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It Takes a Village

Tips for vetting responsible suppliers

By Deborah A. Yonick

For more than a decade, there’s been a movement within the jewelry industry to improve how the precious materials used in it are sourced. As a result, many companies have begun referring to their products as “responsible,” “recycled,” and “sustainable.” But what does it really mean? And how do you know for sure whether or not something is actually what the company is claiming it to be? How do you know who to trust in an industry where trust is key?

To help with that, we’ve spoken with experts in the industry about what it means to source things responsibly, the best questions to ask suppliers, the certifications to look for, and the right resources to turn to for help.

Why It MattersWhy It Matters

Every jeweler needs to embrace responsible sourcing. Why? Because even if you don’t worry about where the materials in your work come from or how they were obtained, your customers likely do.

Millennials, who comprise the largest group of consumers, and Generation Zers, in particular, are known for their interest in learning more about the companies they shop with, including where those companies source their products as well as how those products are made.

Rio Grande San Diego Tourmaline

In its “The Era of Monomass” trend report last year, Dazed Media found that more than 60 percent of the 3,510 Gen Z and Millennial consumers it interviewed (across 12 markets, including the U.S., UK, China, and India) share similar ideals, saying they would find it difficult to engage with brands that demonstrate negative views about the conscious consumption choices both generations now make.

Gold panning photo by Manuela Franco

A 2020 study by Research Insights, in cooperation with the National Retail Federation, found that nearly six in 10 consumers surveyed were willing to change their shopping habits to reduce environmental impact. Nearly eight in 10 respondents indicated that sustainability is important to them. And 71 percent of those who indicated that traceability is very important said that they are willing to pay a premium for products that provide it.

Then there’s the matter of the government, which has an interest in where jewelry companies are sourcing their precious metals and gemstones. According to Tiffany Stevens, Esq., president, CEO, and general counsel of the Jewelers Vigilance Committee (JVC) in New York City, following the arrival of the new White House administration, the JVC is already seeing evidence of financial enforcement of businesses complying with anti-money laundering laws and regulations from the USA PATRIOT Act and Bank Secrecy Act, which “almost all jewelry businesses in the U.S. must comply with.”

And then there’s how good being responsible is for a company as a whole. Research shows that companies that commit to sustainability will come out stronger with more solid customer and supplier relationships, an enhanced corporate reputation, and improved loyalty and productivity from its employees.

“The more a business understands its supply chain and manages strong due diligence processes, the more it can ensure that its products are produced responsibly,” says Iris Van der Veken, executive director of the Responsible Jewellery Council (RJC).

It’s also worth noting that when individual companies within the industry start spending more time and effort on sourcing materials responsibly, it helps to improve the image of the entire industry. In November, Human Rights Watch, a non-governmental organization in New York City, released a report, “Sparkling Jewels, Opaque Supply Chains: Jewelry Companies, Changing Sourcing Practices, and COVID-19,” ranking the sourcing practices of jewelry companies. While the NGO found major brands have made progress, it said most jewelry companies fell short on key processes integral to a robust human rights risk assessment and response, including reporting in detail on their due diligence efforts.

The NGO asked jewelry companies to improve their efforts to ensure human rights are respected in their global supply chains. It also encouraged consumers to send a strong message to companies not taking steps in that direction. “What symbolizes love and joy should not be made in abusive conditions,” said Juliane Kippenberg, associate children’s rights director for the NGO, in a press release earlier this year.

If you haven’t been taking all of the steps necessary to know where your materials come from before, now is the perfect time to start. Luckily, it’s easier than it ever has been to follow the supply chain for many of the materials used in the jewelry industry.

Start the JourneyStart the Journey

One of the easiest ways to get started is to source your materials from responsible suppliers. But how do you find them, and then once you do, how do you trust the information they provide?

Start by reaching out to organizations within the industry that are dedicated to responsible sourcing. Many jewelers begin their journey with Ethical Metalsmiths (EM). Founded in 2004, EM is a community of buyers, jewelers, designers, and suppliers committed to responsible, environmentally sound practices. It also offers a wealth of information and resources.

“This is a membership community built around a common goal to eliminate the negative environmental and social impacts associated with jewelry,” says Hayley Norton, an associate consultant with Hill & Co., a global launch and growth agency for sustainable diamond, gem, and jewelry companies.

Rio Grande San Diego Tourmaline

In addition to EM, there are associations that require adherence to codes of ethics and responsible sourcing and business practices, and jewelers can go directly to their websites to search their membership directories. It’s also helpful to ask colleagues who are dedicated to using responsible materials about the companies they work with and why.

Learn the LingoLearn the Lingo

Because what’s ethical and re-sponsible to one person might not be to someone else, it’s important that industry members develop and share the same vocabulary.

Words matter, says Jared Holstein, owner of D’Amadeo, a San Francisco–based diamond, gemstone, and estate jewelry wholesaler who currently co-chairs the responsible sourcing committee for EM.

“What do we actually mean when we say ethical, conflict-free, sustainable, fair trade, recycled,” asks Holstein. “A shared vocabulary is critical to ethical sourcing in the supply chain.”

That’s why he’s one of several volunteers working on the Jewelry Glossary Project. The group—comprised of jewelry designers, gemstone wholesalers, goldsmiths, educators, and experts in the sector—aims to create shared definitions for use by the trade and the public. Ten definitions have been established so far. (Holstein invites anyone interested in joining the cause to reach out, as they have a long list of words that still need to be worked on.)

Mining for precious metals

Research shows that companies that commit to sustainability will come out stronger with more solid customer and supplier relationships, an enchanced corporate reputation, and improved loyalty and productivity from its employees.

While the glossary remains a work in progress, jewelers can also turn to the JVC for assistance in learning proper terminology, particularly when it comes to de-scribing products as sustainable. Free for everyone in the industry to download from the JVC website (jvc.org), the JVC’s “Understanding the FTC Guidelines” e-guide addresses specific things jewelers need to know about the changes made in 2018 to the Federal Trade Commission advertising guidelines, such as how to avoid deceptive claims about precious metal and gemstones, and when to make disclosures to avoid unfair trade practices. There is also new guidance on green products.

In addition, the World Jewellery Confederation (CIBJO) is offering its CIBJO Blue Books for free to the industry. Among them is one focused on responsible sourcing with sections on supply chain due diligence and responsible sourcing certification, as well as a list of standards, guidance, and certification organizations.  

Ask QuestionsAsk Questions

As the responsible sourcing movement has grown within the industry, so has the number of suppliers claiming to be responsible. So once you’ve compiled a list of possible responsible suppliers with whom you’d like to work, you’ll need to dig a little deeper into them to learn more about their practices. That starts with asking a lot of questions:

While this is by no means meant to be an exhaustive list of questions to ask, it’s a good starting point, as any responsible supplier should be able to (and want to) answer them.

In fact, Torry Hoover, president of Hoover & Strong, a refiner and manufacturer in North Chesterfield, Virginia, says the biggest red flag when vetting any supplier is that it can’t or won’t answer your questions regarding supply chain transparency. And Hoover should know, as he not only has to answer these questions from his own company’s customers but also ask them of his suppliers.

“Know your sources,” says Hoover. “How long have they been in business? What are their long-term business practices? Keep digging down to what’s important to you, to what you are passionate about.”

“It’s always a good idea to do your own due diligence, whether a supplier is certified or not,” adds Norton. “We are an industry based on trust, but also it’s a best practice to Know Your Counterparty.”

Rio Grande San Diego Tourmaline

And don’t just ask your primary suppliers. “If [your] supplier is supplying from another source, continue up the supply chain, ask them to ask their source if they don’t have the information,” says Norton. “It’s a start to transparency.”

Check CredentialsCheck Credentials

It’s easy for a company to claim that it’s responsible but how do you know for sure? One way is to ask about any certifications it’s received that can attest to its claims.

“Not all ethical suppliers are necessarily certified and independently audited, but certification does give credibility to responsible claims, as a third-party audit has been conducted to verify their validity,” says Norton.

She specifically cites the RJC as an excellent resource.

Founded in 2005, the RJC is a leader for setting standards for the jewelry and watch industry. While industry members of all sizes and from all parts of the supply chain can join the RJC, that membership hinges on a company’s ability and dedication to achieving RJC Certification within two years of joining.

To become certified, companies must complete a self-assessment, undergo an audit with an RJC accredited auditor, and develop a corrective action plan to address any issues discovered during the audit. And the work is never done; to maintain membership, companies need to be regularly re-certified (usually after one or three years, depending on the company). As part of the certification process, companies have to show that they meet the RJC’s Code of Practices. Certified companies must have policy and risk management frameworks for conflict-sensitive sourcing practices, and meet certain standards for human rights, labor rights, environmental impact, and business ethics.

And those frameworks will only continue to evolve. Van der Veken says that among the sustainable development goals on RJC’s 2030 roadmap are gender equality, decent work and economic growth, responsible consumption and production, climate change, peace, justice, and strong institutions and partnerships for the goals, which are related to the United Nation’s five pillars of sustainable development (people, planet, prosperity, peace, and partnerships). 

Inspecting gemstones

In a 2020 study, nearly 6 in 10 consumers surveyed were willing to change their shopping habits to reduce environmental impact. And nearly 8 in 10 respondents indicated that susatinability is important to them.

“If you are sourcing suppliers who are certified members of the RJC, this membership would give you the assurance of knowing that the supplier has gone through a robust certification process; independent, third-party audits; periodic checks; and is adhering to an all-encompassing leading global international standard,” explains Van der Veken. “The RJC Code of Practices incorporates principles from key international frameworks, including the Universal Declaration of Human Rights, the ILO Principles, the UN Guiding Principles on Business and Human Rights, and the UN Global Compact.”

Another organization that certifies products within the jewelry industry is SCS Global Services. One of the largest third-party verification organizations in the world, it has been a pioneer in the field of sustainability standards, working across economy in natural resources, food and agriculture, and consumer products. One of the certifications it offers, the SCS Responsible Source Certification, verifies that precious metals have been obtained from recycled sources, conflict metals have been avoided, and environmental and social criteria have been met.

SCS also has a SCS Recycled Content Certification that evaluates products made from post-consumer material. It identifies the percentage of recycled content in the material, so an accurate claim can be made in the marketplace.

To qualify for certification, companies have to submit product data, corporate documentation, information on manufacturing processes, product formulations, and more. Then, SCS will conduct an audit, which will include an on-site inspection of the facility and an upstream supply chain assessment. The auditor will then prepare a draft assessment report, which is then reviewed by another auditor. If the company’s products are then certified, it must undergo annual audits to maintain certification.

When it comes to diamonds, the SCS has a Certified Responsible Source Standard for Diamonds. To achieve this designation, companies must go through a thorough review to ensure that their products are produced under fair labor practices with minimal harm to the environment. Even companies selling post-consumer diamonds have to trace the source of each diamond to validate the supply chain and ensure that environmentally and socially responsible practices were used during production.

Rio Grande San Diego Tourmaline

Although there aren’t currently any formal certifications for colored gemstones, the International Colored Gemstone Association (ICA) has worked with CIBJO to develop an Ethical Member Accreditation for its membership. It’s based on a self-audit that consists of a series of steps containing key ICA and industry objectives outlining the elements of responsible sourcing, and should become a stimulus for continuous improvement, explains Gary Roskin, ICA executive director. He notes that to keep the Accredited Ethical Member status, members must undertake the online accreditation annually. And because it is based on a self-assessment and voluntary pledge, the ICA recommends that companies have independent third-party audits conducted, although they are not required.

But even if an organization hasn’t been through a formal certification process, it doesn’t mean they’re not sourcing their materials responsibly. In those instances, Norton advises running the company name and the names of any owners/partners against government watch lists using a subscription service such as LexisNexis. She also recommends asking for documentation, specifically invoices that show proof of where materials were purchased and/or processed, audit reports, and sustainability reports, if available.

“A supplier may not have all this information, but their willingness to be transparent and provide you with the information they do have is a good indication that they are conscious of their supply chain and stand behind the source of their material,” says Norton.

Get InvolvedGet Involved

One of the easiest ways to discover and learn more about companies that are dedicated to sourcing materials responsibly and ethically is to simply get involved in organizations that have a focus on the topic.

Stevens believes that it takes a village to make ethical sourcing a reality through the supply chain, and she encourages those in the trade to support industry groups that do.

“They are all unique,” she says. “Different groups are doing different things, and we need to support all of these efforts as we build a network for responsible sourcing.”

Norton believes that EM is a great first stop for most, noting that it offers a wealth of information and is on the forefront of sustainability efforts.

Joining and getting certified by the RJC is also an option for most jewelers. And it’s one that may eventually be required for doing business, as more and more companies are wanting to work with those who are certified.

In fact, in 2019 The Plumb Club became the first organization to require its members to become certified members of the RJC.

“Having a standardized universal code of practices throughout our industry that the retailer, consumer, and our government can rely on to guarantee that these products are the most responsibly sourced and ethically produced in the marketplace is critical,” explains Michael Lerche, Plumb Club president.

A founding member of the RJC, Mark Hanna, chief marketing officer of the Richline Group in New York City, recommends that all suppliers and retailers become certified members of the RJC. “Hopefully we’ll see other associations follow the Plumb Club’s lead as the need for transparency and trust throughout our supply chain is paramount.”

Hoover notes that his company requires all of its refinery customers to be RJC and/or SCS Responsible Source Certified. In addition, it requires that they complete an anti-money laundering form before it will process their scrap metal.

Miners holding Fairmined poster

Participating in these groups will not only show your dedication to the cause, but also put you at the forefront of learning about and having access to the latest developments. For example, the RJC recently launched a Due Diligence Member Toolkit for sourcing from conflict-affected and high-risk areas for diamonds and color stone members. And this year, it is building a membership portal that will enhance data management and reporting on progress, with a focus on impacts in the communities where its members have operations.

Also look for industry events dedicated to responsible sourcing, where you can learn more about the resources out there.

Founded in 2017, the Chicago Responsible Jewelry Conference was created to bring people together to find ways to make jewelry supply chains more transparent. In addition to being a place where like-minded industry members can share and discuss ideas, the conference has contributed to the development of educational, industrial, and community initiatives.

Launched during the Tucson gem shows in 2020, the Ethical Gem Fair is dedicated to increasing interest in traceable and ethically mined gemstones. All of the participating stone exhibitors are committed to responsible sourcing and giving back to mining communities.

“Sustainability is a shared responsibility,” says Van der Veken. “Governments, private sector, and NGOs have a role to play. You need a smart mix of policy and standards to advance responsible business practices. We see companies working hard to understand their supply chain, not only to mitigate risks, but focus on how they can achieve real positive impact.”

“Most of us in the industry want to offer the best we possibly can,” adds Roskin. “Whether you self-assess or conduct a third-party audit, all of us must do our due diligence to ensure that we all do the right thing.”

If nothing else, participating in industry groups and events focused on responsibility will connect you with like-minded people in an industry where relationships still very much matter.

“The people you do business with, you have to trust,” says Roskin. “Be as careful as you can. Make relationships. Don’t look to just get the best deal.”

After all, we’re all in this together.

“It is about leaving no one behind. We believe this is a shared responsibility,” Van der Veken says of responsible sourcing. “No one can do this alone.”

 



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Sourcing Responsible Materials: What You Need to Know

April 22, 1 p.m. EDT 

Andrea Hill will lead a discussion of leading responsible suppliers and experts as they clarify certifications, define best practices, and lay out guidelines that will help to ensure that, when sourcing responsibly, you get exactly what you want. REGISTER HERE.

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