Diamond Facts

ADDRESSING MYTHS AND MISCONCEPTIONS

ABOUT THE DIAMOND INDUSTRY
DIAMOND FACTS 2

Table of contents

3 FOREWORD

4 INTRODUCTION

6 IS IT POSSIBLE TO TELL A LABORATORY-GROWN

DIAMOND FROM A NATURAL DIAMOND?

8 HOW DO I KNOW WHETHER I’M PURCHASING A

NATURAL OR A LABORATORY-GROWN DIAMOND?

14 ARE ALL LABORATORY-GROWN DIAMONDS

SUSTAINABLE?

18 WHAT IS THE NATURAL DIAMOND INDUSTRY

DOING TO REDUCE ITS CARBON FOOTPRINT
AND PROTECT BIODIVERSITY?

26 ARE NATURAL DIAMONDS RARE?

28 IS THE INDUSTRY STOCKPILING DIAMONDS

TO DRIVE UP PRICES?

29 WHAT HAVE BEEN THE PRICE TRENDS

FOR LABORATORY-GROWN DIAMONDS?

31 DO NATURAL DIAMONDS BENEFIT

THE COUNTRIES THEY COME FROM?

37 HOW ARE NATURAL DIAMONDS

ETHICALLY SOURCED?

42 WHAT ARE THE WORKING CONDITIONS LIKE

IN THE NATURAL DIAMOND INDUSTRY?

44 ARE NATURAL DIAMONDS TRACEABLE?

48 ANNEXES

51 GLOSSARY
 DIAMOND FACTS
3

Foreword

“The diamond industry continues

to go from strength to strength.
Yet myths surrounding the industry’s operations, its standards and its players
continue to perpetuate. This is, in part, a result of a historical legacy that has not yet
been fully corrected, despite the transformation and reform which has occurred over
recent decades. These myths and misconceptions erode trust, and, in the long run,
they can be harmful – not only to the diamond industry but especially to those who
most depend on the positive impact of diamonds such as the ccommunities who live
where diamonds come from.

In an age where consumers are more inquisitive and enlightened than ever, people
wish to know about the values and responsible business practices of the companies
and indeed the wider industry from which they are purchasing. At the Natural
Diamond Council (NDC), we want to support consumers in taking informed decisions
by providing information transparently.

The modern diamond industry is not perfect, and of course has challenges and areas
of improvement. Our strength is the unity with which we address opportunities
and challenges. The diamond industry supports the livelihoods of 10 million people
across the world, helping to provide better access to healthcare, education and
infrastructure, as well as scale and access to funding to contribute to solving some
of the world’s biggest challenges. The industry is also pursuing land protection and
rehabilitation across continents with fervor.

With this analysis, we seek to correct misconceptions and answer questions about
the industry to enhance trust and allow consumers to make informed decisions.

As the landscape evolves, we will endeavor to continue to fill data gaps

and engage in feedback and collaborations that can better the industry and
enhance transparency.

We thank you for taking the time to read the report.”

DAVID KELLIE – CEO, NATURAL DIAMOND COUNCIL

DIAMOND FACTS 4

Introduction
In recent years, the jewelry industry has evolved We redress the claims that it is impossible to
with the advent of laboratory-grown diamonds as distinguish between a laboratory-grown diamond
a new category. An abundance of misconceptions, and a natural diamond, explore how consumers can
myths and unsubstantiated claims have entered navigate this when buying diamonds and detail the
the information sphere. global regulations in place to protect purchasing
decisions along the supply chain.
In this analysis, we set out to address
misinformation about both natural diamonds and On the environment, we delve into the nuances of
laboratory-grown diamonds. sustainability claims made by the laboratory-grown
diamond industry. Alongside reviewing impacts on
The intent is not to present this as a dichotomy, or water, waste and chemicals, we also look at the
position as one better than the other, but instead emissions footprint of both natural and synthetic
to share the realities and conditions upon which diamonds, and the process of responsible opening
laboratory-grown diamonds and natural diamonds and closure of mines.
are created. Equally, our focus is on providing clear,
accurate and reliable information so consumers Outdated and misleading narratives about social
can make informed choices. As detailed in the conditions in the natural diamond industry are
research, the reader can use existing information also evaluated. We explore ethical sourcing
to formulate their own opinions. of natural diamonds, the heightened focus on
transparency and the adoption of technology to
Misinformation is harmful for all stakeholders in the enhance traceability. The robust set of measures
diamond value chain, whether that is the consumer, in place to enshrine the rights of the employees
mining companies, investors or local communities of Natural Diamond Council (NDC) members is
involved in regions that rely on the production of included. Through spotlighting initiatives and social
diamonds for economic stability. programs, we seek to communicate the positive
impact the natural diamond industry has on the
We are dedicated to creating a positive legacy livelihoods of 10 million people, especially from
for all these stakeholders through openness and diamond producing countries.
unbiased research.
By tackling outdated and factually incorrect
Our work details an investigation into questions narratives, we are able to collaborate with all
often posed relating to environmental and stakeholders to better communicate the inherent
social standards, alongside general value and benefit of natural diamonds, as well as
misconceptions about the market, such as quantity ensure clear and accurate information is shared
of diamonds recovered. about the industry in order to build trust and
cultivate transparency. This is married to our
mission at the Natural Diamond Council.

Learn more at:

www.naturaldiamonds.com/diamondfacts/

A NOTE ON THE RESEARCH METHODOLOGY

The findings of this analysis have been derived from a thorough Industry experts and independent sustainability advisors were
review of a wide range of secondary research sources and consulted on the topics included in the work to inform the
the evaluation of internal research conducted on behalf findings. Research was conducted at the beginning of 2023.
of the Natural Diamond Council by globally respected Methodologies for calculations pertaining to environmental
third-party organizations. footprints have been detailed in the footnotes and where
industry data gaps or inconsistencies exist, a range has been
used to provide balance. We welcome increased levels of
disclosure across the industry for both natural and synthetic
diamonds to enrich and inform future research.
 DIAMOND FACTS
5

Key Findings
DIAMOND FACTS 6

Is it possible to tell a laboratory-grown diamond

from a natural diamond?

FACTCHECK:

All laboratory-grown diamonds can be These studies have been applied to

detected using professional verification the development of screening and detection
instruments. These tools use a variety of instruments that can be used to reliably detect all
technologies to detect the differing growth laboratory-grown diamonds3.
patterns between natural diamonds that
are formed over billions of years in the With the increased quantity of laboratory-
Earth, and synthetic diamonds that are grown diamonds on the market, it has
produced over a number of weeks in become increasingly important to address the
a manufacturing environment. misconception that natural and laboratory-grown
diamonds are indistinguishable. Doing so can
help protect consumers, and ensure they
Claims that it is impossible to distinguish between understand the product they are buying,
a synthetic, laboratory-grown diamond and a that is accompanied by the correct claims
natural diamond are false. Since diamond crystals about its origin.
grow differently in nature from in a laboratory, their
grain patterns, like those in wood, are different1.

Consumers want to be sure about what they are

buying, and there are many instruments available
to distinguish between natural and synthetic
diamonds. There are also legal definitions,
advertising guidelines and certifications to
ensure that consumers are correctly informed.
These are explored in the following chapter.

Industry professionals have, for many years,

used specialist laboratory equipment to examine
growth patterns, composition, nitrogen content,
fluorescence and spectral signature to identify
whether a diamond grew in the Earth’s mantle or if
it was was manufactured in a factory.

For example, production of colorless laboratory-

grown diamonds requires almost the complete
removal of nitrogen, a constituent of around 99%
of natural diamonds2. The changes to impurities
in natural diamonds produced by extended time
under the Earth's crust can lead to very different
responses to ultraviolet light.
CVD LABORATORY-GROWN DIAMONDS

GIA (n.d.) Synthetic Diamonds: Improved Quality and Identification Challenges. Available at:
1 3
GIA (2019) Diamonds from the deep: How old are diamonds? Are they forever? Available at:
https://www.gia.edu/gia-news-research-improved-quality-identification-challenges https://www.gia.edu/gems-gemology/spring-2019-how-old-are-diamonds-are-they-forever
2
GIA (2017) A synthetic diamond overgrowth on a natural diamond. Available at:
https://www.gia.edu/gems-gemology/summer-2017-labnotes-synthetic-diamond-overgrowth-
natural-diamond
 DIAMOND FACTS
7

Differences that exist between natural and The High Pressure High Temperature (HPHT)
laboratory-grown diamonds are due to their method emulates the Earth’s method of diamond
differing creation processes. Natural diamonds creation by using very high temperatures (1,300-
were formed between 90 million and 3 billion 1,600°C) and high pressures. Alternatively,
years ago4 by the action of high pressures the Chemical Vapor Deposition (CVD) method
and temperatures on carbon that took place produces a diamond crystal from a seed diamond
approximatly 100 miles below the Earth’s surface. plate by placing it in a hot gas chamber (900-
They were subsequently brought to the surface by 1,200°C) with methane and hydrogen. The table
dramatic volcanic eruptions. Laboratory-grown below provides more detail about the differences
diamonds are mostly produced in a number of in the creation processes and resultant rough and
weeks using one of two technologies. raw diamond shapes.

LABORATORY-GROWN
LABORATORY-GROWN DIAMONDS
DIAMONDS VIA CHEMICAL
NATURAL DIAMONDS HIGH PRESSURE HIGH TEMPERATURE
VAPOR DEPOSITION
(HPHT) METHOD
(CVD) METHOD

CREATION
Natural diamonds originated This HPHT method replicates part of Chemical Vapor Deposition
PROCESS millions, sometimes billions, the Earth’s process of forming natural (CVD) uses a diamond plate as
of years ago when carbon diamonds. Graphite is placed in a large a seed crystal. This is placed
crystallized over 100 miles machine with metal solvent. It is then into a chamber, which is then
beneath the Earth’s surface, placed in a press with a molten flux of filled with gases (methane
under conditions of intense metals like iron, nickel or cobalt where and hydrogen) and heated
heat and pressure. Diamonds it is crushed to extreme pressures and to extreme temperatures of
remained unaltered for heated to high temperatures (pressure around 900-1,200°C. Carbon
millions of years until around 870,000 pounds per square atoms from the break-up of
inch6, and temperatures of 1,300-
25-400 million years ago, methane are deposited as
1,600°C). According to the According to
when a number underwent layers onto the seed crystal,
the Gemological Institute of America,
a dramatic process where eventually producing a
this pressure is roughly equivalent to
they were propelled upwards the pressure exerted by a commercial diamond crystal. The resultant
by volcanic rock called jet airplane if balanced on the tip of a synthetic diamonds tend to be
kimberlite. They traveled person’s finger7. Under these conditions square-shaped or tabular. The
through the Earth’s mantle and with careful control, the carbon layered growth is responsible
and crust to its surface during material then migrates through the flux to for generating one of the key
violent volcanic explosions. the cooler diamond seed and crystallizes identification features of CVD
Some continued their journey over a period of days or weeks to synthetic diamonds as their
to be found on riverbeds or form a synthetic diamond crystal. fluorescence emission shows
the sea where they reside on Following conversations with industry streaked and lined patterns
ocean floors. The majority professionals, we learnt that each HPHT related to the growth8.
remain in solidified lava rock. reactor can weigh around 50 tonnes.

TYPICAL
SHAPE SHAPE: SHAPE:
SHAPE:
Octahedron Cuboctohedron
Cube
GROWTH: GROWTH:
GROWTH:
8 directions 14 directions
1 direction

4
GIA Diamonds from the Deep: How Old Are Diamonds? Are They Forever? (2019) https://www.gia. 7
GIA: Observations on HPHT-grown synthetic diamonds: A review (2017) https://www.gia.edu/
edu/gems-gemology/spring-2019-how-old-are-diamonds-are-they-forever gems-gemology/fall-2017-observations-hpht-grown-synthetic-diamonds
5
Gemological Science International (2021) https://gemscience.net/geological-origin-of-natural- 8
GIA (2019) CVD Layer grown on natural diamond. Available at: https://www.gia.edu/gems-
diamonds/ gemology/spring-2019-labnotes-cvd-layer-grown-on-natural-diamond
6
GIA: HPHT and CVD Diamond Growth Processes (2016) https://www.gia.edu/hpht-and-cvd-
diamond-growth-processes
DIAMOND FACTS 8

LABORATORY-GROWN LABORATORY-GROWN
DIAMONDS HIGH PRESSURE DIAMONDS VIA CHEMICAL
NATURAL DIAMONDS
HIGH TEMPERATURE (HPHT) VAPOR DEPOSITION
METHOD (CVD) METHOD
REGIONS OF
The conditions needed for the growth In theory, HPHT laboratory- In theory, CVD laboratory-
ORIGIN of diamonds within the Earth are grown diamonds can be created grown diamonds can be created
only found in certain regions. These anywhere. In practice they anywhere. In practice they are
diamonds must then survive transport are mostly produced in China, mostly produced in India, the
through the Earth’s crust in order to be Singapore, Russia and US, Singapore, Europe, the
recovered. Natural diamonds are only the US10. Middle East, China and Russia11.
found in a limited number of places
including Botswana, Canada, Russia,
Australia, Angola, South Africa,
Namibia, Zimbabwe, Lesotho and
Democratic Republic of Congo (DRC)9.

INCLUSIONS Inclusions refer to any ‘birthmarks’ in Metallic flux inclusions containing Dark graphite inclusions can
(IF PRESENT) the stones which can either be related iron, nickel or cobalt are caused form when non-diamond carbon
to structural defects in the crystal when the metals used as catalysts disturbs the growth process15.
lattice or to small pieces of other enter the diamond crystal. These
minerals which were trapped inside the typically appear black and opaque
diamonds as they crystallized12. These in transmitted light but have a
inclusions can give scientists important metallic luster in reflected light.
clues about the history of the earth13. Synthetic diamonds with larger
inclusions can sometimes be
picked up with magnets14.
CREATION
Millions–billions of years A few weeks A few weeks
TIME

What tools are used to detect synthetic Further industry assurance

and natural diamonds?
Diamond Verification Instruments are an integral
The structural differences between laboratory- part of the procedures that ensure pipeline
grown and natural diamonds may not always be integrity, preventing the mixing of synthetic
visible to the naked eye. However, there are more diamonds and natural diamonds.
than 40 instruments available on the market which
can help those involved in the diamond supply The NDC established the ASSURE program in 2019.
chain – like retailers, designers and manufacturers It assesses the relative performance of Diamond
– detect the difference. Verification Instruments available on the market.
Industry professionals can use the directory to
According to the GIA, the instruments help guide them in choosing the instrument that will
professionals read a diamond’s spectral signature best serve their needs17.
to determine its composition and identify whether
it originated in nature or from a laboratory.
Researchers are trained to check for graining
patterns and ultraviolet fluorescence reactions, Certification and legal guidelines on diamond
specific to laboratory-grown diamonds, but definitions also help guide customers and
in recent years changes in the quality and stakeholders across the supply chain on whether
growth of CVD synthetic diamonds has led they are buying laboratory-grown or natural
to greater dependence on spectroscopic diamonds. Read on to find out more.
identification techniques alongside the more
traditional approaches16.

9
Kimberley Process Statistics (n.d.) Public statistics. Available at: https:// 14
IGI (2023) Inclusions seen in Lab grown diamonds. Available at: https://www.igi.org/gemblog/
kimberleyprocessstatistics.org/public_statistics inclusions-seen-in-lab-grown-diamonds/
10
Bain & Company (2021) The global diamond industry 2020 – 2021. Available at: https://www. 15
Ibid.
bain.com/globalassets/noindex/2021/bain_report_diamond_report-2020-21.pdf 16
GIA (n.d.) Synthetic diamonds: Improved quality and identification challenges. Available at:
11I
bid. https://www.gia.edu/gia-news-research-improved-quality-identification-challenges
12
IGI (2020) Some clarity on diamond clarity. Available at: https://www.igi.org/gemblog/some- 17
Natural Diamond Council (n.d.) ASSURE Program. Available at: https://www.naturaldiamonds.
clarity-on-diamond-clarity com/assure
13
GIA (2014) Tiny inclusions reveal diamond age and earth’s history. Available at: https://www.gia.
edu/UK-EN/gia-news-research-tiny-inclusions-reveal-diamond-age
 DIAMOND FACTS
9

How do I know whether I’m purchasing a natural

or a laboratory-grown diamond?

FACTCHECK:

Legal definitions and advertising guidelines Across the world, there are now global standards
exist to protect consumers and ensure they and national legislative requirements which must
understand whether they are purchasing a be followed by anyone selling these stones.
natural or laboratory-grown diamond. Retailers
obtain specific grading reports or certifications Key points from the standards are:
from independent organizations that can
verify the origins and quality of natural and • The word 'diamond' used on its own always
synthetic diamonds. implies a natural diamond.

Legal definitions and advertising guidelines • Just three terms can be used to describe
synthetic diamonds: ‘synthetic diamonds’,
Clear diamond terminology exists to guide ‘laboratory-grown diamonds’ and
audiences on what can and cannot be classified as ‘laboratory-created diamonds’. Terms that
a diamond, as well as how to refer to laboratory- include the manufacturer’s name,
grown diamonds18. followed by the word 'created' are also
permitted in the US.
Table 1 - Summary of definitions and guidelines

USA In 2018 the US Federal Trade Commission (FTC) FRANCE The decree n°2002-65 includes
released guidelines for the Jewelry, Precious guarantees to protect the consumer when
Metals, and Pewter Industries that warned against it comes to the terminology that can be
the use of terms like ‘natural, real, genuine and used in the trade of gemstones and pearls.
precious’ (which can be used for natural diamonds As the French government deemed that
from the Earth), in the marketing of laboratory- there is no acceptable local translation of
grown diamonds to prevent confusion between two the English terms “laboratory-grown” or
distinct categories19. Three modifiers were approved “laboratory-created”, then only the use of
by the FTC for the description of laboratory-grown the term “synthetic” is authorized.
diamonds: ‘laboratory-grown’, ‘laboratory-created’,
or ‘(manufacturer’s name) created’. ‘Synthetic’ can ISO The ISO 18323:2015 standard on consumer
also be used. ‘Man-made’, ‘cultured’, and ‘above- INTERNATIONAL confidence in the diamond industry
ground’ are not acceptable modifiers for laboratory- ORGANIZATION FOR provides global guidelines and clearly
grown diamonds. STANDARDIZATION defines terminology to be applied,
Abbreviations such as ‘lab-grown diamonds’ are including three accepted modifiers:
not accepted. When used alone, the word 'diamond' ‘synthetic’, ‘laboratory-grown’ and
always means a natural diamond ‘laboratory-created diamonds’21.

UK The Advertising Standards Authority (ASA) has CIBJO Created by the World Jewellery
used terminology guidance developed by the (THE WORLD Confederation in consensus with global
JEWELLERY trade, the Diamond Blue Book records
National Association of Jewellers (NAJ) and
CONFEDERATION) trade practices and nomenclature for
other leading industry organizations to rule that DIAMOND BLUE
diamond advertising must ensure that the correct the diamond industry throughout the
BOOK
identifier and term is used for diamond products world22. The guidance is aligned with the
to make the nature of its origin clear20. In the ISO 18323:2015, and complements
UK market, these guidelines have the status of existing nations' fair trade legislation.
Primary Authority Advice which is assured and In the absence of relevant national laws
recognized by Trading Standards. this guidance can be considered' as
trading standards.

18
Natural Diamond Council (n.d.) Diamond terminology. Available at: https://www. ISO (n.d.) ISO 18323:2015 - Jewellery - Consumer confidence in the diamond industry. Available
21

naturaldiamonds.com/resources/diamond-terminology/ at: https://www.iso.org/standard/62163.html

JVC Legal (n.d.) Understanding the FTC Guidelines. Available at: https://jvclegal.org/
19 22
CIBJO (n.d.) The blue books. Available at: https://www.cibjo.org/the-blue-books/
understanding-the-ftc-guidelines/
Professional Jewellery (2021) ASA rules jewellers must provide clarity on diamond origins.
20

Available at: https://www.professionaljeweller.com/jewellers-must-provide-clarity-over-

diamond-origins-rules-asa/
DIAMOND FACTS 10

Understanding grading reports and certifications

Consumers can also be assured about the diamond report24 provides information as to
identity of their diamond by asking for grading whether a diamond was made via CVD or HPHT.
reports or certifications23 (depending on the
grading laboratory).

Laboratory-grown diamonds reports must always

disclose in a clear way that they are laboratory-
grown. For example, the GIA laboratory-grown

Figure 2 - Sample of a GIA natural diamond report25

GIA (n.d.) Natural diamond grading sample report. Available at: https://www.gia.edu/analysis-
23 24
GIA (n.d.) Grading sample report – Laboratory-grown diamond. Available at: https://www.gia.
grading-sample-report-diamond edu/analysis-grading-sample-report-laboratory-grown-diamond?reporttype=laboratory-grown-
colored-diamond-report
25
GIA (n.d.) Natural diamond grading sample report. Available at: https://www.gia.edu/analysis-
grading-sample-report-diamond
 DIAMOND FACTS
11

Figure 3 - Sample of a GIA laboratory-grown diamond report26

GIA (n.d.) Grading sample report – Laboratory-grown diamond. Available at: https://www.gia.
26

edu/analysis-grading-sample-report-laboratory-grown-diamond?reporttype=laboratory-grown-
colored-diamond-report
 DIAMOND FACTS
12

Understanding environmental terms

Before diving into the questions about sustainability and environmental impact,
Before
take a look atdiving into the questions
these concepts.
about sustainability and
environmental impact,
CARBON FOOTPRINT:
FOOTPRINT take
EXPLAINED CARBON INTENSITY:
INTENSITY EXPLAINED
a look at these concepts.
The quantity of greenhouse gas emissions A measure of the carbon footprint (in terms
(GHG) expressed in terms of carbon of carbon dioxide and other GHG emissions)
dioxide equivalent (CO2e), emitted into the per unit of activity. For diamonds, carbon
atmosphere by an individual, organization, intensity is typically calculated by totaling
process, product or event from within a the GHG emissions over a period from a
specified boundary. The word 'equivalent' laboratory or mine and dividing this by a
is used in the metric because other GHGs measure of production in that period. This is
besides carbon dioxide, such as methane, usually either rough or polished carats.
are also released into the atmosphere. These
are included in the measurement to create
one standard figure for comparison and
tracking over time.
DIAMOND FACTS 13

OVERVIEW OF SCOPES AND EMISSIONS

ACROSS THE VALUE CHAIN

The emissions accrued can be separated into three

overarching types; Scope 1, Scope 2 and Scope 3
emissions27 28.

Table 2 - Overview of scopes and emissions across the value chain

CREDIT: GHG PROTOCOL

SCOPE 1 SCOPE 2 SCOPE 3

Scope 1 predominantly covers Scope 2 encompasses Scope 3 includes emissions

fuel-based activities. emissions that are caused that are not produced by the
through purchased electricity. company itself but are a result
It covers emissions from This could include emissions of indirect activities owned
sources that an organization from electricity generation by different stakeholders in
owns or controls directly. through to power generators upstream and downstream
used for buildings and the of the supply chain, different
infrastructure surrounding stakeholders upstream and
a given mine. downstream in the supply chain.

27
Carbon Trust (n.d.) What are Scope 3 emissions? Available at; https://www.carbontrust.com/ National Grid (n.d.) What are Scope 1, 2 and 3 emissions? Available at: https://
28

our-work-and-impact/guides-reports-and-tools/briefing-what-are-scope-3-emissions www.nationalgrid.com/stories/energy-explained/what-are-scope-1-2-3-carbon-
emissions#:~:text=Definitions%20of%20scope%201%2C%202,owned%20or%20controlled%20
by%20it.
 DIAMOND FACTS
14

Are all laboratory-grown diamonds sustainable?

FACTCHECK:
Laboratory-grown diamonds may not always be It is also a misconception that laboratory-
as sustainable as some claim. The manufacturing grown diamonds are mining-free, as stated in
process, which lasts a few weeks, is energy- some marketing campaigns. Synthetic diamond
intensive, requiring temperatures similar to 20% of processes can require graphite and metals, and
that of the Sun’s surface29. Over 60% of laboratory- the reactors in which laboratory-grown diamonds
grown diamonds are mass-produced in China and are created are built with metals that all originate
India where 63% and 74% of grid electricity from mining.
is generated from coal30.
Sustainability claims about laboratory-grown
Publicly available research reveals that the claim diamonds should be supported by evidence on
that laboratory-grown diamonds always have a their social footprint too, especially in areas
low, neutral or even negative carbon footprint relating to tax payments, employment and human
is not true. The environmental sustainability rights, as well as the support provided for local
of laboratory-grown diamonds depends on the communities in laboratory-grown diamond regions.
energy, chemical, material, water and waste
management of the factory in which they are
produced. It is also not possible to make a
simplistic general comparison between natural This chapter focuses largely on environmental
diamonds and laboratory-grown diamonds. Each sustainability and seeks to address these
category has a range of production processes, misconceptions with publicly available data.
geographical locations, power sources, productivity
capabilities, and sustainability practices.

Background on the scale and emissions footprint of laboratory-grown diamonds

The energy required to grow laboratory-grown In 2021, the majority of laboratory-grown diamonds
diamonds depends on many factors including were produced in China (41%) and India (20%)31,
the size of the diamond and the type and age of both of which have a heavy dependence on coal
the machinery used. For example, large stones for electricity production32. The $22 billion global
require more energy to be manufactured. The most laboratory-grown diamond industry is growing
significant factor that impacts energy usage is the quickly33. At the end of 2022, expert industry
method used (HPHT or CVD) in their manufacturing. analyst Paul Zimnisky noted that the output of the
The emissions generated by laboratory-grown laboratory-grown diamond industry has reached
diamond manufactures depend on the amount of between 7-9 million carats34. The industry's
energy required and the energy source used. If production capacity stood at around 6-7 million
electricity is sourced is sourced from the national carats in 202035, indicating that production
grid, it will depend on the geographical location too. capacity is increasing.

29
NASA (n.d.) Temperature of the sun. Available at: https://www.nasa.gov/sun 33
Allied Market Research (2022) Lab grown diamonds market. Available at: https://www.
30
Our World In Data (n.d.) Electricity generation -2022, based on BP Statistical Review of World alliedmarketresearch.com/laboratory-grown-diamonds-market-A13694
Energy. Available at: https://ourworldindata.org/grapher/electricity-generation 34
Paul Zimnisky (2022) State of the diamond market Volume 6 Issue 4 – December 2022. Available
31
Bain & Company (2021) The global diamond industry 2020 – 2021. Available at: https://www. at: https://www.paulzimnisky.com/state-of-the-diamond-market-past-issue-index
bain.com/globalassets/noindex/2021/bain_report_diamond_report-2020-21.pdf 35
Bain & Company (2021) The global diamond industry 2020 – 2021. Available at: https://www.
32
Our World In Data (n.d.) Electricity generation -2022, based on BP Statistical Review of World bain.com/globalassets/noindex/2021/bain_report_diamond_report-2020-21.pdf
Energy. Available at: https://ourworldindata.org/grapher/electricity-generationWW
DIAMOND FACTS 15

The energy consumption of laboratory-grown diamonds

The energy mix where laboratory-grown diamonds If electricity used in the production phases of
are produced is important when considering how laboratory-grown diamonds originates from
sustainable they are because the production of non-renewable sources, this can contribute to
laboratory-grown diamonds is highly energy- laboratory-grown diamonds' GHG emissions.
intensive. As previously stated, there are two
main methods of producing laboratory-grown So, what is the exact carbon footprint of a
diamonds: High Pressure High Temperature (HPHT) laboratory-grown diamond? Few laboratory-grown
and Chemical Vapor Deposition (CVD). The latter diamond companies transparently disclose or
is significantly more energy intensive, mainly due verify such data and the truth is, there is no single
to the use of plasma microwaves that require very agreed upon figure. It is dependent on multiple
high power. factors including the method of production, the
region and the methodology used to calculate the
In these processes, energy is required for extreme footprint. Sphera have estimated that the average
heating, up to around 1,500 degrees°C39 and for emissions per polished carat produced by the CVD
HPHT for high-pressure conditions. A considerable process can vary from 260kg C02e to 612kg CO2e
amount of water is also required in some factories in India40. In the instance that 100% renewable
for cooling systems for reactors. Energy is also energy is used then their research estimates this
needed to stabilize the environment within the figure can be as low as 17kg CO2eq per polished
factory to ensure external conditions do not impact carat of laboratory-grown diamond41.
the growth of the synthetic diamond.

CHEMICAL VAPOR DEPOSITION:

DEPOSITION EXPLAINED HIGH PRESSURE HIGH TEMPERATURE:
TEMPERATURE EXPLAINED

The CVD diamond growth process involves HPHT involves placing a diamond seed into
placing seed crystals in a chamber that is a capsule which is placed into a press. The
filled with gas and heated to temperatures capsule is heated to temperatures of 1,300-
of 900-1,200°C. A microwave beam causes 1,500°C with pressures above 870,000
carbon to form out of a plasma cloud which pounds per square inch. According to the
is then deposited onto the crystal to form a GIA, this pressure is roughly equivalent to
diamond. The entire process usually takes the pressure exerted by a commercial jet
three weeks to a month before the diamonds airplane if balanced on the tip of a person’s
are ready to be cut and polished36. finger37. Metal in the growth capsule melts
and dissolves the high purity carbon source
and carbon atoms are then deposited on the
seed crystal to generate diamond growth38.
Following conversations with industry
professionals, we learnt that each HPHT
reactor can weigh around 50 tonnes.

36
GIA (2016) HPHT and CVD diamond growth processes. Available at: https://www.gia.edu/ 39
NASA (n.d.) Temperature of the sun. Available at: https://www.nasa.gov/sun
hpht-and-cvd-diamond-growth-processes 40
Sphera (2021) Research based sustainability brief on laboratory-grown diamonds from
37
GIA (2017) Observations on HPHT-Grown Synthetic Diamonds: A Review. Available at: https:// chemical vapor deposition technology. Available at: https://pandoragroup.com/-/media/Files/
www.gia.edu/gems-gemology/fall-2017-observations-hpht-grown-synthetic-diamonds Sustainability/Brilliance/Sphera-statement.pdf
38
Ibid. 41
Ibid
 DIAMOND FACTS
16

The carbon footprint of a 1 carat cut and polished laboratory-grown diamond

700
Diamond synthesis
612
600 Raw material acquistion
523
Cutting and polishing
500
Transportation
400

300
260
200

100
36 17
0
India China Eu28 Eu28 windpower Eu28 windpower
(c&p wind power)

Figure 3 - The carbon footprint of a 1 carat cut and polished laboratory-grown diamond.42

Within the laboratory-grown diamond market, Also, claims that laboratory-grown diamonds
different producers use different reactors in their always have a lower carbon footprint and are
production processes, which have varying energy therefore always more sustainable than natural
efficiencies. This further impacts the accuracy of diamonds are not true. The answer is dependent
generalized figures that are often used. Just as on numerous variables, especially in the natural
some natural diamond companies use renewable diamond recovery process. These include
energy, there are instances where laboratory- geography, the productivity of the mine44 and the
grown diamonds use renewable sources for their use of renewable energy.
processes. Hydropower is a reliable renewable
source and it can provide a constant source of There is a common misconception that laboratory-
the high-intensity energy that is required for the grown diamonds are always mining-free. This is not
growing process of a synthetic diamond. In these entirely true. Laboratory-grown diamond synthesis
instances, it is fair to say that these laboratory- requires the production of machines to carry
grown diamonds are more environmentally out various processes. Machinery and machine
sustainable than orthodox mass-produced processes involved at laboratory-grown diamond
laboratory-grown diamonds where factories and factories, like the presses, are made of high-grade
machinery rely heavily on fossil fuels and non- steel, a material that has a high level of embodied
renewable sources. carbon45. Additionally, manufacturing HPHT
synthetic diamonds requires graphite, metals like
To navigate these complexities and if it is of nickel, iron and cobalt and pyrophylite – albeit in
interest, buyers should ask for carbon footprint small quantities46. Equally, synthetic diamonds
data from the specific laboratory-grown diamond produced via CVD require methane and hydrogen.
factory that produced their diamond. There is Methane is generally sourced from the mining of
limited data and transparency about carbon fossil fuels like gas, oil and coal47.
emissions from laboratory-grown diamonds. The
International Grown Diamond Association plans The detailed process of raw material extraction
to work with its members to address the lack of for laboratory-grown diamonds can be found in
disclosure about their environmental impact43. the Annex48.

42
Ibid Building Green (n.d.) The urgency of embodied carbon. Available at: https://www.buildinggreen.
45

com/feature/urgency-embodied-carbon-and-what-you-can-do-about-it#:~:text=Mithun%20
43
Vogue Business (2019) Are mined diamonds more environmentally friendly? Not so fast. (Meghan%20Lewis)-,Steel,ton%20of%20greenhouse%20gas%20emissions.
Available at: https://www.voguebusiness.com/technology/mined-diamonds-environmentally-
friendly-debeers-dpa V. Zhdanov et al (2021) A Comparative Analysis of Energy and Water Consumption of Mined
46

versus Synthetic Diamonds. Energies 2021, 14, 7062. https://doi.org/10.3390/en14217062

44
Diamond Council (2015) Discovery and mining. Available at: https://dcec.diamondcouncil.org/
Documents/CourseMaterials/DiamondCourse/D_Lesson_11.pdf, BBC (2020) The sparkling rise of JCK Online (2023) No, laboratory-grown diamonds are not mining free. Available at: https://
47

the lab grown diamond. www.jckonline.com/editorial-article/laboratory-grown-diamonds-mining-free/

48
See Annex on page 48
DIAMOND FACTS 17

On water usage, some HPHT factories require

the use of large volumes of water to cool their What about laboratory-grown diamonds’
equipment and maintain the humidity levels social sustainability performance?
needed to grow laboratory-grown diamonds
Any broad claims that laboratory-grown
In China, where the majority of HPHT production diamonds are always a sustainable option must
takes place, factories use common water consider the social implications of the industry
reservoirs to cool the HPHT presses and this across the entire supply chain too.
reservoir water can be used multiple times.
Research has found that in general, water Whilst this chapter has focused a lot on
consumption for the HPHT and CVD methods environmental sustainability, social conditions
is materially insignificant, approximately 0 and relating to employment and human rights, as
0.002 m3 per carat, respectively49. When it comes well as the impact and mediation with local
to exact figures on water recycling, there is little communities in laboratory-grown diamond
publicly available data on this to review. regions, are fundamental to ensuring that
when it comes to water usage, laboratory-
A NOTE ON GREENWASHING grown diamonds can justify their ethical
sourcing claims.
The global crackdown on greenwashing,
specifically on misleading environmental claims, There is less access to published data and
has addressed the sustainability statements information about the social footprint of
made by certain producers of laboratory-grown laboratory-grown diamond manufacturers
diamonds. and they are not held to account on
reporting guidelines.
The Federal Trade Commission in the US sent
warning letters to companies in 201950 regarding Additionally, as laboratory-grown diamond
their diamond advertisement disclosures. It noted production has a business model that relies on
that any campaigns that claimed products were technology-based manufacturing, the number
‘eco-friendly’, ‘eco-conscious’, or ‘sustainable’ of employees it must hire for direct production
without specific evidence or data to back this up is significantly smaller than that of the natural
would be placed under review51. diamond industry. There is also much less
local procurement and incomparably less
It also started a public consultation process infrastructure and social investments made or
with the purpose to review its Green Guides. The partnerships developed with
UK’s Competition and Markets Authority (CMA) local communities.
published its Green Claims Code52 and France has
brought in fines against companies found to be This means that that laboratory-grown
greenwashing53. diamonds do not have t have the same socio-
economic benefits for communities or positive
The European Union has also announced a set of social multiplier effect as natural diamonds
new legislations aimed at tackling eco-claims. have. The natural diamond industry operates
This underscores the importance of ensuring that largely in developing countries, so contributes
any sustainability claims made by producers of to the important economic development of
laboratory-grown diamonds can be sustained and producer countries.
are underpinned by robust evidence.
Read more about this later on in our study.

49
V. Zhdanov et al (2021) A Comparative Analysis of Energy and Water Consumption of Mined UK Government (n.d.) Green claims code. Available at: https://greenclaims.campaign.gov.uk/
52

versus Synthetic Diamonds. Energies 2021, 14, 7062. https://doi.org/10.3390/en14217062 Responsible Investor (2021) France brings in fines against greenwashing. Available at: https://
53
50
FTC (2019) Warning letters regarding diamond ad disclosure. Available at: https://www. www.responsible-investor.com/france-brings-in-fines-against-greenwashing/
ftc.gov/news-events/news/press-releases/2019/04/ftc-sends-warning-letters-companies-
regarding-diamond-ad-disclosures
51
Guardian (2020) Are lab grown diamonds the more ethical choice to say I do? Available at:
https://www.theguardian.com/lifeandstyle/2020/mar/10/diamonds-laboratory-grown-climate-
change
 DIAMOND FACTS
18

What is the natural diamond industry doing to reduce its

carbon footprint and protect biodiversity?

FACTCHECK: Factors that influence the difference in carbon

The natural diamond industry has set out on emissions recorded by the industry
its journey to decarbonize in line with global
climate targets. As part of their carbon reduction There are many contributing factors to the
strategies, NDC members are developing difference in carbon emissions recorded by the
renewable energy projects, often in developing industry. These include mainly the availability of
countries where it is harder to source energy, as clean energy at mine locations, the production or
well as engaging in carbon offsetting projects and yield capacity of a mine and exactly which stages
investing in programs to sequester carbon. of mining are included in methodologies.

Companies like De Beers Group are committed to It is estimated that for a 1 carat polished natural
becoming carbon neutral by 203054 and Rio Tinto diamond, the emissions are 106.9kg CO2e in 2019
has set the goal of achieving net zero emissions by (Scope 1 and 2)57. This equates to driving 265 miles
205055. NDC members are also involved in unique in a medium-sized car that runs on gasoline and
programs to sequester carbon such as by using driving just less than the distance between Los
kimberlite, the rock where diamonds are found or Angeles and Las Vegas.58.
through various nature-based solutions.

The natural diamond world protects the How is the natural diamond industry working
biodiversity of an area almost four times the land to decarbonize?
they use, equivalent to the size of New York City,
Chicago, Washington and Las Vegas combined. As The natural diamond industry has set out on its
much as 99% of the waste from diamond recovery journey to decarbonize in line with global climate
is rock and 84% of the water used in diamond targets. Leaders like De Beers Group have set
recovery is recycled56. The natural diamond the goal of becoming carbon neutral across their
industry abides global environmental standards operations (Scope 1 and 2) by 2030 and are making
and stringent national laws. progress, having achieved a 11% year on year
reduction in energy intensity in 202159. Rio Tinto
Before a single diamond is recovered, has the goal to reduce GHG emissions by 50% by
environmental permissions must be granted by 203060.
governments with a legal obligation for ongoing
monitoring, reporting and closure plans. There are many opportunities for large-scale
mining companies to reduce their Scope 1-3
The previous chapter sought to address emissions and NDC members are demonstrating
misconceptions surrounding sustainability claims progress. This section outlines how companies are
made about laboratory-grown diamonds. Now, we working to decarbonize and where future efforts
look to the natural diamond industry to explore can be concentrated.
how leading players are focusing on mapping and
reducing their carbon footprint.

54
De Beers (2021) Sustainability report 2021. Available at: https://www.debeersgroup.com/~/ 58
US Environmental Protection Agency (n.d.) Greenhouse Gas Equivalencies Calculator. Available
media/Files/D/De-Beers-Group-V2/documents/building-forever/building-forever-our-2021- at: https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator#results
sustainability-report.pdf 59
De Beers (2021) Sustainability report 2021. Available at: https://www.debeersgroup.com/~/
55
Rio Tinto (2022) Climate change report. Available at: https://www.riotinto.com/en/invest/ media/Files/D/De-Beers-Group-V2/documents/building-forever/building-forever-our-2021-
reports/climate-change-report sustainability-report.pdf
56
ERM (2022) Natural Diamond Council members sustainability overview. Internal research based 60
Rio Tinto (2022) Climate change report. Available at: https://www.riotinto.com/en/invest/
on NDC members reports and audited data. reports/climate-change-report
57
ERM (2022) Natural Diamond Council members sustainability overview. Internal research based
on NDC members reports and audited data.
DIAMOND FACTS 19

SCOPE 1
Steps to reduce Scope 1 and 2 emissions include improving operational efficiency,
AND 2
increasing the use of sustainable fuels, and switching to sustainable drive trains (the
components of a motor vehicle that deliver power to the wheels), for vehicles
and machinery.
Electrification of mining processes as well as the adoption of hydrogen fuel cells and
battery electric vehicles are promising developments for the diamond industry. De Beers
Group's parent company Anglo American is developing a 300-metric ton fuel cell electric
vehicle (FCEV) haulage truck and Newmont Goldcorp has set up the world’s first fully
electric mine at Borden in Canada61.
In Canada, De Beers Group is designing a mine which incorporates low-carbon energy and
uses only renewable sources. In addition, the Chidliak Diamond Project is exploring the
use of synthetic fuels and biofuels62. Switching to more sustainable biofuels for trains has
the potential to decrease carbon emissions by over 70% according to McKinsey63.

SCOPE 2 Using green sources of electricity has the power to reduce more than 50% of current
emissions output and is essential to reducing Scope 2 emissions64. Multiple alternatives
exist, including purchasing green electricity and using solar panels. NDC members are
working to fully integrate renewable electricity. For example, Rio Tinto’s Gudai-Darri mine
in Western Australia will have 65% of its total electricity consumption supplied by
a combination of solar farms and battery storage65.
Rio Tinto’s Diavik Diamond Mine in Canada has encompassed renewable energy in its
operations in sub-arctic conditions. It operates as one of the world’s largest remote
mining hybrid wind-diesel power facilities. It was commissioned in 2012, and in 2013 it
produced 8.5% of the mine's power and saved 3.8 million liters of fuel66.
Rio Tinto has even have even developed defrosting technology to prevent its four
9.2-megawatt wind turbines from freezing67.
De Beers Group is also looking to replace fossil fuels where possible and is working closely
with Anglo American on the development of solar and wind energy, through a regional
renewable energy ecosystem, for its mines in South Africa and Namibia68. De Beers Group
is also purchasing renewable energy for retail operations in the UK and US69.

SCOPE 3 Notoriously hard to map, manage and report on, Scope 3 emissions remain a focus for
the natural diamond mining industry. To reduce value chain emissions, achievable wins
can focus on material procurement and sustainable alternatives. For example, inputs for
infrastructure and materials needed for the development of mines like cement, steel and
lime all have high levels of embodied carbon.
Alternatives like green steel70 and sustainable cement71 offer one plausible solution.
Companies can also advocate for the adoption and scale of renewable energy projects
near diamond processing sites across the value chain, like Surat in India. An important
part of reducing Scope 3 emissions also involves proactive stakeholder engagement.
As these operations are outside the direct control of natural diamond companies,
it is a case of working with suppliers and encouraging them to take measures themselves72.

61
Ibid. 67
Rio Tinto (n.d.) Diavik. Available at: https://www.riotinto.com/en/can/canada-operations/diavik
De Beers Canada via Youtube (2022) Chidliak project proposal. Available at: https://www.youtube.com/
62 68
Anglo American (2022) Anglo American and EDF Renewables agree to renewable energy partnership
watch?v=41M30xpxL0M in South Africa to form Envusa Energy. Available at: https://www.angloamerican.com/media/press-
releases/2022/04-10-2022
McKinsey (n.d.) Creating the zero-carbon mine. Available at: https://www.mckinsey.com/industries/metals-and-
63

mining/our-insights/creating-the-zero-carbon-mine De Beers Group (2021) Sustainability report 2021. Available at: https://www.debeersgroup.com/~/media/Files/D/
69

De-Beers-Group-V2/documents/building-forever/building-forever-our-2021-sustainability-report.pdf
McKinsey (n.d.) Creating the zero-carbon mine. Available at: https://www.mckinsey.com/industries/metals-and-
64

mining/our-insights/creating-the-zero-carbon-mine 70
WEF (2022) Green steel. Available at: https://www.weforum.org/agenda/2022/07/green-steel-emissions-net-zero/
65
Rio Tinto (n.d.) Our first solar plant to power new iron ore mine. Available at: https://www.riotinto.com/en/news/ McKinsey (n.d.) Creating the zero-carbon mine. Available at: https://www.mckinsey.com/industries/metals-and-
71

stories/First-solar-plant mining/our-insights/creating-the-zero-carbon-mine
Canadian Mining and Energy (2014) Diavik Diamond Mine powers up with wind. https://www.miningandenergy.ca/
66
CDP (2022) 4 steps for reducing Scope 3 emissions. Available at: https://www.cdp.net/en/articles/supply-
72

sustainability/article/diavik_diamond_mine_turns_to_wind/ chain/4-steps-for-reducing-scope-3-emissions-and-accelerating-action-through-your-supply-chain
 DIAMOND FACTS
20

Reducing impact through carbon absorption, offsetting and conservation projects

Beyond emissions reduction strategies, NDC For the emissions that the company cannot
members are actively involved in offsetting mitigate or replace with alternative energy
projects and conservation efforts that help to sources, they are engaging in offsetting projects
remove carbon from the atmosphere and thus like the Wonderbag initiative, which reinvests
contribute to their climate goals. carbon offset financing back into communities
and is verified by numerous carbon standards and
Petra Diamonds is pursuing carbon sequestration protocols 75 76.
initiatives. It is working with academic institutions
that are exploring carbon sequestration through A final example is CarbonVault which is a research
the mineralization of mining waste, specifically program supported by De Beers Group that is
kimberlite tailings. dedicated to exploring ways to lock away carbon
in kimberlite77.

SPOTLIGHT: DE BEERS GROUP

AND KELP BLUE
De Beers Group has launched a partnership
for a pilot of its first nature-based climate
solution. It has invested $2 million in Kelp
Blue, a company that plants kelp forests
across the world to improve the health of
oceans, whilst also sequestering carbon
emissions73. Together, De Beers Group and
Kelp Blue are working to plant a giant kelp
forest off the coast of Namibia, helping
support an ecosystem for 800 species74.

IMAGE: DE BEERS / KELP BLUE

73
Kelp Blue (n.d.) Available at: https://kelp.blue/ 76
Wonderbag (n.d.) Carbon. Available at: https://www.wonderbagworld.com/carbon
De Beers Group (2021) Kelp Blue. Available at: https://www.debeersgroup.com/sustainability-
74
De Beers Group (n.d.) CarbonVault. Available at: https://www.debeersgroup.com/sustainability-
77

and-ethics/protecting-the-natural-world/kelp-blue and-ethics/protecting-the-natural-world/carbon-vault
Petra Diamonds (2022) Protecting our planet. https://www.petradiamonds.com/wp-content/
75

uploads/Pages-63-81-of-SR.pdf
DIAMOND FACTS 21

What is the natural diamond industry doing to protect biodiversity?

FACTCHECK
Members of the NDC are always working, often
in partnership with governments and local
communities, to reduce the impact that natural
diamond mining can have on the environment. The
natural diamond world protects the biodiversity
of an area equivalent to the size of New York
City and Los Angeles combined. NDC members
protect around four times the land they use. As
much as 99% of the waste from diamond recovery
is rock and 84% of the water used in diamond
recovery is recycled78. The focus on stewardship of
diamond mines by NDC members begins from the
exploration phase through to the closure phase and
is regulated by global environmental laws as well
as national and industry regulations.

Every diamond mining operation has a different process, it does not cause any irreversible damage
environmental impact, depending on the type of to the environment. What it does change is the
mining involved – whether it is alluvial, beach, landscape, as it creates waste rock piles. However,
marine or pipe mining. Equally, it is important to these are reclaimed by the landscape as part of
distinguish between artisanal and small-scale mine closure plans which are done under the strict
mining (ASM) and modern large-scale diamond supervision and approval of local communities
mining when discussing the environmental impact. and governments. Topography is not the same
ASM represents 10-15% of the natural diamond as damage. Land can be restored to land use
market79 and refers to mining by individuals, acceptable to the local community.
groups or cooperatives that often take place in the
informal sector of the market80. There is oftenoften In recent years, there has been an important focus
less data available on details of the ASM on water recycling. During the diamond mining
sector’s footprint. They may be less held to process, members consume water from sources
account on regulations and reporting standards on-site including surface water, ground water
These smaller organizations that are publicly and third-party supply81. As diamond recovery is
listed companies. reliant on a mechanical crushing process, water
is more suitable for recycling and reuse82. Large-
There are numerous operational measures scale mining companies are working to reduce
being taken by the natural diamond industry to their dependencies, especially in water-scarce
mitigate and reduce the impact regions, by promoting the use of water recycling.
on the environment. This includes conservation For example, in 2022 Petra recorded that their
efforts and rewilding projects as well as waste water recycling initiatives had resulted in 80% of
and water management. the water used being recycled on-site.83. Lucara
Diamond has also set an overarching goal of ‘zero
Information surrounding diamond recovery discharge’ operations, to engage and share data
processes provided by NDC members details that with neighboring agricultural water users and to
because no chemicals are used in the extraction provider surplus water from their pit84.

78
ERM (2022) Natural Diamond Council members sustainability overview. Internal research 81
ERM (2022) NDC Sword & Shield Library report. Internal research
based on NDC members reports and audited data. 82
ERM (2022) NDC Sword & Shield Library report. Internal research
79
Natural Diamond Council (2020) Creating a force for good to support artisanal miners. 83
Petra Diamonds (2022) Petra Diamonds Sustainability Report. Available at: https://
Available at: https://www.naturaldiamonds.com/industry-news/creating-a-force-for-good-to- www.petradiamonds.com/wp-content/uploads/Petra-Diamonds-Limited-Sustainability-
support-artisanal-miners-2/ Report-2022-1.pdf
80
European Commission (n.d.) Artisanal and small-scale mining. Available at: https://rmis.jrc. 84
Lucara Diamond (n.d.) Sustainability reports. Available at: https://lucaradiamond.com/
ec.europa.eu/?page=artisanal-and-small-scale-mining-a6f8a3#:~:text=Artisanal%20and%20 sustainability/sustainability-reports/
small%2Dscale%20mining%20(ASM)%20refers%20to%20mining,and%20requires%20low%20
investment%20levels.
 DIAMOND FACTS
22

What is the industry doing about the waste from mining?

Over 99% of waste produced by NDC members is An example of successful land protection is The
rock, which is disposed of on-site and eventually Diamond Route, a network of eight conservation
reclaimed as part of the landscape during the sites established by De Beers Group. The network
mine closure and rehabilitation85. De Beers Group spans over 722 square miles of critical habitats
separates waste at the source across a variety of in South Africa and Botswana. In addition to
materials ranging from metals, glass and plastic protecting endangered wildlife, The Diamond
through to batteries86. De Beers Group majority Route creates unique learning opportunities for
shareholder Anglo American has also developed students, scientists and academics91.
a Materials Stewardship strategy to encourage
waste management focused on the principles of Another case is the De Beers Group Moving
the circular economy87. Petra Diamonds recorded Giants initiative, which aims to safely translocate
in 2022 that it had recycled 85% of waste from its elephants with the Peace Parks Foundation to
local operations88. find them safe homes and secure their future in
Mozambique92.
Large-scale mining companies recognize the value
of biodiversity and ecosystem services. They Other examples include Petra Diamonds, who have
employ geologists, biologists and environmental funded a four-year BirdLife Africa Secretarybird
experts to develop programs and ensure all project on an endangered bird species. This
operations are in compliance with environmental resulted in the publication of a scientific article on
regulations and that the land is managed and the feeding and breeding of the bird species.
protected correctly. Through policy and reporting
standards, the companies are committed to Petra Diamonds has also started a bee pollinator
regular monitoring and sharing information conservation project where bees are removed from
on energy usage, air quality, vegetation and the mining site and placed in a safe environment.
biodiversity impact. Operational sites have trained beekeepers to place
bees in well secured hives.
Research conducted by environmental consultancy
ERM details NDC members efforts to work towards Both Rio Tinto and Arctic Canadian Diamond
the United Nations Sustainable Development Goal Company manage Wildlife Monitoring Programs.
15 – Life on Land. NDC members' protect close to Similarly, RZM Murowa have a strict relocation
four times the land they use for mining through program of crocodiles and pythons with the
biodiversity conservation and wildlife protection. support of the local Parks and Wildlife Authority.
At a significant 2,020 square km, the size of the Lucara Diamond are driving a research project
land conserved for biodiversity is equivalent to with BirdLife Botswana to assess the impact of
the size of the total area of New York City and Los mining on insects and birds. They also have plans
Angeles. It is also comparable to the size of four to drill a borehole for a plantation area where the
cities, New York City, Washington, Chicago and community can cultivate plants to use in basket
Las Vegas combined (1,912 square km)89. weaving and other projects.

Here are some examples. Each De Beers Group

operation that is active has a biodiversity
management plan in place. The company
notes that several of their operations measure
compliance against the TSM biodiversity protocol,
an industry-led voluntary certification program
developed by the Mining Association of Canada90.

83
Petra Diamonds (2022) Petra Diamonds Sustainability Report. Available at: https://www.petradiamonds.com/wp- 88
Petra Diamonds (2022) Petra Diamonds Sustainability Report. Available at: https://www.petradiamonds.com/wp-
content/uploads/Petra-Diamonds-Limited-Sustainability-Report-2022-1.pdf content/uploads/Petra-Diamonds-Limited-Sustainability-Report-2022-1.pdf
84
Lucara Diamond (n.d.) Sustainability reports. Available at: https://lucaradiamond.com/sustainability/sustainability- 89
ERM (2022) Natural Diamond Council members sustainability overview. Internal research based on NDC members
reports/ reports and audited data.
85
ERM (2022) Natural Diamond Council members sustainability overview. Internal research based on NDC members 90
De Beers Group (2021) Sustainability report 2021. Available at: https://www.debeersgroup.com/~/media/Files/D/
reports and audited data. De-Beers-Group-V2/documents/building-forever/building-forever-our-2021-sustainability-report.pdf
86
De Beers (2019) Our material topics progress. Available at: https://www.debeersgroup.com/~/media/Files/D/De- 91
De Beers Group (n.d.) The Diamond Route. Available at: https://www.debeersgroup.com/sustainability-and-ethics/
Beers-Group-V2/documents/building-forever/our-material-topics-progress-2019-report.pdf protecting-the-natural-world/the-diamond-route
87
Anglo American (n.d.) Sustainable mining plan. Available at: https://www.angloamerican.com/sustainable-mining- 92
De Beers Group (n.d.) Moving giants. Available at: https://www.debeersgroup.com/sustainability-and-ethics/
plan/healthy-environment protecting-the-natural-world/moving-giants
DIAMOND FACTS 23

Regulations and planning for a positive mining legacy

NDC members are focused on creating a Claim Agreements and a unique, progressive
sustainable legacy and going above and beyond and empowering piece of legislation called the
regulatory and environmental compliance. All Mackenzie Valley Resource Management Act. This
members have to comply with international and ensures a transparent, holistic and integrated
environmental legislation aligned with standards approach to renewable and non-renewable
including ISO 14001, which provides a framework resource management. Regional Land and Water
for effective environmental management systems. Boards of the Mackenzie Valley support licensing
This runs alongside reporting requirements in line on everything from water use and wastewater
with the GRI Mining and Metals Sector Supplement management to land use. These licenses have
and other corporate sustainability reporting strict reporting and monitoring requirements too97.
guidelines and frameworks93. Further expansion of their policies and guidelines
can be found in the Annex.
The stewardship of mines throughout their life
cycle underscores the strict rules that mining Additionally, in Canada there is the Mining
companies must follow, related to both post- Association of Canada’s Towards Sustainable
mining land use and economic plans to support Mining (TSM) standard supports mining companies
the socio-economic prosperity of communities. in managing key environmental and social risks. An
Permits are not provided without details of impact independent board completes an environmental
mitigation, a sophisticated closure plan and proof assessment and also uses tools like Socio-
of financial resources to support a sustainable exit. Economic Agreements, which set out sets out
commitments and predictions made by a company
A mining closure plan involves how a site would regarding their impact. This is then monitored and
be managed at the end of its productive life, the published in a yearly report to the government of
activities to achieve closure goals and how the the Northwest Territories98.
land can be rehabilitated94.
In South Africa, regulations over mining begin
In an interview, a representative from De Beers at the scoping phase all the way through to
Group noted that “We need to be planning for closure. As of 2010, mining became a listed
closure right from the design of the mine.”95, which activity. The environmental provisions of the
is what the large-scale mining industry is doing. National Environmental Management Act (NEMA)
No. 107 of 1998 now apply to mine closure
The Intergovernmental Forum on Mining, Minerals, certification, resulting in mines having to comply
Metals & Sustainable Development outlines with stipulations of this Act too before qualifying
that closure plans should include stakeholder for closure99. NEMA underlines that public
engagement, risk analysis, close monitoring and consultation is essential at the early stages
maintenance as well as financial assurance and of projects.
many other areas96.
In Australia, the Government of Western Australia
Varying geographies have a range of regulations Department of Mines and Petroleum (2017) Mining
pertaining to environmental mining regulations Rehabilitation Fund – Guidance and The Mining
and closure plans. For example, in Canada there Rehabilitation Fund (MRF) Act of 2012 approach
is the Canadian Environment Protection Act important issues related to funding the closure
administered by Environment and Climate Change and rehabilitation of abandoned mines. This goes
Canada (ECCC). against the narrative that mining companies simply
enter a region and leave with no accountability100.
According to Ryan Fequet, Executive Director
for the Wek’èezhìi Land and Water Board, the
Northwest Territories (NWT, Canada) have Land

Natural Diamond Council (n.d.) The framework for an ethical and sustainable diamond industry. Available at: https://
93
The Land and Water Board (n.d.) LWB Policies and Guidelines.Available at: https://mvlwb.com/resources/lwb-
97

www.naturaldiamonds.com/industry-insights/the-framework-for-an-ethical-and-sustainable-diamond-industry/ policies-and-guidelines
APEC (2018) Mine closure checklist for governments. Available at: https://www.apec.org/docs/default-source/
94
The Mining Association of Canada (n.d.) Towards sustainable mining. Available at: https://mining.ca/towards-
98

Publications/2018/3/Mine-Closure-Checklist-for-Governments/218_MTF_Mine-Closure_Checklist-for-Governments. sustainable-mining/
pdf
University of Johannesburg (2011) A critical analysis of the mine closure process as followed by the De Beers Group
99

Fashionista (2019) How do you responsibly close a diamond mine. Available at: https://fashionista.com/2019/12/
95
Oaks Diamond Mine, Limpopo Province, South Africa. Available at: https://core.ac.uk/download/18219063.pdf
orapa-botswana-diamond-mine-closing-ethics-responsibility
Government of Western Australia – Depart of Mines, Industry Regulation and Safety (2017) Mining Rehabilitation
100

Intergovernmental forum on mining, minerals, metals and sustainable development. IGF case study – mine closure
96
Fund. Available at: http://www.dmp.wa.gov.au/Documents/Environment/ENV-MEB-382.pdf
policies in South America. Available at: https://www.iisd.org/system/files/2021-01/igf-case-study-mine-closure-
south-america-en.pdf
 DIAMOND FACTS
24

IN FOCUS: MINING REGULATIONS AND GUIDELINES

Whilst not exhaustive, the list below details initiatives, guidelines and frameworks that highlight the level
of regulation on the opening and closure of mines:

• Australian Government (2016) Mine Closure • NOAMI (2010) Policy Framework in Canada
– Leading Practice Sustainable Development for mine closure and management of long-
Program for the Mining Industry: introduction term liabilities
to mine closure and current leading practices
from an Australian perspective. • World Bank Multistakeholder
Initiative (2010) Towards Sustainable
• ANZMEC (2000) Strategic Framework for Decommissioning and Closure of Oil Fields
Mine Closure and Mines: provides a policy-oriented series of
toolkits related to closure for both oil fields and
• ICMM (2008) Planning for Integrated Mine mines.
Closure – A Toolkit: provides a broadly
conceived life cycle and risk-based approach to • Intergovernmental Forum on Mining,
closure planning. Minerals, Metals and Sustainable
Development (IGF) (2013) The IGF Mining
• Mining Association of Canada (2008) Policy Framework: Mining and Sustainable
Towards Sustainable Mining – Mine Development: lays out a framework that
Closure Framework: an industry-led initiative provides a comprehensive model for policy
to articulate the commitment of member that will allow mining to make its maximum
companies to promote responsible contribution to the sustainable development of
mine closure. developing countries.

Responsible mine restoration

With the closure of Argyle in Australia – one of SPOTLIGHT: THE VICTOR MINE
the world's most iconic natural diamond mines – Based in Ontario, Canada, the Victor Mine
responsible mine restoration has come into focus. halted production in May 2019 and demolition
It takes on average 10 years to open a mine. Having of its operational facilities started in 2020.
a closure plan is a prerequisite to opening a mine, De Beers Group has worked to rehabilitate
in addition to social and environmental impact the mines' waste rock repositories and
assessments which are audited, approved and separate recyclable and non-recyclable
monitored by governments and local community. waste produced throughout the demolition.
It has planted over 150,000 spruce trees and
rehabilitated approximately 328 hectares of
the mine’s disturbed operational footprint,
using commercial seed and seedlings
propagated both onsite and offsite. The
company is using field-based and remote-
sensing programs to track progress101.

ONTARIO, CANADA

De Beers Canada (n.d.) Victor mine. Available at: https://canada.debeersgroup.com/operations/

101

mining/victor-mine
DIAMOND FACTS 25

SPOTLIGHT: RIO TINTO –

DIAVIK MINE
Set in the Northwest Territories of
Canada, the Diavik mine, owned
by Rio Tinto, is set to close in
2025, after opening in 2003. The
company has designed the mine
to minimize disturbance once
it comes to the end of its life.
Rio Tinto has used engineering
technology and techniques that
hold back the waters of the Lac
de Gras to minimize disturbance
to surrounding wildlife and
communities. It has plans to build
back the embankment to ensure
lake water can flow back into the
open pit102.

IMAGE: RIO TINTO

Further projects to support responsible mine of Canada as mining activity winds down. This
restoration include Rio Tinto’s collaboration focuses on socio-economic planning and support
with RESOLVE, a non-profit organization. They whilst engaging with numerous stakeholders
have worked together to launch Regeneration, a including Indigenous governments, federal
company that will use re-mining and processing governments, mining companies, businesses,
of waste from legacy mine sites to support communities and conservation bodies104.
rehabilitation activities and restore natural
environments. Rio Tinto has committed to initially The details of these efforts underline that the
invest $2 million into the company103. natural diamond industry is working to minimize
the impact mines have on the environment
Elsewhere, NDC members De Beers Group and through a focus on land restoration, as well as
Rio Tinto are working together on the Reimagining seeking positive post-mining opportunities via
Closure project with the intention to identify socio-economic rehabilitation for communities in
opportunities for life after diamond mining in surrounding regions.
the Slave Geological Province (SGP) in the NWT

Rio Tinto (n.d.) Innovation at Diavik. Available at: https://www.riotinto.com/en/operations/

102
Life After Diamond Mining (n.d.) Process. Available at: https://lifeafterdiamondmining.com/
104

canada/diavik#:~:text=All%20mines%20have%20a%20finite,back%20into%20the%20open%20 process
pit.
Rio Tinto (2021) Rio Tinto invests in start-up to support habitat restoration. Available at:
103

https://www.riotinto.com/en/news/releases/2021/rio-tinto-invests-in-start-up-to-support-
habitat-restoration-final
E Facts26
DIAMOND FACTS

Are natural diamonds rare?

2 3
FA C T

FA C T
FACTCHECK:
Natural diamonds are a finite resource. Global In fact, today there are only 30 significant natural
natural diamond recovery peaked in 2005, when diamond mines in production, with only 7 mines
r Natural diamonds Demand for
rough diamond production was around 30% higher considered to be classified as Tier 1 deposits.
are rare and no two natural diamonds
than in 2022105. The annual recovery of 1 carat
diamonds is equivalent in volume to filling an
Tier 1 deposits are those that have over $20 billion
in reserve109.
diamonds are the
exercise ball. remains strong.
De Beers Group has recorded that over the last 140
Thesame. Jewelry is
process of natural diamond formation means the fastest
years, almostgrowing
7,000 luxury
kimberlite pipes have been
thatDiamonds
as an object, theynatural
are innately rare. Formationsegment.sampled
Global sales of diamond Yet approximately only
by geologists.
, are a finite resource. jewelry reached record levels, at +52%
takes
Theplace
number across the span
of recovered of millions, sometimes
natural 60 of these were deemed to be sufficiently rich
since 2019 boosted by strong demand
billions, of years
diamonds peaked and occurs
in 2005 andinhavelimited zones of in natural diamonds to be economically viable for
from Millennials and Generation Z,
r thedecreased
Earth’s mantle at extreme
ever since. Only 15% of temperatures and large-scale diamond mining companies110.
both for gifting and self-purchase.
pressures
kimberlite.pipes ever found contain dia-
106
The self-purchasing woman is the main
Graph:vsNumber of diamond deposits sufficiently rich
s While the appetite
monds—and
Natural diamonds
of these,foronly
are2.5
exploration
hard
1% are suit-
to find
remains highdriver at +42%FIG. 31: NUMBER
2019, she OF
is noDIAMOND
longer DEPOSITS
ed (2013 spending
able for diamondwas recovery. times thatand
Diamonds ofare have only
2001), overall to warrant
but the development
s been found has
spending
completely inunique
rock
still over
not theother.
reached
of each lastthe 150record
They years.levels
The of
SUFFICIENTLY
the receiver one that RICH TO WARRANT
is driving DEVELOPMENT
the purchase with control of $32 trillion
first diamonds
2007,
hold were found
when companies
specific properties, in caves
spent almostinUS$1
characteristics, Indiabillion
nearly
inon
worldwide6,800
spending.
s diamond
4,000
andyears exploration
ago and making
even inclusions for(see
a longFig.time,
them 30).
one The
thistrend
was thehere 1,000
differs
onlyofknown from
the most the mining
source.
intimately Over sector
time,items
personal in general,
they whereAccording
have become 2013 to Boston Consulting
5,800
expenditure,
to select
prized for their although
for oneself
perfect lower
or for others.
shape, than in 2012,
hardness, remains
rarity, Group, Gen Z and Millennials are set to
fire
well aboveand
resistance 2007/2008
intense lightlevels.107De Beers and ALROSA
. represent more than 60% of the luxury
ANNUAL GLOBAL
represented almost 75 RECOVERY
per cent of exploration market by 2025. For these younger
The annual
spending inrecovery 33 of 1 carat diamonds
.
2013contribute
These conditions to their rarity. The consumers, cultural credibility and
would fill one exercise ball. The annual authenticity is important, making the
annual recovery of 5 carat diamonds and
recovery of diamonds 5 carats and lasting value, uniqueness, emotional
above would fitfill
intoonea basketball.
basketball108.
LOOKING AHEAD
above would connection and versatility
TION
of diamond jewelry desirable.

TheCARAT
1
REMAIN ELUSIVE
large DIAMONDS
diamond mining
5
LARGE-SCALE PROFITABLE DISCOVERIES WILL MOST LIKELY

companies are expected

CARAT DIAMONDS
GROWTH OF GLOBAL
DIAMOND MARKET $87
to continue to invest in exploration,
would fill one AND ABOVE but the 90 BILLION
probability
exercise of a major profitable
ball. would fill new
one diamond
85
$79
$76 $78
discovery will remain relatively low. This is simply
basketball.
BILLION
because finding economic diamond deposits is 80 BILLION
BILLION
difficult: even spending billions of US dollars
75 60
in exploration carries no guarantee of actually
53 7
discovering economically viable deposits. 70
2017 Kimberlite
2018Non- 2019 2021
Diamond- Non- Economical Tier Tier 1i
Over the last 140 years, almost 7,000 kimberlite pipes pipes diamond- iferous economical deposits 2&3
sampled iferous deposits
have been sampled by geologists, about 1,000 of
Sources: De Beers Insight report 2022, NDC Diamond
HAN which have been diamondiferous. However, onlydesirability report i Over2021,
January US$20 billion
Boston reserves. 7 ‘Tier 1’ finds are: Jwaneng,
Consulting
Orapa, Udachny, Venetia, Catoca, Premier (now Cullinan), Mir
S. about 60 of these are sufficiently rich in diamond Group, McKinsey, Vogue
to Business and Catalyst.org/
Source:
research/buying powerDe Beers
2020
be economically
Source: NDC viable. Just seven mines (Jwaneng
Source: Number of diamond deposits sufficiently rich to warrant development - De Beers
Source: NDC
and Orapa in Botswana, Udachny and Mir in Russia, Group 2014 Diamond Insight Report 111
The geographical focus of diamond exploration will
Premier (now Cullinan) and Venetia in South Africa be likely to continue to be in those areas where the
and Catoca
Kimberley
105
in Angola)
Process Statistics are what
(n.d.) Public statistics. miners
Available at: https:// refer to as
prospectivity potential is highest and where the least
Natural Diamond Council (2021) Beyond the 4 C’s. Available at: https://www.
108

kimberleyprocessstatistics.org/public_statistics naturaldiamondcouncil-academy.com/sites/default/files/2021-08/BEYONG%20THE%204C.pdf
‘Tier 1 deposits’ with more than US$20 billion worth
Geology (n.d.) How do diamonds form? Available at: https://geology.com/articles/diamonds-
106 exploration
Petra
109 has been
Diamonds (n.d.) Industry overview. conducted to date, such as
Available at: https://www.petradiamonds.com/our-
of reserves (see Fig. 31).
from-coal/#:~:text=may%20contain%20diamonds.-,1)%20Diamond%20Formation%20in%20
Earth%27s%20Mantle,by%20deep%2Dsource%20volcanic%20eruptions
industry/industry-overview/
Central Africa, Russia and Canada. In addition, South
De Beers Group (2014) The diamond insight report 2014. Available at: http://insightreport.
110

Natural Diamond Council (2023) A brief history of natural diamonds. Available at: https://www.
107

Overall, the global mining industry is facing

naturaldiamonds.com/epic-diamonds/history/the-diamond-story/
Africa and Zimbabwe are countries with potential:
debeersgroup.com/

although they have a long tradition of diamond

Ibid
111

increasing pressure on capital expenditure, and in

DIAMOND FACTS 27

Many industry experts and analysts believe that The termination of operations of mines like Argyle,
the annual recovery of natural diamonds peaked in which once produced up to 40 million carats a
2005 at 177 million carats112. Though this recovery year, is symbolic of the changing landscape of
has fluctuated, leading analyst Paul Zimnisky natural diamond mining117.
notes depleting legacy mines and limited new
supply sources, further punctuated by the Covid-19 Further potential near-term closures include
pandemic, resulted in a significant production Diavik, Ekati, Nyurbinskaya and Almazy-Anabara,
decline. Through his analysis, it is predicted that which are expected to either reach economic
production will remain within a range of 115-125 depletion or conclude conventional mining by the
million carats annually, a much lower figure than end of this decade.
the 150 million carats recorded in 2017113.
In fact, Zimnisky notes that these mines currently
A major contributing factor to this belief is the account for a combined 17-20 million carats of
declining profile of existing mines and the small annual production, representing approximately 15%
success rate of exploration. Petra Diamonds states of global supply118. This represents a significant
that the success rate in diamond exploration is supply change to the natural diamond industry.
estimated at less than 1%114. De Beers Group is still exploring new opportunities
and in 2022 signed Mineral Investment contracts
Data recorded via the Kimberley Process from with Angola to return to exploring the country for
2014-2021 illustrates the gradual decline of new sources119.
rough diamonds recovered and traded under the
Kimberley Process Certification Scheme (KPCS)
over recent years.

Deep pockets and large financial investment

are needed to explore new diamond mining
opportunities.

Determining the economic viability of these

projects also extends to different types of mining,
including alluvial mining. Alluvial mining is a
process where stones are found in riverbeds or
shorelines after kimberlites have eroded over time.
Approximately 10-15% of the world’s diamonds
originate from alluvial mining, however geologists
have commented that often they cannot tell
how many stones there are. This is a key piece
of information in determining if reserves justify
economic investment115.

The closure of mines that have reached the

end of their economic lives include Argyle in
Australia, which is owned by Rio Tinto and closed
in November 2020; Victor Mine in Canada, which
is owned by De Beers Group and closed in 2019;
Voorspoed in South Africa, which is owned by De
Beers Group; and Snap Lake, which is owned by
De Beers Group in Canada116.

112
Petra Diamonds (n.d.) Industry overview. Available at: https://www.petradiamonds.com/our- 117
JCK Online (2020) The Argyle diamond mine is shutting down. Available at: https://www.
industry/industry-overview/ jckonline.com/editorial-article/argyle-diamond-mine-shutting/
113
Paul Zimnisky (2023) State of the diamond market February 2023. Available at: https://www. 118
Paul Zimnisky (2023) State of the diamond market February 2023. Available at: https://www.
paulzimnisky.com/state-of-the-diamond-market-past-issue-index paulzimnisky.com/state-of-the-diamond-market-past-issue-index
114
Petra Diamonds (n.d.) Industry overview. Available at: https://www.petradiamonds.com/our- 119
De Beers Group (2022) De Beers group signs mineral investment contracts with Angola.
industry/industry-overview/ Available at: https://www.debeersgroup.com/media/company-news/2022/de-beers-group-
115
Ibid. signs-mineral-investment-contracts-with-angola
116
ERM (2022) Natural Diamond Council members sustainability overview. Internal research
based on NDC members reports and audited data.
 DIAMOND FACTS
28

Is the industry stockpiling diamonds to drive up prices?

FACTCHECK:

Inventories of natural diamond producers fluctuate Comparisons of production and sales data
across periods of time, especially when they are for NDC member companies show that over a
broken down by size or quality of stones. This is business cycle, there is no evidence of deliberate
because, unlike other industries, natural diamond stockpiling to systematically drive up prices. This
producers cannot operate a just-in-time production is because total production and total sales are in
model to match supply with demand. line with one another. Bain & Company compiled
data from company reports and the Kimberley
Inventories are also impacted by seasonal demand Certification process to estimate that upstream
patterns and by external events such as the global inventories (i.e. those at diamond mine sites and
the Covid-19 pandemic. sorting offices) across the world fell by 40% in
2021, leaving them close to minimal ‘technical
levels’120.

The factors impacting diamond inventories

There are multiple factors that cause diamond Additionally, external events like the the Covid-19
inventory levels to fluctuate over time. Firstly, pandemic in 2020 or the lower case financial crisis
unlike other industries, there is a large variance in of 2008 can cause a reduction in demand and
the size, color and quality profile of the diamonds therefore impact inventories following such events
recovered each month. These characteristics are when economies start to recover122.
dependent on natural geological processes, rather
than manufacturing decisions. It also takes several
weeks and months for recovered diamonds to
travel from mine to the point of sale.

This is because they must be sorted, typically

into one of 15,000 categories of rough diamonds
according to their size, shape and quality, before
being sold or auctioned at sales that are typically
held once a month121. Inventories therefore
fluctuate, particularly by type of stone.

Seasonal fluctuations in demand can also affect

monthly diamond inventories. For example,
consumer demand for jewelry is usually highest
in the fourth quarter of the year, around
seasonal holidays, which can impact the
inventory upstream.

Bain & Company (2022) The global diamond industry 2021 – 2022. Available at: https://www.
120

bain.com/insights/a-brilliant-recovery-shapes-up-the-global-diamond-industry-2021-to-22
The Israeli Diamond Industry (n.d.) Diamond sorting. Available at: https://en.israelidiamond.
121

co.il/wikidiamond/terms-attributes-the-diamond/diamond-sorting/
Bain & Company (2022) The global diamond industry 2021 – 2022. Available at: https://www.
122

bain.com/insights/a-brilliant-recovery-shapes-up-the-global-diamond-industry-2021-to-22
 DIAMOND FACTS 29

Recent trends
So, what has happened to diamond producer Whilst this does not provide a complete picture,
inventories in recent times? As explored in the when analyzed over a considerable time, it
chapter on rarity, natural diamonds are a finite helps to demonstrate that total production and
resource and their recovery peaked in 2005 total sales are in line with one another. There is
following the closure of legacy mines and the therefore no evidence of deliberate stockpiling to
finding of new deposits123. Production in 2021 was systematically drive up prices.
recorded to be 20% below the level of 2017124.
According to analyst Paul Zimnisky, upstream
Supply depletion, alongside the strong market inventory levels remain at significantly low levels.
demand of 2021 as the world emerged from the Production data is available on companies’
pandemic, has reduced the inventory of mining websites126 and underlines how the industry is
companies to low levels125. pursuing increased transparency when it comes to
production and inventory management.
Bain & Company compiled data from company
reports and the Kimberley Certification process to Through the UN and World Trade Organization
estimate that upstream inventories (i.e. those at mandated Kimberley Process Certification
diamond mine sites and sorting offices) across the Scheme, explored in our chapter on ethical
world fell by 40% in 2021, leaving them close to sourcing, international rough diamond trade is
minimal ‘technical levels’ . regulated and recorded. Data and statistics arising
from the Kimberley Process indicate the levels of
To review inventory trends, comparisons of diamond recovery and paint a clear picture of the
published carat production and sales data over a market’s production.
business cycle can be assessed.

What have been the price trends for

laboratory-grown diamonds?

FACTCHECK:
Prices for laboratory-grown diamonds have fallen laboratory-grown diamonds and natural diamonds.
from 2016 to 2023. For example, in some cases the Whilst the price of natural diamonds has also
price of a 1.5 carat stone has fallen by over 74%. fluctuated over the last 35 years, on average they
There is a widening price differential between have risen by 3% per annum.

How has the pricing of laboratory-grown diamonds changed over time?

Diamonds were first synthesized in a laboratory Since the commercial development of CVD
in the 1950s and the first synthetic gem-quality technology in the early 2000s, the production
stones appeared on the market in the 1970s. In costs of laboratory-grown diamonds have fallen
these early years, the stones were mostly small, dramatically – in line with technological advances,
and yellow or brown in color127 and production economies of scale and competitive pressures as
costs were high128. new producers have entered the market.

Kimberley Process Statistics (n.d.) Public statistics. Available at: https://

123
Bain & Company (2022) The global diamond industry 2021 – 2022. Available at: https://www.
125

kimberleyprocessstatistics.org/public_statistics bain.com/insights/a-brilliant-recovery-shapes-up-the-global-diamond-industry-2021-to-22
124
Ibid. De Beers Group (n.d.) Production reports. Available at: https://www.debeersgroup.com/
126

reports/production-reports
 DIAMOND FACTS
30

Additionally, machines that were previously used However, as the laboratory-grown market has
to make industrial diamonds have been repurposed expanded, the relationship has diverged.
for gems. Bain & Company estimated that in the 10 For example, analyst Paul Zimnisky has noted that
years from 2008 and 2018, the average production in 2016, a round, almost colorless, high quality, 1
costs of a high-quality laboratory-grown 1 carat carat synthetic stone cost around 10% less than
stone fell by 90%129. Retail prices of laboratory- a natural diamond. However by the close of 2022,
grown diamonds have also declined, though to a the differential was as much as 80%, depending
smaller extent. When laboratory-grown diamonds on the manufacturer. Zimnisky’s figures illustrate
began appearing in commercial quantities in the that a typical, generic, 1 carat laboratory-grown
jewelry market around 8 years ago, prices were stone of this color and clarity was more than 70%
typically slightly cheaper than those of cheaper than a natural diamond at the end of 2022.
natural diamonds.

Sample prices of man-made relative to natural

over 7 years

Q4’16 Q4’17 Q4’18 Q4’19 Q4’20 Q4’21 Q4’22 Q1'23

0.5 CARAT

MAN-MADE $1,305 $1,170 $875 $700 $585 $640 $555 $580

NATURAL $1,490 $1,425 $1,500 $1,260 $1,430 $1,390 $1,235 $1,255

1.0 CARAT

MAN-MADE $5,250 $4,515 $3,675 $2,700 $1,945 $1,745 $1,485 $1,435

NATURAL $6,200 $5,925 $6,325 $5,626 $5,850 $6,215 $5,620 $5,635

1.5 CARAT

MAN-MADE $10,600 $8,450 $6,550 $4,985 $3,740 $3,370 $2,785 $2,445

NATURAL $12,125 $12,050 $12,750 $12,325 $12,375 $14,225 $13,925 $13,625

3.0 CARAT

MAN-MADE N/A N/A N/A N/A $19,950 $13,580 $11,095 $9,065

NATURAL N/A N/A N/A N/A $63,000 $66,750 $67,000 $72,125

Source: Paul Zimnisky (2023) State of the

diamond market March 2023. Available at:
https://www.paulzimnisky.com/state-of-the-
diamond-market-past-issue-index

GIA (n.d.) What are laboratory-grown diamonds. Available at: https://4cs.gia.edu/en-us/

127
Bain & Company (2018) The global diamond industry. Available at: https://www.bain.com/
129

laboratory-grown-diamond/ contentassets/a53a9fa8bf5247a3b7bb0b10561510c2/bain_diamond_report_2018.pdf
IGS (n.d.) A brief history of laboratory-grown diamonds. Available at: https://www.gemsociety.
128

org/article/brief-history-of-lab-grown-diamonds/
 DIAMOND FACTS 31

How the prices of natural diamonds and The differences in pricing structures
laboratory-grown diamonds have changed between laboratory-grown diamonds
from 2016-2023 and natural diamonds

Prices for laboratory-grown diamonds have fallen In addition to the diverging price trends over time,
from 2016 to 2023, in some cases, for example these is also a difference in the pricing structures of
for the price of a 1.5 carat stone, by over 74%. laboratory-grown diamonds and natural diamonds.
For example, according to Zimnisky's "State The supply, size and the available quality mix
of the diamond market" March 2023 report, in available of natural diamonds depends completely
2016, a 1.5 carat natural diamond would have on geology, and as noted in previous chapters, large
cost $12,125, while a 1.5 carat synthetic would stones are very rare. The prices of different types of
have cost $10,600 – amounting to a difference natural diamonds have therefore always reflected
of $1,525. However, early 2023, the retail price this rarity. For example, this means that a 2 carat
of a 1.5 carat natural diamond had increased to stone costs significantly more than double the price
$13,625, whilst its laboratory-grown counterpart of a 1 carat stone. As a laboratory-grown diamond
would have decreased in price to stand at is not dependent on geology, the main constraint
$2,445 – representing a substantially larger is the production capacity of each company. A
difference of $11,180. Research conducted by The larger synthetic stone requires more energy and
takes longer to produce than a smaller one, but the
Gem Academy illuminates the difference132. By
relationship is broadly linear – the production costs
analyzing 2021 price data for natural diamonds
for a 2 carat stone are twice that of a 1
and laboratory-grown diamonds available from
carat stone. Whilst prices of natural and laboratory-
two online retailers, they recorded that the cost grown diamonds have diverged, the differences
of a 1 carat natural diamond was $7,355, whilst have not been uniform across all sizes and qualities.
a 1 carat laboratory-grown diamond cost $2,110, They have tended to be highest for larger stones.
representing a price difference of -71%. Across For example, Zimnisky’s data indicates that
diamonds ranging from 0.5-3 carat weight, the between the end of 2020 and the end of 2022,
research stated there was an average price prices of 1 carat synthetic stones fell by 24% while
difference of -66% across all sizes133. prices of 3 carat stones fell by 45%.

The current pricing of natural diamonds Economic policies and geopolitical factors
influence the price differential between natural
Natural diamond prices reflect their rarity and and laboratory-grown diamonds. The OECD has
limited supply. Bain & Company conducted a recorded that many countries are in a highly
historical analysis looking at data between 1970 competitive race to attract diamond trading, with
and 2019, in which they noted that polished prices nations offering tax exemptions or special economic
of natural diamonds had risen over the last 35 zones for activities like cutting and polishing137.
years by an average of 3% per annum134. Post- To stimulate the production of laboratory-
pandemic, Bain & Company noted that in 2021, grown diamonds at a significant scale, India has
rough natural diamond prices grew by 21% and that implemented new policies to position itself as
prices increased by 9% year on year for polished a competitive marketplace. For example, there
diamonds. Whilst this is below their historic has been a recent push by the Indian government
maximums, it illustrated that both rough and to reduce import duties on diamond seeds, an
polished prices were returning to pre-pandemic essential component of lab grown diamonds,
levels135. Zimnisky has tracked prices of rough originating from China. In the latest 2023 Budget,
diamonds since 2007. Based on an initial index the Union Finance Minister Nirmala Sitharaman
value set at 100 on 31 December 2007, his rough abolished a 5% customs duty on imports of seeds
price index stood at 183.4 at the end of March used for the manufacturing of rough laboratory-
2023, implying an average annual growth trend of grown diamonds138.
4% per annum136.

The Gem Academy (2021) How much cheaper are laboratory-grown diamonds? Available at:
132 136
Ziminisky (n.d) Rough Diamond Index https://www.paulzimnisky.com/roughdiamondindex
https://www.thegemac.com/post/how-much-cheaper-are-laboratory-grown-diamonds
OECD (2016) The challenges faced by developing countries in valuing rough diamonds.
137
133
Ibid Available at: https://www.oecd.org/dev/Session-6B%20-Case-study-on-mineral-product-
pricing-rough-diamonds.pdf
Bain & Company (2019) The Global Diamond Industry 2019. Available at: https://www.bain.
134

com/globalassets/noindex/2019/bain_report_global_diamond_report_2019.pdf The Hindu Businessline (2023) What are laboratory-grown diamonds? Can they substitute
138

natural diamonds? https://www.thehindubusinessline.com/blexplainer/bl-explainer-what-are-

Bain & Company (2022) The global diamond industry 2021 – 2022. Available at: https://www.
135
laboratory-grown-diamonds-can-they-substitute-natural-diamonds/article66476547.ece
bain.com/insights/a-brilliant-recovery-shapes-up-the-global-diamond-industry-2021-to-22/
DIAMOND FACTS 32

Do natural diamonds benefit the countries

they come from?

FACTCHECK
Members of the NDC are dedicated to reinvesting Enriching the lives of diamond
in and creating a positive multiplier effect across mining communities
the communities they work with, in line with their
commitments to the UN Sustainable Development The natural diamond industry supports the
Goals – especially on areas surrounding alleviating livelihoods of 10 million people across the world
poverty, decent work, health and wellbeing, fair who are involved in the diamond supply chain140.
wages and reduced inequalities. Up to 80% of
rough diamond value can remain within local It is important to note that many mining companies
communities in the form of local purchasing, are partially owned by local governments, which
employment benefits, social programs and means they receive direct economic benefits
investment in infrastructure as well as the taxes, and impact the strategic direction of the mining
royalties and dividends paid from the industry to operations. This includes De Beers Group’s
respective governments139. operations in Namibia and Botswana.

Perceptions about economic inequalities across NDC member companies make a significant socio-
the natural diamond supply chain are outdated economic contribution to the local communities
and tainted by a history of power imbalances. and governments where they operate. This can be
in the form of local employment and training, local
Today, this is no longer the case. The natural sourcing of products and services as well as health
diamond industry has generated significant and education programs and training for local
economic contributions to many developing suppliers and businesses, through investment
nations that are diamond producing countries. in infrastructure. They aim to ensure that local
This has created a positive multiplier effect communities share in the success of the mine
for countries like Botswana and Namibia. The whilst it is in operation and also prepare for their
flourishing of these economies fights the paradox future after mine closure.
of the ‘resource curse’.

The natural diamond industry is often perceived

as a mining industry that does not take care of
the regions from which it extracts minerals and
diamonds, and that operates only for the benefit of
organizations in the West. Perceptions of legacy
issues such as colonialism and corruption of large-
scale diamond miners are often outdated. These
companies are heavily regulated and are genuinely
invested in the economic and social prosperity
of the communities they have worked with for
centuries.

Reuters (2017) De Beers Group Namibia launch world’s biggest diamond exploration
139
Natural Diamond Council (2022) How buying sustainable natural diamonds leaves a positive
140

ship. Available at: https://www.reuters.com/article/us-anglo-american-debeers-namibia- impact. Available at: https://www.naturaldiamonds.com/diamond-guide/reasons-to-buy-

idUSKBN1961HS sustainable-natural-diamonds/
 DIAMOND FACTS
33

Table 3 - Summary of socio-economic benefits created by NDC members141

EMPLOYMENT AND
99.7% of NDC member employees are from the countries where mines are located.
TRAINING

LOCAL SOURCING
ERM estimated that 85% of all procurement by NDC members is made in-country.
OF PRODUCTS AND
SERVICES

TRAINING FOR LOCAL

NDC members run progams to support economic development and job creation
SUPPLIERS AND
BUSINESSES
by mentoring local entrepreneurs to develop the skills needed to build successful
businesses and by providing access to markets. Examples include the Tokafala and
Zimele programs.

SOCIAL INVESTMENT
Social investment programs assist with provision of key services such as
PROGRAMS
housing, water, digital connectivity, healthcare, education and skills support for
children and adults. Agricultural initiatives support food security and transform
rehabilitated mining land into productive agricultural land.

INVESTMENTS
Investments are made in roads, schools, hospitals, water and energy supply and
IN LOCAL
INFRASTRUCTURE
local sports and culture.

TAXES AND
Payroll, profit, taxes and royalties paid by diamond miners make a significant
ROYALTIES
positive economic contribution to host governments (35% of fiscal revenue in
Botswana in 2021). All NDC members report publicly either via their sustainability
reports, financial reports or tax and economic contribution reports.

Research conducted by sustainability consultancy

ERM determined based on 2019 and 2020 data
that countries who host mining operations gain
significant opportunities for development and
industrialization, especially in regard to the
purchasing of goods and services within a given
region, which prevents a leak in investment and
procurement being transferred elsewhere. It
recorded that the total procurement spend by NDC
member companies in these countries exceeded
spend on wages, taxes, royalties and community
investment combined142.

It was also reported that approximately $3.2 billion

was spent with local suppliers, defined as those
within the country of operation. This represented
over 85% of all procurement spend143. These
figures indicate how serious the natural diamond
industry is about ensuring their operations benefit
communities of host mining countries. In 2019,
it was also recorded that the natural diamond
industry has made a total economic contribution of
at least $9.64 billion to local communities144.

ERM (2022) Natural Diamond Council members sustainability overview. Internal research
141
ERM (2022) Natural Diamond Council members sustainability overview. Internal research
143

based on NDC members reports and audited data. based on NDC members reports and audited data.
142
Ibid. 144
Ibid.
DIAMOND FACTS 34

SPOTLIGHT: BOTSWANA
The southern African nation of Botswana Debswana has existed for over 50 years and
illustrates the power the natural diamond the venture held between the government and
industry has to uplift communities and create De Beers means that it sells 75% of its output
a positive socio-economic impact. Diamonds to De Beers Group, while 25% goes to the
represent 88% of Botswana's total exports state-owned Okavango Diamond Company149.
and the industry currently contributes De Beers is 15% owned by Botswana and
around 35% of income to fiscal revenue145 the Diamond Trading Company Botswana
and contributed 33% of Botswana’s GDP in (DTCB) is 50% owned by the government of
2021146.The development of the industry has Botswana. The World Bank has reported that
helped Botswana avoid the resource curse the arrangement that enables the government
and supported employment and growth to generate revenue from diamond mining
in the economy through a focus on local is approximately 80 cents of every dollar
procurement and development programs of profits generated by Debswana150.
for SMEs such as the Tokafala and Zimele Activities like this have contributed to a
program, alongside investments in capital rise in prosperity and per capita income,
works and infrastructure147. which following independence in 1967 stood
at around $80 a year but in 2008 reached
Revenue from diamond sales to the $6,000 a year151. Revenue from natural
government is generated by income tax, diamonds contributes to a school system
royalties and a share of the company’s profits providing free primary education to every
as dividends from Debswana, its 50/50 joint child in Botswana.
venture with De Beers Group148.

The Sparklr (n.d.) Positive impact of diamonds on producing countries. Available at: https://www.thesparklr.com/
145
Reuters (2023) De Beers Group confident talks will deliver Botswana diamond deal. Available at: https://www.
149

learn/positive-impact-diamonds-producing-countries reuters.com/markets/commodities/de-beers-confident-talks-will-deliver-botswana-diamond-deal-2023-02-16/
PR Week (2022) Natural Diamond Council global ambassador Lily James visits Botswana. Available at:
146
World Bank (n.d.) Small countries with volatile revenue: Botswana and Bhutan. Available at: https://documents1.
150

https://www.prnewswire.com/news-releases/natural-diamond-council-global-ambassador-lily-james-visits- worldbank.org/curated/en/413221467997599192/pdf/98089-WP-Small-states-with-volatile-revenue-flows-
botswana-301659963.html Box391504B-PUBLIC.pdf
Trucost (2019) The socio-economic and environmental impact of large-scale diamond mining. Available at: https://
147
New York Times (2008) Diamonds are forever in Botswana. Available at: https://www.nytimes.com/2008/08/09/
151

www.spglobal.com/marketintelligence/en/documents/the-socioeconomic-and-environmental-impact-of-large- business/worldbusiness/09nocera.html
scale-diamond-mining_dpa_02-may-2019.pdf
World Bank (n.d.) Small countries with volatile revenue: Botswana and Bhutan. Available at: https://documents1.
148

worldbank.org/curated/en/413221467997599192/pdf/98089-WP-Small-states-with-volatile-revenue-flows-
Box391504B-PUBLIC.pdf
 DIAMOND FACTS
35

Namibia neighbors Botswana and also

The impact of contributions from Natural
demonstrates how positive socio-economic Diamond Council members
returns can arise from the natural diamond
industry. Diamonds generate 20% of Namibia’s NDC members are dedicated to reinvesting and
foreign export earnings and the country receives creating a positive multiplier effect across the
80 cents of every Namibian dollar generated by communities they work with in line with their
Debmarine Namibia, its 50:50 joint venture with commitments to the UN Sustainable Development
De Beers Group152. According to the World Bank, Goals, especially on areas surrounding alleviating
the adoption of new marine mining technologies poverty, decent work, health and wellbeing, fair
for diamonds in Namibia in 2004 led to an increase wages and reduced inequalities.
in production and helped the economy achieve
historically high growth of 12.3%. As of 2021, According to an ERM report, NDC members paid
diamonds remain Namibia’s most important close to $2 billion directly in salaries and benefits
product in the mining sector, accounting for close in 2019156.
to 68% of mineral output and 45% of foreign
exchange earnings153. Commitment to societal impact is underlined by
the fact that NDC members invested over $165
It is not only regions in Africa that stand to benefit million in social programs in 2019 that focused
from the natural diamond mining industry. It is a on community development initiatives related to
foundational industry for the Northwest Territories agriculture, enterprise development, education
(NWT) in Canada where it is the largest private and skills development, healthcare,
sector industry and contributed 24% of total and infrastructure158.
GDP in 2020154. Data from the 2021 Government
of the Northwest Territories Socio-economic There are over 150 social and infrastructure
Agreement Report for Mines operating in the NWT investment and philanthropy initiatives that take
recounts how the mining industry contributes to place across various areas including agriculture,
construction, transportation, retail and real estate, enterprise development, education and skills
alongside the direct benefit of wages in 2021. development as well as healthcare, sports, arts
Since 1996, NWT diamond mines have provided and culture. These activities generate $16 billion
32,137 person years of employment cumulatively net profit annually .
and contributed over $24 billion to the economy.
Of this, nearly $17 billion went toward NWT Mining companies’ response during Covid-19
businesses and $7.5 billion to Indigenous-owned highlights their dedication to support communities.
NWT businesses155. For example, during the pandemic, De Beers
Group was active in Botswana and provided 24
clinics with Personal Protection Equipment (PPE),
accommodation for medical personnel, food
parcels for vulnerable households, water relief for
local communities, 250,000 face masks from local
SMEs, remote support for entrepreneurs, 20,000
liters of sanitizer produced in partnership, $50,000
to tackle gender-based violence and a PCR test
machine for a hospital159.

NORTHWEST TERRITORIES

Reuters (2017) De Beers Group Namibia launch world’s biggest diamond exploration
152 155
Ibid.
ship. Available at: https://www.reuters.com/article/us-anglo-american-debeers-namibia-
idUSKBN1961HS ERM (2022) Natural Diamond Council members sustainability overview. Internal research
156

based on NDC members reports and audited data.

World Bank Group (2021) Namibia systematic country diagnostic. Available at: https://
153

documents1.worldbank.org/curated/en/976371617896981427/pdf/Namibia-Systematic-Country- 157
Ibid.
Diagnostics.pdf
158
Ibid.
Natural Diamond Council (2022) How the natural diamond industry supports Canada’s last
154

frontier. Available at: https://www.naturaldiamonds.com/industry-insights/canada-diamond- 159

Ibid.
mines-community-impact/
DIAMOND FACTS 36

SPOTLIGHT: DE BEERS GROUP HIV SPOTLIGHT: DIAMONDS DO GOOD

DISEASE MANAGEMENT PROGRAM
Diamonds Do Good, formerly the Diamond
Natural diamond revenue is helping African Empowerment Fund, is a global non-profit
nations work to combat HIV/AIDs. The De that works to support initiatives that
Beers Group HIV Disease Management empower people and their development
Program was launched by Debswana in in diamond communities. It supports
2001 with the government of Botswana. It beneficiaries in Africa and India including
was a first of its kind initiative, aimed at the African Leadership Academy in South
preventing, detecting and treating HIV and Africa, Botswana Top Achievers Program
AIDs, and offers free antiretroviral treatment in Botswana, The Diamond Development
to employees and their families. De Beers Initiative in the Democratic Republic
Group recorded that 89% of employees knew of Congo (DRC), the Flaviana Matata
their HIV status in 2018 compared with 26% Foundation in Tanzania and Veerayatan’s
in 2015, and that the uptake of HIV treatment Colleges of Pharmacy, Engineering &
has risen from 90% to 95%160. In 2020, the Business Administration in India162. It aims to
company marked more than 11 years of no fund programs and provide grants that focus
babies being born with HIV to De Beers on high-quality education for
Group employees or their spouses161. younger generations163.

SPOTLIGHT: DIAMOND DEVELOPMENT INITIATIVES

Based in Nigeria, Diamond Development The DDI’s work with Resolve
Initiatives (DDI) is a non-profit that works with
an ecosystem of businesses, government and In 2020, the DDI joined forces with non-
social services to encourage development governmental organization RESOLVE to focus
and growth in businesses involved in diamond on responsible sourcing of artisanal diamonds
mining and promote sustainable environemtal by looking at conflict resolution, poverty
and social impact. reduction and heightened levels of social
due diligence. They created the Maendeleo
In recent times, it has run projects such Diamond standards, which were the first set
as operating mobile schools in countries of standards for ethical artisanal diamond
like the DRC to help students pass exams. production and supply chain security165.
Through its programs over 200,000 miners
have been registered in the DRC, 10 miners’ Their partnership work in Sierra Leone is
cooperatives have been formed and legalized, focusing on land reclamation and restoration
121 children in mining communities have been as well as reconciliation for communities
given access to remedial education, 13 mining affected by conflict. They are working to
operations have been certified compliant to ensure responsible sourcing and help artisan
the Maendeleo Diamond Standards in Sierra diamond miners move away from poverty. The
Leone and several previously mined sites DDI has been supported by members of the
have been environmentally rehabilitated164. NDC include De Beers Group and Rio Tinto,
as well as retailers like Tiffany & Co
and Cartier166.

160
De Beers Group (n.d.) Our journey – Volume 3. Available at: https://www.debeersgroup.com/~/ 164
The Sparklr (n.d.) Positive impact of diamonds on producing countries. Available at: https://
media/Files/D/DeBeers-Group-V2/documents/building-forever/our-journey/our-journey-vol-3. www.thesparklr.com/learn/positive-impact-diamonds-producing-countries
pdf 165
Resolve (n.d.) Diamond Development Initiatives. Available at: https://www.resolve.ngo/ddi.
161
De Beers Group (n.d.) HIV & Aids prevention. Available at: https://www.debeersgroup.com/ htm
sustainability-and-ethics/partnering-for-thriving-communities/hiv-and-aids-prevention
162
The Sparklr (n.d.) Positive impact of diamonds on producing countries. Available at: https://
www.thesparklr.com/learn/positive-impact-diamonds-producing-countries
163
Diamonds Do Good (n.d.) Who we help. Available at: https://www.diamondsdogood.com/
who-we-help/
 DIAMOND FACTS
37

How are natural diamonds ethically sourced?

FACTCHECK: Pressure for mine-to-market supply chain

transparency and traceability of diamonds has
The industry is highly contributed to the growing importance of ethical
regulated. Under the Kimberley sourcing in the natural diamond community.
Process mandated by the
United Nations and the Multiple pillars exist to ensure ethical sourcing and
World Trade Organization, compliance across supply chains. The Kimberley
all rough diamond trade is Process or Kimberley Process Certification
strictly regulated to ensure Scheme (KPCS) is foundational for the industry
it is conflict-free. Multiple in achieving this. As a joint initiative between
initiatives, processes and policies ensure that governments, diamond industry bodies and civil
the industry moves beyond compliance on social society. It is mandated by the United Nations and
issues across the supply chain. There is a robust the World Trade Organization, to stem the flow of
set of checks and balances in place, including conflict diamonds.
audits of the largest industry players, to enshrine
the importance of ethical sourcing. Since it became operational in 2003, the KPCS
has worked to ensure that only rough diamonds
with KP certificates can be legally traded and
that only KP compliant countries are able to
Ethical sourcing is essential to the practices of the operate in the international diamond trade. These
natural diamond industry. It means that products countries must commited to the transparency and
and services across the supply chain are obtained exchange of statistical data and export and import
in an ethical way. This includes upholding labor controls. They must also only legally trade with
rights, decent working conditions, no child labor, other KP participants. The KPCS stipulates that all
the existence of health and safety measures and international shipments of rough diamonds must
importantly, strong business ethics with respect be accompanied by a certificate that guarantees
for local communities166. In the context of diamond they are conflict-free.
mining, this includes sourcing conflict-free
diamonds. Now, over 80 countries participate in the process,
and it has been recorded that conflict diamonds
For many years, the natural diamond industry has account for less than 1% of recorded rough
worked hard to reform and address legacy issues diamond trade – a number that once stood at
related to mining practices and conflict diamonds. 4-15% in the 1990s.
Now, the whole sector is held to extremely high
trading standards. This is in part because 85% Whilst the KPCS definition refers to conflict
of the world’s diamonds by volume and 95% by diamonds, the natural diamond industry has built
value167 are extracted and marketed by large on this to expand ethical sourcing beyond being
mining companies that are public entities held to conflict-free. To ensure human rights are protected
account by shareholders and stakeholders for their it follows numerous other policies and frameworks.
social and environmental impact.

Sedex (n.d.) What does ethically sourced mean? Available at: https://www.sedex.com/blog/
166
Natural Diamond Council (n.d.) The framework for an ethical and sustainable diamond industry.
167

what-does-ethically-sourced-mean/ Available at: https://www.naturaldiamonds.com/industry-insights/the-framework-for-an-

ethical-and-sustainable-diamond-industry//
DIAMOND FACTS 38

The industry’s sourcing practices are held to Industry standards

account by legislation such as the Dodd-Frank Act
in the US which implies that any single company The natural diamond industry has committed to
assumes its own direct ethical responsibility measures that encompass social standards and
without transferring this issue to international business ethics. This includes codes of conduct,
organizations171. In this report’s traceability guidelines and third-party oversight measures,
chapter, we touched on the importance of OECD alongside in-house due diligence structures. These
Due Diligence Guidance, UK Modern Slavery Act, processes are continuously evolving as industry
California Transparency in Supply Chains Act, the players proactively address social issues and work
EU Conflict Mineral Regulation and the London to protect human rights through ethical sourcing.
Metal Exchange Responsible Sourcing initiative.
A few examples include:

WORLD DIAMOND COUNCIL SYSTEM OF WARRANTIES

The System of Warranties (SoW) was developed The SoW guidelines support universally accepted
in 2002, to address areas outside the KPCS. principles of human and labor rights that
prioritize ethical sourcing. They reference the
It requires professional buyers and sellers of UN Guiding Principles on Business and Human
rough diamonds, polished diamonds and jewelry Rights, the ILO Declaration on Fundamental
setters with diamonds to include a warranty Principles and Rights at Work, the UN
statement on invoices and memos each time Convention Against Corruption, and national
a diamond changes hands. This is with the AML guidelines that comply with the FATF’s 40
objective of assuring the next buyer that it Recommendations on Money Laundering for
originated from sources in compliance with the Dealers in Precious Metals and Stones168.
KPCS and to confirm its conflict-free origin. The
SoW includes responsible business practices Retailers abide by the SoW and it is cited by
related to human and labor rights as well as anti- multiple jewelers including De Beers, Chow
money laundering and anti-corruption. Tai Fook and Tiffany & Co in their supplier codes
of conduct.
Warranty statements are made each time the
diamond passes along the supply chain, not
just at export and import stages. It has become
challenging to do business without the SoW as
it is demanded by associations, companies and
countries like Belgium, where it is integrated into
statutory auditing procedures.

Abiding by the SoW is a condition of membership

to organizations like the World Federation of
Diamond Bourses (WDFB), the International
Diamond Manufacturers Association (IDMA) and
the Responsible Jewellery Council (RJC).

World Diamond Council (2022) System of Warranties Factsheet. Available at: https://www.
168

worlddiamondcouncil.org/wp-content/uploads/2022/02/System-of-Warranties-Fact-Sheet.pdf
 DIAMOND FACTS
39

RESPONSIBLE JEWELLERY COUNCIL CODE OF PRACTICES

The RJC is a not-for-profit standards authority The Code of Practices has thorough rulings on
working to help the jewelry industry create a human rights due diligence, responsible sourcing
sustainable supply chain. The Code of Practices in high-risk areas, labor rights on contracts, wages,
defines responsible ethical, human rights, social health and safety, grievance procedures, child
and environmental practices that certified labor, forced labor, freedom of association and the
members must adhere to. Members are upheld right to collective bargaining169.
against the ISEAL Code of Good Practice for
Setting Social and Environmental Standards too.

SPOTLIGHT: DE BEERS GROUP SPOTLIGHT: GEMFAIR TM

Companies in the industry like De Beers GemFair™ is a program that connects
Group have introduced their own standards, artisanal and small-scale miners to the
which are independently audited by third global market through digital technology and
parties to ensure ethical sourcing. Their the assurance of ethical working standards.
Best Practice Principles (BPPs) Assurance
Program aims to guarantee that diamonds It was first piloted to create a secure
are not only conflict-free but that they abide transport route to market for small-scale
by international human rights frameworks diamonds. With a digital record, each
and labor regulations. The standards are exporter parcel can be tracked via GemFair™
applied throughout the De Beers Group value until it reaches its destination.
chain and over 2,600 entities, employing Not only does GemFair™ help to improve
nearly 350,000 are subject to these business and environmental practices, but it
standards170. also ensures miners are paid a fair price for
Another example is the De Beers Group their diamonds and provided with access
Kalahari Dream venture. This organization to training172.
sells natural diamonds directly to the In 2019, GemFair™ operations were expanded
consumer where they have been sourced in Sierra Leone to scale its positive impact
directly from southern African mining and extend the benefit of the program and
companies with high ethical standards, heightened traceability to more miners173.
like Debswana. These diamonds have
been manufactured and polished by local
workshops that employ artisans and
communities in Botswana and can
guarantee that the highest ethical
standards have been followed171.

Responsible Jewellery Council (2019) Code of Practices. Available at: https://www.

169 171
Kalahari Dream (n.d.) Available at: https://kalaharidream.com/
responsiblejewellery.com/wp-content/uploads/RJC-COP-December-2019.pdf
172
GemFair (n.d.) Available at: https://gemfair.com/
De Beers Group (n.d.) Best practice principles assurance program. Available at: https://
170

https://www.debeersgroup.com/sustainability-and-ethics/leading-ethical-practices-across- Mining Technology (2019) De Beers Group expands GemFair pilot for ethically sourced
173

the-industry/best-practice-principles-assurance-programme diamonds. Available at: https://www.mining-technology.com/news/company-news/de-beers-

gemfair-diamonds/
DIAMOND FACTS 40

What to consider when purchasing ethically sourced diamonds

It is important to ask the right questions and to know what to look for when purchasing a natural diamond
to ensure it is ethically sourced.

Here are a few of our tips:

• Ask your jeweler if they have a certification or • Look for certification and brand marks
if they work with suppliers that have third party relating to their sourcing, for example the
certifications. This includes the Responsible Tiffany & Co provenance guarantee.
Jewellery Council who help guarantee that the
processes of diamond sourcing and production • Research whether the jeweler is a member of
are ethical and responsible. industry standards and initiatives174.

• Ask that your retailer or jeweler works • Review the brand’s own policies and see if
with diamonds that abide by the Kimberley they go beyond the KPCS.
Process Certification Scheme (KPCS)
if trading in rough diamonds.

IMAGE: PETRA DIAMONDS

Time (2015) How to buy an ethical diamond. Available at: https://time.com/4013735/how-to-

174

buy-an-ethical-diamond/
 DIAMOND FACTS
41

What are the working conditions like in the natural

diamond industry?

FACTCHECK:
Members of the NDC ensure that working significantly lower than in other industrial and
conditions related to fair pay, health and safety, mining sectors.
employee benefits and protection of human rights
are followed to the highest global standards NDC members seek to build long-term partnerships
within their mining operations. Nearly all (99.7%) with the people they employ. They seek to offer
employees of NDC members are hired locally and safe, high-quality jobs and fair working conditions
according to data from 2021 were paid on average for all their employees and contractors in terms
64% more than the national average salary175. of wages, working hours, non-discrimination and
protection from harassment, as well as the right
Diamond recovery is mostly carried out by large- to collective bargaining and the ability to follow
scale companies using modern equipment and grievance procedures176. One third, and growing,
mining practices. All NDC members have adopted of the natural diamond mining industry workforce
the goal of zero-harm in the workplace. Workplace are women, and 30% of board members of NDC
safety incidents recorded by NDC members are members are women.

Employment benefits created by NDC members182

VALUING LOCAL
Priority is given to local employment with 99.7% of NDC member employees recruited from within
PEOPLE the country where a mine operates. Where applicable, NDC members have public commitments to
respect the rights, interests and traditions of local communities and Indigenous people.

COMPENSATING
All NDC members offer competitive wages to employees, typically significantly higher than the local
FAIRLY labor market.

DEVELOPMENT
NDC members train and develop their employees to equip them with skills to contribute and better
THROUGH TRAINING their career and to make a positive difference to their lives and communities. Each member also has
targeted training programs to accelerate equal opportunities for previously disadvantaged groups.

PRIORITIZING HEALTH
Health and safety is the core value at the heart of all operations. NDC members put the health and
AND SAFETY safety of their employees and contractors ahead of any other consideration.

RESPECTING HUMAN
NDC members have clear human rights policies that adhere to all key global and national standards.
RIGHTS Beyond that, they seek to promote human rights within the broader industry and to be a force for
continuous improvement.

WOMEN ON BOARDS
30% of board members of NDC companies are women177. This surpasses the average for similar sized
companies according to the OECD, where only around 1 in 20 of the top 500 multinationals have
female representation above 30% at a board level .

ERM (2022) Natural Diamond Council members sustainability overview. Internal research
175
ERM (2022) Natural Diamond Council members sustainability overview. Internal research
177

based on NDC members reports and audited data. based on NDC members reports and audited data.

ILO (n.d.) Working conditions. Available at: https://www.ilo.org/global/topics/dw4sd/themes/

176

working-conditions/lang--en/index.htm
DIAMOND FACTS 42

As explored in our chapter on ethical sourcing, the Health and safety

industry is highly regulated under trading and legal
frameworks by the United Nations and World Trade All NDC members have adopted the goal of
Organization. Multiple initiatives, processes and zero-harm in the workplace.
policies ensure that the industry moves beyond
compliance on social issues across the supply Keeping employees safe is the responsibility
chain. Read more about ethical sourcing in the of everyone on-site. It requires a strong safety
natural diamond industry here. culture in which no shortcuts or compromises
are acceptable if they could result in an injury. It
The industry also adheres to the Responsible also requires following strict rules and processes,
Jewellery Council’s Code of Practices, the De wearing the appropriate protective equipment,
Beers Group Best Practice Principles Assurance analyzing every task for its safety risk before
Program, the Petra Human Rights Policy and the performing it and continuously training teams to
Rio Tinto Human Rights Policy and Supplier Code employ safe behaviors.
of Conduct.
In the workplaces of NDC member companies,
The Responsible Jewellery Council's Chain-of- work shifts start with a safety review of the last
Custody Standard requires companies to establish shift and a discussion of risks associated with
documentary evidence of business transactions the next shift. Leaders engage continuously with
along the supply chain and to confirm they are not their teams on the ground to coach, train and
causing adverse impacts in conflict-affected and correct them. New technologies are continually
high-risk areas. This includes understanding more introduced, such as vehicle proximity detection
about the working conditions at each stage of equipment or geological movement monitoring
production178. With a focus on miners in the supply devices. The safety performance of every
chain, the Resolve and Diamond Development operation is rigorously monitored and is a very
Initiative, Maendelo Diamond Standards and important driver of a leader’s performance
Initiative for Responsible Mining Alliance, amongst evaluation. No leader with a poor safety record will
many others, are working to enshrine workers’ be promoted179.
rights on the ground.
From De Beer’s Good To Great Program and Petra
The large-scale mining industry works to do this, Mining Occupational Safety and Health initiative
not only to meet regulatory requirements but run in cooperation with the South African Chamber
because they are deeply invested in the livelihoods of Mines, to the Rio Tinto Critical Risk Management
of the millions of workers they employ. program, NDC members are focused on the health
and safety of their workers at all times.
NDC members adhere to the highest labor standards
shaped by the:

• UN Guiding Principles on Human Rights

• International Labour Organization

• GRI Sector Standard for Mining

• OECD Due Diligence Guidance for Responsible

Supply Chains of Minerals

IMAGE: DE BEERS GROUP

Responsible Jewellery (2017) Code of conduct. Available at: https://www.responsiblejewellery.

178 179
Natural Diamond Council (2022) World health day: How the natural diamond industry is
com/wp-content/uploads/RJC-CoC-2017-V2-Standard-Guidance-3-1.pdf building healthy communities. Available at: https://www.naturaldiamonds.com/industry-
insights/world-health-day-how-the-natural-diamond-industry-is-building-healthy-communities/
 DIAMOND FACTS
43

Gender diversity in the workplace

NDC members are focused on encouraging This surpasses the average for similar sized
gender diversity at an executive level, as well as companies as according to the OECD, only around
throughout the entire workforce. One third of the 1 in 20 of the Top 500 multinationals have female
natural diamond industry (for mining) are women, representation above 30% at a board level182.
which can have a positive impact on their family’s Rio Tinto provides an example, with Angela Bigg
prosperity and inclusion in communities180. From a appointed the first female President and CEO of
corporate governance perspective, 30% of board the Diavik Diamond Mine183 and Kellie Parker as the
members of NDC companies are women181. Chief Executive for Australia184.

SPOTLIGHT: LUCARA DIAMOND

The Globe and Mail’s third benchmark contract, they receive a housing allowance,
of female leaders in Canada recognized medical aid subsidy, group life insurance and
Lucara Diamond as the second highest statutory worker’s compensation. Lucara
among 74 Canadian companies reported. Diamond also respects multiple national
Lucara Diamond has 75% women corporate holiday days and instead of the statutory
executives, including President and CEO, Eira 25% of pay during maternity leave, the
Thomas, as well as Naseem Lahri, Managing company pays 100% of wages for up to three
Director, Lucara Botswana Proprietary children. Additionally, instead of a pension
Limited. NDC member Lucara highlights scheme, employees are paid a gratuity every
excellent labor practices. For the company’s three years185.
workers with a permanent

IMAGE: LUCARA BOTSWANA

ERM (2022) Natural Diamond Council members sustainability overview. Internal research
180
Rio Tinto (2021) First female president appointed for Diavik Diamond Mine. Available at:
184

based on NDC members reports and audited data. https://www.riotinto.com/en/news/releases/2021/first-female-president-appointed-for-diavik-

diamond-mine
181
Ibid.
Rio Tinto (n.d.) Executive committee. Available at: https://www.riotinto.com/en/about/
185

OECD (n.d.) What big data can tell us about women on boards. Available at: https://www.oecd.
182
executive-committee/kellie-parker
org/gender/data/what-big-data-can-tell-us-about-women-on-boards.htm
Lucara Diamond (2021) Sustainability report 2021. Available at: https://lucaradiamond.com/
186

site/assets/files/39356/2021_sustainabilityreport.pdf
DIAMOND FACTS 44

Are natural diamonds traceable?

FACTCHECK:

The natural diamond industry is accelerating its chains meet the demands of global policies on
traceability initiatives and leveraging technology social and environmental regulations as well as
like blockchain to bring transparency to its supply heightened sustainability expectations from
chains. Historically, tracing raw materials and their customers.
minerals for diamonds across the globe has been
difficult, but now, traceability along the whole The diamond supply chain consists of mining
mine-to-market diamond supply chain is being and trading processes followed by certification,
realized. Natural diamond retailers are launching cutting, polishing and manufacturing before a
their own traceability platforms and collaborating diamond enters the retail landscape and is sold
with technology providers to ensure their supply to consumers.

DIAMOND SUPPLY CHAIN LEVELS

INDUSTRIAL
DIAMOND MINE

KIMBERLEY CUTTING,
CONSUMER
TRADING HUB PROCESS POLISHING,
AND RETAIL
CERTIFICATION MANUFACTURING

ARTISANAL
DIAMOND MINE TRADER

UPSTREAM MIDSTREAM DOWNSTREAM

Figure 8 - Diamond supply chain levels.

Supply chain traceability involves tracking the Not only can supply chain traceability enhance
journey of a diamond at each stage of production, supply chain efficiencies for the natural diamond
from raw material mining through to the moment industry, but it is also critical to decrease the
when it is sold in store. 'Provenance' refers more likelihood of conflict diamonds or synthetic
specifically to the details of how a diamond has diamonds entering the system. Multiple factors
moved through the supply chain and what exactly have catalyzed the need for supply chain
happens at each step. Historically, tracing raw traceability – such as investor demands for
materials and minerals for diamonds across the stronger ESG (Environmental, Social, Governance)
globe has been difficult as there was no performance, expectations from customers
centralized digital database for natural diamond about social due diligence, as well as heightened
certification records. regulation across the supply chain. The natural
diamond industry is working at pace to achieve
But now, the mine-to-market diamond supply chain full traceability.
is being realized. The natural diamond industry is
focusing on implementing a chain of custody through
traceability initiatives that are enabled by technology
to ensure diamonds are ethically sourced and real.

Kroll (2020) How due diligence can address risks in the diamond industry. https://www.kroll.
187

com/en/insights/publications/compliance-risk/supply-chain-due-diligence-diamond-industry
 DIAMOND FACTS
45

At a legislative and global guidance level, there industry are far-reaching. It can ensure that
are multiple developments that underline the when diamonds are traded on blockchain, each
need for traceability including the Dodd-Frank transaction undergoes a clearance process.
Act, OECD Due Diligence Guidance, UK Modern This helps to ensure that traders comply with
Slavery Act and the California Transparency in regulations related to the Kimberley Process, anti-
Supply Chains Act. More recently, the EU Conflict money laundering and global banking protocols.
Mineral Regulation and the London Metal Exchange It also helps to trace a diamond’s lifespan and
Responsible Sourcing initiative require players creates more data for managers in industry191.
to abide by the OECD’s five-step risk-based Due
Diligence Guidance for Responsible Supply
Chains of Minerals from Conflict-Affected and
High-Risk Areas188.
SPOTLIGHT: SARINE TRACEABILITY
ECOSYSTEM
It is no secret that sustainability, transparency
and social issues have become a priority for Sarine Technologies has built a high-
consumers. In its latest Global Diamond Industry performance tracking system for tracing
report, Bain & Company note that the growing rough diamonds. Their data-based platform
desire for social impact, especially amongst spans the entire pipeline from the mine to the
younger consumers, is prompting mining consumer. It connects miners, manufactures
companies to address environmental and social and retailers across the world. Retailers who
issues, including traceability and transparency189. use Sarine’s traceability ecosystem receive a
Members of the natural diamond industry are Diamond Journey digital report that provides
customers with the story of the diamond194.
working proactively to mitigate these supply
chain risks. Natural Diamond Council member Lucara
Diamond is also leveraging Sarine’s
The mine-to-market supply chain technology to design a solution called
Clara. Clara scans diamonds to create
Enabled by technology like blockchain, initiatives digital IDs that are tagged using blockchain
are being designed by producers, retailers, and then uploaded to the Sarine platform.
manufacturers and grading organizations to Manufacturers can place orders for diamonds
based on desired properties and Clara uses
enhance traceability and share the story of the
the analytics to match each order withthe
diamond with customers in order to increase trust.
right diamonds. This reduces the number
of intermediaries handling the stones and
Blockchain technology creates a peer-to-peer makes it easy to trace with a verifiable digital
network of trade along value chains to provide a record195.
history of transactions for a single product, in this
case a natural diamond. It has previously been
described as a digital, decentralized, distributed
and public ledger of what happens across a supply
chain.

For the last few decades, the industry has been

reliant on the Kimberley Process Certification
scheme to regulate trade in rough diamonds
to prevent inflows of conflict diamonds. This
paper-based process has since been digitized on
blockchain, which has made it more efficient190.
The benefits of blockchain technology for the

Kroll (2020) How due diligence can address risks in the diamond industry. https://www.kroll.
188
LCX (2022) Blockchain technology in diamond trading. Available at: https://www.lcx.com/
191

com/en/insights/publications/compliance-risk/supply-chain-due-diligence-diamond-industry blockchain-technology-in-diamond-trading/#:~:text=The%20blockchain%20can%20be%20
used,they%20comply%20with%20all%20regulations.
Bain & Company (2022) The global diamond industry 2021 – 2022. Available at: https://www.
189

bain.com/insights/a-brilliant-recovery-shapes-up-the-global-diamond-industry-2021-to-22/

WEF (2018) From diamonds to recycling: how blockchain can drive responsible business
190

rehttps://www.weforum.org/agenda/2018/06/diamonds-recycling-blockchain-technology-
responsible-ethical-businesses/
DIAMOND FACTS 46

Everledger is a blockchain technology provider

SPOTLIGHT: TRACR TM
BY helping to increase traceability of the diamond
DE BEERS GROUP supply chain for retailers. It traces a jewel’s
ownership from mine to ring and as of 2017,
De Beers Group pioneered digital tracking had recorded over 1.6 million diamonds on the
of a diamond from mine-to-store in 2018
platform196. In an interview, Everledger founder
when it followed the journey of 100 high-
Leanne Kemp stated that “in the case of a
value diamonds using its blockchain platform,
TracrTM. This has since been named one of diamond, it is unique like a snowflake, so we can
Forbes top 50 leading blockchain solutions. identify every single stone,” and that it helps
to answer important questions about who was
How does it work? The TracrTM platform involved in the making and extraction of minerals
combines distributed ledger technology with and gemstones197. The company works with brands
advanced data security and privacy, ensuring like Brilliant Earth, who stated they have upward
that participants control the use of and
of 10% of their diamond inventory on blockchain.
access to their own data.
How does it work for a brand? Brilliant Earth would
Each participant on TracrTM has their own buy a blockchain enabled diamond from a mining
distributed version of the platform, meaning operator where its unique properties are logged on
that their data can only be shared with their the blockchain. That assigned record then follows
permission, and only they choose who can the diamond across the supply chain, from trading
access their information. to cutting and polishing before
The advanced privacy technologies used being purchased198.
by TracrTM reinforce data security on the
platform. The alterable nature of each
transaction on the platform ensures that
the data cannot be tampered with when the iTraceiT is a software company based in Belgium
diamond progresses through the value chain. that provides traceability solutions to an array of
industries.
As of 2022, De Beers Group has registered
$2.2 billion total value of diamonds on the
platform and 25% of its production by value The company's traceability solution uses a
is recorded. The platform now has the ability combination of QR code and blockchain technology
to register up to 1 million diamonds per week. to ensure that the traceability information is
correctly transferred between companies in a
TracrTM complements the intent of the De highly secure and reliable environment. In addition,
Beers Group Code of Origin, which is a iTraceiT has invested significant development time
customized unique code assigned to each
in automated connections. As the iTraceiT system
diamond that provides assurance that
is entirely digital, it can easily connect to any other
it is natural, produced with high ethical
standards and was discovered by De Beers system or software.
in Botswana, Canada, Namibia or South
Africa192. As the latest announcement, the
Gemological Institute of America (GIA) will
also join Tracr tm.
Consumers purchasing a diamond traced
from the source by Tracr and graded by
GIA will receive a GIA grading report with
enhanced information about the provenance
of their diamond193.

De Beers Group (n.d.) Code of origin. Available at: https://www.debeersgroup.com/code-of-

192
Wired (2017) How blockchain is stopping the spread of conflict diamonds. Available at: https://
196

origin www.wired.co.uk/article/blockchain-conflict-diamonds-everledger

De Beers (2023) GIA Joins Tracr. Available at: https://www.debeersgroup.com/media/

193
FT (2019) Transformations in the supply chain. Available at: https://www.ft.com/
197

company-news/2023/gia-joins-tracr content/58642d44-d41c-11e9-8d46-8def889b4137

Sarine (2022) Enabling traceability, enhancing the supply chain. Available at: https://blog.
194
Barrons (2022) How this company is using blockchain to buff up the image of
198

sarine.com/enabling-traceability-enhancing-the-supply-chain diamonds. Available at: https://www.barrons.com/articles/brilliant-earth-blockchain-

diamonds-51647294829
195
Ibid.
 DIAMOND FACTS
47

VALUE OF TRACKED PROVENANCE ALONG THE SUPPLY CHAIN

A SECURE AND TRANSPARENT VALUE CHAIN ENABLED BY BLOCKCHAIN

Conflict Modern Child Human rights Illicit activites are prevented

Mining Slavery Labor violations from being part of the supply chain

Figure 9 - Source: World Economic Forum199

There are multiple other initiatives and They also worked with the Initiative for
mechanisms in place to cultivate traceability. Responsible Mining Assurance to develop a
standard that provides the world’s first shared
The Responsible Jewellery Council has specific definition of leading practices for large-scale
provisions about what its members can claim mining operations202.
about the way they source materials like diamonds.
Provision 14 stipulates that any company that Luxury leaders like LVMH are involved in the
makes claims about the provenance of materials industry’s traceability push too. Alongside Prada
(source, origin and practices) have to be audited200. Group, Cartier and OTB Group, they founded the
The GIA has a specific Diamond Origin report that Aura Blockchain Consortium, which will be using
helps to share the story of the mining of each Sarine’s diamond traceability platform for
stone and has a science-based methodology for their jewelry203.
determining a given diamond’s country of origin201.
All these efforts underscore how important
Luxury brands like Tiffany & Co are leading reducing harmful supply chain risks and creating a
when it comes to sharing the provenance about positive impact across each stage of production is
their diamonds. In 2019, they began providing for the natural diamond industry. Technology is one
geographical sourcing information for customers tool to achieve traceability, and the industry will
for diamonds of 0.18 carats or larger with a T&Co have to move beyond compliance and advocate for
serial number. In 2020, they built on this to share rigid due diligence across all the countries in which
details of the journey including where each stone it operates.
was cut, polished and set.

This is only the beginning.

199
WEF (2018) The Week (2020) Tiffany & Co: Pioneering diamond traceability. Available at: https://www.
202

theweek.co.uk/951538/tiffany-co-pioneering-diamond-traceability
Responsible Jewellery Council (2019) Provision 14. Available at: https://www.
200

responsiblejewellery.com/training/cop-2019-walkthrough/provision-14/ 203
Professional Jeweller (2022) Cartier, Bulgari and more add latest development in diamond
traceability. Available at: ttps://www.professionaljeweller.com/cartier-bulgari-and-more-add-
201
GIA (n.d.) Diamond origin. Available at: https://discover.gia.edu/diamond-origin.html latest-development-in-diamond-traceability/
DIAMOND FACTS 48

Annexes
 DIAMOND FACTS
49

Annex I

The process of raw material extraction for laboratory-grown diamonds

Annex II
Overview of Northwest Territories (NWT, impact assessment (EIA), permitting and licensing
Canada) regulatory process, by Ryan Fequet, processes – and to ensure that all projects are
Executive Director for the Wek’ èezhìi designed for closure from the start. The process
(Mackenzie Valley) Land and Water Board. begins with the requirement for early engagement
with land owners, traditional land users and other
In the Northwest Territories (NWT, Canada) the potentially affected parties. The level of effort for
finalization of some Land Claim Agreements (or this required engagement is scaled to the nature
Modern Treaties) in the early 1990s resulted in of the potential resource development project.
a unique, progressive and empowering piece of Similarly, the information requirements related to
legislation called the Mackenzie Valley Resource proposed activities are also flexible to ensure the
Management Act (MVRMA, enacted in 1998). The level of effort is reasonable for the size, type, and
MVRMA and associated Land Claims created location of the activities.
the regional Land and Water Boards of the
Mackenzie Valley (LWBs) the Mackenzie Valley All applications undergo a public review process
Environmental Impact Review Board (MVEIRB) , that takes place on a real-time online platform
the Renewable Resource Boards, as well as Land where all recommendations and the applicant’s
Use Planning Boards; collectively referred to as responses are visible to the public (Online Review
the Boards. Together, these entities make up the System). Parties and the Board itself may retain
co-management system that ensures a holistic technical and traditional knowledge experts to
and integrated approach to renewable and non- assist with document review and with ensuring
renewable resource management. that proposed activities would be carried out in
the most appropriate way by helping to assess
The LWBs, responsible for issuing authorizations the potential impacts and mitigations; this step is
required for projects, have established policies, known as preliminary screening – the first of the
guidelines and standards to guide applicants and three levels of EIA.
resource developers through the environmental
DIAMOND FACTS 50

There are legislated timelines for the LWBs

and MVEIRB to carry out their processes, that
range from 52 days to three years depending on
the nature of the proposed project (where the
longer period would include a full Environmental
Assessment prior to regulatory permitting).

Because the Boards are administrative tribunals

that must ensure procedural fairness, at the end
of each process the Boards produce a Reasons
for Decision that explain how all of the evidence
that was provided throughout the process was
considered. When a Land Use Permit or a Water
License is issued by a Land and Water Board, it
contains requirements for: management plans,
monitoring programs, reporting and the posting
of security – which is the amount it would cost
for a third party to come in and reclaim the site to
ensure there is financial incentive for the project to
reclaim the project site.

A standard requirement is that all management

plans must be reviewed each year, and any
proposed revisions sought by the Licensee must
be provided to the respective Land and Water
Board for approval. An Annual Report is also a
standard requirement and ongoing environmental
monitoring and response plans (when pre-defined
triggers are met to avoid reaching an unacceptable
level of change in the environment) come in
monthly or more frequently as needed.

Regular inspections take place by the federal

or territorial government to ensure a project is
compliant with the conditions of its permit and/or
license. Inspection reports and all submissions and
correspondence with the Board are made available
on the public registry.
 DIAMOND FACTS
51

Glossary

ASSURE PROGRAM CARBON OFFSETTING

The Natural Diamond Council established the A process that involves a reduction in, or
ASSURE Program in 2019. It assesses the relative removal of, carbon dioxide or other greenhouse
performance of Diamond Verification Instruments gas emissions from the atmosphere in order to
available on the market. All results can be found compensate for emissions made elsewhere.
via the ASSURE Directory, in addition to evaluation
criteria such as diamond false positive rates, CARBON SEQUESTRATION
diamond referral rates and diamond accuracy. The capturing, removal and storage of carbon
dioxide (CO2) from the Earth’s atmosphere. It is
BLOCKCHAIN recognized as a key method for removing carbon
A digital shared database or ledger, that is from the Earth’s atmosphere.
distributed amongst nodes of a peer-to-peer
network. As a database, it stores information CHEMICAL VAPOR DEPOSITION (CVD)
electronically and holds a record of transactions A process to make laboratory-grown diamonds.
which cannot be edited. This means that the CVD uses a small diamond seed crystal and
history of transactions are permanently recorded places it into a chamber, which is then filled with
and accessible for anyone across the supply chain gases heated at extreme temperatures of around
network. 900-1,200°C. As the chamber reaches the right
temperature, layers of carbon begin to form on
CARBON FOOTPRINT the seed crystal, which then grows into a diamond
The quantity of greenhouse gas emissions crystal. CVD involves breaking down the molecules
expressed in terms of carbon dioxide equivalent of a carbon-rich gas, such as methane, into carbon
(CO2e), emitted into the atmosphere by an and hydrogen atoms, which then are deposited
individual, organization, process, product or on diamond seeds to produce a square-shaped,
event from within a specified boundary. The tabular diamond crystal.
word equivalent is used in the metric as other
greenhouse gases besides carbon dioxide, such DIAMOND DEVELOPMENT INITIATIVE (DDI)
as methane, are also released into the atmosphere A non-profit organisation that works with an
but they are incorporated to create one standard ecosystem of businesses, government and
figure for comparison and tracking over time. social services to encourage development and
growth in businesses involved in diamond mining
CARBON INTENSITY and promote sustainable and social impact.
A measure of the carbon footprint (in terms of In 2020, it joined forces with RESOLVE in a
carbon dioxide and other greenhouse gases program merger to strengthen the capacity of the
emissions) per unit of activity. For diamonds, responsible sourcing of diamonds and minerals
carbon intensity is typically calculated by totaling for communities, companies and consumers.
the greenhouse gas emissions over a period from a RESOLVE works across various sectors to design
laboratory or mine and dividing this by a measure sustainable solutions to critical social, health,
of production in that period. This is usually either gas and environmental challenges by creating
rough or polished carats. innovative partnerships where they are least likely
and
most needed.
DIAMOND FACTS 52

ENERGY EFFICIENCY effective environmental management system.

The use of less energy to perform the same task or
produce the same result. INTERNATIONAL LABOUR ORGANIZATION
A United Nations agency whose mandate is to
ESG (ENVIRONMENTAL, SOCIAL, advance social and economic justice by setting
GOVERNANCE) international labor standards.
A framework that helps stakeholders understand
how an organization is managing risks and KIMBERLEY PROCESS CERTIFICATION
opportunities related to environmental, social and SCHEME (KPCS)
governance criteria. The process established in 2003 to prevent
'conflict diamonds' from entering the mainstream
FEDERAL TRADE COMMISSION (FTC) rough diamond market by United Nations
An independent agency of the US government General Assembly Resolution 55/56 following
whose principal mission is the enforcement of recommendations in the Fowler Report.
civil anti-trust law and the promotion of consumer
protection. LABORATORY-GROWN DIAMOND
A synthetic, man-made diamond created in a
GEMOLOGICAL INSTITUTE OF AMERICA (GIA) laboratory through Chemical Vapor Deposition
An authority on diamonds, colored stones and (CVD) or High Pressure High Temperature (HPHT)
pearls. A public benefit, non-profit institute, GIA processes.
is the leading source of knowledge, standards and
It is an artificial product that has essentially the
education in gems and jewelry.
same chemical composition, physical properties
and structure as that of a diamond. The terms
GREENHOUSE GAS EMISSIONS (GHG)
'synthetic', 'laboratory-created' and 'laboratory-
Gases in the Earth’s atmosphere that trap heat, grown' are synonymous with one another. In the
causing the greenhouse effect. They include US, the Federal Trade Commission also accepts
carbon dioxide (CO2), methane (CH4), nitrous '[manufacturer’s name] created diamond'. Where
oxide (N2O), hydrofluorocarbons (HFCs), there is no acceptable local direct translation of
perfluorocarbons (PFCs) and sulphur hexafluoride the English terms 'laboratory-grown diamond'
(SF6). These emissions are converted into CO2e or 'laboratory-created diamond' then only the
using global warming potentials (GWPs) provided translation of the term 'synthetic diamond' should
in assessments of the Intergovernmental Panel on be used.
Climate Change.
DIAMOND MINING
HIGH PRESSURE, HIGH TEMPERATURE (HPHT)
Alluvial mining - An above-ground form of mining
A process to create laboratory-grown diamonds. that concentrates on gathering diamonds on the
HPHT involves placing a diamond seed into a press surface from deposits of sand, gravel and clay.
inside a chamber that is heated to temperatures
of 1,300-1,600°C with pressures above 870,000 Beach mining - Involves combing beaches and
pounds per square inch. The hot metal plates excavating deposits using machines to move the
dissolve the high-purity carbon source and as a sand.
result, carbon atoms form on the seed crystal,
Marine mining - A method used for drawing
before the diamond continues to grow.
diamonds from the sea with the help of mining
vessels.
ISO14001
Sets out the criteria for an environmental Pipe mining - There are two types of pipe mining.
management system. It maps out a framework that Open-pit mining involves removing the layers of
a company or organization can follow to set up an sand and rock found just above the kimberlite. In
 DIAMOND FACTS
53

underground mining, miners tunnel through the when energy is purchased and used in production.
Earth’s crust to the kimberlite pipe. Tunnels are This could include emissions from electricity
constructed on two levels, one above the other generation through to power generators used for
with funnels built to connect the two. buildings and the infrastructure surrounding a
given mine.
MAENDELEO DIAMOND STANDARDS (MDS)
Requirements adapted to the specific conditions SCOPE 3 EMISSIONS
of artisanal and small-scale diamond mining Includes emissions that are not produced by the
communities. Maendeleo is a Swahili word company itself but are a result of indirect activities
meaning development and progress. The owned by different stakeholders in the supply
standards apply to diamonds mined in conflict- chain, like suppliers and transport facilitators.
free zones and produced safely with consenting
and engaged communities. MDS operations are SOCIO-ECONOMIC AGREEMENTS (SEAS)
violence-free, respect human and worker rights, A socio-economic agreement is usually agreed
and follow practices that promote environmental between a private organization and a public body.
responsibility. It outlines the commitments and predictions made
by a company during its social and environmental
NATURAL DIAMOND assessment, including:
A diamond is a mineral created by nature; the word
“diamond” used on its own always means a natural • Employment and business opportunities
diamond. • Cultural wellbeing and traditional economy

OECD DUE DILIGENCE GUIDANCE FOR • Community, family and individual wellbeing
RESPONSIBLE SUPPLY CHAINS OF MINERALS • Net effects on government
Provides detailed recommendations to help
companies respect human rights and avoid • Sustainable development
contributing to conflict through their mineral
purchasing decisions and practices. UNITED NATIONS GUIDING PRINCIPLES ON
HUMAN RIGHTS
RESPONSIBLE JEWELLERY COUNCIL (RJC) A set of guidelines for states and companies to
CODE OF PRACTICES (COP) prevent, address and remedy human rights abuses
Defines the requirements for establishing committed in business operations.
responsible business practices throughout the
jewelry supply chain, from mine to retail. The COP WORLD DIAMOND COUNCIL SYSTEM OF
provides a common standard for ethical, social, WARRANTIES (SOW)
human rights and environmental practices, and The SoW was developed in 2002, by the World
certification against it is mandatory for all RJC Diamond Council. It requires professional buyers
commercial members. and sellers of rough diamonds, polished diamonds
and jewelry setters working with diamonds to
SCOPE 1 EMISSIONS include a warranty statement on invoices and
Covers emissions from sources that an memos each time a diamond
organization owns or controls directly. For the changes hand.
diamond industry, this could include emissions
from hydrocarbons, diesel, marine gas, oil or
petrol used to power machinery used to mine for
diamonds or transport like trucks and ships.

SCOPE 2 EMISSIONS
Encompasses emissions that are caused indirectly
DIAMOND FACTS 54

Natural Diamond Council members' sustainability reports

READ MORE ABOUT THE ENVIRONMENTAL AND SOCIAL PERFORMANCE
OF OUR MEMBERS HERE:

Building Forever: Our 2021 Sustainability Report

DE BEERS GROUP
Building Forever: 2030 Goals – Progress Update 2021

PETRA DIAMONDS Sustainability Report 2022

LUCARA DIAMOND Sustainability Report 2021

RIO TINTO Socio-Economic Monitoring Report 2021

MUROWA DIAMONDS Sustainability Report 2020

ARCTIC CANADIAN
Ekati Socio-Economic Monitoring Report 2021
DIAMOND COMPANY

ANALYSIS BROUGHT TO YOU BY THE NATURAL DIAMOND COUNCIL.

LEARN MORE AT WWW.NATURALDIAMONDS.COM/DIAMONDFACTS/