Exit Interview: Ronald Friedman Speaks His Mind

Ronald (Ronny) Friedman, the nine-year president of the Diamond Manufacturers and Importers and America, promised me a frank interview when his term was up (he serves until March), and he didn’t disappoint. Here he doesn’t mince words about mining companies, other industry groups, and even—gasp!—the press: 

On the mining companies: The mining companies have businesses to defend but their focus in normal times has been to realize as high a price for rough as possible. I understand companies trying to maximize profits, but it has to be the context of long-term health of their clients. 

They sometimes lose sight of the long-term goal of making sure the industry stays healthy. A perfect example of that is the lead-up to the crash of 2008, when prices were skyrocketing. After the crash of 2008, when we had the crisis meeting in Antwerp, the mining companies were really on their knees. There were questions on whether the mining companies would survive, and they were begging for unity. They were saying how the industry needed to be unified to get through this crisis. It was really the manufacturing community that stepped up and took goods in extremely volatile times. 

Now we are back in a crisis. Look at the last few months of people not taking up allocations, goods being resold for losses. I think we are going through a difficult time. 2012 was a very challenging year for the industry. It is really important for the mining companies to have a long-term vision for what makes for a successful manufacturing industry. When you have a successful manufacturing industry, it goes all the way through the pipelines.

On DMIA’s relations with other New York organizations: We have to reach out to the other organizations to work together. I am proud that I have always attempted to do so. I have not always been successful. I think that speaks for itself. The DMIA is committed to do that after my departure as well. 

On DMIA’s relations with the IDMA, the international group: The Diamond Source Warranty Protocol was a nuclear topic. We were attacked for our involvement, although we are convinced now, as before, it was the right direction to go in. And the reality is all you have to do is look at Tiffany, look at Cartier, look at Borsheims, look at Sterling and Signet. Those are all companies that are trying to defend the product to the customer, in terms of it being ethically sourced. 

Here in the U.S., we can’t deal in Zimbabwe goods anyway. It’s against the OFAC [Office of Foreign Assets Control] rules. If you have someone here in the U.S. who has an issue with that, are they saying that they are working without taking the OFAC rules into account?  

On the recent changes at the World Diamond Council: There is a general feeling that the WDC has not been representative of the industry. What I would like to see is a total reconstitution of the board of directors. It has the appearance of being stacked with cronies. That board should be constituted of the best and the brightest leaders of the industry who can fulfill the mission of the WDC. That is the next natural step.

On the industry in New York City: Unfortunately the shrinkage in the manufacturing in New York is comparable to the shrinkage in Belgium and I think also in Israel. We are facing India becoming such a huge cutting center and a force in the industry; we can’t be in denial about that. [But] it’s not a level playing field. 

India didn’t become the behemoth it became just by itself. There were currency manipulations, advantages that they had from their governments—all sorts of different things outside of the realm of diamonds helped them take over the diamond business. Those kind of things were never available to manufacturers here. We never got the help of our government; we never were given cheap financing; we didn’t have the benefit of currency manipulations. That really enabled the Indians to grab hold of the industry. Now, they have been very dedicated and they were talented. But there were certain advantages that none of us had.

Here in New York [City], we have adapted. You still have manufacturing going on here. Realistically the most important thing is we have a solid, formidable financial foundation here. And you also have a better understanding of the American market. So there will always be an industry here in New York. 

On the press: This is not meant to be critical, but I think the press has an important role to play. I think the press is a little bit soft in terms of being forward with leadership and has treaded a little bit lightly on certain topics. Obviously you have a few exceptions—people who are a little over-the-top. If we had a press that was more engaged on a regular basis, more forward about writing about organizations and their work, you would have more interesting reading and a much better industry.  

I think the press knows there have been leadership problems in the industry, and needs to bring it out in the open.  

On serving at DMIA: It’s certainly an honor but frankly it’s been too long. You come in with a lot of enthusiasm and a lot of ideas, but it’s better to expend it over a shorter period of time. 

JCK News Director