Fairtrade Gold is gaining ground

Germain Mottet
21 January 2019
Like the precious metals industry, the gold industry is shrouded in a considerable level of opacity. However, labels make it possible to authenticate the origin of gold, and the conditions in which it was mined. The emergence of Fairtrade Gold and Fairmined highlights the many issues surrounding gold mining.

Fairly-traded products are becoming more and more widespread. Nevertheless, there are still some products which we never would have thought could be fairtrade. Gold is one example. Did you know that there are now labels certifying the origin of the metal, the working conditions and the remuneration of miners? Fairmined and Fairtrade Gold have emerged as a guarantee of fairly-traded gold.


Controversial exploitation

Although these days, gold is a raw material with multiple uses (jewellery manufacturing, electronic components, etc...), it is nevertheless a high-value product. Its intense exploitation around the world is a source of environmental and social degradation. Industrial production has almost entirely taken over from artisanal work. As such, activity has expanded, but it has a more negative environmental impact than before.  Social conflicts have broken out among local populations, due to land grabbing. The working conditions of miners have not improved. Moreover, they are exposed to both toxic fumes and mercury. All this for a paltry wage. In addition, placer mining (gold exploration and mining) is accelerating deforestation in some parts of the world, including the Amazon.

The working conditions of miners have not improved. Moreover, they are exposed to both toxic fumes and mercury. All this for a paltry wage.

A gold miner working in Sudan
© iStock

Polishing the image of the industry

The Fairmined and Fairtrade Gold labels certify that the gold comes from small artisanal cooperatives that pay workers a fair wage. These organisations must be accountable and democratic so that their members can benefit from a fair price. A Fairtrade bonus allows them to carry out joint projects. These labels ensure better working conditions, social development and environmental protection. They also ensure that child labour is eliminated, and they focus on the traceability of gold, from the mine to the jeweller.

Certification is helping to rebuild a positive image of the gold industry. The labels apply the resolutions of international organisations, including Convention 169 of the International Labour Organization (ILO). This convention requires that mining companies consult with indigenous peoples and share the proceeds with them. The reality is still too often a far cry from this requirement.

Gold in figures

  • The manufacture of one gold ring requires 50,000 litres of water and produces 20 tonnes of toxic waste;
  • 80 to 95% of gold production is industrial;
  • There are an estimated 15 million artisanal miners, or 15% of the total;
  • 30% of certified gold is fairly-traded;
  • Fairly-traded gold is only 10 to 15% more expensive;
  • There are currently at least 16 goldsmiths using Fairtrade Gold in Belgium.

The alternative: labelled gold

It may seem difficult to shake up the industry's methods, but some actors are attempting to do just that. One example is the Syanyonja Artisan Miners’ Alliance (SAMA), an organisation of miners in Uganda. The SAMA obtained the Fairtrade label in 2016. It brings together 600 miners. The organisation was required to comply with certain conditions, such as eliminating the use of mercury and child labour. The SAMA is supported by the Belgian Development Cooperation, through the Trade for Development Centre - TDC, and has received nearly €100,000 in funding. Investments in facilities, assistance with certification, and finally marketing coaching, have helped establish a sustainable strategy for the organisation. This example is intended to inspire other initiatives around the world.

There are currently at least 16 goldsmiths using Fairtrade Gold in Belgium.

A gold smith at work
© iStock

Facilitating access to the market

Once gold has been mined, it still needs to be sold. While traditional channels give preference to industrial gold, fairtrade gold is not as well-known. The solution is networking. CATAPA, a volunteer organisation based in Ghent, realised this. CATAPA raises awareness, is involved in lobbying, and fosters cooperation between actors in the industry. Primarily active in Latin America, the organisation also monitors mining areas in Greece and Romania. Through its "Generation Transition" campaign, CATAPA trains young people in sustainable development in the mining industry. One of the objectives is to create a system of intermediaries to market ethical gold.

Making the gold industry ethical is also the mission of Humanum Gold. This is an initiative by Vicente J. Balseca Hernandez, with the aim of creating the first ethical gold industry in Belgium. It intends to offer development opportunities to mining communities. It is not philanthropy, but the tools to achieve self-management. The biggest challenge is to convince local populations to change their methods. The costs associated with certification are also a stumbling block. Despite all this, the sacrifice opens up commercial opportunities and ensures transparency for consumers.

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