A Kimberley Process…for Gemstones?

The recent announcement that the International Colored Gemstone Association is working with the United Nations on developing a chain of custody for gemstones raised a lot of questions. And talking with some of the people involved, they are not yet prepared to answer them.

The will to do something is there—as well as a budget, and some initial ideas. But it’s not yet clear how everything will work. (The system doesn’t even have a name!) 

ICA vice president Jean Claude Michelou says the basic elements of the system have been conceived yet cautions it will take four to five years to get it up and running. 

“This is not something we can do overnight,” he says.

The system he envisions is both less and more ambitious than the Kimberley Process. Like the KP, it will have local governments certify where gems were produced. It will be less ambitious because it will probably start out voluntary, without the force of law that backs up the KP. But it could also get more ambitious because, unlike the KP, it may specify country of origin, and could go beyond conflict, into violence, child labor, and environmental issues. 

The key will be keeping everything simple, says one of the people involved in the scheme’s planning, Nick Houghton, CEO of miner True North Gems. 

“If it’s too complicated, it won’t work,” he says.

Houghton says whatever happens with this system, his company is working on a computerized process to track his gemstones from the mine to the retail counter. 

As for why all this is needed, one can just look at Burmese rubies. When America banned their import, big retailers like Tiffany decided to stop buying all rubies, since they couldn’t guarantee their provenance. And while the Burma ban likely will soon be lifted, who knows what gem will find itself under the microscope next. These issues aren’t going away (a point I wish some of my friends in the diamond business would recognize).

A system like this could also be of particular benefit to the gemstone trade, where country of origin has long been a selling point. It could also help distinguish natural stones from synthetics, another big issue in the colored stone world.

“The Richemont Group, the LVMH group, all the big houses really want this,” says Michelou. “They really want to be able to say, ‘My product is clean.’”

The gemstone industry “doesn’t have the same threats as diamonds,” he notes. “But it could happen. The more transparent we are, the better. You see the big scandal with tracking meat. This let us have a tool for the future.”

Adds Houghton: “People are starting to come back to color. We need to make sure the product we deliver has integrity and everyone benefits from it. When you buy clothes, it tells you where they are from. This is an old, old industry. It needs to be at the forefront again.

“Every year we hear something that weakens the industry,” he says. “This will strengthen it.” 

JCK News Director