The Fair Trade Challenge

Millennial consumers want honesty and transparency. Can the industry guarantee “gems that do no harm”?

By By Barbara Moss

The children of a Malawi village helped by the Fair Trade buying practices of Columbia Gem House.

In Africa, small children are sent down into the earth with little more than a water hose and a headlamp to extract gems from tiny passageways too small for adults to maneuver. In countless towns, villages and cities across the globe, laborers toil for pennies a day to feed their families, routinely denied a decent wage but happy to get the work — all for the love of the fine gemstones that make their way into American jewelry stores.
These are the stories of which nightmares are made. And though many groups, from NGOs to retailers and mining conglomerates have steadily made progress in the fight for safer, fairer working conditions for those who mine, cut and polish gemstones, it can still be a challenge to guarantee ethically sourced gemstones at point of sale.

New Consumer Paradigm
A new crop of American consumers, however, is demanding greater transparency when it comes to jewelry purchases. Millennials, that large and vocal generation responsible for some of the most dramatic changes in buying habits the industry has ever seen, want more than mere words to guarantee that the jewelry they buy “does no harm.”
Research shows that this is a consumer group that strongly prefers ethical products. According to the 2015 Nielson Global Survey of Corporate Social Responsibility and Sustainability, an online poll of consumer buying habits in 60 countries, almost three out of four Millennial-aged respondents said they would be willing to pay extra for green or sustainable products, up from approximately half just one year earlier. And it’s not just Millennials: The same study showed that 51 percent of Baby Boomers, ages 50 to 64, would be willing to pay more for these products, up 7 percentage points from 2014.
Although diamonds and precious metals have also received supply chain scrutiny, gemstones are notoriously difficult to track from mine to showcase. Approximately 80 percent of new rough comes from small “artisanal” operations, according to a 2016 industry overview of colored gemstones conducted by The Responsible Ecosystems Sourcing Platform (RESP), a collective of government and industry representatives from the fashion, cosmetics and jewelry industries, based in Troinex, Switzerland.
While many jewelry organizations pay ethical sourcing lip service, there is still no industry-wide stamp of approval for colored gemstones. Most that can truly be called “Fair Trade” often come into the market only after a reputable dealer has examined a mining operation firsthand, visited the location and even talked to the miners. It’s that level of knowledge and intimacy that makes the process so involved, with no “one size fits all” solution.

Passion for a Cause
Eric Braunwart, president and founder of Columbia Gem House in Vancouver, Washington, and a longtime proponent of a transparent supply chain, has worked hard to create a verifiable system for the rough he cuts, sells and sets in jewelry. It has taken decades, but today his company is known as a trusted supplier of ethically sourced merchandise. And business has been brisk.
“I’m opening, on average, about one new account a day,” Braunwart says, “and these are not businesses that are listed in Jewelers Board of Trade (JBT). They’re not traditional jewelers. They pay by credit card. They’re under 30. They know very little about the game in some ways, but they’re very savvy. And they know jewelry that has a message, that is ethically sourced, sells.”
They’re also very, very successful. They are Millennials selling to other Millennials. And according to Braunwart, these “new” jewelers demand to know where the gems they’re buying originate, what the working conditions are for the people who cut the gems and what impact their mining and cutting may have on the environment. In other words, they want to know it all. And so do their customers.
Like Braunwart, who has been involved in Fair Trade and ethical sourcing for decades, Trios Studio in Lake Oswego, Oregon, a suburb of Portland, is a business with a dedication to verifiable sourcing. Founded ten years ago by three partners — Mary Wong, Deborah Spencer and Kathe Mai — Trios has grown by sharing their own passion for Fair Trade gems.
“Our customers let us know that they are concerned about where their gemstones, diamonds and precious metals are sourced,” says Wong, whose store hosts a “Fair Trade Month” every December. Education is a huge component of the store’s marketing efforts and, says Wong, the effort has paid off with steady sales growth and a clientele that appreciates helping others across the world. “Fair trade,” she says, “is a big part of our success.”
For retailers who may not have considered ethical sourcing as a selling point, research tells us that it is. And as consumer preferences evolve, so should jewelers’ buying habits as they consider new ways of doing business. Consider it a win/win: In helping the people of the planet, you are also helping your business.