The Ethics of Gold

By Rob Bates, Senior Editor

source: JCK Online

Issue 1: Conflict Gold

Background The conflict in the Democratic Republic of Congo has had a higher profile ever since Secretary of State Hillary Clinton’s trip to that country last summer. The ongoing war there is considered one of the world’s worst, with gruesome reports of rape, sexual violence, and other atrocities. Until now, activists who charge that conflict minerals are funding Congo unrest have focused mostly on minerals used in electronics, rather than gold. But Sasha Lezhnev, of the Enough Project, said that’s changing. “Gold is increasing as a problem as its price goes up,” he told JCK. He said gold is now the second-biggest contributor to Congo unrest after tin.

Recent news60 Minutes in late November ran a story explicitly linking gold jewelry to the Congo war. Lezhnev said his group plans to survey the major jewelry chains and sellers about how they source their gold. A bill about conflict minerals is under consideration by Congress, but it doesn’t mention gold.

The future Lezhnev said conflict-mineral activists would like to see a “Kimberley Process for gold,” but some Kimberley Process veterans say that’s unlikely. “People use the term ‘Kimberley Process’ without really knowing what that is,” says Jewelers of America chairman Matthew A. Runci. “It’s an open question whether that kind of approach can be developed for gold.” He said his group is now meeting with gold miners and NGOs to discuss possible solutions. In any event, major companies will be under pressure to show a traceable supply chain.

Issue 2: Dirty Gold

Background The No Dirty Gold campaign calls gold mining one of the “world’s dirtiest industries,” claiming that one ring’s worth of gold production creates 20 tons of mine waste. The mining industry disputes that characterization and that figure, but no one doubts that gold mining—particularly its use of cyanide—affects the environment. Activists urge jewelers to question suppliers about their gold sources and to use recycled gold.

Recent news The No Dirty Gold campaign has been urging retailers to sign its Golden Rules, which commit them to ethical sourcing of gold. While many industry members, including Tiffany, have signed, Tiffany chief executive officer Michael Kowalski told JCK, “There are things in the Golden Rules that require further clarification. In some ways they are aspirational. One needs to get into the details to make them meaningful.” Still, Tiffany has generally won plaudits from activists for sourcing most of its gold from the Bingham Canyon mine in Utah.

The controversy over gold mining is one of the issues that led to the formation of the Responsible Jewellery Council, the industry group that certifies members’ business practices. Some nongovernmental organizations prefer the Initiative for Responsible Mining Assurance, a group that’s considered more inclusive of NGOs but slower moving.

The future Earthworks, one of the forces behind the No Dirty Gold campaign, plans to release findings of a study that investigated how leading retailers source gold, including those who have signed The Golden Rules. “The report is a five-year check-in on the progress that has been made since the No Dirty Gold campaign began,” says Earthworks’ Payal Sampat.

Issue 3: Pebble Mine

Background Pebble mine is a proposed gold and copper mine in Alaska’s Bristol Bay. It’s being sought by Anglo American, one of the owners of De Beers, and Northern Dynasty, a junior partner partially owned by Rio Tinto. But its planning is caught up in controversy. Critics worry it will destroy the bay, the world’s largest wild salmon habitat, and the local fishing industry that depends on it. The people behind the mine say they will take care not to harm the environment and argue it will bring jobs to the area.

Recent news Anti-mine activists are asking jewelers to sign a Bristol Bay pledge, which says in part: “We are committed to sourcing our gold and other materials in ways that ensure the protection of natural resources such as the Bristol Bay Watershed.” Tiffany not only signed the pledge but also campaigned against the mine, going so far as to buy ads against it and screen an anti-mine movie. But now Kowalski says the company will step back and “let the people of Alaska decide the mine’s future.” He notes that this controversy points to a larger issue. “One of the more challenging questions is: How do you define the places that should be off-limits to mining? For us, Pebble represents a poster child of where mining of any sort should not take place.”

The future The mine’s backers will probably request that it be permitted this year. Then an environmental review will kick in. Earthworks’ Bonnie Gestring cites three efforts aimed at stopping the mine, a bill and two lawsuits. Even if all goes well for the mine, it likely won’t start production for years.

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