JCK Las Vegas: Conflict Gold a Growing Issue

The conflict gold controversy is giving the industry an “opportunity to prove that it is an industry people can trust,” Sasha Lezhnev of the Enough Project said in a seminar titled Conflict Gold: The New Blood Diamonds.

“We would really like to see more action from the jewelry companies,” he said. “We hope the jewelry industry will be a leader on this issue.”

While there are other minerals, generally used in electronics, involved in the conflict in Congo, he noted that the electronics industry has taken action to audit its supply chain, but, so far, the jewelry industry has not.

“From the electronics side, we are starting to see serious pressure from higher on the supply chain,” Lezhnev said. “From gold, not at all.”

He noted that the issue is receiving more attention. There are two bills regarding conflict minerals in Congress, and Secretary of State Hillary Clinton called conflict minerals “a priority” when she visited Congo this year. In addition, 60 Minutes aired a story on gold in the Congo last year, and that piece is likely to be rebroadcast this summer.

“We’re in the process of writing to the major jewelry companies,” Lezhnev said. “We want to find out what they are doing and hear from them how interested they are. We have done this with the electronics industry, and only half of them wrote us back. But now they are all responding after they see the consumer response.”

He said that illicitly mined minerals, including gold, generate $100 million to $300 million a year for armed groups in Congo. Most of the miners who find conflict minerals are children, and their mining is done under armed guard.

Lezhnev called the war in Congo “the most deadly since the Holocaust,” with the main weapon being rape. “The human devastation is unreal,” he said.

He said his coalition believes a solution for conflict gold is possible. “The jewelry industry has been a leader on the conflict diamond issue,” he noted. “We have seen that progress can be made.”

Lezhnev called for a regional tracing, auditing and certification system. “The jewelry industry would do very well to work with players in the region,” he said.

He also recommended that the jewelry industry set up a working group on this issue and talk with key players in the gold market.

“The lesson from electronics is, initially the companies all complained,” he said. “And then they all found out how much it would cost, and then they are all willing to pay it. The cost is minuscule.”