In an exclusive interview with Shilpa Dhamija, the Swiss Better Gold (SBG) honorary board member PHILIPPE FORNIER, who has been involved with the association since its conception and launch, explains the motivation behind the formation of the SBG and its journey so far.
Switzerland is the world’s largest international transit hub for gold as it has 4 of the 7 biggest precious metal refineries in the world. Last year, Switzerland exported 1,560 tonnes of gold.
In the past few decades, Switzerland has been encouraging initiatives that promote ethical mining of gold, as a rising number of global consumers and stakeholders are soliciting fair practices in gold’s supply and value chains.
The Swiss Better Gold (SBG) association is one such organisation formed in 2013 to support Artisanal and Small-scale Gold Mining (ASGM) in following ethical and responsible practices.
Cartier, Chopard, and Metalor are some of the current members of SBG who use the gold sourced from accredited ASG mines. Since SBG’s inception, more than 13 tons of ASM gold, primarily from mines in Peru, Colombia and Bolivia have been imported into Switzerland.
The State Secretariat for Economic Affairs of Switzerland (SECO), too, has been supporting the SBG with public-funds through a public-private partnership. Together they have invested 18 million CHF from 2013 until 2025 towards the welfare of ASGM.
Over to PHILIPPE FORNIER:
Ethical mining of gold should apply to all mines. What triggered the formation of an organisation to support ASGM, in particular?
The idea came from an incident around 2007, when a friend of mine wanted to launch a jewellery brand in Switzerland that uses only ethically sourced gold but found it very difficult to find a clean supply chain for it. She couldn’t get the refiners or traders to provide the provenance of the gold that she was going to buy.
After talking to various stakeholders in the gold business in Switzerland, we launched the non-profit Swiss Better Gold Association to find a solution to this problem faced by many other members of the trade in Switzerland. We did a lot of brainstorming with the Minister of Economy in Switzerland, on how we can improve traceability and social responsibility of the gold that we import. So, we decided to start on a small scale with artisanal mines in Peru who were producing about 30-40 kilos of gold annually.
The State Secretariat for Economic Affairs (SECO) of Switzerland, in a public-private partnership with SBG, pumped about 6 million CHF over a period of the first three years to improve the social and environmental practices of selected mines in the South American country.
For us to work with overseas mines we also need local governments to cooperate. So, we had to look at that and the mine’s ability to adapt changes too.
What are the various ways in which the Swiss Better Gold Association helps small gold mines in South America?
While ASMs account for only 10-20% of global gold production, they employ 80% of the gold mining workforce. Our work on the ground is to support artisanal and small-scale gold mines to improve their mining operations and practices to meet the Swiss Better Gold sourcing criteria. We also provide them with access to international markets and, lastly, co-investing in projects to improve social and environmental conditions on the ground.
The gold that we source from these mines costs 1$ more per gram to our SBG members, who are happy to pay the premium because they know that the extra cost is to benefit the artisanal mines. Most of the funds that we subsequently gather are invested first in the welfare of these mine workers and the mining process. A small part of it is spent on selecting and approving new projects or mines.
The SBG has leveraged a total of USD 11 million in impact premiums from the private sector, which are reinvested in social, environmental (including climate change) projects in mining communities.
How do you ensure that the supply chain is correctly traceable?
We try to keep the supply chain short and facilitate direct exports between SBG accredited ASM gold producers and our member companies. We have people on the ground, and we do annual audits to ensure that the rules and regulations are followed, as well as establish an accurate production capacity of each mine to monitor any eventual volume variations.
In some cases, we support the accredited mines to achieve the Responsible Jewellery Council certification, too. We constantly scout and support small mines on the ground, monitor the improvements that they have made with our investments and support. The value chains that we have built have proven to be stable and reliable and are based on a relationship of trust between all actors.
The SBG Initiative is highly recognised in Bolivia, Colombia, and Peru by directly benefiting 6,000 miners (62,000 direct and indirect beneficiaries).
In May this year, 27 miners at La Esperanza, a Peruvian gold mine, lost their lives in a fire. This mine was a project under the SBG. What went wrong?
Our priority is to work with existing standards such as the Responsible Jewellery Council (RJC) and this mine was cleared under it. We don’t want to duplicate excellent existing systems.
SBG’s involvement in this mine was primarily focused on improving the conditions of the mining activities and supporting the formalisation of over 250 artisanal producers on the mine’s concession. The investigation into the causes of the accident is ongoing. Once it concludes, we will revise processes accordingly. We are committed to continue providing support to these artisanal miners.
The accident is a stark reminder of the risks associated with mining and the fragility of the local context, but also the necessity of not abandoning these miners to their fate. It also reminds us of our responsibility as buyers and consumers of gold-containing products.