“We’re not as good as we want to be but we are better than ever!” For Sabrina Karib, founder of the Precious Metals Impact Forum, genuine progress has been made towards eradicating social and environmental risks in the gold supply chain. Speaking at the Watch Forum, an event for watch industry professionals organised by Watches and Culture on the theme of sustainability, Karib was nonetheless clear that much remains to be done, and that “collaboration is vital if we are to improve the situation across the supply chain. We’re in it for the long haul and can only succeed if everyone is part of the journey. You, as watch brands, have the power to bring about change.”
The weakest link…
Artisanal and small-scale mining (ASM) is at the heart of the debate, and not necessarily as a key component of the mining sector. These operations come under fire for their use of mercury, cyanide and iron chloride for gold extraction, and have been linked to child labour, deforestation and organised crime. In his presentation, Marcin Piersiak, Executive Director at the Alliance for Responsible Mining, began by setting out the facts. Artisanal and small-scale mining employs 20 million miners – 80% of those working in the sector – and accounts for 20% of global supply which, according to a Canadian survey, totalled 3,200 tonnes in 2020. This means 600 or so tonnes originate from artisanal mines. With a trade value of $30 billion, this gold provides a vital source of income that helps lift local communities out of poverty.
“Before handing out judgement, we should consider living conditions for these populations, for whom mining is often the best option available,” said Marcin Piersiak. “Artisanal and small-scale mining, a largely informal sector in many countries, won’t go away. Far from it. So rather than pretending the problem doesn’t exist, we need to work with these miners, support them and bring them into the supply chain.” “Of course there are risks, because the companies dealing with this sector have to resolve legal and reputational issues,” added Louis Maréchal, an advisor on the mining sector at the Organisation for Economic Co-operation and Development (OECD) which supports the market economy. “However, responsible investment in artisanal mines can legitimise their contribution to gold supply and help these communities.”
…or the strongest link?
Marcin Piersiak had no shortage of examples of mining villages where working conditions have improved, environmental impacts have been reduced, and women and children are better protected. On condition that miners are paid a fair price for their gold. “I like to give the example of the Nobel Peace Prize medal that was awarded to the Colombian president Juan Manuel Santos in 2016. It was made from fairmined certified gold from Colombian mining organisations that respect the environment and ensure good working conditions for the miners. The gold was sourced from five certified mines in Nariño, a mountainous region in south-west Colombia.” Knowing that more than half of Colombia’s mines are informal and illegal, for a mine to become certified is always a victory.
“There aren’t a million solutions,” concluded Sabrina Karib. “Firstly, these miners must become business partners. They should be properly remunerated for their work, including a premium for certified mines. At the same time, we are entitled to impose contractual obligations with respect to social and environmental criteria, with the means to measure progress. Collaborative action is the most effective way to achieve this.” This is already beginning to take shape, in some cases using blockchain as a technological support to secure progress towards ethical gold.