The global diamond industry operates under stringent ethical guidelines, primarily driven by the Kimberley Process (KP) Certification Scheme. This vital international initiative ensures that rough diamond purchases do not finance conflict, thereby safeguarding human rights and maintaining consumer confidence in the diamond supply chain. A cornerstone of this scheme is the periodic review visit, where delegations assess participant countries’ adherence to the minimum requirements. In this context, a significant delegation from the Kimberley Process undertook a comprehensive review visit to Russia between August 25 and August 30, 2018. The primary objective was to meticulously examine the nation’s robust system governing the mining, accounting, implementation, and control of operations involving rough diamonds, ensuring its full compliance with the strict standards set forth by the KP Certification Scheme. ALROSA, Russia’s leading diamond mining company and a crucial global player, highlighted the importance and transparency of this inspection, underscoring Russia’s ongoing commitment to ethical diamond trade practices.
The Kimberley Process emerged in 2003 as a collaborative effort involving governments, the international diamond industry, and civil society organizations. Its creation was a direct response to concerns that illicit rough diamonds, often referred to as “blood diamonds” or “conflict diamonds,” were being used to fund civil wars in Africa. The scheme establishes a robust certification system for rough diamonds, requiring participants to certify that all shipments of rough diamonds are conflict-free. This involves a rigorous system of internal controls over diamond production and trade, ensuring that only legitimately sourced diamonds enter the global market. With 54 participants, including the European Union as a single entity, the KP represents the vast majority of the world’s diamond production and trade. The efficacy of the KP hinges on the active participation and strict adherence of its members, making regular review visits like the one to Russia indispensable for maintaining its integrity and effectiveness.
The delegation tasked with this critical assessment was a testament to the Kimberley Process’s multi-stakeholder approach and global representation. Led by Angola, a significant diamond-producing nation itself, the team comprised representatives from other key diamond-producing and trading countries. These included Botswana, known for its leading role in responsible diamond mining; the European Union, a major hub for diamond cutting and trade; the United Arab Emirates, an emerging global diamond center; and South Africa, the birthplace of the KP. Crucially, the delegation also included observers from prominent industry and civil society organizations: the World Diamond Council (WDC), representing the diamond industry’s commitment to self-regulation and ethical practices, and the Civil Society Coalition (CSC), providing independent oversight and advocating for human rights and sustainable development. This diverse composition ensured a comprehensive and unbiased evaluation, drawing on expertise from various facets of the diamond supply chain and social responsibility.
Russia holds an undeniably pivotal position within the global diamond industry, being one of the world’s largest producers of rough diamonds by volume and value. Its national diamond industry is primarily spearheaded by ALROSA, a state-owned enterprise that accounts for a substantial portion of global diamond output. Given this scale, Russia’s unwavering adherence to the Kimberley Process minimum requirements is paramount not only for its own national reputation but also for the stability and integrity of the entire international diamond market. The Ministry of Finance of the Russian Federation acts as the official representative of Russia within the Kimberley Process, signifying the high-level governmental commitment to upholding these international standards. This institutional backing ensures that the necessary legal frameworks, regulatory mechanisms, and enforcement capabilities are in place to prevent conflict diamonds from entering or transiting through Russian territory.
The 2018 review visit was meticulously planned to cover a broad spectrum of facilities crucial to Russia’s diamond control system, from the initial stages of sales and distribution to mining and sorting, and even extending to newly developed trade hubs. The delegation’s itinerary began in Moscow, where they visited the United Selling Organization (USO) of ALROSA. The USO serves as the central sales arm for ALROSA’s rough diamonds, playing a critical role in the initial classification, valuation, and sales of diamonds before they enter the global market. Scrutiny of the USO’s operations is vital to ensure that all diamonds handled are properly documented, originate from legitimate sources, and comply with all KP certification requirements from the outset of their commercial journey. This rigorous oversight at the point of sale is a key safeguard in preventing illicit diamonds from infiltrating the supply chain.
Continuing their assessment, the delegation traveled north to Arkhangelsk, a region significant for diamond mining. Here, they inspected the production site of PJSC Severalmaz, a subsidiary of ALROSA that operates the Lomonosov diamond deposit. This visit allowed the KP delegation to observe first-hand the mining operations, security protocols, and inventory management systems at the source. Ensuring transparency and robust controls at the mining stage is fundamental to preventing the commingling of legitimate and illicit diamonds. Following the mine visit, the delegation also toured the diamond sorting center in Arkhangelsk. This facility is critical for the initial processing and classification of rough diamonds based on size, shape, quality, and color. The accuracy and integrity of this sorting process are essential for proper valuation and for maintaining an auditable trail of diamonds as they progress through the supply chain, reinforcing the effectiveness of Russia’s internal control mechanisms in compliance with KP standards.
A particularly noteworthy aspect of the 2018 review was the inclusion of recently inaugurated facilities, which were not in existence or accessible during previous KP visits. This demonstrates the Kimberley Process’s commitment to adapting its oversight to the evolving landscape of the global diamond industry. The delegation ventured to Vladivostok in Russia’s Far East to inspect the Eurasian Diamond Center (EDC) and the operations of KGK Company. The Eurasian Diamond Center represents a strategic initiative by Russia to establish a new hub for diamond trade and value-added services, fostering economic development in the region. Visits to such new centers are crucial for assessing how emerging trade platforms integrate KP compliance into their operations from inception. Similarly, examining the activities of companies like KGK, an international player involved in diamond manufacturing and trading, within these new hubs provides insights into how both domestic and foreign entities uphold the KP Certification Scheme in diverse operational environments. This forward-looking approach ensures that the KP remains relevant and effective in monitoring an industry that is continually expanding and diversifying its geographical footprint.
Kimberley Process review visits are not arbitrary events but rather a fundamental and regularly practiced component of the scheme’s operational framework. These comprehensive assessments are conducted every few years for each participant country, serving as an essential mechanism to verify and validate that existing national rules and procedures are sufficiently robust to effectively monitor the entire diamond turnover within their jurisdiction. Such periodic examinations are critical for identifying potential vulnerabilities, assessing the implementation of previous recommendations, and ensuring that control systems remain resilient against evolving threats and challenges in the illicit diamond trade. Following the completion of each review visit, the Kimberley Process publicly releases a detailed report. This report includes objective assessments of the country’s compliance, highlights areas of strength, and, crucially, provides concrete recommendations for improvement. This transparent process fosters accountability among participants and contributes to the continuous strengthening of the KP Certification Scheme globally.
Russia has a particularly strong track record within the Kimberley Process, having previously received commendation for its robust control system. The last comprehensive Kimberley Process review visit to Russia took place in 2013. Following that rigorous inspection, the rough diamonds control system adopted and implemented in Russia was officially recommended to all other KP participants as a benchmark – a “best practice” model for effectively implementing the intricate requirements of the Kimberley Process Certification Scheme. This designation by ALROSA underscores the nation’s proactive and exemplary commitment to establishing and maintaining a highly secure and transparent diamond supply chain. The 2018 visit, therefore, not only served as a routine re-evaluation but also as an opportunity to confirm the sustained excellence and potential further enhancements of a system that has already set a high standard for global compliance, reinforcing Russia’s position as a reliable and ethical supplier in the international diamond market.
The sustained integrity of the global diamond trade is inextricably linked to the rigorous enforcement of the Kimberley Process Certification Scheme. Review visits, like the one conducted in Russia in 2018, are indispensable for upholding this integrity. They provide critical assurances to consumers, governments, and the industry alike that the diamonds they purchase are not funding conflict and are ethically sourced. By systematically inspecting mining operations, accounting procedures, sales organizations, and emerging trade hubs, the KP ensures that its minimum requirements are not merely theoretical but are actively implemented and continuously monitored on the ground. This ongoing commitment to transparency and accountability, exemplified by the multi-stakeholder delegation and the thoroughness of their inspection, is what underpins consumer confidence and the long-term sustainability of the legitimate diamond industry worldwide. Russia’s engagement in this process, building on its history as a “best practice” example, continues to play a vital role in this global endeavor.
News Source: gjepc.org