As we ascend the iconic Diamond Head, the 300,000-year-old volcanic cone on the Hawaiian island of Oʻahu, Don Proebstel and I continue discussing the sustainability nexus of innovation in the renewable energy sector and diamond mining. As we work our way to the top of the structures added in 1908 as part of the island’s coastal defense system, we come back to this question: What will be the sustainability drivers of a diamond’s journey from mine - or lab - to finger?
The Diamond Producers Association (DPA), a global alliance of the leading diamond mining companies, which represents 75% of the world’s diamond production, recently released its first independent research report on its members' impact on local communities, employees and the environment. The study, which was conducted by Trucost ESG Analysis and published in May 2019 (with data from 2016), finds the world’s diamond producers infuse billions of dollars in benefits into communities. Having been involved in ESG reviews, impact assessment and sustainability reporting in the mining sector in emerging markets worldwide (see here), this was not a surprise.
However, I was unaware that, on average, DPA members’ diamonds had a 70 percent smaller carbon footprint per polished carat of diamond compared to lab-generated synthetic diamonds (LGD), which have captured about two percent of the market. Truecost highlights that DPA’s members produce the equivalent of 160 kg of carbon dioxide per polished carat, which is equivalent to the amount of carbon dioxide generated by driving 390 miles (628 kilometers) in an average passenger vehicle. I wonder how many miles/km that would be in a hybrid, plug-in or hydrogen-fueled vehicle?
DPA’s membership will need to continue to demonstrate its broader, positive ESG impacts, including an increasingly more favorable carbon footprint. This means that operations in the lowest performance quartile in terms of carbon footprint need to become more creative. They need to figure out how to introduce more readily available and cost-effective renewable energy into their own – or perhaps their local communities’ – power mix. This would help avoid being shamed by ESG raters or, worse, shunned by investors, supply chain and consumers.