The Cranfield School of Management and the Corporate Responsibility Initiative at Harvard Kennedy School have launched a joint report examining the creation of the Conflict-Free Gold Standard by the World Gold Council.
The report provides an important case study for Corporate Responsibility Coalitions and trade associations looking to develop common standards and self-regulatory mechanisms.
The Conflict-Free Gold Standard provides a common approach through which gold mining companies can provide assurance that their gold has been extracted in a manner that does not cause, support or benefit unlawful armed conflict.
The report’s findings include the need for Corporate Responsibility Coalitions and trade associations to demonstrate:
- Top-level and sustained commitment by individual business leaders and their companies
- Widespread stakeholder engagement and meaningful consultation
- Identification and inclusion of advice from credible, third-party technical experts
- Effective ecosystem-mapping and co-ordination with other relevant initiatives
- Credible, independent third-party convenors to facilitate stakeholder dialogue
The report draws upon over 600 pages of World Gold Council documents, as well as reports, draft regulations and other documentation from the United Nations Expert Panel on the Democratic Republic of Congo, the Organisation for Economic Co-operation and Development, the International Conference on the Great Lakes Region, the European Union and the US Securities and Exchange Commission.
Over 20 in-depth internal and external interviews including with personnel from AngloGold Ashanti, Barrick Gold, Fund for Peace, GIZ/International Conference on the Great Lakes Region, Global Witness, Goldcorp, Gold Fields, IAM Gold, Kinross Gold, London Bullion Market Association, Newmont Mining Corporation, the Organisation for Economic Co-operation and Development (OECD), PAMP, Rand Refinery, US State Department and the World Gold Council.
Edward Bickham, Visiting Fellow at Cranfield School of Management and the author of the report, said: “It is five years since the World Gold Council launched the Conflict-Free Gold Standard as a process to enable gold mining companies to provide assurance to downstream users and other stakeholders that their gold had been produced in a way which avoids fuelling conflict or financing armed groups. It was an ambitious initiative to define reasonable expectations of corporate responsibility for a mining operation in a high risk or conflict-affected area."
“The legitimacy of the Standard was entirely dependent upon striking a balance between what companies felt to be workable and what stakeholders felt to be necessary to create confidence in the integrity of the process. The case study describes the consultation process and how the companies ultimately overcame their natural suspicions of each other to agree upon a workable framework the legitimacy of which has been widely accepted.”
Speaking at the launch of the report in Washington D.C, Professor David Grayson, Director of The Doughty Centre for Corporate Responsibility, Cranfield School of Management said: “Behaving responsibly, being corporately responsible and encouraging other businesses to follow suit, is fundamental to restoring trust in individual businesses. Companies must take a leadership role on their own, but also be willing to work collectively in partnership with their peers and competitors to achieve industry-wide progress."
“Leadership on human rights and sustainability issues by business executives is more important than it has ever been, and this example from the gold mining sector illustrates what is possible.”