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Today

Pandora hires new Chief Commercial Officer

Pandora invited Martino Pessina to join the company as Chief Commercial Officer.

Yesterday

COVID-19: De Beers suspends March sight, permits 100% deferrals

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Nano-diamonds will be used to create masks for coronavirus - report

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Rapaport Price List suspended till May 1

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27 march 2020

Ethical sourcing and Diamonds Standards Organization

27 january 2020

antonio_cecere_xx.pngThe diamond sector is ready to embrace a new decade and overcome some of its historical challenges. Ethical sourcing has proven to be undoubtedly one of the main aspects that industry professionals need to address.

Antonio Cecere, President of Geneva Diamond Exchange and Founder of Monaco Diamond Exchange, is one of the foremost contributors to the efforts made in the past decade to a conflict-free diamond trade.

Here, Rough & Polished spoke to Antonio Cecere to understand more about the signs of progress made; his vision for the future and the importance of the incorporation of Diamonds Standard Organization (DSO).

Some excerpts:

Since Rough&Polished featured you in April 2019, Geneva Diamond Exchange and Monaco Diamond Exchange are now registered NGOs of United Nations Department of Economic and Social Affairs. What does this mean for you?

This is without a doubt a fundamental recognition for the progress we have made with both the Swiss and the Monegasque market regulators and it rewards our efforts in promoting a conflict-free diamond trade. Our objective remains that to control the afflux of conflict diamonds in mainstream markets and to this purpose, we now fully endorse Diamonds Standards Organization (DSO) so to extend our efforts to polished diamonds.

Consumers have increasingly become aware of ethical sourcing and conflict-free diamonds. Can you explain how Diamonds Standards Organization is going to contribute to eradicating this problem, and how will this impact the diamond sector?

I believe that Diamonds Standards Organization, a non-profit Swiss entity, will have a profound effect on the global trade and its certification system will reassure consumers and protect professionals. Recent market research showed how customers do not feel confident about the provenance of the gemstones when they purchase jewelry. Millennials’ purchasing power is now increasing and their level of awareness about sustainability and ethical sourcing has no precedent compared to the previous generations.

Therefore, informing customers has become a priority and a necessity for retailers and dealers alike. Historically, there is a fracture between rough and polished diamonds' ethical certification. Consequently, DSO realized that it had to link polished diamonds to the Kimberley Process Certification Scheme by connecting every layer of the supply chain to reach consumers.

How does the DSO Certification process work?

Similarly to KPCS, the solution starts by certifying the professionals that deal with conflict-free diamonds. The DSO certification is designed to inform end-customers; the retailers and the jewelry manufacturers that are DSO members need to ensure that they purchase their stock from dealers that are DSO certified or that source their stock exclusively from cutters that are KPC compliant/DSO certified. Kimberley certification, although voluntary, is already incorporated in the international trade regulations of over 80 countries. Therefore, the most difficult aspect of control and regulation is already accomplished. DSO educates end-customers to complete purchases that conform to the ethical standards set by Kimberley.

To achieve this, industry-wide support is essential and in return, the benefit is immense for the whole sector because customers’ confidence can be finally reinstated and the purchasing barrier is overcome.

Is DSO certification limited to the professionals or can it be extended to the gemstones as well?

The idea behind DSO is similar to ISO (International Standards Organization) which sets the standards on general products and processes. DSO certified professionals can issue DSO certificates to their stock. DSO diamonds certificates also inform customers on their purchase in regards to whether the gemstone is natural or synthetic/lab-grown; although laboratory certified diamonds already inform customers on this aspect, the jewels are often set with smaller uncertified diamonds and DSO certification will surely help customers to understand this difference.

Is DSO certification conceived to replace laboratory certifications?

No, on the contrary, it is an extension of certification like GIA and it focuses on the ethical aspect of a diamond. At the same time, GIA produces testing machinery to help professionals to independently assess and differentiate synthetic and natural diamonds set on a jewel. Therefore, the use of a DSO certificate to reassure a customer on the results of such tests plays an essential role. I met with Steven Morisseau, GIA director of corporate communication, who showed me the ID100 Tester and its application to identify non-natural diamonds that are already set on a jewel. Now, a DSO certified professional can issue a certificate after a successful test.

Wrapping up, do you see the global diamond industry returning to its erstwhile confident status going forward, despite the LBDs threat?

Consumer behavior and buying patterns changed, but some fundamentals remain valid and a luxury purchase is completed for three reasons: gifting, status and self-reward. Therefore, for as long as the customers have the choice and the financial ability, they will still choose to purchase a natural diamond over a synthetic diamond.

The problem exists with small diamonds set on jewelry that are not laboratory certified and are sold as natural gemstones; however, times have changed and so have customers, especially millennials who ask for greater reassurance when they complete a purchase. If a retailer (or its supplier) has tested the product and issued a DSO certificate, then in my view we overcame the obstacle and we re-established confidence in customers. The cost of a natural-diamond testing machine is very affordable and it can be operated by any shop manager in seconds.

With regards to larger lab-grown diamonds, both De Beers and Swarovski produce synthetic diamonds and they will invest in branding; this will create a new market of branded diamonds that will win some market share from other gemstones and crystals in that price range rather than from natural diamonds. What I mean by this is that if a customer has enough money to buy an aquamarine, he or she can now buy a synthetic diamond, but he or she was never a natural diamond customer.

I am confident that the industry will return to its former glory, it is simply a matter of adjusting to a new era and embracing change rather than fearing it.

Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough & Polished