Is the diamond grading system flawed?

3.7 k views | By Jeff Salton • Assistant Editor

Do current diamond grading certificates mislead consumers by not accurately reflecting the quality and beauty of each stone? Jeff Salton investigates if it’s time the industry developed a better grading system.

When a diamond is graded professionally, many factors are taken into account in order to arrive at a universally-accepted grading scale that helps the industry to determine the quality and approximate price range of the finished stone.

To do this, a total analysis of all the parameters of the stone are taken into account, which include the 4Cs (primary) and other secondary factors, like polish and symmetry.

This article concentrates on how cut, polish and symmetry affect diamond grading and whether the current system accurately reflects the quality and beauty of each individual stone.

To begin, a basic explanation of the above factors:

•   Symmetry – how symmetrical is the stone, both optically and at the facet meet points and parts?
•   Polish – the smoothness and size of each facet, poor finish makes grooves or ”snake-skin” effect that can reduce fire and light return.
•   Cut – the combination of many things. Starts with the physiognomy of the stone, its angles, percentages and millimetres, the way the stone is built – the whole construction including the addition of polish and symmetry.

At present, the scale for diamond grading reads ‘excellent’, ‘very good’, ‘good’, ‘fair’ and ‘poor’ but, as diamond expert Garry Holloway from Melbourne’s Holloway Diamonds explains, production techniques and technology has improved to the point that the industry no longer sees the ‘poor’ or ‘fair’ grade for cuts.

In recent times, the quality of gemstone production has improved greatly

“Today, 80-90 per cent of round diamonds are in the ‘excellent’ or ‘very good’ categories for all three grading factors due to improvements in technology, better polishing equipment and tools,” Holloway says, adding that the bar has been raised so far in recent times that a diamond graded as ‘fair’ really means ‘terrible’, while ‘poor’ stones would rarely even be sent to a lab for grading.

“Therefore, ‘good’ really means ‘poor’,” Holloway says. “It’s misleading to consumers because nearly everything is described as ‘very good’ or ‘excellent’, and that is okay for polish and symmetry, but wrong for cut grades.”

Holloway believes the current grading system no longer reflects the differences between cut stones and that consumers are becoming confused because most stones have the same grading.

Marc Brauner, International Gemological Institute (IGI Worldwide) director and CEO of Asia and Far East, agrees that the quality of gemstone production has greatly improved.

“Most ‘poor’ diamonds have been recycled from old jewellery pieces that have often entered the market via pawn shops, auction houses or antique jewellery stores,” Brauner says, but he doesn’t believe the grading system should change and disagrees with Holloway’s claim that ‘good’ diamonds are now ‘poor’.

“I think we are just finding fewer ‘fair’ and ‘poor’ stones in the marketplace,” he says. “We are seeing so many ‘excellent’ and ‘very good’ stones that the other grades do look distinctly different.”

Brauner says the current grading system has been designed for the horizontal industry – from mine to retail – but not for the consumer, and that perhaps that is where the problem lies, if any.

Brauner looks at several hundred stones every day, adding that his eyes see things that consumers will never notice without the appropriate training. He believes the consumer doesn’t have the mechanism to evaluate gemstones outside the current system and what the jeweller explains to them, adding that jewellers must engender trust with the customers.

“That’s why jewellers hand over a certificate,” he says. “The certificate describes the quality and the unique attributes of each individual diamond. Also, it helps determine the price range (value) of the diamond.”

It serves as a document of authentication and identification as well.

“Jewellers can tell customers who query a price for a diamond with the parameters they want that the international diamond industry sets the price range, not the jeweller – it’s a fair system.”

Brauner explains that the grading, which has roots stemming back decades, was developed to enable the international trading of diamonds between manufacturers of cut stones and buyers without the buyers having to necessarily inspect every individual stone.

“Jewellers should sell their diamonds to consumers on their appeal and their beauty; not a certificate. That’s when bargaining starts – the head takes over and the heart misses out,” he asserts.

Holloway agrees that selling a diamond takes a lot more than just providing consumers with a diamond grading certificate, but he would prefer an open-ended system that includes human preference terminology, like that used in other subjective product reviews.

He points to AGS, a boutique lab in the US that has applied a grade of “ideal”, which sits above the current “excellent” grading for round stones.

“Using the word ‘ideal’ suggests that there can never be anything better than ideal. Also there is no cross-relationship between different cut shapes when the term ‘ideal’ is applied to stones of different beauty,” Holloway says.

Therefore, he believes the addition of a higher grade to the current system still doesn’t achieve what consumers want, and he suggests an independent alternative instead.

“If you use Tripadviser ratings or the Parker system that rates wines independently from 50-100 points with review notes, then there is something that is relevant to consumers – some perceived benefit. Consumers know they can trust these systems because they’re not put forward by the industries themselves,” Holloway says. “Consumers would be more inclined to trust a grading system that was written in jargon-free language they could understand easily.”

Brauner is inclined to stick with the system in place now, though he’s not adverse to “tinkering” with it.

“If a stone fits into the ‘excellent’ category according to the parameters we have now, rather than create a new category or new system, I would prefer we graded ‘excellent’ into a narrower range, thereby perhaps eliminating some of the lower ‘excellent’ stones that are really borderline ‘very good’ stones.

Brauner believes the difference in the eyes of the consumer is minor: “Really, I don’t believe that many consumers would care much. If they view an ‘excellent’ diamond as a beautiful stone, I’m sure they won’t be able to differentiate the minute variations in light behaviour between them. That would be the jeweller’s job, according to what he believes the consumer really wants.”

Holloway urges jewellers to improve their communication with consumers.

“What consumers want and need is for us to use their language – human language. Like ‘This diamond sparkles more’, ‘This one has more pretty flashes of colour’, but ‘That one is really bright and flashy’. We use terms like ‘scintillation’, ‘fire’ and ‘brilliance’, but there is no decent definition and certainly no training or agreement among gemmologists and jewellers as to what any of these terms mean.”

One point in which both men agree is that jargon really doesn’t belong in conversations between jewellers and consumers when selling diamonds.

“Industry terminology has an essential role to play in buying and selling diamonds, but jargon can mislead consumers because it can be difficult to interpret – we should at least offer an additional buyer-friendly alternative language,” Holloway says, believing that this is never more important than when trying to explain diamond inclusions with consumers, saying the whole ‘VVS’, ‘SI’, ‘IF’ terminology can be a minefield.

The pair also agrees that any chosen system must address beauty, which is what consumers want.

Brauner says more consumers use the internet to find out technical details and answers to just about every question pertaining to diamonds, but it is the stone’s beauty that should be its selling point.

He says 20 different cut stones from 20 different cutters can all produce diamonds that fit into the Excellent category.

“All [stones] deserve ‘excellent’ but some might be in the low range of ‘excellent’ because they’re still better than ‘very good’ but not as good as another ‘excellent’ stone,” Brauner says. “If we can develop an affinity with higher quality and thereby differentiate between them, we can better recommend stones to suit the consumers’ needs.”

Even so, he believes there are consumers out there who are more than happy wearing what some would consider to be ‘good’ or ‘fair’ diamonds, and that this jewellery will still be admired.

Brauner believes that it’s possible that someone will think of a new way of describing the finest of differences in diamonds one day and the industry will have no choice but to follow, especially if it becomes a trend at the consumer level.

“It could be from someone very left field, and before you know it, it’s gone viral and everyone is using it,” he laughs.

Whatever the source of any new system, as long as it’s a grading method that acknowledges a diamond’s beauty (or lack of), then both men will be happy, as will consumers.

Posted September 01, 2013