Operations Manual Sale of Gold Coins


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Operations Manual Sale of Gold Coins

  1. 1. The Value of Ethical Gold By Payal Sampat Director of International Programs at Earthworks Good afternoon everyone. How’s everyone doing? Close to lunch – nap time yet? Stay awake for a little longer. It’s a real honor to be invited to speak here today. I really want to thank SNAG for welcoming us here, us outsiders, into your Board conference. I wanted to thank Susan and Christina for organizing this panel. As Susan mentioned, maybe it’s Christina, I’m the Director of International Programs at Earthworks, which is a not for profit environmental organization that’s based in Washington D.C. It was founded in 1988 and it was then called the Mineral Policy Center. We worked to promote environmentally and socially responsible mining practices and to protect communities and the environment from the impacts of irresponsible mining. I feel very humbled standing here today talking to a group of artists and crafts people about something that is central to your art, your work and your lives. In many ways it’s something that is central to my life as well, and I’m talking about gold. I was born, raised and have spent most of my life in India, in Bombay, India. You may know India as one of the world’s poorest nations but perhaps you didn’t know that India is, in fact, the world’s number one consumer of gold jewelry. My name, Payal, actually is the word in Hindi for piece of jewelry, it’s an anklet that’s worn around the ankles of many women, dancers. I was gifted handcrafted gold jewelry at birth and at other milestones in my life. When I got married my mother handed these down to me along with heirloom jewelry that belonged to my great-grandmother and her mother before her. Those beautiful pieces of handmade jewelry are some of my most treasured possessions. I have the utmost respect for the craftsmanship, artistry and hard work that went into creating that jewelry. In the same way, I believe that we, as consumers and makers of jewelry, need to be conscious into what went into mining the gold that we buy or sell. Today consumers and metalsmiths have a real opportunity to ensure that the gold we’re buying and selling was produced ethically, that it was mined in a way that did not hurt communities, workers or the environment. In the same way that SNAG members have set themselves apart from the mast produced jewelry market, you have the opportunity to distinguish yourselves as leaders in the ethical sourcing of gold. For a long time I didn’t really think about where the metal in jewelry, or anything else for that matter, came from. It took me a long time to make the connection between gold and the earth. Since 1997 I have researched, written about and worked to reform the mining industry and during this time I have been staggered to learn about the kinds of environmental and social impacts that gold mining is exacting on the planet. I’d like to share some of this information with you and provide you with a glimpse into the reality of large-scale gold mining. page 1
  2. 2. Gold mining as currently practiced is one of the world’s most polluting industries. This is no exaggeration. Using data provided by the mining industry itself, we have calculated that on average the production of one single gold ring, enough gold to make a single ring, generates some 20 tons of mine waste. That works out to several billions of tons of mine wastes left behind at every gold mine in the world, which there are hundreds, if not thousands. Leaving behind literally mountains of wastes of the kind that you see in this picture. Some of these mine wastes are polluted with dangerous chemicals like cyanide, mercury, sulfuric acid and arsenic, which are either by-products of mining or are used to separate gold from ore. Now everyone knows that cyanide is a deadly poison but probably you people know that, in fact, 90% of cyanide that’s consumed in the United States goes into gold mining, is used by the gold mining industry. Overall, mining is the number one toxic polluter in the United States. By it’s own reporting to the government, the mining industry produces 95% of all arsenic, 80% of all lead and 91% of all mercury measurements that are discharged by industry – discharged to air, land, water, soil, every form. In this picture you can see a common site that is seen in and around gold mining operations, or mining operations. Sulfuric acid that leaks out from the exposed rock, and this can continue not just for a few years but for tens of thousands of years, it’s known as the perpetual pollution that’s caused by mining. These enormous quantities of waste and chemicals are not easily or discreetly disposed of. There have been numerous spills of mine waste in recent years in cases like Spain, Romania, Ghana, even Colorado in the United States. page 2
  3. 3. This is an image of a spill involving cyanide tinged wastes from the Baya-Mara gold mine in Romania a few years ago which killed over a million fish in the Danube River and poisoned the drinking water supplies of several thousand people. At some mines, companies intentionally dump contaminated wastes directly into the ocean or into rivers. In cases like Indonesia, the Philippines and Papua New Guinea, this has deprived coastal communities of their livelihoods, harm to ecosystems and coral reefs and led to serious problems for communities who were exposed to those wastes. This is an image of the Aktedi mine in Papua New Guinea, which every single day – think about this – every day it dumps 120 thousand tons of contaminated wastes into the Fly River. That’s more waste each day than the entire waste production of Japan, Australia and Canada combined. Every day. page 3
  4. 4. I love this picture. This is one of the most beautiful places I’ve ever been to. It’s the Los Alerces National Park in Argentinia, Patagonia. A Canadian gold mine firm is proposing to build an open pit of cyanide heap leach mine on the edge of this park and unfortunately this is not the only wilderness area or natural reserve that’s threatened by mining. Metals mining threatens about 40% of the worlds pristine areas in places like Indonesia, West Africa, South America and, believe it or not, even in the United States. Some of the most irresponsible practices associated with gold mining have to do with the impact on people, on communities. Tom is going to be talking much more about this but I wanted to just touch on this briefly. About half of the gold mined worldwide is taken from indigenous peoples’ lands. In places as diverse as Peru, Indonesia and Native American lands in Nevada. Hundreds of thousands of people have been displaced from their homes, have suffered serious health problems, lost their livelihoods and suffered human rights violations as a result of mining violations. A recent report from Human Rights Watch documents how major mining companies have been complicit in massive human rights abuses in the Democratic Republic of Congo, including murder, torture, rape and forced labor, and here’s an image showing children working at these mines. Anglo Gold Ashanti, the second largest gold mine company in the world, developed links to the armed groups that were perpetuating those abuses in order to guarantee access to their gold mines. Much of this gold was, in turn, sold to refiners in Switzerland who sold to European and U.S. markets. page 4
  5. 5. I’m really sorry this has been something of a downer but for a change of pace, how about some good news? It really doesn’t have to be this way. Gold does not have to be produced at the expense of human rights or environmental protection. There are practical concrete steps that the mining industry can take to mine gold in more responsible ways. Here’s a short list of criteria for ethical mining and sourcing of gold. We informally have been referring to this as the gold rules. I’ve sort of simplified these in very nontechnical terms but when you take a look at that list there’s really nothing there that isn’t really basic common sense. The Golden Rules: Criteria for Ethical Gold • Respect all basic human rights. • Provide safe working conditions. • Respect workers’ rights. • Operate only with the prior consent of communities affected by a mine. • Disclose all information on the environmental and human impacts of mining activities. • Do not forcibly evict communities off their land. • Do not operate in national parks, fragile ecosystems, and other protected areas. • Do not dump mine waste into oceans, lakes, rivers, and streams. • Do not generate sulfuric acid in perpetuity. • Cover all costs of closing down and cleaning up mine sites. • Are not located in war or armed conflict zones. • Allow independent verification of all of the above. The key part of this is ensuring that there’s independent verification of all of the above. You wouldn’t want to be sourcing from a mine that says yes, we’re doing all this but no, we’re not going to allow outside observes or independent verifiers into the mine. So the independence is a very key requirement. I can’t point to a single mine that embodies all these practices that’s currently operating but a number of mines are implementing three or four or five of these different criteria. In other words, these are practical and pragmatic criteria BHP built on, which is the worlds largest mining company, has gone on the record to state it will not use the ocean dumping of mine wastes, and dumping mine wastes into rivers, that other mining companies for North America are continuing to do in South Pacific, indicating that you can still remain profitable while following ethical principles. Why aren’t these principles being implemented at mines right now? Well, it is becoming increasingly clear to us that one of the biggest hurdles to seeing these reforms implemented is that the mining industry and its track record have essentially been invisible; they’ve been hidden from view. People buying and selling and making products that used gold such as those of us in this room have very little information about the kinds of impacts gold mining is having and that gold can, in fact, be produced in ways that are far less damaging. page 5
  6. 6. In response to this absence of information a number of groups from around the world came together, including Earthworks and Oxfam, to launch to No Dirty Gold campaign on Valentine’s Day 2004. This campaign is in no shape or form of a boycott on gold. Rather, it’s an effort to educate those who make, buy and sell gold products and to enlist their help. The No Dirty Gold consumer pledge, which is on our website www.nodirtygold.org urges jewelry retailers and mining companies to offer them an alternative to irresponsibly mined gold. It has already been signed by over 10,000 people. Consumers are clearly indicating that there is a market for ethical gold. And this brings me to my second piece of good news for the day which is this: some of the world’s leading jewelry companies are already on our side. Christina beat me to this but here it goes again; Michael Kowalski, the CEO of Tiffany & Company, has gone on the record to state that he shares the campaign’s concerns about gold mining and supports our call for ethically produced gold. Less than two months after the campaign launch Tiffany & Company took out this whole page ad in the Washington Post which states: “We at Tiffany & Company understand that mining must remain an important industry but we also believe that reforms are urgently needed. Minerals should and can be extracted and processed and used in ways that are environmentally and socially responsible.” In recent months jewelry firms such as Helzberg Diamonds, Harry Winston, Cartier, Piaget and others have joined Tiffany & Company in calling for ethical gold and more responsible mining practices. In other words, there’s a real momentum building for this. One retailer wrote to us saying, “We are pleased to take these efforts not only because they embody our corporate culture and initiates but because we believe that our customers appreciate the value of protecting the world’s environment and human rights.” page 6
  7. 7. In other words, these leading names in fine jewelry have stepped up to take not just an ethical position but also to make a good business decision. There’s a real momentum that has built up, and now it’s not just human rights groups or environmental groups who are calling for change, but consumers, leading jewelry firms and financial institutions. We now have a multi-stakeholder group that is led by Tiffany & Company that has commissioned an expert study to establish certification criteria for responsible mining. The process isn’t completed but it is well under way. The position that Tiffany & Company, Harry Winston, Cartier and others have endorsed is very similar to the resolution that you are considering at this meeting. You can lend your voice as metalsmiths to the cause for responsible for mining and ethical gold. Consumers are becoming more conscious of mining’s impacts and are asking that the symbol of their love and commitment and partnership not be tainted by pollution or by human rights abuses. In recent months I personally received since the launch of the campaign – I personally received hundreds of e-mails from people who are getting engaged or married or buying an expensive piece of jewelry and they want to make an ethical purchase. They want to know where they can buy gold that was ethically produced. Even more so than consumers who buy fair trade coffee or sweatshop-free garments, people who are making that once in a lifetime purchase to convey their enduring love want to make the ethical choice. These are experienced lessons and consumers are willing to pay more money, if necessary, to ensure that their love is not tarnished by dirty gold. The jewelry that you make is laden with value and emotion, symbolizing love, commitment and beauty. There is another set of values that you could craft into the rings, bracelets and earrings that you sell; the values of conservation, protection and responsibility. You have a tremendous opportunity, both from a business and ethical prospective, one that I hope you will seize. Thank you page 7