15 October 2007

Ethical jewellery: miners unite to lift the standard

EARLY next year Michael Rae, a veteran of the environmental movement, will be rolling out an ambitious plan to ethically monitor the entire diamond and gold jewellery production chain, from mines to store windows.

Bankrolling his effort will be the likes of global mining giants Anglo, BHP Billiton and Rio Tinto, which were once Rae's regular targets.

Today, the miners are acutely aware that cyanide spills from gold mines and the illicit diamond sales that line the pockets of African warlords could easily put off increasingly aware jewellery buyers.

After a 25-year career championing causes such as protecting the Daintree rainforest and Kakadu, Rae these days is chief executive of the Council for Responsible Jewellery Practices.

His extensive list of employers now includes the miners he once regularly browbeat, as well as such retail heavyweights as Cartier and Tiffany & Co.

Rae, 49, says industry no longer needs to be cajoled by NGOs - it is increasingly anxious to get its house in order as environmental and ethical issues become mainstream concerns for consumers.

"Companies are realising that this is the way the world is going and they need to anticipate the effects rather than be dragged kicking and screaming," Melbourne-based Rae told The Australian.

"People are becoming more cynical about what companies are saying. They want proof rather than just glib assurances, and that is especially true of the younger consumers, who are also tomorrow's consumers."

The council was established in London in 2005. Rae sees it as the logical extension of his work in the early 1990s with WWF (formerly the World Wildlife Fund) to develop a project to co-operate with miners to introduce third-party monitoring of mine sites.

Rae remembers that when he first began making calls on the Mining Certification Evaluation project in 1993, many miners dismissed it as "rubbish", and initially only Canada's Placer Dome showed any interest.

But the 1990s proved a turning point for the mining industry. Rae remembers representing WWF at a function during the 1990s at which Campbell Anderson, boss of miner North Limited that for years fought to develop the Jabiluka uranium deposit in Kakadu, declared that mining "failed the brother-in-law test". That is, if you are in mining, at a family function your brother-in-law can be guaranteed to berate you over the industry's reputation for environmental devastation and community destruction.

By the end of the decade, even a conservative warrior like then WMC boss Hugh Morgan was publicly warning that mining risked losing touch with changing community attitudes.

The rationale for the council, however, was rising concern among jewellery retailers that despite their best efforts, their product was vulnerable to the sort of backlash and community condemnation that had hit the fur industry. In 2002, rising concerns over the illicit trading in so-called "conflict diamonds", which were financing bloody conflicts across Africa, persuaded the UN Security Council to introduce the Kimberly Process that now regulates the cross-border trade in rough diamonds.

The trade in conflict diamonds has been cut to only 0.2 per cent of the world trade, largely because of peace deals in previously war-torn Angola and Sierra Leone, but the issue was given fresh prominence last year in the Leonard DiCaprio movie Blood Diamond.

The ongoing civil war in the Ivory Coast, where rebels occupy diamond mining areas, remains a key source of conflict diamonds.

"The notion that someone's engagement ring could have been used to further the misery of someone in a war-torn area is an anathema to the industry, as to its customers," Rae says.

The gold industry was also under renewed scrutiny because of some high-profile cyanide spills. The worst occurred in 2000 when some 120 tonnes of cyanide poured from Australia miner Esmeralda's Romanian goldmine into the Tisza river, from where the deadly chemical was washed into the Danube, killing 1240 tonnes of fish.

At a meeting in London in 2005, a large cross-section of the industry from mining, processing, manufacturing and retailing agreed to form the council, with the aim of adopting and monitoring responsible practices covering environmental, social and ethical criteria.

The idea had been inspired by the success of the Forest Stewardship Council and Marine Stewardship Council, which brand products from sustainably-managed forests and fisheries.

But the challenge for jewellery is much more complex. While both the FSC and MSC track wood and fish products through the production chain, the diamond and gold that make up a bracelet or ring come from a wide variety of different sources. In addition, the FSC and MSC are focused only on monitoring the harvesting of wood and fish, not the downstream processing.

The aim of the council, however, is not to track individual gold and diamonds, but to monitor the whole production chain, so that manufacturing operations will also be required to abide by its standards - which cover issues such as child and slave labour as well as the environment and corruption.

"What we are trying to do is a more comprehensive process through all the links in the chain. Nobody has done this before for a complex manufacture."

Under the plan, the council will oversee and authorise regular, independent, third-party monitoring by its members to ensure they comply with the council's code of practice.

The council is trialling the monitoring process, and aims to formally introduce it during the first quarter of next year.

A key issue, says Rae, is to ensure that the process doesn't become limited to the big players in the industry, who can most easily afford the expense. He says there is a risk small players could find their reputations unfairly tarnished, and that the council needs to avoid this by making it easy for small operators to participate.

Rae believes the council's work can eventually be extended to other products such as silver, platinum and precious stones.

The mining members of the council are AngloAshanti, BHP Billiton, De Beers, Newmont Mining and Rio Tinto. In all, the council has 71 business members, excluding industry associations.