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 ‘Tesco is to tailor adverts in petrol stations by using face scanning screens’ according to The Grocer magazine. Detractors are already lining up to condemn the idea; likening the retailer’s efforts to something out of George Orwell’s Nineteen Eighty-Four, and threatening to never darken their doorsteps again. The company’s cause hasn’t been helped much by the MD of Amscreen, the makers of the technology, allegedly saying, “It’s like something out of Minority Report”. The hyperbole is almost guaranteed to cause apoplexy amongst civil liberties campaigners, and is a gift to conspiracy theorists, but is this latest development as sinister as it first seems?

At first glance the technology isn’t nearly as advanced as the facial-recognition tools used with varying degrees of success in many security applications to identify individuals and place them at the scene of a crime. If Tesco’s scanning can only establish age and gender, the data generated is stereo-typical rather than specific, rather like that collected by social media sites. So, maybe the real issue here is not this actual development but the sheer ubiquity of Tesco – its TV advertising already resembles brainwashing – plus the plethora of bigger questions it prompts!

Will legislation governing the disclosure of data captured by face scanning appease public concerns about snooping?  Will capturing children’s images be acceptable when the technology migrates from petrol stations – where most customers are adults – to supermarkets? And if so, will all the effort of putting tantrum inducing sweets out of sight have been wasted once kids are stimulated into a frenzy of nagging by checkout adverts aimed right at them?

Michael Hoare
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A few days ago I spoke at a Fairtrade Foundation gold meeting in London – standing in for Vivien Johnston – and was privileged to meet the miners from Peru and Bolivia who supply the raw material, and to hear first-hand their accounts of the conditions under which they work.  Their stories are a powerful testament to the benefits that can accrue from certified gold, and the positive effect that it has on local communities and people. I came away convinced that Fairtrade Gold has a pivotal role to play in building a traceable and transparent supply chain. Having noted the difficulties that had faced UK industry I was delighted to receive a positive response in return

Fairtrade Meeting (3) Oct 13

Consumer tastes are changing! Influenced by new products; technological advances; economic circumstances; and latterly concerns for the environment and the future safety of the world in which we live. This has not happened overnight. Environmental activists have been working for more than forty years, to raise awareness of the ecosystems on which we all rely.

Hand in hand with environmental concerns we have grown aware of the terrible price sometimes paid by the people who bring us the necessities that we take for granted. The result is that consumers’ relationships with the goods they buy are far more complex than ever before, and there has been a welcome rise in the number of people who want to buy ethically.

The last decade has seen considerable change in the jewellery sector. Many more miners, raw material processors, designers and jewellers want to act responsibly and ethically, and with due respect for the planet and the people that populate it. In that time there has also been a flourishing of ethical initiatives touching on all levels and segments of the sector. However the supply chain is very complex, with a proliferation of companies and individuals playing their part in bringing products to market. The result is a web of sometimes complimentary, sometimes conflicting, and often over-lapping schemes, each with their own priorities, timescales, and objectives. And of course the world does not stand still.

The result is a matrix that is not easy to navigate. Customers seeking greater understanding, and jewellers committed to the ideals of ethical trading, find themselves baffled by the plethora of initiatives. A couple of years ago, The National Association of Goldsmiths (NAG), the British Jewellers Association (BJA), and the Gemmological Association of Great Britain (Gem-A) came together to form a joint ethics working group to try and answer some of the more pressing questions; put the initiatives in context; and devise some straightforward and un-ambiguous guidance for jewellers. So, the Ethics Working Group coalition is formed of the three largest trade associations of the British jewellery industry, with occasional input from CIBJO, the World Jewellery Confederation. The NAG represents the ‘selling’ part of the industry, the BJA the ‘making’ part, and lastly, the Gem-A is a prestigious educational resource, having many thousands of students and graduates around the world.

These trade associations all have different roles to play. However, one common thread is a sincere commitment to improvement in the jewellery industry. They are also firmly united in the promotion of best practice in UK jewellery businesses. This ultimately means advocating industry-wide awareness of the challenges within the supply chain. But it also gives them an opportunity to engage closely with suppliers and to form strong partnerships with those who share this commitment.

Consumer tastes and preferences constantly change. Jewellery, as a luxury item, now competes with new products –computers, gadgets, holidays, and even experiences, for the consumer’s disposable income. Since the beginning of the recession in 2008, economic circumstances have put increasing pressure on consumers who want to keep up with the newest products on the market. Also, materials like plastic, wood, rubber, and non-precious metals, have become commonplace in jewellery manufacture. The number of items containing gold, silver, platinum, and palladium, and Hallmarked in the UK, has dropped dramatically over the last decade. From 35 million in 2003 to just over 9 million last year.

The result is that consumers are more selective than ever before, but this has not affected the number of people who want to buy fairly and ethically! Sales of ethical goods and services have increased despite the recession, growing to more than £47bn last year. And a Co-operative Bank report calculates that since the economic downturn, five years ago, the value of ethical markets including Fairtrade products, green energy, free-range and sustainable food, has grown from £35.5bn to £47.2bn. The same report shows that sales in ethical consumer markets have grown from £13.5bn in 1999.

In the last decade there has been a considerable shift in the jewellery sector. Across the globe there is a shared ambition for people to act responsibly and with due respect for the environment and other people in the supply chain. Many more miners, refiners, designers and jewellers have come to realise that they want to do ‘Good Business’ with each other whilst protecting the environments in which they live. The challenge is to connect these networks!

minersGold is treated as a commodity by investors, and is valued for its properties as a conductor by electronics companies, and in the automotive industry. However, 43% of gold represents something quite different. Jewellery has no use! It is pure ornament! Yet globally, it represents the largest use of gold!

Jewellery is a sentiment, an emotion and a passion. And pride is one result of the design innovation, the technical virtuosity, and the quality of the materials, which are intrinsic to the product itself. Luxury jewellery companies understand the pride their customers feel when they wear a piece of their jewellery. It’s not simply a product. It’s imbued with an identity, a brand, a personal statement.

Consumers now expect that pride to extend to ‘ethics’. They have become a core ‘brand value’ for many jewellery companies. The most future-thinking brands see the benefits of forming strong strategic partnerships with miners. They want gold mined by people who share their pride, passion and commitment. They want to know that every piece of the supply chain is something to take pride in. Recognising these shared values is one thing. Implementing them is quite another!

The world does not stand still. It is constantly re-shaping around us, depending on politics, economics and individual growth. Continual adjustment is requires to make sure our values remain aligned, and we continue to be accountable to each other.   The Fairtrade label has a long history of delivering a ‘brand’ of ethics to a range of consumer products including coffee, bananas, and chocolate.

As we know, gold has its own complexities. However, since 2011 Fairtrade has brought their trusted label to the outlets of some of the leading jewellery designers in the UK. The UK ethics group wholeheartedly supported this, but in 2012 it recognised that there were some factors which were preventing larger companies from adopting ASM-sourced gold in their supply chain. And, in turn, this was preventing Fairtrade from scaling-up gold production from their miners.

So, it conducted a series of industry consultations and workshops; taking stock of the issues of human rights; negative community impacts; and environmental threats that exist within jewellery supply chains – and ultimately undermine consumer confidence in the business. It also engaged with NGO’s who have campaigned to highlight such issues, or have lobbied for improvements from the sector. Next it held consultations with representatives from the gold industry and heard from their perspective why they found it difficult to achieve transparency.

There have been numerous new standards created which affect gold. These include the World Gold Council’s Conflict Free standard; the OECD Due Diligence guide for conflict minerals; the Responsible Jewellery Council’s chain of custody certification scheme, and the US Dodd Franks Act. They were examined to see how they applied to the trade – from refiners and bullion dealers to manufacturers – and the investment banks who hold the bars in their vaults. Even the London Bullion Markets Association (LBMA) Responsible Gold Guidance were studied. The committee also looked at the challenges businesses faced in complying with these standards.MinersFromSotramiFairtradeGoldMinePeru

The supply chain was simply not designed with transparency in mind, and there are too many stumbling blocks between mining and processing the gold; to the way it’s handled by banks and bullion dealers at a national level. In February this year, the committee published a ‘Gold Paper’ which looked at all aspects of the gold supply chain and identified the ‘choke-points’ that prevented companies from achieving transparency, traceability and improved accountability. It also contained ten recommendations towards jewellers achieving transparency.

Until recently there seemed to be two aspects of Fairtrade gold which were limiting growth. One was the price structure, which, given the already high price of gold, made it difficult to be competitive. The second was the marketing strategy. It needed to be more visible to consumers of small brands, but this wasn’t necessarily acceptable for companies who didn’t want to appear to ‘co-brand’ with the Fairtrade label.

The ethics committee wrote to Fairtrade emphasising the important benefits it could bring to small-scale miners, and the rank and file of the jewellery profession. Pointing out that the majority of jewellery consumers are unaware of its existence, and calling on Fairtrade to invest into the national marketing of Fairtrade Gold to the British Consumer. They were confident that this would add real ethical value to the trade’s standing. Feedback from consultations also showed that Fairtrade could exert considerable leverage on the rest of the supply chain to source responsibly.

Lastly, whilst it is accepted that traceability means extra costs, it was felt that a premium of 10%, over continually rising gold prices, effectively priced this valuable gold product out of the market. Most importantly, addressing this would also make the market even more accessible to miners who have worked hard to fulfil their own ambitions.

In 2011, World Gold Council figures showed that world gold demand was approximately 4,500 tonnes. Of this, 43% was used for jewellery; 10% for technology; 37% for Investment; and 10% for official sector purchases. 70% of that demand was met from primary sourced gold. The balance – of 30% – was met from recycled gold. Scrap gold plays an important partin the UK, but there is still a significant hole to be filled by Fairtrade gold.

Britain still supports many small workshops and retailers. They find it difficult to comply with new regulation. Equally, small scale miners around the world, who are reliant on the success of the UK industry, and access to our markets, need support to achieve the changes we ask of them. Our aim should be to ensure that British businesses are at the forefront of positive and sustainable global change and that certified Fairtrade gold miners share that success!

Michael Hoare

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Twelve years on the periphery of the jewellery industry and my association with SaferGems taught me that security is never far from a jewellers’ mind – or shouldn’t be – but I also learned to my horror that they occasionally skimp on spending when it really matters. Sometimes taking the lowest quote rather than getting the right solution, accepting the lowest common denominator so they can ‘tick the right boxes’,  and get the cheapest insurance quote. There are lots of examples in physical security – not least when it comes to glass – where under investment is shortsighted, but with the increasing use of private security operatives, contracted in guards are one area where jewellers really can’t afford to take a short cut.

I was reminded of this when, at a recent conference, Ian Kirke, director at Training for Success (TFS), asked delegates to consider if the cheapest is always the best. Ian writes:

In terms of price there has to be a tipping point below which the patrolling guard is either on the minimum wage or dangerously close to going under. And remember they need to turn up in some form of clothing and must have a back of house administrative function. Being SIA trained, to use the words of Shania Twain, “That don’t impress me much”! That’s the law, so get over it! And is that baseline status enough? Surely if procurement can buy an SIA qualified guard at the cheapest rate then surely that has to be happy days for the business concerned? According to George Gershwin and recent case-law I would suggest that, “It ain’t necessarily so”.’

You can read the rest of his thoughts in his accompanying article in Professional Security magazine: http://www.professionalsecurity.co.uk/news/case-studies/dont-be-led-by-price-only/

Michael Hoare

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Should be a must-read for the jewellery sector and anyone who wants to make the world a better place.

It’s not often that you read a book that is so absorbing that you feel compelled to finish it in a single sitting. But then it helps if you yourself witnessed many of the events described within its pages! Subtitled Fighting for Fair Trade Jewellery, Making Trouble traces Greg Valerio’s progress from bolshie youth to campaigner and activist. His fight for a transparent supply chain in the jewellery industry isn’t over yet, but his tireless work has led an industry driven by luxury and romance to the realisation that not all in their garden was lovely. And it has spurred others to try to redress the balance of inequalities heaped on the many by the few in the pursuit of riches.

As a fellow traveller for more than a decade, I have often felt frustrated and wearied by glacial progress and the continual need to restate an argument that appears so obvious. But Greg’s book is a timely reminder of just how far the jewellery trade has come in that time. Not that trace-ability and transparency in the jewellery supply chain is a done deal yet, but at least the dam has been breached!

Michael Hoare
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The repeal of the Trucks Act in the mid 1980’s changed workers’ relationship with their wages for ever. A series of Acts in force since the 15th Century were designed to protect workers from bondage to company stores. With the abolition of the Act workers lost the right to request the payment of their wages in cash, and thus began our bondage to the banks. Suddenly, people who had been accustomed to budgeting by the simple expedient of putting their rent in one draw and their housekeeping money in another, were faced with dealing with money as a concept rather than a tangible object. Of course, the change rid employers of the burden of carrying cash and saved many a man from the temptation of handing his weekly wages over the bar on pay day, but it has also inextricably linked the individual to his bank through his deposit account.

For decades, having no bank account meant effective marginalisation within society. But now banks are set to take an even more intrusive role in everyone’s lives. Not only do the banks decline to give a worthwhile return on deposits, they are also mining depositors’ data and selling it to add to the profits they make on lending their money. And the big news is that UK retailers such as Morrison’s, Argos and Pets at Home are signing up to buy consumer data in an effort to predict future spending.

According to reports in Retail Week, ‘US data analytics firm Cardlytics has partnered with Lloyds Banking Group to provide Halifax customers with targeted deals. The service, called Halifax Cashback Extras, will launch in September with offers from retailers including Homebase, New Look, Ocado, The Body Shop, Urban Outfitters and Oasis. The service is the first in the UK to use customers’ banking data to provide targeted retail offers’.

“So what!”, you might say, “I’ve got nothing to hide”; and personally I’m not too worried about privacy either. It is so far eroded already as to be almost irrelevant to this debate. I’m more concerned about the rising tide of predictable drivel coming our way as a result of their efforts.

Anyone who ever made the mistake of handing over their details is accustomed to the never-ending stream of rubbish littering their inbox. I once gave my email address and mobile number to Dwell in exchange for a catalogue and thereafter had the  Sisyphean task of deleting enticements to buy their furniture. What they, and many others, can’t grasp is that just because I once made a vague inquiry about their products I didn’t  fall in love with them, and their persistence makes me less likely to do so! Many other retailers – including ones I like – top up my inbox on a daily basis, and on an equally regular basis I throw their electronic rubbish away! It’s become part of my computer hygiene regime; a bit like cleaning my teeth!

I suppose the major difference with offers generated from analysis of my spending patterns is that they will focus on things I’ve already bought rather than just idly inquired about. So, unless they use their intelligence and creativity, am I going to be bombarded with offers for stuff I’ve already got? Much depends on the way they interpret the data. For instance, I recently went to Peru. If the data miners use that information in the usual way, am I going to get endless offers of woolly hats, Pisco sours, and meals in Lima?

Spending data inevitably reflects what has already happened – history – yesterday! Aren’t shoppers more interested in today, tomorrow, future possibilities, and serendipity? If we’ve got to endure this stuff from our banks, let’s hope they use their imagination. Personally, I’d rather my bank forgot all this nonsense and concentrated on giving me a decent return on my deposits! Thankfully it’s now a whole lot easier to switch!

Michael Hoare

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A couple of column inches on the front page of today’s Daily Telegraph suggest that payment for carrier bags may be back on government’s agenda. Christopher Hope writes: ‘PLANS to force shoppers to pay for plastic carrier bags could be introduced across Britain after David Cameron praised the way it was working in Wales. Use of plastic bags in Wales has fallen by 80 per cent since a 5 p charge per bag was introduced in October 2011. England remains the only home nation not to have announced a charge for them.. …Zac Goldsmith, MP, who attended the event, described Mr Cameron’s comments as “reassuring”.’

It’s hardly surprising that Goldsmith could muster only a lukewarm response, because we’ve been here before. The issue has been floating around since about 2006, and in February 2010 I wrote a comment piece for Jewellery Focus magazine under the title Taxes in the Bin. I’ve reproduced the text below, and although I correctly predicted the subsequent increase in VAT imposed by this government, I held out little hope that environmental concerns would hold sway. But maybe, three years on, carrier bags will have their day!

Here’s what I wrote at the time:

Before Christmas a little note in Retail Week magazine caught my attention . Apparently shoppers in Wales are to be charged for plastic bags before 2011. The compulsory charge is likely to be between 5 – 15 pence and the British Retail Consortium (BRC) has, according to the report, ‘slammed the move’, saying that ‘the best way to achieve lasting change is to educate customers, not punish them’.

Sadly, I must admit to being interested in plastic bags, and have been trying to wean myself off them for a year or so.  I am one of those irritating people who decline a store bag wherever possible; tries to take his own shopping bag with him; and considers it a personal failure to have to accept one on rare occasions in the supermarket. I know I’m not alone in this, but in my position I feel a little ambivalent about my stance because of the retail sector’s reliance on these handy pieces of plastic. After all they are the ultimate disposable convenience; a jolly handy way of promoting a brand; and make for useful bin liners too. But, I ask myself, does society as a whole pay too big a price for this throw-away convenience?

Jewellers are not particularly guilty of producing unnecessary waste packaging, their goods being small; and generally encased in a quality reusable container, but I’m sure we’ve all asked ourselves why the supermarkets feel it necessary to encase four baking spuds in a rigid plastic sarcophagus when a paper bag would do the job perfectly well, or give us yet another variety of individual dessert in an almost indestructible pot. However the plastic bag issue rages on, either because they are believed to be a waste of scarce petrochemicals; because some aren’t biodegradable in landfill; or because too many end their lives littering our highways and bye-ways. INCPEN, the Industry Council for Packaging and the Environment, dispute all of the above it has to be said, and in the Irish Republic, where a 15 cents tax was levied from 2002, a lively debate has broken out about the pros and cons.

Naturally, the subject of so-called ‘green’ taxes is a hot topic of bar room deliberation, and few among us are not now experts on the theory of ‘hypothecation’ whereby tax revenues are earmarked for a particular purpose? But I suspect it’s not the environmental issues that are vexing the BRC in this case, nor whether carrot is more effective than stick when it comes to influencing public behaviour, but why retailers have to double up as tax collectors once again. I don’t know enough about the proposed tax on plastic bags to comment on the who what and where of its collection, and I don’t want to confuse measures that

Bins

are designed to modify behaviour with ones that benefit the public purse, but it did start me thinking about indirect taxation.

Taxes on income are always unpopular, and few politicians want to be identified with them, but indirect taxation is another story. Jewellers are familiar, not to say happy, with their role as unpaid collectors of VAT on behalf of the Treasury. But if my instinct is correct it’s a job that is set to grow in the future, as government looks for fresh sources of money to fund the financial crisis. Not that I predict an increase in the rate of VAT, although I wouldn’t rule it out. What I expect is an expanding catchment area, with more goods and services gradually coming within scope. And I suspect in the first instance we will be sold the idea as a logical ‘tidying up’ of the system. (Why should chocolate covered biscuits attract VAT and not custard creams after all, or printed matter escape the tax?) But as time goes by, more and more commodities will come into scope, until finally it will be the turn of the ‘sacred cows’ such as children’s clothing and groceries. I’d like to be around to see which politician tackles that one!

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