Abstract:
The coloured gemstone industry is a rapidly growing sector, but it suffers from a wide range of governance challenges including pervasive informality, an opaque environment that favours corruption, and widespread fraud and anti-competitive practices throughout the value chain. This thesis examines three examples in which similar governance challenges have been addressed at an international level in other extractive industries: the Kimberley Process in the diamond industry, the Fairtrade and Fairmined Standards in the gold industry, and the Extractive Industries Transparency Initiative. Based on these case studies, a certification programme targeted at gemstone traders is proposed, coupled with the development of a premium market to incentivise adoption of higher, voluntary standards. Such a governance scheme would enable greater transparency and revenue collection and impede fraud, while providing upwards pressure on working standards for miners. Recommendations are also made for how transnational advocacy groups can drive development of such a governance scheme, namely by applying public pressure on the global gemstone industry while working alongside governments and industry at a domestic level to design optimal certification processes.
