The Business of Conflict Free Diamonds

Lorein Abenhaim

ethical_diamondsLet’s list all the things we love about diamonds: they sparkle, they are unbreakable, they last forever, and last but not least—they’re pretty! A form of global currency, diamonds, especially the rare stones, always hold some sort of value. But somewhere in-between all of this love, a crisis of conscience hits—how sure are you that your diamonds are conflict free?
Conflict diamonds, historically, are those trafficked and sold to fund weapons and civil wars in various regions in Africa (the 1990s was a particularly difficult period). Being that two-thirds of the diamonds circulating around the world come from Africa, it’s hard to tell which ones are conflict free and which are not. It’s estimated that 3.7 million people have been killed and millions more displaced in countries like Angola, Sierra Leone, and Democratic Republic of Congo because of the diamond trade.
While civil wars in those countries have come to pass, conflict diamonds are still prevalent in Liberia and fueling rebels in Côte d’Ivoire. Smugglers mix conflict diamonds with those that are responsibly sourced before they leave Africa, so by the time they reach jewelers in the United States, there is no way to distinguish between them.
This gap of uncertainty is what led Beth Gerstein (pictured below) and Eric Grossberg to co-found Brilliant Earth over six years ago, a jewelry e-commerce business based in San Francisco where the brand has a showroom, that only sells responsibly sourced diamonds. “We work with vetted suppliers that can trace the diamonds themselves back to the mine,” Gerstein told us. “We look at specific countries that we feel really good about their practices.”
Gerstein and Grossberg are both Stanford Business School graduates, who saw a relatively untapped market for conflict free diamonds that consumers have been increasingly demanding. With the diamond industry selling an estimated $60 billion in diamond jewelry each year, and consumers increasingly looking for products that are ethically and sustainably produced, there was a distinct hole in the market, something that Gerstein experienced firsthand when her fiancé proposed in 2004.
All of Brilliant Earth’s merchandise can be traced back to mines in Canada, Namibia, and Botswana—countries that have some of the strictest labor and environmental laws in the world. The company stays far away from diamonds coming out of Sierra Leone and the Republic of Congo, as these areas are well known for trafficking conflict diamonds. Anyone who has seen Blood Diamond and left the theater chanting “TIA” (this is Africa) can tell you that.
It’s a common misconception to think because responsibly sourced diamonds come from areas with better labor laws, they will cost more than those from an average jeweler, according to Gerstein. Brilliant Earth is not like the organic section of Whole Foods. A diamond is a diamond. Its value is determined largely by the industry’s standard pricing method, the four C’s (clarity, cut, carat, and color).“We don’t believe that you should have to pay more for an ethical product,” Gerstein said. In sum, if you buy a diamond from Brilliant Earth it will cost you pretty much the same as any other piece of diamond jewelry and it comes with an extra goodie—a certificate of origin, which includes information on the practices behind it.
While Brilliant Earth may not have million dollar diamonds like some of the iconic jewelry brands, they still have a pretty wild selection. According to Gerstein, their most expensive diamond to date is a round, 5.02-carat diamond totaling $321,000. While valuable, that’s not Gerstein’s favorite. She’s much more fond of The Willow Ring—a round diamond in an antique vintage setting. “Its just really beautiful and the aesthetic is both classic and unique,” Gerstein said. “It’s a very specific style that’s exclusive to us.”
Beyond selection, Brilliant Earth is very much a diamond jewelry 2.0 company. You can, for instance, build your own diamond ring on the brand’s site, equipped with scales for you to adjust price point, as well as shape, cut, carat, clarity, and color.
And while Brilliant Earth is certainly an innovator in this space, others have started to follow its lead. Forevermark is De Beers’ answer to consumer demand for ethically sourced diamonds (they come with an inscribed identification number so they can be traced). Canadian diamond brand Igloo prominently touts that its diamonds are mined in Canada. This wave suggests that not only are conflict diamonds ethically responsible, they are also good business.
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