The Australian Diamond Portfolio Conflict-Free Guarantee
Conflict diamonds are diamonds illegally traded to fund conflict in war-torn areas, particularly in central and western Africa. The United Nations (UN) defines conflict diamonds as “…diamonds that originate from areas controlled by forces or factions opposed to legitimate and internationally recognised governments, and are used to fund military action in opposition to those governments, or in contravention of the decisions of the Security Council.” These diamonds are sometimes referred to as “blood diamonds.”
Conflict diamonds captured the world’s attention during the extremely brutal conflict in Sierra Leone in the late 1990s. During this time, it is estimated that conflict diamonds represented approximately 4% of the world’s diamond production. Illicit rough diamonds have also been used by rebels to fund conflicts in Angola, Liberia, Ivory Coast, the Democratic Republic of Congo and the Republic of Congo.
Today, the flow of conflict diamonds has been reduced to considerably less than 1%.
Eliminating Conflict Diamonds
In July 2000, the global diamond industry made clear to the international community its zero tolerance policy towards conflict diamonds. Dedicated to eradicating the trade in conflict diamonds, it worked closely with the United Nations, governments and non-governmental organizations (NGOs) such as Global Witness and Partnership Africa Canada to create the Kimberley Process Certification System. This system was formally adopted in 2003 and guards against conflict diamonds entering the legitimate diamond supply chain. The diamond industry also adopted a voluntary System of Warranties to assure consumers that their diamonds are from sources free of conflict.
Today 74 governments have enshrined into their national law the Kimberley Process Certification System, and now more than 99% of the world’s diamonds are from conflict free sources. However, even one conflict diamond is one too many. The diamond industry continues to work with governments, NGOs and the UN to strengthen the Kimberley Process and the System of Warranties.
While diamonds have been used to fund conflict, the problem is not the diamonds themselves but the rebels who exploit diamonds (along with other natural resources) to achieve their illicit goals. The vast majority of diamonds come from countries at peace. These countries have been able to invest the revenue from diamonds into the development of infrastructure, schools and hospitals for the good of the communities in which diamonds are found. These countries include Australia, Botswana, Canada, Namibia, Russia, South Africa and Tanzania.
Today, more than 99% of the world’s diamonds are now from conflict free sources and are officially traded under the UN mandated Kimberley Process.
The Australian Diamond Portfolio Conflict-free Guarantee
Ethical sourcing is incredibly important to us and across the entire legitimate diamond trade, and we are a full supporter of the Kimberley Process Certification Scheme (KPCS). The KPCS is a global organisation of governments, industry, and human rights groups created in 2002 to prevent the sale of conflict diamonds, which today regulates 99% of the worldwide rough diamond supply.
Australian Diamond Portfolio requires all of our suppliers to provide us with a written warranty as per the KPCS, stating that their diamonds come from Kimberley-certified sources and are not involved in funding conflict. The warranty statement, which was officially recognised at the creation of the Kimberley Process, reads:
“The diamonds herein invoiced have been purchased from legitimate sources not involved in funding conflict and in compliance with the United Nations Resolutions. The seller hereby guarantees that these diamonds are conflict free, based on personal knowledge and/or written guarantees provided by the suppliers of these diamonds.”
Suppliers are selected carefully in accordance with the stringent trading practices of the World Federation of Diamond Bourses (WFDB). These rules include sourcing diamonds from trusted and reputable industry members, those who subscribe to industry-wide standards of disclosure regarding products and who subscribe to a System of Warranties that all diamonds are conflict-free, amongst a host of other undertakings.