How the Industry Earns Consumer Trust

Woman Gazes at Jewelry in Store Window

The jewelry industry is striving to establish standards and principles to protect consumers and promote their confidence in purchases. Trade bodies, governments, and Non-Governmental Organizations (NGOs) around the world are all working together to achieve this.

In this article, we look at the industry initiatives in place which:

  1. Provide guiding industry principles
  2. Promote disclosure and transparency
  3. Address business and social challenges
  4. Drive environmental responsibility

These will help you, as a jewelry retailer, to stay abreast of broader industry developments and activities and answer any questions your customers may have.


1. Guiding industry principles

The main global trade bodies working to promote responsible business practices in the jewelry industry across the whole supply chain are CIBJO (the World Jewelry Confederation) and the Council for Responsible Jewellery Practices (CRJP). By understanding their guiding principles, jewelry retailers can gain an insight into industry standards and set expectations for suppliers.

CIBJO – The World Jewelry Confederation

CIBJO is the international trade organization of the world jewelry industry. Its members comprise representatives
of commercial organizations and over 70 national jewelry associations in more than 34 countries. Established in 1926, CIBJO educates and communicates on matters of business responsibility by raising awareness of consumer confidence issues, distributing information, and acting as a forum for the worldwide industry to debate its views.

CIBJO’s “Code of Ethics” is designed to give its members overarching principles to help them operate according to strict ethical, business, and consumer confidence guidelines. Jewelry retailers can refer to CIBJO’s membership to identify whether their suppliers should adhere to the Code.

CRJP – The Council for Responsible Jewelry Practices

The CRJP is a trade body representing over 70 organizations involved in the diamond and gold jewelry supply chain. Established in May 2005, it is an associate member of CIBJO.

CRJP has been set up to enable companies in the jewelry sector to evidence compliance to a baseline common standard governing practices throughout the diamond and gold jewelry supply chain, from mining and manufacturing to retail. This is distinct from the role of CIBJO, which promotes responsible business practices through education and communication.

The CRJP’s Principles and Codes of Practice complement CIBJO’s overarching guidelines covering key aspects of responsible business practices such as business ethics, human rights and labor standards, environmental performance, and community standards.

Gold and diamond jewelry retailers can be direct members of CRJP alongside mining companies, jewelry manufacturers/ wholesalers, and diamond trading/ cutting/ polishing companies and can play a major part in setting the agenda for the industry.


2. Promoting disclosure and transparency

Accurate product descriptions, clear labelling, and disclosure of any material changes a jewelry piece has undergone before sale are critical in maintaining the trust and running your business ethically and legally. There are many industry-wide measures in place to assist jewelry retailers in ensuring transparency in the products they sell.

The CIBJO Blue Book

The CIBJO Blue Book is a publication outlining terminology, classification, and ethical guidelines for coloured gemstones, diamonds, and pearls. It is considered to be the accepted world standard for disclosure standards and as such should apply to wholesalers, suppliers, manufacturers, and retailers at all points in the trade internationally. In addition, CIBJO also produces a precious metals guide.

In the US, the Federal Trade Commission Guidelines on jewelry terminology and disclosure are very detailed. Further information can be found on the FTC website.

By following these guidelines, you can help empower customers with essential information about jewelry purchasing.

Grading laboratory reports for diamonds, colored gemstones, and pearl jewelry

Grading laboratories issue reports that measure and certify loose diamonds, colored stones, and pearls as well as diamond, colored stone, and pearl jewelry.

In the case of diamonds, for example, you should ensure that you have a grading report from an independent and reputable gemological laboratory on file should you get asked for it by the customer. These grading reports should disclose any treatments that the diamond may have undergone or whether it is even a diamond. Most diamonds of above 20 points are graded.

In the absence of a grading report, or if you are in any doubt about the integrity of the diamond, colored gemstone or pearl products being sold, you may consider independent testing at a reputable grading laboratory.

Hallmarking and labelling

In most countries, there is a legal requirement for all precious metals to be tested (assayed) by an independent third party. The precious metal is stamped with the caratage or fineness, the manufacturer’s mark, and the assay office mark. By bringing a consumer’s attention to this hallmark they can clearly see the origin of the metal.

In the case of natural, cultured, and/ or imitation pearls, retailers should ensure they are always properly labelled using one of the descriptive terms. Information should also be provided on the size, orientation (iridescent color as a result of light reflection), luster, and the actual color of a pearl in relation to its price.


3. Addressing business and social challenges

Several important industry initiatives are in place to uphold responsible standards around trading practices in the jewelry industry and to support retailers in reassuring consumers if required.

The World Diamond Council and the Kimberley Process

The World Diamond Council was created by the industry in 2000 to specifically confront the issue of conflict diamonds on behalf of the entire diamond industry, which pledged a zero-conflict diamond policy. Members cover a broad range of industries, including mining houses, diamond jewelry manufacturers, and retailers.

In 2002, a joint initiative between governments, the international diamond industry, and NGOs called the Kimberley Process was set up to prevent conflict diamonds from entering the legitimate diamond supply chain. Today 47 participants including the European Community (73 countries in total) are part of the Kimberley Process, working with NGOs and the diamond industry to ensure that every diamond can be traced back to a legitimate source.

As a result, today over 99% of diamonds are from conflict-free sources. This conveys an extremely positive message to customers that the industry is committed to its zero-tolerance policy towards conflict diamonds.

This system was further extended by the World Diamond Council (WDC), with the introduction of the “System of Warranties”. Under this system, every buyer and seller of polished diamonds and jewelry containing diamonds within the supply chain must make the following statement on all business-to-business invoices:

“The diamonds herein invoiced have been purchased from legitimate sources not involved in funding conflict and in compliance with UN resolutions. The seller hereby guarantees that these diamonds are conflict-free based on personal knowledge and/or written guarantees provided by the supplier of diamonds.”

Every legitimate business selling diamonds is committed to ensuring they are compliant with the Kimberley Process and System of Warranties.

It is important to remember that the Kimberley Process helps ensure that diamonds, as a major source of revenue, continue to positively contribute to the development of diamond-producing countries such as those in Africa, Canada, and Russia by improving infrastructure, healthcare, education, and supporting local economies.

The Initiative for Responsible Mining Assurance

The Initiative for Responsible Mining Assurance (IRMA) was launched in June 2006 as a multi-sector program to independently verify compliance with environmental, human rights, and social standards for mining operations.

A multi-stakeholder group, it includes World Gold Council members, jewelry retailers, trade partners, and NGOs, and aims to develop a process for the identification of responsible mining standards and a governance model for the assurance system.


4. Driving environmental responsibility

The CRJP’s Principles and Code of Practices set out guidelines for jewelry retailers to operate in an environmentally responsible manner (and these complement the principles set up by CIBJO). Environmental responsibility is also particularly high on the agenda of the formal extractive industry.

By demonstrating a real commitment to environmental, economic, and social responsibilities, mining companies can make a significant contribution to the countries where they operate and hence make a strong case for continued access to the land, capital, and product markets they need for future business success.

Today, many of the world’s mining companies and national associations are part of the International Council on Mining and Metals (ICMM). Formed in 2001, it represents leading mining, minerals, and metals industries that aim to work together to build trust and respect.

All member companies of ICMM are required to implement the Sustainable Development Framework which has:

  • Ten principles covering conservation of biodiversity, sustainable development considerations, and environmental performance
  • Sustainability reporting guidelines for public reporting of progress
  • Independent assurance process that members are meeting their commitments

In addition to this, a large proportion of the world’s largest mines are ISO 14001 compliant. This is the highest global environmental standard that exists.

Retailers need to be aware of the environmental guiding principles governing the extractive industries, to reassure customers that mining companies’ activities have adhered to the highest environmental standards.


Source: Believe in Me, A Jewellery Retailer’s Guide to Consumer Trust by CIBJO