This October, CIBJO – the World Jewellery Confederation will hold its annual congress in Bogota, Colombia, and shortly after that the delegates of the World Federation of Diamond Bourses (WFDB) and of the International Diamond Manufacturers Association (IDMA) will gather in Mumbai for their biennial congress – the 38th! There will be a lot to discuss, since the global diamond, gem and jewellery trade is facing lots of pressing issues and challenges.
This past July, the United States Federal Trade Commission released the final revision to its “Guides for the Jewelry, Precious Metals, and Pewter Industries.” These guides focus on advising U.S. marketers and those marketing in the U.S. how to make claims about jewellery products that are not deceptive to consumers.
It is clear that the FTC rules have a much greater and wide-spread impact than just on the US market. Take, for instance, the elimination of the minimum threshold fineness for the use of the terms “gold” or “silver” – 10-karat fineness for gold, 900 parts-per-thousand for coin silver, and 925 parts-per-thousand for sterling silver – allowing marketers to use the terms “gold” to describe products under 10-karat gold so long as the fineness is disclosed – for example, “8-karat gold.” A radical change!
At the same time, the changes in the FTC rules have truly shaken the global diamond industry since the new rules now define laboratory-grown diamonds as sharing essentially the same optical, physical, and chemical properties as mined diamonds. The new rules also allow marketers to use words or phrases other than the ones listed in the previous guides – “laboratory-grown,” “laboratory-created,” “[manufacturer name]- created” and “synthetic.” And, to add insult to injury, the revised guides removed “synthetic” as a recommended descriptor, but do not prohibit the use of that term to describe laboratory-grown diamonds. These changes have long been coming and are a clear response to the demands from the sales floor…
What will the global industry gem and jewellery industry’ reaction to these substantial changes be? Will it be viewed as an opportunity or as yet another threat to the vested order?
Following the publication of the new FTC Rules, the first reactions we heard and read from gem and jewellery industry officials and operators were of the latter and of a – typical – ‘knee-jerk’ type: We don’t want these rules, we won’t accept them, and we will fight them, tooth and nail. We, the mid-stream, the manufacturers and the traders, are pulling up our bridges and barricading the gates and we’re going to defend our positions…
At the congresses in October, which are the preeminent platforms to discuss these matters, the central question to ask and resolve would be: Isn’t it time that organizations like ours i.e. CIBJO or the International Diamond Council, the joint body of the WFDB and IDMA in charge of nomenclature, change our ‘horizontal’ approach to a ‘vertical’ approach?
Indeed, for decades we have witnessed diamond, gem and jewellery industry professionals and operatives setting their rules, regulations and nomenclature within and for their own layer of the industry – hence the use of the term horizontal – according to their own and often academic, narrow interests and reasoning.
Maybe, just maybe, the time had come for those operatives and professionals to give up their – long-time – seats to members of the next generation who have a clear view and full grasp of the vertical nature of our industry and trade, to driven professionals and operatives, skilled, trained and ethically sound, who are closely connected to market trends and developments in the downstream markets and who understand, embrace and are comfortable with change as the only constant in their current, vertical business environment?
I am sure that for many of these veterans, giving up on long-time held convictions and beliefs will be difficult, even more when they will be asked for their understanding, cooperation and ultimately their agreement to a new set of harmonized nomenclature. It will be a painful, arduous, process.
The CIBJO and WFDB/IDMA congresses in October are a grand opportunity to finally do away with the ‘isolationism’ that has for so long stood in the way of the so much needed synchronization of market trends with industry nomenclature. It will take courage, resolve and determination, not whining and reminiscing about the good old days, to induce these processes. For diamonds and diamond jewelry to remain desirable, salable, marketable to the consumer, the diamond industry will need to follow market trends and begin speaking the language that those who put down the cash for their product can understand and are comfortable with.