{"id":15806,"date":"2022-06-16T12:08:29","date_gmt":"2022-06-16T06:38:29","guid":{"rendered":"https:\/\/gjepc.org\/solitaire\/?p=15806"},"modified":"2022-06-16T12:57:55","modified_gmt":"2022-06-16T07:27:55","slug":"while-maybe-not-as-virtuous-as-narratives-suggest-there-is-a-place-for-esg-in-diamonds","status":"publish","type":"post","link":"https:\/\/gjepc.org\/solitaire\/while-maybe-not-as-virtuous-as-narratives-suggest-there-is-a-place-for-esg-in-diamonds\/","title":{"rendered":"While Maybe Not as Virtuous as Narratives Suggest, there is a Place for ESG in Diamonds"},"content":{"rendered":"\n

Environmental, Social, and Governance (ESG) may have finally peaked \u2013 at least in terms of its trendy corporate and investment culture narrative.<\/p>\n\n\n\n

In May, leading electric vehicle manufacturer Tesla was dropped from the widely-tracked S&P 500 ESG index, all while oil-major Exxon secured a top-10 position and oil refiner Phillips 66 was added. For context, Tesla\u2019s \u201cESG score\u201d didn\u2019t drop, other companies scores improved, overtaking Tesla. Tesla CEO Elon Musk frustratingly responded by Tweeting \u201cESG is a scam\u2026it has been weaponized by phony social justice warriors.\u201d<\/p>\n\n\n\n

Aswath Damodaran, a professor of finance at the Stern School of Business at New York University and vocal critic of ESG, recently said \u201cthe mask is off ESG\u2026it can\u2019t be measured\u2026(and now) companies like Exxon are (just) playing the game they were asked to play.\u201d<\/p>\n\n\n\n

We still need oil (which couldn\u2019t be clearer than it is at the moment), we need mining to produce metals to produce batteries for green solutions, and although more discretionary, people still want natural diamonds (which was made very apparent last year, marked by record global diamond jewellery sales) \u2013 so, despite the nauseating hypocrisy of \u201ccommercial\u201d ESG, having a framework for more sustainable business practices, especially for industries that most directly impact the environment, still holds value.<\/p>\n\n\n\n

And, while the public light may have finally been shed on the opportunistic political and economic spoils of the movement, it doesn\u2019t mean that some of the fundamental underpinnings of ESG won\u2019t still have lasting, positive, real-world impact. The narrative did get people thinking about a fairer, more just society, conscious of the choices that our decisions could have on future generations, especially as it pertains to the environment.<\/p>\n\n\n\n

Getting to the diamond industry, in recent weeks, De Beers, the world\u2019s largest diamond miner by value produced \u2013 and clear industry steward, released its latest iteration of \u201cBuilding Forever,\u201d the company\u2019s medium-term, relatively objective, \u201cblueprint to a better future.\u201d<\/p>\n\n\n\n

Notable goals include, becoming carbon neutral across operations, providing the \u201corigin and impact\u201d of every diamond the company discovers and sells, and \u201csupporting\u201d four jobs for every one operational job in the countries in which the company operates \u2013 all by the end of the decade.<\/p>\n\n\n\n

More specifically, the company is aiming to convert its truck fleet to hydrogen-fueled vehicles by 2030, an initiative De Beers\u2019 parent Anglo American is leading. Last month, Anglo unveiled a prototype of the world\u2019s largest hydrogen-powered mine haul truck \u2013 a 2-megawatt hydrogen-battery powered hybrid truck that generates more power than its diesel predecessor, allowing it to carry a 290-tonne payload.<\/p>\n\n\n\n

\"\"<\/a>
Anglo American\u2019s nuGen hydrogen-powered truck. Photo \u00a9 Anglo American<\/figcaption><\/figure><\/div>\n\n\n\n

Also, last month, De Beers announced that it is now using its diamond provenance \u201ctechnology platform,\u201d Tracr, to track diamonds \u201cat scale.\u201d Approximately, a quarter of De Beers\u2019 production has been registered on the platform so far this year, which utilises \u201cthe blockchain, artificial intelligence, and the internet of things\u201d to significantly increase the transparency of the diamond industry\u2019s supply chain.<\/p>\n\n\n\n

Importantly, De Beers has very publicly and clearly distributed its sustainability objectives, fairly setting itself up for scrutiny if it were to fall short.<\/p>\n\n\n\n

\u2014<\/p>\n\n\n\n

Paul Zimnisky, CFA is an independent diamond industry analyst and consultant based in the New York metro area. For regular in-depth analysis of the diamond industry please consider subscribing to his State of the Diamond Market<\/a>, a leading monthly industry report; an index of previous editions can be found here<\/a>. Also, listen to the Paul Zimnisky Diamond Analytics Podcast<\/a> on iTunes or Spotify. Paul is a graduate of the University of Maryland’s Robert H. Smith School of Business with a B.S. in finance and he is a CFA charterholder. He can be reached at paul@paulzimnisky.com<\/a> and followed on Twitter @paulzimnisky<\/a>.<\/em><\/p>\n\n\n\n

Disclosure: At the time of writing Paul Zimnisky held a long position in Lucara Diamond Corp, Star Diamond Corp, North Arrow Minerals Inc, Brilliant Earth Group and Barrick Gold Corp. Please read full disclosure at www.paulzimnisky.com<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Environmental, Social, and Governance (ESG) may have finally peaked \u2013 at least in terms of its trendy corporate and investment culture narrative. In May, leading electric vehicle manufacturer Tesla was dropped from the widely-tracked S&P 500 ESG index, all while oil-major Exxon secured a top-10 position and oil refiner Phillips 66 was added. For context,…<\/p>\n","protected":false},"author":7,"featured_media":15807,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[105,79],"tags":[],"thb-sponsors":[],"class_list":["post-15806","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mining","category-viewpoint"],"acf":[],"yoast_head":"\nWhile Maybe Not as Virtuous as Narratives Suggest, there is a Place for ESG in Diamonds - Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine<\/title>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/gjepc.org\/solitaire\/while-maybe-not-as-virtuous-as-narratives-suggest-there-is-a-place-for-esg-in-diamonds\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"While Maybe Not as Virtuous as Narratives Suggest, there is a Place for ESG in Diamonds - Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine\" \/>\n<meta property=\"og:description\" content=\"Environmental, Social, and Governance (ESG) may have finally peaked \u2013 at least in terms of its trendy corporate and investment culture narrative. 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