During a conference held yesterday at the U.S. Department of State, government officials stressed that all members of the jewelry industry need to get a better handle on their supply chains, sources told JCK.
Some attendees expressed considerable nervousness prior to the conference, in light of an April meeting with Department of State officials that struck some as threatening, with cryptic warnings of executive orders and a coming crackdown.
But attendees at yesterday’s conference told JCK that it was decidedly nonconfrontational.
“It was not the tone of the meeting in New York,” says one person who attended both. “The tone was not threatening at all. It was very cooperative. They don’t want to hurt us. They want to work with us, if we work with them.”
Of course, the source noted, if the industry doesn’t do more, “there is always the threat of government stepping in. But it was more about staying ahead of the curve, so they don’t have to legislate.”
The meeting was held under the Chatham House Rule, which forbids attendees from repeating who said what, although they are allowed to discuss the general topics that were discussed. For that reason, attendees choose to remain anonymous when discussing the meeting. (JCK was invited but did not attend.)
The title of the conference was “Women’s Economic Empowerment: Minerals, Responsible Sourcing, and the Jewelry Supply Chain,” and a large chunk of it addressed gender issues, particularly the role of women in artisanal mining. But it also touched on industry sourcing more generally.
Some were surprised that officials talked a bit about issues in the gold supply chain—particularly the case of gold refiner NTR Metals, which in 2018 pled guilty to failing to maintain an adequate anti-money-laundering program. The prior year, three former NTR employees pled guilty to conspiracy to commit money laundering, for buying millions in smuggled gold.
The officials repeatedly called for the industry to follow Know Your Customer (KYC) protocols. In particular, they stressed the need to file Suspicious Activity Reports (SAR), noting that the industry has barely filed any.
“The State Department finds it hard to believe that the industry doesn’t know who in the industry is a problem,” says one attendee.
In many ways, this has been the same message the State Department has been delivering to the industry for years. But attendees especially appreciated the panels featuring tech giants such as Intel and Kemet, who have coped with similar issues in their supply chain.
“All businesses have these issues,” says one source. “The question is how you deal with them.”
Says another: “It was really informative to hear what these other companies are doing and how forward thinking they are. We need people who are not trying to set up roadblocks. We need people who are willing to take on these difficult challenges.”
Parts of the meeting was devoted to current initiatives in the industry— including in the Responsible Jewellery Council and the Diamond Source Warranty Protocol—and the issues smaller companies face in responsible sourcing.
“The message was: From the designer to the retailer to the miner, everyone can do more,” says an attendee. “It’s a shared responsibility across the value chain. Everyone has to do their necessarily due diligence. It’s about having the right systems in place, knowing who you are doing business with. No system is going to be perfect, but you can always do better.”
Says another: “They were clear that transparency is here to stay, and that is not negotiable. Everyone agreed that this should not just be one conference and nothing will happen. I think a lot of people stepped out of that room yesterday and said, ‘I could do more.’ ”
Signet chief executive officer Gina Drosos (pictured above) was the keynote speaker for the event. She announced that her company was undergoing a comprehensive review of its global supply chain, to ensure all its suppliers respect and empower women.
Responsible sourcing in the jewelry industry and the State Department’s views on it were discussed in the latest episode of the JCK podcast, “The Jewelry District.”Follow JCK on Instagram: @jckmagazine
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