THE POWER OF VOLUNTARY COMMITMENT
Why the System of Warranties is essential
for our industry’s future
SEPTEMBER 8, 2024
Dear WDC Members and friends of the industry,
I trust this message finds you well. As the Executive Director of the World Diamond Council, it is my responsibility to discuss a matter that is central to the integrity of our industry – the WDC System of Warranties. While the SoW is not a mandatory requirement, its importance cannot be overstated. It is a powerful tool that embodies our collective commitment to self regulation and responsible business practices. It also helps ensure trust within the diamond trade.
What Is the WDC System of Warranties?
The WDC System of Warranties extends beyond the Kimberley Process Certification Scheme (KPCS) to cover the entire supply chain, from mine to market. It’s a voluntary system whch requires that every time diamonds are bought or sold, a warranty statement is included on the invoice or memo, declaring that the diamonds have been purchased from legitimate sources, not involved in funding conflict and which are in compliance with United Nations resolutions.
While the KPCS is crucial in preventing conflict diamonds from entering the market, the SoW plays an equally important role in fostering transparency and accountability throughout the diamond pipeline. It assures customers and stakeholders that the diamonds they are purchasing have been sourced ethically and responsibly.
The SoW represents a significant enhancement to our commitment to responsible diamond trading. Its updated framework extends the scope of the original warranty, ensuring not only that diamonds are conflict-free but also that they adhere to broader universal standards, including human rights, fair labor practices, and anti-corruption and anti-terrorism financing.
Under the recently revised SoW system, all companies in the diamond supply chain are encouraged to conduct a thorough self-assessment to verify their compliance with these expanded requirements. This self-assessment is a crucial step in maintaining transparency and accountability, demonstrating our collective dedication to upholding the highest standards of integrity throughout our entire diamond industry. Successfully completing the self assessment enables companies to issue the revised Warranty Statement on their invoices, word for word.
The power of voluntary action
One might question the value of a system that is not mandatory. However, it is precisely the voluntary nature of the WDC System of Warranties that makes it so powerful.
By adopting the SoW, you proactively demonstrate your commitment to ethical practices, not because you are compelled to do so by law, but because you openly recognize that maintaining trust in our industry is interwined with ensuring the viability of our businesses. It is a smart commercial decision!
Voluntary actions often carry more weight than mandated ones. They signal to consumers, partners, and regulators that the industry is self-regulating and taking the initiative to ensure the highest standards of conduct. In an era where consumer confidence is paramount, this voluntary commitment is a significant differentiator.
Strengthening industry standing
The diamond industry has made tremendous strides in addressing the issues associated with conflict diamonds, but the journey is far from over.
The WDC System of Warranties is a critical component in enhancing the standing of our industry. It reinforces the message that we are committed to continuous improvement and the ethical sourcing of diamonds. It also reinforces our beliefs that natural diamonds need to uphold values that are prominent in the eyes of our customers: integrity, transparency and socioeconomic development.
By adopting the SoW, you help build a culture of integrity that permeates every level of the supply chain. This culture not only protects the reputation of our individual businesses but also strengthens the overall perception of the diamond industry. It ensures that we remain a trusted and respected industry, capable of withstanding scrutiny from consumers, governments and advocacy groups.
A call to action
As members of the natural diamond industry, I urge you to embrace the WDC System of Warranties, even though it is not mandatory. Its adoption is a clear demonstration of your commitment to ethical business practices and your dedication to preserving the integrity of the diamond industry and the desirability of our product!
Let us lead by example and show the world that the diamond industry is not just about commerce, but also about responsibility, sustainability and doing what is right. The WDC System of Warranties is not just a tool for compliance – it is a symbol of our collective values and our renewed commitment to ensuring that diamonds are a source of joy and pride for all.
Thank you for your continued support and commitment to these ideals. Together, we can continue to build an industry that is not only prosperous, but also ethical and sustainable.
Sincerely,
Elodie
Executive Director, World Diamond Council