Indian jewellers have no idea if their suppliers violate human rights

Top Indian retail jewellers are now under the lens for not putting in place systems to track possible human rights violation within their supply chains.

While the companies themselves may not be following unethical practices, a report by New York-based nonprofit Human Rights Watch (HRW) says they are unable to explain how they monitor any abuse while sourcing gold and precious stones.

Among those named in HRW’s report, released last week, is India’s largest chain of jewellery stores, the Titan Company-owned Tanishq, which is part of the Tata group. Tanishq runs close to 240 outlets and three manufacturing facilities in India, with a turnover of Rs10,237 crore (pdf) in the financial year 2017.

The company was termed “very weak” in HRW’s rankings of 13 global brands, with “no evidence of steps towards responsible sourcing.” The report also named others such as Kalyan Jewellers and Tribhovandas Bhimji Zaveri (TBZ). HRW did not rank these two jewellers as there’s no publicly available information on their supply chain policy.

India is home to an estimated 410,000 jewellers, according to the World Gold Council, and is one of the world’s largest importers and consumersof gold.

The report ranked some of the world’s top retailers such as Bulgari, Cartier, Chopard, Christ, and Harry Winston. These retailers were ranked from “excellent” to “very weak” apart from “no-ranking,” depending on the responsible sourcing practices they followed. The list does not include suppliers of precious metals and stones.

No due diligence

The advocacy group’s concerns on Tanishq range from “vague” corporate social responsibility policies and a lack of assessment of human rights violation risks in its supply chain, to an absense of third-party audits to ensure compliance on such issues.

Tanishq just doesn’t publicly disclose the suppliers it works with, the HRW report said. “Tanishq does not have a full chain of custody for its gold and diamonds. The company seems to rely on the reputation of its suppliers and sources a large portion of its gold from well-known international banks,” the report added.

On child-labour, the report noted that while Tanishq has identified the issue in Indian manufacturing as a potential risk, “it does not appear to carry out its own assessment of human rights risks in its international supply chain.”

The company, however, dismissed HRW’s allegations. “Titan is not in agreement with many dimensions of the framework used by the NGO,” CK Venkataraman, CEO of the company’s jewellery division, said in an e-mail.

Tanishq, he said, sources gold and diamonds from reputed international banks, bullion dealers and refineries. “It would be unfair and impractical to expect Titan to exercise such oversight on their processes and policies and would, in fact, tantamount to a transfer of accountability,” Venkataraman said.

E-mails sent to the two other Indian firms, Kalyan and TBZ, remained unanswered.

India is one of the world’s largest markets for gold jewellery with an estimated annual demand of 727 tonnes. Here the bulk of jewellery is sold through small, unorganised stores.

For years now, human rights groups have flagged unethical sourcing of gold and diamonds the world over, often involving child labour and harsh working conditions. However, the industry’s supply chain is fairly complex, making it hard for retailers, who procure precious gems and metals mined across the world and sold through manufacturers, bullion dealers, and traders, to keep a tab.

“We very much hope they (Indian retailers such as Tanishq) will publish much more on their sourcing practices and publish names of their suppliers,” said Juliane Kippenberg, HRW’s associate director for children’s rights and co-author of the report.

Venkataraman, on his part, said that Tanishq is in touch with legal experts to “determine the manner in which all this information, including details about its suppliers, are to be made public on a regular basis.”

Courtesy: Quartz India, Image courtesy: Reuters