Interview With the State Department Advisor on Conflict Diamonds Ashley Orbach

Ashley K. Orbach was appointed special advisor for conflict diamonds for the U.S. Department of State earlier this year, which means she represents the United States in front of the Kimberley Process. (Her official title is special advisor, conflict minerals and precious stones, showing that she will work on more than diamonds.) The affable and approachable Orbach, who previously served as foreign affairs officer with the U.S. Mission for the United Nations, talked with JCK about what the U.S. government wants from industry, issues with the KP, and controversies about the Precious Stones Multi-Stakeholder Working Group (PSMSWG). Edited highlights of our conversation follow.

JCK: How do you see the prospects for human-rights language being added to the conflict diamond definition of the Kimberley Process? 

Orbach: I wouldn’t frame it as human-rights language, though human rights is one of the things that remains important to the United States. We have in the past made clear that the KP needs to remain relevant, and needs to retain the ability to act quickly when circumstances arrive. The world has a way of throwing situations at us that we didn’t necessarily contemplate. We need the KP to be flexible so when there are issues surrounding rough diamonds, the KP can remain relevant. This continues to remain important to the United States.

In terms of its current status, this continues to be an ongoing discussion. In our view, progress is sitting down and talking about this stuff. There aren’t easy issues. One of the beauties of a multi-lateral initiative is it brings many different views to the table.

JCK: What do you see as America’s goals regarding the KP?

Orbach: A major goal of our chairmanship, which is being carried forward by the succeeding chairs, was working on development issues. I would see another best practice as looking at a regional approach. We are doing a lot of work in West Africa, and we have had a lot of success in helping to marry aspects of the KP with development. The role of artisanal miners is something that we care a lot about. We have seen participants in the KP try to ensure that these crucial actors are not left out of economic development. 

JCK: How is the new administrative support mechanism [ASM] working?

Orbach: We have a real problem with the lack of institutional memory. There was a real administrative burden on the chair. We had to make sure that information is accessible and usable. The ASM is starting to play a crucial role but it is new. 

Input is being collected from various participants to see how the ASM is working. We are very happy that the ASM is in existence. It will become more important as we go forward.

JCK: You are involved with the Precious Stones Multi-Stakeholder Working Group. I have heard many say that this is a group that has the power to affect the trade worldwide. Yet, just about all of its founders, as well as most of its participants, are associated with the United States and Europe, so some worry it has a pro-West bias. 

Orbach: We are really proud of the work of this group in terms of helping to create a platform where people, industry, government, and civil society can come together and talk about these issues. I’m aware of the criticisms, but this is very new. 

We are proud of the U.S. industry and the role it plays and continues to play in demanding higher standards and greater transparency and due diligence in the supply chain. We look forward to having this discussion through our working group and on our phone conferences, which are open to anyone who is interested.

Does the PSMSWG need to be inclusive? Of course. Should there be more outreach? Of course. Will there be disagreement? Of course. That is okay as long as people are willing to work together and be constructive.

JCK: I keep hearing the goal of the group involves due diligence. Can you explain what that means?

Orbach: What we are really talking about is transparency in the supply chain—knowing where your product comes form, taking steps to ensure that the minerals you are sourcing are not fueling conflict or contributing to human rights abuses, environmental degradation. At the core it’s asking questions about where your supply is coming from, and who you are sourcing from, and knowing how the product moves along the supply chain and seeing if there any red flags.

There are already a number of voluntary schemes out there. There is the Responsible Jewellery Council, the Diamond Source Warranty Protocol. The OECD guidelines apply to all minerals, and there are specific guidelines on the three “T”s and additional supplements on gold. These guidelines have been developed taking into account the unique aspects of those supply chains, in partnership with the [International Conference on the Great Lakes Region] member states. They are voluntary guidelines that companies elect to use on their own supply chains and that have to be tailored to the circumstances of a particular industry. We have a handful of U.S. companies that are already applying these voluntary guidelines, and we’re expecting to hear from them in terms of application of the guidelines.

JCK: Many people feel that, if there are voluntary guidelines, it will be easy to make them permanent. 

Orbach: I recognize that is a concern of industry. The flip side of that proposition is, once you have a voluntary guideline, maybe regulation isn’t needed. We are not lawmakers here in the State Department. I am not saying whether regulation is or is not needed. Certainly, the working group has not advocated for any legislation. We have been focused on voluntary standards and due diligence.

JCK: Can you explain the study that the group is preparing?

Orbach: We are hoping it will get finalized, and when it does it will be out for public comment. We are hoping to get a broad base of reaction. It is just one data point for us. We had hoped it would be finished by the time we went [to the upcoming June meeting in] Paris, but we don’t expect it to be. There is still a lot to talk about in Paris. We need to take stock and figure out what we need going forward. When the study is completed, it should be out for public comment and should make for some discussion.

JCK: Some countries are worried that the study will single them out. 

Orbach: The point of the study is not to look at the global supply chain. It is not to say which countries are at risk. It features initiatives that are in development and looks at what might be some of the gaps and what might be closed.

JCK: Many in the colored gemstone industry appear unhappy about this initiative, perhaps because it has less experience working on these issues.

Orbach: I wouldn’t characterize it that way. When I went to Tucson, Ariz., I found the colored-stone industry is doing a lot in terms of various initiatives and has a really unique understanding about the issues of artisanal mining and small-scale mining.  

The diamond industry has had the KP for over a decade. That has brought together industry in a particular way. We don’t have the same sort of organizational platform for colored stones. We have found members of the colored-gemstone industry to be quite open to discussions on these issues. Working in a multi-lateral forum is new to some members of industry. We welcome them, and we hope that more people join and give their opinions—positive and negative—as long as they are constructive. 

I think the gemstone industry has some legitimate concerns and wants to ensure its voice is heard. First, it’s important to appreciate the challenges of the small business and small- business owner in today’s global market. Companies need to make tough decisions on where to focus their energy and resources. Given the nature of the colored-stone industry, these are very real concerns. What we are hearing from a number of dealers, retailers, and the like, however, is that responsible sourcing is good business, and consumer trends across many industries point to that fact. 

Second, the manner in which colored stones move through the supply chain presents its own set of unique challenges, and we need to be cognizant of this and not simply extrapolate from our experience with the diamond supply chain, for instance. 

Last, I’ve heard from a number of individuals in the colored-stone industry who have been working on projects or supporting responsible business practices for many years but are unfamiliar with much of the U.N. or OECD jargon. This is a fair point, and we need to do a better job of explaining what these multi-lateral organizations are and are not. 

JCK: Does the Working Group aim to supplant the Kimberley Process? 

Orbach: I have gotten that question. I am not sure how exactly that would happen. The Kimberley Process is implemented by domestic legislation. We are looking at voluntary due diligence. Voluntary guidelines will not supplant the Kimberley Process. The Kimberley Process is very good at what it does, but the nature of it is it can’t do everything related to responsible sourcing. 

JCK:  You also oversee certain aspects of the implementation of Dodd-Frank Sect. 1502, which covers so-called conflict minerals. Can that legislation ever be expanded to diamonds? 

Orbach: Right now it is tailored to a handful of minerals. Its application can be broadened. But I am not aware of any discussions in that direction at the moment.

JCK: Will there be further legislation targeting the industry? 

Orbach: I’m not in a position to comment on what lawmakers might or might not do. We encourage all in industry to conduct themselves responsibly and do supply chain due diligence. I think the industry can evaluate its own risks. But I think we also should look at how the industry can benefit from these initiatives. 

JCK: You are a relative newcomer to the industry and the KP. Can you give me your impressions of the industry and the Kimberley Process? 

Orbach: It’s been really interesting. And I am really grateful to everyone in industry. I have found that people have been very open to working with me and have been patient with my many questions as I learn my way around the jewelry industry. It’s been a very warm welcome.

The KP is built on the triumvirate of government, industry, and civil society. It has been extremely successful regulating the trade in conflict diamonds from an estimated high of 15 percent to less than one percent. The KP is one of the first models of industry, civil society, and government working together. There is a lot to reflect on its success.

JCK: Any message for the industry?

Orbach: We are here to engage with anyone who wants to engage constructively with us. We are here to talk about the issues and learn from you. We continue to encourage business to continue to be leaders, which is what industry has always done in this regard. 

At the end of the day, industry will drive this effort forward, as we’ve already seen happening. Just take a look at the various trade shows where this has been put on the agenda. We encourage all sectors of industry to explore responsible sourcing and supply chain due diligence.

 

JCK News Director