conditions for the vast majority of artisanal miners. The jewelry industry has a responsibility to use its organizational and financial might to help scale up the fair trade gold system. It also should be offering more financial support to programs, like the ones we support through our non-profit fund, that empower artisanal miners and help communities harmed by irresponsible mining.

 

Where to Start

 

So where should the RJC begin? We believe the RJC’s first step should be to address what may be its biggest weakness: its leadership structure. The RJC’s board of directors is composed entirely of industry representatives. Unlike even the flawed Kimberley Process, which incorporates non-profit groups like Partnership Africa Canada into its leadership structure, the RJC doesn’t include civil society groups in its governance. Representation from mining communities, labor unions, and non-profit groups – like the ones that wrote the report – is totally missing.

 

Instead of reacting defensively to this report, the RJC ought to reach out to its authors, ask them to join its leadership team, and adopt some of their best ideas. This isn’t too idealistic to imagine happening. Indeed, the report notes that other certification systems, such as the Forest Stewardship Council, manage to incorporate civil society participation at all levels. If the RJC does this, perhaps it can yet evolve into the responsible jewelry organization it claims to be.

 

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