The World Gold Council has drafted a 'conflict-free' gold scheme
World Gold Council drafts ‘conflict-free’ gold scheme
Posted June 21, 2011 | By Sonia Nair
The World Gold Council has developed a preliminary draft of its Conflict-Free Gold Scheme, a framework designed to determine whether companies producing, transporting and refining gold meet conflict-free gold standards.
The World Gold Council has published the draft standards to gauge the opinions of leading gold companies and refineries. Parties interested in signing up to the scheme will have to provide their feedback on the draft by September 1.
The World Gold Council said the objective of the framework would be to eradicate activities which “directly or indirectly finance or benefit armed conflict and extreme levels of violence which contribute to abuses of human rights” in the gold industry.
According to the framework, conflict-free gold will have to fulfil the ‘conflict-free gold standard’ and the ‘chain of custody standard’.
The ‘conflict-free gold standard’ is split into three parts; conflict assessment where it is determined if a company is operating in a ‘conflict or high-risk area’; company assessment where it is determined if the company has appropriate systems in place to deal with its corporate obligations in its area; and commodity assessment where it is determined how and by whom the gold is handled, transported and refined.
The ‘chain of custody standard’ on the other hand will determine if gold has been tampered with during its transport between the mine and the refinery or during the refining process.
The World Gold Council said an important goal of the framework would be to foster the formation of responsibly run gold manufacturing companies operating in a conflict-affected or high-risk environment.
“Stopping these operations can cause greater instability as livelihoods are destroyed and economic progress stifled,” it said.
“Where a mine is located in a conflict or high-risk zone, focus moves on whether the company has the right policies, systems and skills to enable it to operate in conformance with international benchmarks,” the World Gold Council added.
The World Gold Council’s move follows CIBJO’s call out last year where the global industry association urged luxury jewellers to respond to an emerging social conscientiousness among consumers in order to secure commercial success.
In February, British jewellers led the way and launched the world’s first set of hallmarks for certified ‘Fairtrade’ gold to help miners working in high-risk conditions and abject poverty. According to the Fairtrade Foundation and the Alliance for Responsible Mining, ‘Fairtrade’ gold is forecast to account for five per cent of the global market in the next 15 years as the initiative was implemented internationally.
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