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Responsible Sourcing —International Colored Gemstone Trade Trends

2020-05-18 Source:InColor

The responsible sourcing of gemstones is a concept involving behavior, ethics and compliance along the supply chain that has gradually developed over the past decade. As consumers continue to grow their expectations of the business ethics of the goods they purchase, and the requirements of governments, non-governmental organizations, companies, media, etc. for supply chain responsibilities.



CIBJO panel, that looked at how responsible business standards can help jewelry producers break into foreign markets.(Photo: by CIBJO)


AT the CIBJO 2018 Congress, CIBJO’s Responsible Souring Guidance was unveiled. The International Colored Gemstone Association (ICA), the Responsible Jewelry Council (RJC) / American Gem Trade Association (AGTA), etc. have developed industry codes of conduct that include responsible and sustainable practices. Responsible Sourcing has also become the hottest topic in international jewelry industry conferences and forums in recent years.



Responsible procurement is increasingly important

The responsible sourcing is becoming vital to the colored gemstone trade. New generations of consumers are becoming concerned about the environment, human rights and social justice. They also require the transparency and traceability of the production and marketing chain, and include responsible procurement in its criteria for deciding whether to purchase. governments, civil society, designers and consumers are calling for credible procedures to ensure the legal, ethical and responsible provenance of colored stones sold and set in jewelry.


Responsible sourcing has become an integral part of high-end customer marketing efforts. A large number of luxury brands around the world have begun to develop standards and verification guidelines to promote and clarify their industry ethics and procedures and provide responsible supply chain documentation during the procurement, cutting and production of gems and precious metals. For major brands, responsible procurement is also a key element of good governance and compliance.



Technical development of responsible sourcing

The types and sources of colored gemstones vary. Found in many underdeveloped and remote areas of the world. Different geographical locations, political environment, socio-economic conditions and cultural beliefs all constitute a highly decentralized supply path. As a result, the traceability of most gemstones in the entire supply chain is extremely difficult.


The vertical integration of large mining companies that greatly shorten the gem’s path from the ground to the finger. Standards and guidelines are not a problem, but it is difficult and difficult for artisanal miners and informal small-scale miners.Stakeholders of the colored gemstone supply chain are deeply concerned that failure to meet the standards may lead to the eventual disappearance of small-scale miners, with the consequent loss of their traditions and culture.


For example, the Australian opal mining industry goes to extraordinary lengths in bringing Australian opal to the world market in a sustainable and ethical manner, and some would argue that it is the world’s most ethically mined gemstone. It benefits from the fact that it is mined in a highly developed, highly regulated and stable country.Artisanal and small-scale mining accounts for some 65% of colored gemstone output, but well over 80% of active mining operations. It constitutes the core of the offering in terms of varieties, species and colors. The vast majority of players in the supply chain still depend on these smaller sources.



The key challenges facing responsible sourcing initiatives are finding technologies, procedures and standards, which are sufficiently easy, secure and affordable so that they can include artisanal and small-scale miners (ASM), while preserving traditional, small gem-trading and cutting businesses.


A variety of solutions ranging from nanotechnology to blockchain mobile applications have entered the market, but none of them have been deeply applied in the colored gem industry. To build a traceable supply chain from mine to market, only a system is not enough, the active cooperation of stakeholders is also important: if the information is correct, but someone in the blockchain is conducting a violation transaction ,How to do? Or, if the person who initiated the blockchain obtained gems through illegal channels, but circulated through the authentication channels, what should I do? The success of new technologies depends on the business models of various stakeholders and the ability to adapt to inevitable technological changes. It is necessary to continuously educate all participants in the blockchain    in this regard, make them aware of risks, and encourage everyone to protect gems The integrity of the supply process.


At the second World Emerald Seminar, Edward Mendelson from Everledger introduced how blockchain technology can provide traceability to the gem industry. (Photo: Cynthia Unninayar)


Finding a balance between all these factors will help preserve and improve the sustainability and diversity of the artisanal small-scale mining community as well as the traditional gem trading and processing businesses. The result will be a strengthened colored gemstone sector for everyone.



The future of responsible sourcing

The Internet has made the world more and more close, and it is possible to transfer information, communicate with each other, and conduct business activities anytime, anywhere. Jewelry has become one of the most important commodity categories in the new retail channel, and responsible procurement is more conducive to building consumer confidence in the new era and new scenarios.


Colored gemstones are becoming increasingly popular among millennial consumers. For those who can combine procurement with responsibility and sustainability, industry ethics and technical strength, good customer service, and effective marketing throughout the supply chain, the future prospects are promising!


Where did the gems you purchased come from?


The content is organized from 《InColor》2019 spring, summer, autumn and winter

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