Industry lays emphasis on the need of 'ethical sourcing' of gold

ABU DHABI (Scrap Monster): Dubai intends to implement a new system whereby gold jewelry retailers will have to ensure that the traded gold is obtained only through ‘official channel’. The accreditation process is expected to be implemented across the industry within 18 months. The move aims to ensure that no gold traded in Dubai are sourced from strife-hit countries through unofficial channels.

According to Tawhid Abdullah, Chairman, Dubai Gold & Jewellery Group, the new system will be implemented in two stages. In the initial stage spanning six months, the gold retailers will be educated to create awareness of the need for ethical sourcing. The second stage that lasts for twelve months must be utilized for entering into contract with authorized agencies to ensure that transactions carried henceforth are only through official channels.

Of late, Dubai has become a hub of gold trade. Although there have not been any allegation so far regarding the source of gold traded in the region, the new process will further enhance the credibility of gold trade. It is intended to lay foundation towards foolproof sourcing and selling mechanisms for the future. Retailers are being urged to comply with the new accreditation requirements in order to ensure that the gold supplies in the region are not from questionable sources.

The trade participants are urged to comply with the template set forth by the Organization for Economic Cooperation and Development (OECD). Local jewelers are also required to ensure that the OECD guidelines mentioned in ‘Due Diligence Guidance for Responsible Supply Chains of Minerals’ are strictly followed by conducting thorough audit of their supply chains. By this way, it could be ensured that the gold reaching the manufacturing units are obtained only from legal and legitimate sources.