Corporate Social Responsibility in the Diamond Supply Chain

Running head: MANAGEMENT 1
Management
Student Name
Institution
Author’s Note

MANAGEMENT 2
Executive summary
The report analyses the corporate social responsibility of the diamond supply chain with
reference to the documentary Blood Diamond. Diamond is an important commodity in the
international market and the diamond industry has a social, environmental, economic and
political impact on the development of the international market. The drawbacks of an
irresponsible supply chain are evidence through lack of compliance to labor laws, human right
violations, decrease revenue and decrease the brand value. Moreover, some of the human right
violations by the diamond industry in Africa include taking away if life, sexual abuse, forced
labor and slavery. This has resulted in some actions that companies need to take to prevent
human right issues and these include using technologies such as blockchain and supply chain
cleaning. There are some recommended practices that can ensure good environmental
practices by diamond industry and these include the use of current tracking technologies,
elimination of unauthorized subcontractors and clean manufacturing. Companies within the
diamond industries need to invest in corporate social governance investments, alternative
energy provision, and environmental investments. In addition, there are some areas that form
the basis of CSR Audit and can be applied to the CSR Ombudsman. This paper concludes by
identifying the importance of a responsible supply chain and this is through proper application
of corporate social responsibility all diamond value chain.
Table of Contents

MANAGEMENT 3
Introduction.................................................................................................................................................3
a) Impact of the diamond industry......................................................................................................3
b) Drawbacks of irresponsible supply chain.........................................................................................5
i. The irresponsible supply chain has social issues..........................................................................5
ii. Do not comply with labor laws such as forced labor...................................................................5
iii. Decreased revenue......................................................................................................................5
iv. Decrease brand value..................................................................................................................5
c) Human rights and company actions................................................................................................6
d) Recommendations...........................................................................................................................7
i. Companies should employ new technologies that can track materials.......................................7
ii. Eliminating incentives for unauthorized subcontracting.............................................................7
iii. Clean manufacturing....................................................................................................................8
e) Responsible investment...................................................................................................................8
f) CSR Audit for the investments.........................................................................................................9

MANAGEMENT 4
Introduction
a) Impact of the diamond industry
Diamond has a social, environmental, economic and political impact on the
development of the international market. Firstly, the diamond industry has a high impact on
the social and cultural development of the international market at every stage of the diamond
value chain. Many companies within the diamond value chain value diamond as a source of
wealth and its extraction in countries especially within Africa is attributed to control of power
(Srivastava, 2010). In addition, the diamond industry has been known to contribute largely to
power and control within the international market. For instance, major companies trading on
the diamond are known to be wealthy hence decision makers in the international market.
Diamond industries have been known to support human right violating militant groups in Africa
and this has resulted in pressure within the international market for these companies to clean
their value chain. One example of companies under pressure is Sodiam which is a leading buyer
of conflict diamond mined in Africa (Adhikari, 2016).
Secondly, the extraction of diamond has resulted in environmental issues within the
international market leading to conflict. Many environmental groups such as UNEP have come
out to pressurize companies within the diamond industry to remain sustainable throughout
their value chain. Many companies such as De Beers is currently trying to remain
environmentally sustainable in order to remain in the international market. This is following
much concern that the company has been dealing in diamond mined from Africa under unsafe
environment. Many international market players are concerned with environmental activities of
diamond industry companies and this has resulted in sanction for companies participating in
environmental unsafe practices (Maditati, Munim, Schramm & Kummer, 2018).
Thirdly, diamond has an economic impact on the development of international market
since there are many different products that are valuable along the diamond value chain.
Diamond trade in the international market has contributed to the development of the
machinery market especially those machines that are directly or indirectly involved in diamond