Remarks at the World Diamond Council's Annual General Meeting

Remarks
Andrew Keller
Deputy Assistant Secretary for Counter Threat Finance and Sanctions, Bureau of Economic and Business Affairs
New York City
September 8, 2016


As Prepared

Thank you to Patricia for that introduction and thank you to the World Diamond Council (WDC) for the opportunity to speak to you this morning.

I know that this is the first time the WDC has held its annual meeting in the United States so, on behalf of the U.S. Government, I’d like to welcome you to New York.

On a more personal note, it is particularly meaningful to me to be here with you today as I am the proud grandson of a diamond-teer from Antwerp.

I plan to focus my remarks on the U.S. perspective on the Kimberley Process (KP) and on responsible business conduct more broadly, but let me begin with a more general observation: The jewelry industry, and your individual efforts, represent an important part of the U.S. economy and touch the lives of so many people around the globe. The U.S. jewelry sector continues to lead by example through innovation, hard work, artistry, and the highest levels of commitment to responsible business conduct.

The diamond industry is one of our close partners in the KP, and the KP is one of the most important multilateral bodies working to break the link between natural resources and conflict. These efforts are geared towards ensuring that countries can benefit from their resources, artisanal mining communities can share in the fruits of their labor, and consumers can buy a clean, ethical product.

The KP provides the minimal standards for trading in rough diamonds worldwide. No matter where rough diamonds are produced or traded, the KP certificate provides some assurances to consumers that they have not funded conflict by rebel movements aimed at undermining legitimate governments.

While the KP provides a critical baseline, it is not enough. The World Diamond Council and the members here in this room have called for more. Civil society groups have advocated for more. And, critically, consumers want more.

I can tell you the U.S. government agrees with this demand signal. We have consistently stated that the KP is necessary but not sufficient. Its limitations can negatively impact consumer confidence and create risks to the integrity of the diamond supply chain.

Consumers in the United States, and beyond, care about responsible sourcing. They care about issues surrounding working conditions, environmental practices, fair wages, child labor and human rights. They care about how diamonds are cut, polished, and traded.

Responsible sourcing and supply chain transparency should be key to this industry’s efforts: They increase consumer confidence. They ensure that undisclosed materials, including synthetic diamonds, do not enter supply chains. And, they increase the confidence of financial institutions to work with the sector, which is of critical importance in this era of bank derisking.

The U.S. government encourages all U.S. companies to strive to ensure their activities respect the human rights of people in the communities where they do business. Businesses can do this through the adoption of and adherence to voluntary due diligence practices to assess business impacts and risks.

This is not unique to the precious stones or jewelry sectors. For companies in all sectors, due diligence should be ongoing as risks and operating context evolve, and will vary in complexity with the size of the organization and the environments in which they operate.

In the past year, the United States has taken significant steps to strengthen our own domestic system.

In June, we worked with the FBI to host, in The Hague, the first Diamond Trafficking, Illicit Trade, and Threat Finance conference which focused on vulnerabilities in the diamond supply chain and how to prevent criminals from taking advantage of those vulnerabilities.

We have also recently put in place additional measures to strengthen the U.S. Kimberley Process Authority (USKPA), a body critical to the successful administration of our KP commitments here in the United States. We are very pleased to announce that we have elevated our relationship with the USKPA by formalizing a Public-Private Partnership and we recently signed a new MOU. In the coming weeks, we will be taking further steps to implement our enhanced measures with our partners in the U.S. rough diamond trade.

Some of these actions were in response to the KP’s Review Visit to the United States and reflect the seriousness with which we undertake our KP obligations. We urge all KP Participants to do the same.

On this front, I would like to personally recognize the WDC’s unwavering support for the KP peer review system and stress the importance of having industry’s voice and expertise represented on the KP review visits.

Of course, the KP is not just about government and industry. It is defined by its tripartite structure. The involvement of civil society is essential to the KP, and it is in all of our interests to ensure that there is a meaningful role for civil society in the KP going forward.

Both inside and outside of the KP, governments, industry, and civil society groups must keep tackling the issues facing us together to ensure the integrity of the world’s diamond supply from mine to market. Your experience in the KP and your deep expertise in the diamond business are critical.

The United States will continue to complement the KP with other tools and work in other fora where we can make progress on the issues we care about and hold deeply as national values.

As the world’s leading polished diamond market, we take pride in the steps the U.S. industry and the WDC have taken to be leaders in ethical diamond sourcing and to operate with a higher level of vigilance and due diligence consistent with internationally accepted frameworks. We encourage our U.S. and global industry partners to keep striving and urge others to do the same.

Thank you.