WDC Newsletter

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STANDARDS, TRANSPARENCY AND GRASSROOTS INVESTMENT
CORNERSTONES OF TIFFANY’S RESPONSIBLE SOURCING STRATEGY

ABOVE: A worker at the Laurelton Diamonds cutting and polishing plant on the Indian Ocean island of of Mauritius. Laurelton is a wholly-owned subsidiary of Tiffany and an essential part of its vertically integrated supply chain. (Photo courtesy of Tiffany & Co.)

Although the celebrated jewelry chain Tiffany & Co. became a member of the World Diamond Council in 2000, its strategic commitment to responsible sourcing can be traced back to 1995, when it decided to advocate against a proposed gold mine that threatened the fragile ecosystem of the Yellowstone National Park in the United States.

It was a watershed moment for the iconic firm, which was founded in New York in 1837. Tiffany’s management came to the understanding that the best way to ensure a socially and environmentally responsible supply chain was to control as much of it as possible, while working to create broader impact. Consequently, for the past two decades, it has been investing in vertical integration and supply chain transparency, as well as improving responsible mining standards to create positive change in the sector.

In 2000, the same year that Tiffany became a member of the WDC, it established The Tiffany & Co. Foundation, with the specific goal of managing its its philanthropic giving. Over its two decades of operation, the foundation has distributed more than $85 million in grants, much of it to programs that are dedicated to preserving the natural environment. This has included responsible mining through remediation and land preservation, and coral and marine conservation, where it has a particular focus.

The Tiffany & Co. Foundation has also supported the development of responsible sourcing standards at the artisanal and small-scale level, strategically focusing on funding the development of standards and credible certification systems that will contribute to a fair and viable future for small-scale and artisanal miners (ASM) and their communities.

In addition to its work on gold, colored gemstones and pearls, in Sub-Saharan Africa the foundation has advanced responsible practices in the ASM sector through grants to organizations such as the Diamond Development Initiative, which is an NGO that Tiffany played a key role in establishing and has supported since 2007, and which created the Maendeleo Diamond Standards, the first set of responsible mining standards specifically tailored for artisanal diamond mining. It has also supported the International Institute for Environment and Development, which maintains dialogues between artisanal mining communities, large-scale mining companies and governments.

To drive its own supply chain transparency, Tiffany today sources 100 percent of its rough diamonds directly from known, responsibly-managed mines or from responsible suppliers, receiving goods from a limited number of known mines and sources. The majority of its rough stones are procured from Namibia, Russia, Botswana, Canada and South America. It purchases rough diamonds and sources, cuts, polishes and supplies finished stones through a wholly-owned subsidiary, Laurelton Diamonds, Inc.

Tiffany sources all of its rough diamonds directly from known, responsibly-managed mines or from select polished diamonds suppliers who are able comply with its traceability, social and environmental standards. (Photo courtesy of Tiffany & Co.)

The company purchases select polished diamonds from suppliers who are able comply with its traceability, social and environmental standards. Its Conflict Minerals Policy requires that suppliers complete annual training on the policy itself, and submit an annual conflict minerals survey. It includes a mechanism for suppliers, employees and others to report concerns regarding potential policy violations.

The Tiffany & Co. Supplier Code of Conduct requires all the company’s suppliers to comply with labor, health and safety, human rights, environmental protection and ethical business conduct principles, and encourages them to proactively engage with and support development in the communities where their operations and supply chains are located.

Tiffany’s Diamond Source Initiative, which it launched in 2019, involves it sharing with customers the provenance of all newly sourced and individually registered diamonds of 0.18 carats and larger. (Photo courtesy of Tiffany & Co.)

In 2019, almost two decades after its decision to invest in sustainability and vertical integration, Tiffany announced its Diamond Source Initiative, which shares with its customers the provenance of all newly sourced and individually registered diamonds of 0.18 carats and larger.

To further its commitment to responsible sourcing, this past October Tiffany announced that, in addition to disclosing the region of origin, it will now be able to share the full craftsmanship journey of a Tiffany diamond, including cutting and polishing, grading and setting.

The company’s sustainability model also involves contributing positively to the communities and local economies in which it operates. This is accomplished through creating jobs, training and promoting workers, as well as establishing a location-specific living wage program for employees in its workshops in developing countries. The custody over its supply chain, Tiffany says, helps it ensure that the jewelry it sells is crafted in a safe and healthy workplace.

Today, Tiffany employs approximately 1,500 in-house artisans. Some 60 percent of its jewelry is manufactured in its own workshops. Tiffany has manufacturing facilities in New York, Kentucky and Rhode Island, as well as diamond workshops in Belgium, Botswana, Mauritius, Vietnam and Cambodia. It also carries out assembly work in the Dominican Republic.

“We are proud to hire locally, invest in communities and provide a living wage for employees in developing countries,” Tiffany states on its website. “For example, as of June 2020, 94 percent of the workforce at our Hai Duong, Vietnam facility consisted of women hired from the local community.”

In 2019, the company estimated that it generated more than $59 million in economic benefits to the Botswana economy.

“We believe that diamonds can be a positive force for social and economic development along the supply chain and in communities around the world,” said Anisa Kamadoli Costa, the Chief Sustainability Officer at Tiffany & Co., and Chair and President of The Tiffany & Co. Foundation. “The future of responsible sourcing and responsible mining is in transparency — both along the supply chain and with consumers — rooted in high standards, and how companies operate across all of the issues that consumers today care about: labor conditions, local and indigenous community consent, climate change, biodiversity and ethical behavior.”

By |2020-12-22T09:58:59+01:00December 22nd, 2020|NEWSLETTER|