The Gemfair Way 2019

Our due diligence procedures

Candidates must pass our initial due diligence checks—which are closely aligned with the OECD’s Due Diligence Guidance for Sourcing Minerals from Conflict-Affected and High-Risk Areas Annex II—including proving that they possess a license to operate. Our due diligence verification includes a site visit to gather information about the mine’s precise location and working conditions, ensuring that our gated criteria is being met. We also screen the candidate through an international database.

When artisanal miners become part of the GemFair programme, they demonstrate an absence of any OECD Due Diligence Guidance Annex II Risks and begin a journey of continuous improvement.

Interview with Tamba Kono, licence holder for one of the first sites to join GemFair. 2019

Becoming a GemFair Member

If the candidate passes our screening, they’re invited to sign on to either the DDI’s Maendeleo Diamond Standards Programme or the GemFair Responsible ASM Assurance Programme. Members in good standing with either programme are welcome to sell their diamonds to GemFair.
We recognise that context is everything when addressing the materiality of breaches. If we suspect a Member has breached our requirements, we look at the nuance of the situation, investigate all sides of the issue and in extreme cases commission an assessment by a third-party. If the issue is grave, we will disengage, but this is our last resort. This year, we disengaged from two mine sites.

Monitoring our Supply Chain

We invite cohorts of new Members to participate in a suite of training workshops on subjects outlined in our ASM Standard, including the importance of human and worker rights, business integrity, as well as fair wages, health and safety, first aid and environmental management, among others.
The training and support we provide our Members are not isolated to one workshop; we work with our Members long term to support the improvement of their working practices, including training and action plans, based on their needs.

We believe that direct engagment with ASM miners is an important way to support behaviour change.

*In addition, GemFair underwent a third-party audit for the Best Practice Principles Assurance Programme and the Responsible Jewellery Council Code of Practices this year. An audit report summary for the BPPs and our RJC certificate will be published once we are certified.

The GemFair Responsible ASM Assurance Programme draws on existing best practice for sourcing responsibly from artisanal and small-scale miners, including the OECD’s Due Diligence Guidance, the United Nations Guiding Principles for Business and Human Rights, De Beers Group’s Best Practice Principles Assurance Programme, the Diamond Development Initiative’s Maendeleo Diamond Standard Programme™ and ARM and Resolve’s CRAFT Code, among others. Our ASM Standard is field-ready and we recently launched our full assessment framework in Spring of 2019.

How Members meet our ASM Standard Requirements

We assess GemFair Members on their business and working practices. Assessments include observation at the mine site, interviews and document review. We use non-material breaches as a training opportunity and set out Risk Management Plans (RMP) in collaboration with the Member so that the RMP can be achieved within a reasonable timescale.
We work closely with ASM miners, government and civil society to share information and complement our own robust monitoring of the ASM sector. We also provide several ways for stakeholders to get in touch with us, including a third-party reporting service if they need to make a complaint about any of our Members or indeed our own activities on the ground. Further information can be found here: Whistleblowing Policy and Procedure.
We commission regular third-party audits of the effectiveness of our due diligence management system and a sample of our Members to ensure that the claims we make about their compliance are verifiable. Our first summary audit report and our response incorporating the auditor’s recommendations can be found here: Third-Party Audit Report and GemFair response memo to third-party audit.

Logging diamonds at the mine site

Members receive a GemFair Toolkit to log and bag diamonds themselves once they have achieved certain milestones on their progress in either the MDS or GemFair ASM Assurance Programme. Members who have not yet met those milestones phone our office when they discover a diamond, and one of our field officers will travel to the Member’s mine site to log it for them. The location of each Member mine site is registered in our database so when a diamond is logged, we can trace it directly to the site where it was recovered.

At the GemFair buying office

When a miner brings in a diamond or a batch of diamonds to our office, our buyers conduct routine checks on the miner’s licence status and the condition of the QR-coded bags. We then open the bag, clean the diamond and value it according to the four Cs—colour, clarity, cut and carat—and add in fluorescence for larger diamonds. For really interesting diamonds, we may use a rough to polish mapping machine to see the diamond’s polished outcome.

We cross-reference this information against the De Beers Price Book and arrive at a unique price based on its characteristics.If the miner chooses to accept our offer, we issue a receipt and pay the miner in either cash or by bank transfer. We follow best practice with respect to handling cash and declare all transactions above the nationally-mandated threshold. Our transactions are all logged on our app, linked to an image of the diamond and the QR-coded bag it arrived in, which provides an added level of traceability for transactions.

We monitor our Members regularly on an international database for any suspicious links, such as to political groups or sanctioned individuals, that would heighten the risk for money laundering.

Export

As we prepare to export, we follow several important steps. Before leaving our office, the diamonds are removed from their bags and sorted into government-mandated categories and placed in new bags. This procedure helps the Precious Mineral Trading Unit (PMTU) of the National Minerals Agency (NMA) value diamonds efficiently. We then transport the diamonds securely to the capital. At the PMTU, the NMA has a tri-partite evaluation procedure in place: a valuation is done by the company, the second by the PMTU and the third by an independent evaluator. The highest valuation of the three is then used and we pay all required export taxes before the parcel is sealed and certified with a Kimberley Process Certificate. Before the parcel arrives at its final destination, our customer receives our invoice, which aligns with the requirements of the World Diamond Council’s System of Warranties.

Reporting back

A critical part of our work is reporting back to mining communities and civil society organisations in the region. In 2018, we conducted a livelihoods assessment to obtain a baseline of the living and working conditions of artisanal mining communities in the Kono District. Over 300 households located in some 40 villages participated in the assessment. Now our field team is carrying out a sensitisation campaign on some of the key issues we uncovered around road safety, occupational health and safety, anti-corruption reporting options provided by the government and more.

It’s also our regular practice to hold meetings and roundtables with both local and international non-governmental organisations and the government of Sierra Leone to share information and knowledge on the emerging challenges in Kono’s ASM sector.