As the biggest seller of jewelry in the world, Pandora could move the industry forward with its lab-created diamonds
Transparency in the jewelry industry
In many ways, the fashion industry and the jewelry one is similar – for a garment or a stone to be sold, it passes along a long route and many hands that cut and process it to become the final, dazzling piece. While the global jewelry market is estimated to be worth £230 billion (compared to the fashion industry’s 1.5 trillion in 2020), sustainability has not been as big a part of the conversation as it should be until recently.
Jewelry production has been heavily involved with international conflict and media stories focused on trade wars on the African continent as well as worker rights abuses. With the dawn of the millennium came new legislation to curtail the links and bring the jewelry industry into the future. Schemes like the Kimberley Process, created in 2000 ensure that conflict diamonds are eradicated. Since its foundation, it has claimed to have rooted out 99.8% of global production of conflict diamonds.
Pandora 2021 sustainability report
There are still other areas where the industry must do more, from showing wage transparency across the continents to sustainable packaging and less environmentally intensive sourcing and processing. For some companies like Pandora, these questions have been the focus of their sustainability strategy since their inception. In their latest sustainability report for 2021, President and CEO Alexander Lacik highlights that, «Investors increasingly consider Environmental, Social and Governance (ESG) performance alongside traditional financial metrics, and consumers prefer brands with strong social and environmental profiles», showing the need for change in a sector that holds a lot of capital.
As the biggest seller of jewelry in the world, coming to about $3 billion a year across 100 countries, Pandora is at the forefront of the affordable jewelry sector. The brand has always worked with gold and silver and semi-precious stones to focus on bringing craftsmanship through an affordable model. Now it is introducing a collection made of lab-grown diamonds that could change the jewelry industry.
Lab-grown diamonds: affordable jewelry and with lower carbon footprint
Pandora has not worked with diamonds before – the new Brilliance collection, initially launched in the UK, is a market opportunity that could bring the gem to millions of its customers. As Corporate Communications & Sustainability Vice President at Pandora Global, Mads Twomey-Madsen is at the helm of the sustainable conversation around Pandora’s shift to lab-grown diamonds.
«There are two reasons for us doing this – one is that the lab-created diamonds have reached a cost level and they have become cheaper. The concept of Pandora is ‘affordable jewelry’. We can now offer diamond jewelry to people that would not consider it earlier because it was too expensive. It fits with our product concept, our value proposition and then at the same time, the carbon footprint of lab-grown diamonds is lower than the alternatives. It becomes part of our journey in becoming a low-carbon company that brings down the entire carbon footprint of our company».
Lab-grown diamonds
Others have looked to different models to solve the natural diamond dilemma. Luxury companies like De Beers, are using blockchain through its Tracr program to create an alternative to lab-grown diamonds that are ethically produced. While diamonds typically must be mined to be used in jewelry, the lab-grown diamond has been around since before 1956 when it was used in the industrial sectors. With the introduction of better-quality chemical vapour deposition (CVD) diamonds onto the market, ‘natural’ diamonds for jewelry were not the only ones available anymore. Lab-grown diamonds became more popular as the links to global conflict were highlighted in the media, which created a quandary for traditional diamond jewelry companies.
The affordability of lab-grown diamonds
In recent years, lab-grown diamonds have become cheaper to produce, bringing their affordability to new markets. Lab-grown diamonds are also resource-intensive and can take a lot of energy to manufacture, similarly to other new technologies like cryptocurrencies. «The key part in this when you look at sustainability for lab-grade diamonds is that they require a lot of energy. When you make sure that the production of the diamonds is made with renewable energy though, that gives you a very low CO2 footprint. With our global launch next year, we expect that the production will be at 100% renewable energy». These efforts showcase the possibilities of integrating innovations in a sustainable way across the industry that frequently uses diamonds, especially in bridal markets.
LEED (Leadership in Energy and Environmental Design) certification for Pandora facilities
While most companies have made an effort to position their brands as ‘sustainable’ and showcase their action across social media, the company has been growing out its annual sustainability reports as well as promoting transparency across its website through a series of in-depth sections. The development has also extended to a scrutiny of its precious metals that are certified according to the standards of the Responsible Jewelry Council and are now going to be recycled at the factory.
«We put circularity as one of the three pillars in our sustainability work. We set out to become a low-carbon, circular and inclusive company and we put circularity at the highest pillar. A circular economy is crucial to how we develop our societies, our economy, and our businesses. One of the main things that we did recently was to decide that we will shift all silver and all gold to come from recycled sources. We did that because it’s circularity at its core, especially as these materials can be used repeatedly without losing their properties. We also want to make sure that the third-party components are made with recycled materials and we’re on track to getting that done within our target of 2025. That has a big impact on the climate as the use of recycled silver and gold has a much lower CO2 footprint than using materials that are not recycled».
While many jewelry brands work with small suppliers or artisans across the world, making the supply chain long and hard to scrutinize at times, Pandora produces most of its jewelry in-house at the facilities in Thailand. These have been awarded the LEED (Leadership in Energy and Environmental Design) certification for their sustainable features, including water efficiency and materials used, as well as a minimizing environmental impact. It has also heavily invested in its workers – both on the shop floor and within its factories.
Lampoon reporting: Pandora’s transparent supply chain and recycled silver and gold
Twomey-Madsen affirms that «We have high visibility of everything that goes into crafting and when it comes to our suppliers, we also have a relatively consolidated supply chain compared to some other industries who have quite a few, very large suppliers. That allows us to have high transparency and high control of what is going on. We also have an extensive community engagement around our facilities, covering everything from engagement with health programs, personal finance, health, health education, but also a long-standing program on engaging with schools and repurposing or restoring schools in the community».
The company focuses on waste, showcasing a way of thinking about the supply chain from end-to-end in line with the themes behind doughnut economics and a circular approach. «We have mapped out the main waste streams that are associated with the manufacturing of our products. On all of those, we have high recycling ratios and, in some instances, even 100%». This focus on transparency all the way down to the factory level is rarely seen and paves a way forward for social-media agile companies that want to bring in the same level of sustainable action to their younger consumer base. An approach towards sustainability that prioritizes good practices, values its workers should be the cornerstone on which all jewelry companies are built, but this is not always simple to turn into practice.
Pandora
Headquartered in Copenhagen, Denmark, Pandora employs 26,000 people worldwide and crafts its jewelry at two LEED certified facilities in Thailand using mainly recycled silver and gold. The company plans to be carbon neutral by 2025 and has joined the Science Based Targets initiative to reduce emissions across its full value chain. Mads Twomey-Madsen holds the title of Corporate Communications & Sustainability Vice President at Pandora Global.
