The World Diamond Council has received an unusual amount of criticism these days—at least by the general standards of intra-industry omertà. Last week, former Jewelers of America CEO Matt Runci slammed the group during his speech at the Jewelers Vigilance Committee luncheon. (Making things somewhat awkward, JVC’s president and CEO is general counsel of WDC.) That comes on the heels of Martin Rapaport’s epic cri de coeur from December, which also includes sometimes-harsh words for the WDC.

Rapaport’s piece speaks for itself, but I wanted Runci to explain his comments. He gave me three reasons for his remarks:

– First, Runci, who resigned from the organization’s board last summer, doesn’t think the World Diamond Council currently reflects the concerns of the more-consumer-conscious downstream industry. “You have a narrower and narrower circle of people making decisions,” he says. “The WDC needs to represent all segments of the industry.” 

– He feels the group lacks follow-through on the big issues. “Human rights language [in the Kimberley Process] is a great example,” he says. “The WDC expressed public support for certain reform measures with the knowledge that certain governments will be opposed to them. If the WDC could use its influence to help educate those governments, that would be much more helpful. It is relatively easy to say we are for something when you know it’s not going to happen anyway.”   

 – He also thought that WDC president Eli Izhakoff’s endorsement of an end to U.S. sanctions against Marange goods hurt the industry among NGOs and could possibly affect consumer confidence. (I should note that idea stirred considerable dissention within the WDC, and it has now been dropped.)

Runci stressed to me several times that he felt uncomfortable talking about this, as he really didn’t want to get into a public argument with the current WDC leadership. Izhakoff declined comment, also expressing a desire to end the public spat. 

First off, I do believe the WDC does a lot of under-the-radar things that aren’t always noticed or appreciated. But looking at all this from a wider perspective, this is just the latest example of the increasing difficulty of maintaining an overarching industry body. When the WDC was first formed, the industry was united against conflict diamonds. The organization worked tirelessly to bring the KP about, and deserves a lot of credit for its success. But that unity no longer exits. On issues ranging from Marange to audited chains of custody, certain segments of the middle market and retailers in America and Europe increasingly find themselves at odds. So now the question is: Can one trade group represent all these perspectives?

Last year, Edahn Golan floated an idea, in response from criticism of the WDC from the middle market (yes, the WDC gets it from all sides): 

With such different needs and outlooks, some are starting to think it wrong that a number of NGOs serve as Independent Observers in KP, but only one entity represents the diversified trade. This may change soon. 

In India and Israel, concerned industry leaders and opinion makers are already thinking of forming an additional Independent Observers body that will voice the needs of the industry and trade at KP. 

But perhaps a better idea comes from a current WDC board member, who proposed eventually developing a different structure for the group—one that would, like Kimberley Process, have a rotating chair from different sectors of the industry. (Currently, Izhakoff serves as both CEO and chair.) One year it may be headed by a representative of the middle market; the next, the retail sector; after that, a miner. That might improve communication between all the different sectors, although it probably would not bridge every single gap. But it’s worth a shot. As Runci put it: “I have always felt it is worth it to get key people together in the room to have a serious conversation. Unless one tries, how will you know what is possible?”

Rob Bates

JCK News Director