the market for diamond jewelleryDIAMONDS

29 JULY 2007

The World Diamond Council(WDC) was established inJuly 2000 to address theissue of conflict diamonds.It developed the KimberleyProcess which has reducedthe illegal export of dia-monds from 4% to less than1%, but continues to workto eliminate this trade. TheWDC represents over 50industry organisationsworldwide.

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Diamonds Interview

Diamonds, a unique gift from nature

CONTENTS

Mighty ice 4

A Diamond Witness 6

Conflict-free diamonds 6

Diamond dynasties 8

Profile of the De Beers Group 11

Diamonds transform lives 11

The perfect setting 13

History in the making - the Lesotho Promise 13

Big is beautiful 13

Diamond engagement rings… 15

Diamonds have fascinated mankind for more than four thousand years. In centuries past, they were potent symbols of power and wealth. Today, they reflect the most powerfulhuman emotions and values of love and commitment.ELI IZHAKOFF, CHAIRMAN AND CEO OF THE WORLD DIAMOND COUNCIL

n addition, diamondshave provided the basisfor secure and sustainablelivelihoods for millions of

people around the world, many of them indeveloping economies such as Botswana andIndia. For many of us in the international dia-mond industry it is not only a delight but aprivilege to work with this unique and beauti-ful product. A product that has the ability todeliver so much pleasure and benefit to allthat come into contact with it.

Furthermore, diamonds are valued notonly for their beauty and for being the ulti-mate symbol of love. They have also con-tributed significantly to scientific and eco-nomic progress, from their use in industrialmanufacturing and construction to thedevelopment of intricate surgical instru-ments and their role in helping break newfrontiers in computer hardware technology.Diamonds are both the most magical andversatile of Nature’s creations.

No one quite knows exactly how diamondswere formed, but geological evidence sug-gests that they were created up to 3.3 billionyears ago in a unique environment, some 200kilometres inside the Earth, subject to intensepressure and temperatures. They were even-tually transported to the Earth’s surface about300 million years ago. This was a journeywhich only a few would survive. What Naturehas provided us with is a finite treasure andthe conditions under which diamonds wereformed no longer exist, ensuring that dia-monds are both beautiful and rare. For exam-ple, few might be aware that if you took allthe gem diamonds that have been polishedthroughout history, they would not quite fill aLondon double-decker bus. The ‘modern’ dia-mond industry is over 600 years old and dates

back to Venice in the 15th Century. Veniceestablished an early predominance in the dia-mond trade, as stones from India, where thefirst documented discoveries of diamonds areto be found, were carried across the southerntrade caravan routes via Arabia to Alexan-dria, and from there by sea. In 1725, dia-monds were found in Brazil and in the latterpart of the 19th Century the first significantdeposits were discovered in South Africa. Asa result, diamond trading and polishingmoved from Venice to Lisbon and later toAmsterdam, Antwerp, London, New York andTel Aviv.

Today, diamonds are still polished in placessuch as New York, Antwerp and Tel Aviv.However, this highly specialised skill isincreasingly carried out in the developingeconomies from India and China toBotswana, South Africa and Namibia. In fact,India is currently the biggest producer of pol-ished diamonds in the world. The technologydeployed and established working practicesin India are sophisticated and often exceedexpected standards.

However, in spite of the contribution dia-monds continue to make to the well being ofmillions, their high value makes them vulner-able to theft and abuse. This was highlightedin the 1990s when rebel organisations inAngola, the Democratic Republic of the Congoand Sierra Leone expropriated diamonds andused the revenues to perpetrate civil war andcarry out atrocities against innocent civilians.

Having been made aware of the urgency toact by two non-governmental organisations(NGOs), Global Witness and PartnershipAfrica Canada, the diamond industry actedswiftly to co-operate with NGOs, governmentsand the United Nations. It established theWorld Diamond Council, representing the

entire industry from mining to retail. This co-operation eventually led to the creation of aunique and successful initiative to combatconflict diamonds called the KimberleyProcess. The World Diamond Council con-tributed significantly to the development ofthe Kimberley Process Certification Scheme,which ensures that today 99.8 per cent of theworld’s trade in rough diamonds is conflict-free. However, one diamond traded for con-flict is one too many and that is why we arecontinuing to work, together with NGOs, gov-ernments and the United Nations, to eradicatethis illegal trade entirely.

Diamonds are a unique gift of nature andare, above all, an emotional product. Con-sumer confidence is, therefore, our paramountconcern. This is an industry that, more thanmost, is dependent on safeguarding consumerconfidence and the Kimberley Process is ourprimary safeguard. That is why we meet withgovernments and NGOs twice each year tofurther refine the measures that have led todiamonds being one of the most audited min-erals in the world.

We face the future with renewed confidenceand a determination to ensure that the con-sumer can be assured that each diamond theypurchase has contributed exclusively to pros-perity and progress amongst the communitiesfrom which they came.

The World Diamond Council invites read-ers to challenge their jeweller to provideassurance that their diamond jewellery hasbeen purchased from reputable sources. Ifthey cannot provide this assurance, theyshould go to a jeweller who can. For moreinformation on diamonds and what to askand look for when purchasing diamond jew-ellery, please visit the WDC website,www.diamondfacts.org.

DIAMONDSA TITLE FROM MEDIAPLANET

Publisher/Editor: Kayvan SalmanpourProduction Editor: Katherine WoodleyJournalist: Claire AdlerDesign: Sophie WesterbergPrepress: Jez MacBeanPrint: News International

Mediaplanet is the leading European publisher in providing high quality and in-depth analysis on topical industry and market issues, in print, online andbroadcast.

For more information about supplements in the daily press,please contact Kayvan Salmanpour, 020 7563 8884kayvan.salmanpour@mediaplanet.com

www.mediaplanet.com

IN ASSOCIATION WITH

Eli Izhakoff, Chairman andCEO of the World DiamondCouncil (WDC). As Chairmanof the World DiamondCouncil, Mr. Izhakoff leadsthe industry delegation ofthe Kimberley Processreview, as well as liaisingwith government represen-tatives and NGOs through-out the year.

Claire Adler writes aboutjewellery, watches anddesign and is the head jour-nalist for this Diamondsreport. She has written forThe Times, Financial Times,The Guardian, The Businessand House & Garden,amongst others.ca@claireadler.com

Kayvan Salmanpour is anexecutive manager atMediaplanet and editor ofthis Diamonds publication.His vision for the reportwas to showcase theworld’s most luxurious dia-monds whilst highlightingthe industry’s socialresponsibility policies.

I

For information telephone (020) 8080 0330 – www.cartier.com

in rose gold and platinum stars,would be snapped up almostimmediately. Unsurprisingly,he’s now focussing onshowpieces with pricetags in the millions.

One of Tiffany’smain growth areas isin diamonds of twocarats and above,while at Leviev it’sten carats plus. “There’sa voracious appetite forthe extraordinary,” con-firms Simon Williamson,Leviev’s UK managing director.

Likewise, Bulgari is seeing increas-ing clients investing in jewellery fea-turing large and rare stones like the3.61 carat fancy vivid pink diamondring in its high jewellery collection.

One eye-watering necklace inBoucheron’s new Fleurs Fatales highjewellery collection, comprises a 5.2carat cushion cut diamond, a 1.01carat solitaire, 1365 round diamonds,515 yellow diamonds, 192 pink dia-monds coupled with 735 small emer-alds. That’s 122.64 carats in total onone necklace. Sigh.

Both Montblanc and Georg Jensenhave taken their jewellery offeringsup a notch or three in the last year torespond to growing demand for highend diamond pieces. Montblancintroduced its first ever high jewellerycollection, which includes six caratdiamond pendant necklaces in thebrand’s patented star cut, which tookeight years to master.

“What used to be considered radi-cal is now the norm,” says Gord Ray,Georg Jensen’s international market-

Diamonds by numbers:1 Harry Winston cluster earrings2 Till Death wedding ring by Stephen Webster, made for music star Pink3 Van Cleef & Arpels Socrate ring in between fingers4 Asprey Swirl bracelet5 Shaun Leane Captured rings6 Moussaieff white diamond agate necklace7 De Grisogono pearl and black diamond white gold Spirit of De Grisogono ring8 From left to right - Pragnell’s oval paraiba tourmalineand diamond ring in 18 carat white gold, Leviev yel-low diamond ring, Bulgari ruby ring from the highjewellery collection9 Montblanc Star ring10 Georg Jensen Cave Red Carpet diamond ring11 David Morris hand-made, Victorian inspiredrose-cut pear diamond necklace

ing director. “Womenare now more adventurous. Cocktailrings, like our Cave yellow gold dia-mond charm rings, are becomingmore playful.”

BrillianceCushion cuts are on the up, accordingto the Diamond Trading Company,which markets diamonds for the DeBeers Group. “Inspired by gems wornby the Indian maharajahs in the eigh-teenth century, cushion cut diamondsare selling well,” says Jeremy Morris,managing director of David Morris.Earlier this year, Tiffany brought outa new patented version of the cushioncut called the Novo.

“Cushion shape diamonds are verypopular at the moment and, asalways, the elegant and timelessemerald cut,” confirms edgy London-based, New Zealand-born designerJessica McCormack. “But above all,and this always seems to be consis-tent, the brilliant is a dead setfavourite for all diamond buyers.”

As consumers become ever savvier,contemporary, fashion-driven design

is increasingly important. “In myjewellery designs, any shape - and Iuse a huge range of all sized dia-monds and every shape imaginable -sells well as it comes secondary to thedesign of the actual piece. The dia-mond content is like icing on the cakefor the buyer personally,” saysMcCormack.

InterestColoured diamonds are garnering lotsof interest too. Yellows and pinks arethe hot favourites at Boodles andPragnells, while at Leviev the crèmede la creme are aching for greens,blues and exceptional chameleons. .But there’s also a definite swing to thesubtle sophistication of champagnesand cognacs found in H Stern’sZephyr collection, the De Beers Ice onFire and Stephen Webster for DeBeers collections. Then there is thecappuccino brown and signatureblack diamond look at De Grisogono.

Boodles managing director,Michael Wainwright, says he is sell-ing more fancy coloured diamonds,often in a pavé style to make them

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Diamonds Trends

Such is thedemand ford r a m a t i cpieces andgenerous-

sized stones, the diamond jewellerymarket could easily be compared withthe currently burgeoning art market,now enjoying a growing audience ofhigh level buyers.

Consumers are armed with moreknowledge than ever about the pre-ciousness and rarity of what they arebuying and where it comes from. Newpockets of extreme wealth mean themarket’s most significant growth areais at the loftiest of price points. Dia-

mond jewellery is the most desirableluxury good globally, according toresearch from Research Internationalcommissioned by the Diamond Trading Company, which asked peo-ple what they would prefer if moneywas no object.

When Boodles created a show-stopping necklace, priced at £140,000last year to use in its marketing andadvertising campaigns, managingdirector Michael Wainwright plannedto use it to direct attention to thebrand’s more accessible, mainstreampieces. He certainly didn’t imaginethat three of these chains, dripping inwhite and natural pink diamonds set

Mighty ice

Demand for diamond jewellery is soaring, with biggerand bolder pieces very much on the rise.BY CLAIRE ADLER

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more affordable. Vivid yellows aredoing particularly well, he says, sincethey are not as prohibitive as pinks.

The De Beers Talisman collectionplays with rough diamonds, couplingthem with champagne and cognacdiamonds. Rough diamonds bringadded mystique, since very few peo-ple outside the diamond trade haveever seen them.

For a while now, women have beenindulging themselves instead of wait-ing around for their partners to comeup with the goods. With America rep-resenting just over 50% of the marketfor diamond jewellery, recent fig-ures show that 34% of diamondrings sold in America are nowbought by women treatingthemselves.

“Women are examiningdiamonds as a new way ofcelebrating their own lives,not just their relation-ships,” says David Lamb,worldwide marketing direc-tor of the Diamond TradingCompany.

Perhaps this is whybracelets like Asprey’s Swirlare becoming more populartoo, because women can see themwhen they wear them, suggestsLamb. Other key trends are ultra-long sautoir necklaces, a stylewhich has been around sinceNapoleonic times, and state-ment earrings, he says.

Elsewhere, at auctionrooms sales of diamond jew-ellery are soaring. “The mar-ket is particularly strong forquirky, rare and wearablequality antique jewels,especially those with his-torical provenance,” saysJustin Roberts, Sotheby’s

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Trends Diamonds

jewellery specialist. Many pieces arefetching twice or three times auctionestimates. A pair of Georgian rose-cutdiamond earrings estimated at £8000to £12,000 fetched a hammer price of£43,200 at Sotheby’s recently.

And last month at Christies, a bluediamond ring thought to be worth£330,000 a carat fetched £655,000 a

Otherwise engagedUnbound by tradition, couples areincreasingly choosing maverick dia-mond rings to reflect the uniqueness oftheir relationship, says Claire Adler.At a time when commitment is one of the less fashionablewords in our culture, it is perhaps surprising that the conceptof the commitment ring has entered the vernacular.

In fact, call them what you like, there are a whole host ofrings on the market today which seem to hint at commitmentyet just don’t quite commit. Hip Notting Hill jewellers Wint &Kidd have introduced a delectable collection of six coloureddiamond commitment rings. De Beers goes a step further andrefers to its not-quite-ready-to-commit Secrets of the Rosediamond collection as pre-bridal. Tiffany offers an assort-ment of Celebration Rings, hinting at a multitude of unde-fined milestones. But designer Shaun Leane is a rare manwho means business, having recently introduced his Capturedcollection which consists of three rings which interlock torepresent three pledges – engagement, wedding and eternityring all rolled into one.

While the market for diamond solitaire engagement ringsremains robust, coloured gemstones and unusual cuts andsettings are an increasingly popular choice.

“What is clear is that people are increasingly looking for dia-mond jewellery with new levels of meaning,” says David Lamb,worldwide marketing director of the Diamond Trading Compa-ny. The DTC’s campaigning for three-stone rings symbolisingthe past, present and future of relationships, has resulted insales of this category now representing $7 billion globally.

In the US market, diamond engagement rings account forover 15 per cent of total value of diamond jewellery sales,while in Japan, that figure is 11 per cent and dropping thanksto fewer formal engagements, according to the DTC.

“In emerging Eastern markets like China, we are seeing anexplosion of demand for traditional engagement and wed-ding rings, which were unheard of a decade ago,” says Lamb.

At the top end of the market, jewellers all the way fromMayfair to Fifth Avenue are reporting a penchant for some-thing individualistic and one of a kind. Take Stephen Webster,the specialist in rocks for the stars. No plain solitaires on goldbands for him. Webster crafted a ‘Til Death diamond ring forpop chick Pink and husband Carey Hart. Jewellers includingBulgari, Tiffany and Leviev are all tracking increasing ordersfor bespoke engagement rings, oftenincorporating rare coloured diamondsand unusual settings, as opposed tomore traditional white solitaires.Leviev reports fancy coloured dia-monds are especially popular for sec-ond and third marriages.

“The engagement ring is the ulti-mate expression of personal style andwomen are looking for more choices,”says Melvyn Kirtley, Tiffany & Co.’schief gemmologist and UK president.

carat, setting a world record price fora blue diamond.

“At this level, buyers have to take adeep breath and just go for it, but it isa solid market and a good time to buytop quality jewellery for investment,”says Raymond Sancroft-Baker, jew-ellery expert at Christies.

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2007 boutique openingsGRAFF Tokyo Sep 07, Hong Kong and Geneva, summer 07, NewYork flagship 08BULGARI Omotesando, Tokyo – Nov 07 Ginza, Tokyo – Dec 07TIFFANY Las Vegas, Aug 07; Masachussets Sep 07; Wall Street NewYork, Oct 07; Mexico City, Oct 07; Rhode Island, Nov 07; Santa Bar-bara, California, Nov 07; Red Bank, New Jersey, Nov 07LEVIEV Madison Avenue, New York, Nov 07DAVID MORRIS Saudi Arabia, Sep 07CARTIER London Selfridges Wonder Room, Aug 07, Red Square,Moscow, October 07SELFRIDGES Wonder Room opens in London Aug 07: Chanel FineJewellery and Watches, Chopard, Bulgari, Theo Fennell, Tiffany & Co

David Lamb, DTCmarketing director

Eradicating trade in conflict diamonds is a Her-culean task. But the diamond industry is tack-ling reputational issues on a scale without par-allel in any other industry. BY CLAIRE ADLER.

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Diamonds A conflict free market

A DiamondWitnessJust moments into thefilm Blood Diamond,after scenes of car-nage as rebels attacka Sierra Leonean vil-lage, the action movesto the quiet grey suitsof an internationalsummit in Europe.

According to a ‘devastatingreport by Global Witness’,went the script, diamondsfrom conflict zones were mak-ing their way into the world’sdiamond markets, helping tofuel brutal wars in Africa.

It’s not often that a smallcampaigning NGO gets a men-tion in a Hollywood film. Butin the late 1990s an interna-tional campaign led by GlobalWitness exposed the scourgeof conflict diamonds, leadingto the development of aninternational regulatory sys-tem for rough diamonds- theKimberley Process (KP).

Most of the diamond warsare now thankfully over, andcountries such as the Demo-cratic Republic of Congo,Liberia and Sierra Leone areedging towards fragile recon-struction.

Last month the UnitedNations reported that dia-monds are still mined andlikely being smuggled out ofIvory Coast and into the legit-imate global trade in spite ofan embargo on diamondexports because of the conflictthere.

The government-run Kim-berley Process aims to certifyall shipments of rough dia-monds between participatingcountries, to ensure that con-flict diamonds cannot reachthe high street. After govern-ments set up the KimberleyProcess, the industry initiateda voluntary system of self-regulation, the System ofWarranties, but it consistsmainly of a statement on aninvoice and is meaningless ifnot backed up by third-partyauditing.

Governments must do moreto strengthen the KimberleyProcess and to increase moni-toring of the industry, toensure that diamonds are con-flict-free.

Global Witness works tobreak the links between natu-ral resource exploitation,environmental abuses, con-flict and corruption.

www.globalwitness.org

E thical consumerism hasnever been this glam-orous. At the Oscars thisFebruary, a bevy of A-lister celebrities banded

together to effectively dub diamondsthe new fur.

Red carpet events such as theOscars have a long history of beingawash with sparkling diamonds. Butthis year, many of Hollywood’sbiggest names asked agents and dia-mond experts to ensure they werenot photographed wearing illegaldiamonds. Leonardo DiCaprio andJennifer Connelly, the stars of BloodDiamond, the 2006 film set in 1999which highlighted the link betweencivil conflict and diamond smug-gling in West Africa, rap artistKanye West, Iman, the former faceof De Beers jewellery and supermod-el Erin O’Connor, are among the

most high profile campaign-ers for conflict-free dia-monds.

Back in 2004, Iman, wife ofsinger David Bowie, ended hercontract with De Beers in protestagainst the eviction of tribes peoplefrom their land in Botswana. In 2005,actress Julie Christie joined a demon-stration outside the Natural HistoryMuseum in support of the sametribesmen. De Beers denied all allega-tions made against it.

All of which has served to fuel con-sumer demand for conflict-free dia-monds, carrying a certificate of con-firmation that their trade is not con-nected with war, civil strife or humanrights abuses.

During the 1980s and 1990s, about4 per cent of diamonds traded camefrom conflict in West Africa, accord-ing to the World Diamond Council.

Today that figure is underone per cent.

In 2000, the diamondindustry, non-governmental

organisations, the UnitedNations General Assemblyand governments gal-vanised into action.

This was the first time aglobal industry had co-operated with the UnitedNations, governmentsand civil society toaddress an importanthumanitarian issue.

“There are otherindustries which havehad to face reputationalproblems, for example,the issue of dolphin-friendly tuna,” saysGareth Penny, manag-ing director of the DeBeers Group. “But thesheer scale of thediamond industry,the number ofcountries in whichit is mined, themillions of peopleround the worldwho depend on

Conflict-free diamonds

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A conflict free market Diamonds

it, the way the issue has been tackledwith the involvement of the Euro-pean Union, the United Nations, 71countries, 100 NGOs and CIBJO, theWorld Jewellery Confederation, iswithout precedent. When the historybooks are written, I believe this willbe understood as an extraordinaryexample of public private participa-tion.” By 2002, the Kimberley Processwas created and was followed by theSystem of Warranties to eliminateconflict diamonds from the market-place.

Much to be done

While the Kimberley Process monitorsrough diamonds and the areas theyare produced and cut, the System ofWarranties focuses on the point atwhich they are polished. It providesevidence to all purchasers up to thesale to consumers that diamondsbeing sold are from conflict-freesources. The System of Warrantiesinvolves a written statement on allinvoices declaring that the diamondsare from a conflict-free source.

By 2004, a Canadian governmentreport concluded that the Kimber-

ley Process had been 99.8 per centeffective.

“Even though 99.8 per cent of dia-monds are flowing through the mar-ket in a carefully monitored way,there is still much to be done,” saysDe Beers Group managing director,Gareth Penny. “There is a chair of theKimberley Process at the EuropeanUnion and each year procedures arebeing enhanced. Retailers are obligedto provide consumers with assurancesand we support all their efforts.”

The World Diamond Council, theDe Beers Group, who now control 40

per cent of the world’s diamonds, andGlobal Witness, the campaigninggroup that first alerted the world tothe issue of conflict diamonds in the1990s, all agree that one blood dia-mond is too many.

“The system is only as strong as itsweakest link,” says Eli Izhakoff, chairof the World Diamond Council. “Ouraim is that every diamond sold shouldbe conflict-free and that consumersshould ask about the source of thediamonds they buy. The educationalprocess which we started severalyears ago has to reach every single

jewellery retail outlet in the world.”Izhakoff reports positive signs from

two problem areas – Zimbabwe andVenezuela. In early June, KimberleyProcess representatives and WorldDiamond Council experts visitedZimbabwe. “Initial reports indicatethat the Zimbabwe government isnow fully co-operative,” saysIzhakoff. A Venezuelan governmentrepresentative attended a KimberleyProcess session in Brussels this Juneand indicated that Venezuela plan tocomply. The World Diamond Councilis now waiting for the Venezuelangovernment to invite them back for areview visit.

While the Ivory Coast is not signedup to the Kimberley Process, Izhakoffpoints out they are still subject to UNsanctions. Sanctions on Liberia wererecently lifted and they have nowjoined the Kimberley Process, he says.

Jewellers and consumers have theirown role to play in ensuring a con-flict-free market place. Global Wit-ness believes jewellery retailers needto introduce more rigorous internaland third-party auditing procedures.However, jewellers like Tiffany, Bul-gari, Boodles, Hamilton & Inches, HStern, Boucheron, Montblanc and

Signet (including subsidiaries ErnestJones, H Samuel and Leslie Davis) areamongst those maintaining a strictzero tolerance policy towards conflictdiamonds.

The fifth C

Thierry Robert, has been Boucheron’sgem scout for 37 years and his fatherwas in the position for 55 yearsbefore him. “Robert knows and trustshis sources and they know him,” saysa Boucheron spokesperson. “He onlybuys from reputable sources. This isimperative to maintain the integrityof the House.”

“If customers ask about whetherour diamonds are conflict-free –although surprisingly few do – wehave a certificate we show stating alldiamonds we sell are conflict free,since all our suppliers are signed upto the Kimberley Process,” saysMichael Wainwright, managingdirector of Boodles.

Montblanc call the conflict-freeissue the fifth C to look out for whenbuying diamond jewellery, in addi-tion to the more traditional cut,colour, clarity and carat.

What is the Kimberley Process?The Kimberley Process certifies the origin of stones, exporting them fromtheir country of origin in tamper-resistant packs with a government-issuedcertificate stating they are not from a conflict zone. Participating countriesthat import the stones for cutting and polishing in turn pass on the war-ranty at each stage. Today, anyone importing or exporting rough diamondswithout a Kimberley Process certificate is breaking the law. For more information visit www.diamondfacts.org

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Diamonds Dynasties

A man named Isadore Hennig…If you ever wander down to the heart of London’s diamond district, Hatton Garden, youwill probably notice a beautiful, private, Georgian street named Ely Place. Beyond theimposing wrought-iron gates and the watchful eye of the liveried commissionaire liesthe gentrified world of the diamond broker.

Behind one of these royal blue doors is the headquarters of I. Hennig & Co. Ltd, theworld’s oldest and largest diamond brokerage. Established in 1890, by Isadore Hennig,this brokerage, has over the years, helped procure rough stones from De Beers’ DiamondTrading Company for some of the most prestigious diamantaires. It has also been instru-mental in the sale of the world’s most magnificent diamonds, such as the 726-caratJonker Diamond in 1935, and the 968.9-carat Star of Sierra Leone in the 1970's.

It was in the late 1940’s that the country with the oldest diamond tradition of all,India, was re-emerging as a manufacturing centre. By advising the Indian industry onimprovements to its manufacturing skills and the development of sales outlets, Hennighelped the country become the largest diamond-cutting centre in the world. In fact, 11out of 12 diamonds are now cut and polished in India.

Today, according to head of marketing, Mark Poole, Hennig plays a pivotal role in thediamond industry, representing the interests of a major share of the world’s leading dia-mond manufacturers and rough dealers. Beyond this core historical role, Hennig alsohelps its clients with services such as providing outsourced manufacturing to recruitingdesigners from the world’s most prestigious jewellery schools.

With offices in New York, Antwerp, Tel Aviv, Bangkok, Johannesburg, Mumbai andLondon, it’s certainly a long way to have come for a man named Isadore.

David Morris

“I’ve sold multi-million pound necklaces,but nothing quite beats designing andmaking a piece of jewellery,” says Jere-my Morris, son of David. Jeremy’s fatherestablished his international jewellery busi-ness in 1966 – shortly after Jeremy, now man-aging director and creative director, was born.After starting out in a Paris atelier, Jeremy

joined the family business as adesigner and jewellery maker in his early twenties. With wife Erin as publi-

cist and muse, Jeremy sold the Harrods and Selfridges concessionsand opened the Bond Street store in 1997. David Morris film cred-

its include Diamonds are Forever, The World is Not Enough andGuy Ritchie’s Snatch.

Dynastic moment During the making of Snatch, theDavid Morris workshop became a film set with jewellersat their benches transformed into movie extras as theyworked.See-it-and-have-it White and pink diamond marquiseand heart-shaped floral ring weighing 6.83 carats

Jeremy and David Morris

Anyone borrowing jewellery from Chopard at the CannesFilm Festival gets a bodyguard dressed in black tie thrownin. For a decade, Caroline Gruosi-Scheufele, co-presidentwith her brother Karl-Friedrich, has dressed actresses forthe red carpet, with Chopard as official event sponsor.Often creating speculative pieces hoping celebrities willdon them, nothing is certain till they step out of thelimo. Caroline’s father Karl Scheufele, a third-generationGerman goldsmith and watchmaker, bought Chopard in

1963 when Paul-Andre Chopard sold out afterhis sons showed no interest in the business. Caro-

line’s husband is Fawaz Gruosi, founder of another Geneva-based jewellery brand, De Grisogono.Dynastic moment Years ago, after buying an “incredible”set of pink diamonds without considering the price, Caro-line’s father was angry with her for the whole of Christmas.But the result was La Vie en Rose, inspired by Edith Piaf -and Chopard’s first colour diamond collection. See-it-and-have-it Breathtaking high jewellery emeraldchoker, dripping with diamond brilliants

Horse-whispering is an unlikely key to a glittering futurein the world of fine jewellery. When Jacques Adlermoved from Austro-Hungary to Turkey in the 1870s,word got out the Sultan’s horse was ill. Jacquessecured the job of stable chief, later leveraging hisroyal connections to help his son Edouard establish

himself as court jeweller. Edouard regu-larly enticed his eldest grandson Franklin withchocolate cake to visit the shop after school andplay with gems. Today Geneva-based Franklin isfounder, his wife Leyla is Adler’s creative brainsand their Harvard-educated son Allen is CEO.

Dynastic moment Aged 19, with abright academic future in sight afterfinishing school two years early,Franklin headed to Brighton to begin hishigher education. But when his grandfather died, his fathersummoned him back to Istanbul to help run the business. See-it-and-have-it Head-turning brown brilliant cut 15.01carat diamond ring set with 230 brilliants on white gold

Franklin Adler

Adler

Chopard

Starting out as a Hatton Garden apprentice aged 15 in 1960, LaurenceGraff couldn’t have imagined he would open over 25 stores andreceive four Queen’s Awards for Enterprise. Graff spent his twen-ties selling jewels in remote parts of the globe and opened his firststore in Knightsbridge in 1974. Today his son François is manag-ing director. “Diamonds are a portable form of wealth, they’vesaved so many lives. If diamonds could talk, imagine the stories,”says Raymond Graff, production director and Laurence’s brother. Dynastic moment In 1987, Laurence Graff bought the 19 caratemerald engagement ring which belonged to Wallis Simpson, Duchess

of Windsor. “I have the originaljeweller’s invoice made out

to the King,” he said. Graffgave the ring to his wifefor their 25th weddinganniversary.See-it-and-have-it Fancy Vivid Yellow100.09 carat diamond unveiled at Kens-ington Palace last year, now a pendant. Thefaint-hearted need not apply.

Graff

Laurence, Anne-Marie and François Graff

Diamond Dynasties

Fawaz Gruosi and Caroline Gruosi-Scheufele of Chopard

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GENEVE . GSTAAD . LONDON 13, New Bond Street +4420 7409 2237 . MOSCOW . HONGKONG . TOKYO

www.adler.ch

Paris: a dance step, the echo of music, a romance on the Pont des Arts.Titanium brooch set with 701 diamonds 43.17cts and 93 black diamonds 3.40 cts.

adler, jewellers since 1886

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Industry Diamonds

Thanks to revenues generated bydiamonds, every child in Botswananow receives free schooling until age13. In 1966, there were only three sec-ondary schools in Botswana, nowthere are over 300. In South Africa, DeBeers has funded the building of 12schools, directly supporting the educa-tion of approximately 12,000 pupils.

Botswana’s president announcedlate last year: “Revenue from diamondshas enabled Government to fund virtu-ally 100 per cent of basic education,provide virtually free healthcare, buildthe infrastructure that has supportedour economic activity and fund 80% ofthe anti-retroviral drugs that havegiven hope to our fellow citizens livingwith HIV/AIDS.”

With control of 40 per cent of theworld’s rough diamond supply, the DeBeers Group employs 21,000 people,17,000 of whom are in SouthernAfrica. The diamond trade in totalcontributes approximately $8.4 bil-

As an employer of 17,000 people insouthern Africa, De Beers was the firstmining company in South Africa toextend free anti-retroviral treatmentto HIV positive employees, employeelife partners and retired or redundantemployees as part of a comprehensivedisease management programme.Graff’s cutting and polishing compa-ny, Safdico, provides regular sessionson HIV and prevention to its 300employees as does Leviev who alsopartners with the Catoca project inAngola, which contributes millions ofdollars in medical treatment and edu-cation against HIV/AIDS.

“The Botswanan government nowpays for over 92 per cent of the coun-try’s anti-retroviral programme. Theonly way we’ve been able to affordthis is through diamond revenue,”says Dr Ndwapi Ndwapi, Botswana’sNational HIV/AIDS Minister. “I usedto go to an HIV-related funeral two tothree times a week. I’ve been to less

More reason to indulge

Diamonds transform livesThe scourge of HIV and AIDS has left 12 million orphansacross Africa. By providing free drugs and healthcare, thediamond industry is helping to fight back.BY CLAIRE ADLER

What is the relationship between DeBeers and the DTC?De Beers owns the DTC. De Beersowns diamond mines – some whollyand some together with governmentsincluding Botswana, Namibia andTanzania. The De Beers boutique onOld Bond Street is part of a joint50:50 venture between De Beers andLVMH, the world’s largest luxurygoods group. De Beers also owns Ele-ment Six, the world’s leading supplierof industrial diamonds.

Q and A withVarda Shine

Varda Shine (left) is man-aging director of the Dia-mond Trading Company,the sales and marketingarm of De Beers, whichnow controls around 40

per cent of the world’s rough diamonds.

lion annually to Africa’s economy.The De Beers Group devotes a further$10 million a year in the form ofcharitable donations to communitysupport activity.

“Our award-winning HIV and AIDSprogramme, which distributes anti-

So what do you do?My work involves three key groups:diamond producers, diamond sellersand of course the people who buydiamond jewellery.

We are now working to ensureAfrica enjoys a bigger share in the pro-duction process, so we are increasinglyencouraging clients to keep cuttingand polishing local. Our clients haveeight factories in Botswana employing1400 people. Eighteen months ago,that figure was 300 to 400 people.

than four in the last two years. I hopeto put at least two funeral parloursout of business a year.”

Ishmael Time (above) is an HIV posi-tive De Beers mine worker in Botswana.He fell ill in 2000 and received freeanti-retroviral medicine, counsellingand medical support from the mineclinic. Ishmael’s health has sinceimproved dramatically. He now edu-cates other employees and their fami-lies about HIV/AIDS. His wife recentlygave birth to their second child, whowas born healthy and free of HIV.

As one of Africa’s major natural resources, diamonds are transforming thefortunes of more than just global luxury brands. Claire Adler talks to GarethPenny, managing director of the De Beers Group.

Gareth Penny, MD of the De Beers Group

Cutting it fine Gem experts traditionallyuse four criteria to define adiamond’s quality.

CUTWhile a diamond owes its beautylargely to nature, the shape andaccuracy of the cut determine thesparkle factor.

CLARITYThe higher the clarity of the dia-monnd, the rarer and more valu-able it is. Specks or dark marksaffect a stone’s price.

COLOURThe whiter the diamond, the better.Diamonds are graded from D(colourless) to Z (tinted). Aspreysells diamonds between D and H.

CARAT A diamond’s size is measured incarat weight. One carat is 0.2 gram.A two carat stone is worth morethan twice a one carat stone.

retroviral medication to employees,partners and immediate family mem-bers, is at the forefront of the world,”says Penny. “We are turning diamonddreams into lasting and sustainablerealities for the people of Africa.”

“I urge you to continue supportingus by buying more and more dia-monds, because for us the joy of yourcelebrations with diamonds is alsoour joy,” said president Mogae ofBotswana last year.

As one of Africa’s major naturalresources, diamonds enable countrieslike Botswana, Namibia and SouthAfrica to build a more prosperousfuture for their inhabitants. InBotswana, diamonds account for 76per cent of export revenue and inNamibia 40 per cent. Botswana repre-sents 38 per cent of Africa’s entirediamond production.

“While consumer demand for dia-mond jewellery is at an all time high,rising globally at between five and sixper cent annually, consumers can takecomfort in the knowledge that dia-monds are making a significant contri-bution to the countries from which theyare mined,” claims Gareth Penny, man-aging director of the De Beers Group.

Diamonds have traditionally signifiedwealth and indulgence. But lovers ofluxury will be pleased to know thereis a more noble reason to justifyindulging in conflict-free diamonds.

Secondly, we choose the most suit-able diamond dealers to sell ourrough diamonds. We currently have93 companies – we call themsightholders - in 33 countries onthree year agreements.

Thirdly, we develop communica-tions campaigns to show that dia-monds are the ultimate symbol oflove, they are inherently unique andthat buying them helps to improvethe lives of Africans who producethem.

Debeers Ice on Fire Collection

Leviev’s store on Bond Street, London

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Diamond makers Diamonds

Big is beautifulSpecialists in large,coloured stones andsuper-exclusive jew-els, Steinmetz arealso experts in head-line-grabbing public-ity stunts.BY CLAIRE ADLER

What do a pair of $2 million 20carat diamond jeans, an ice car, adiamond encrusted steeringwheel, Bangkok’s Temple of Dawnand Washington’s SmithsonianInstitute of Natural History allhave in common? Steinmetz hasused all of these to draw attentionto the glamour of its diamonds.

Steinmetz is probably bestknown for creating the 203.04carat internally flawless De BeersMillenium Star, the world’slargest top colour D flawless,pear-shaped diamond. Unveiledin 1999 at the Millennium Dome,it became the target of a foiledrobbery attempt in 2000.

Less well known is that Stein-metz also attracts private jewelleryclients by means of staggeringlyglamorous invitee-only socialevents. Word has it locations haveincluded Bangkok’s Temple ofDawn and yachts in Monaco.

To celebrate McLaren’s 40thanniversary at last year’s MonacoGrand Prix, racing star KimiRaikönnen (below) drove with aSteinmetz diamond encrustedsteering wheel. Given his unfailingcoolness under pressure, Raikön-nen has earned himself the nick-name The Iceman. Fittingly, thewheel’s dramatic unveiling tookplace in a replica Team McLarenMercedes car fashioned from twotonnes of ice. This year there werediamond encrusted helmets fordrivers. Last year’s Steinmetz dia-mond studded helmets fetched$400,00 at a charity auction.

In Monaco in 2004, a Stein-metz-sponsored Jaguar with adiamond on its nosecone hit thewall on one of the laps. Whenthe car was craned out, the stonehad disappeared. The columninches the accident generatedwere every publicist’s dream.

“Our clients are all high networth individuals and generallyconnoisseurs who want to associ-ate with excellence,” says a brandspokesperson. “In the current cli-mate, we have more clients toreach out to than ever before.”

For a year now, London has beenbuzzing with boutiques opening andexpanding, with one treasure trovemore enticing than the other.

Last summer, London welcomedthree diamond titans onto BondStreet within weeks of each other –Leviev, Moussaief and Harry Win-ston. All three are diamond jewellersat the top end of their game, bringingwith them strong brand followings,not to mention stashes of breathtak-ing gems.

For sheer Hollywood glamour,Harry Winston diamonds have gracedthe necks of stars from Liz Taylor toJulia Roberts and Scarlett Johansson.Experts on the rarest and largest ofthe rare stones, Leviev is worth a visitif only to witness the reactions ofpassers-by to the gargantuan stonesin the shop front’s windows, whileMoussaief simply brims with extrava-gance.

At Leviev, the highlight is the ulti-mate in sweet trolleys. Simply namewhat you’re after, be it rings or pen-dants over five carats, and a personalshopper will zip round the store andits underground James Bond-likevault, selecting delights to be broughtup on a specially created trolley boyand wheeled to your side for perusal.

Both Harry Winston and Leviev aredesigned to resemble Mayfair townhouses. Though their interiors areentirely different – at Leviev you goup to the VIP salon in a lift accompa-nied by a showcase of spectaculardiamond jewellery, while at HarryWinston, there’s an impressiveswirling staircase reminiscent of aluxury hotel - both communicate asense of intimacy. It’s all about enter-

The perfect settingLondon has long been a world-class destinationfor a limitless array of diamonds and diamondjewellery. And now, the choice is greater than ever. BY CLAIRE ADLER

ing a privileged world where staff arethrilled to be making you feel nothingless than regal.

Over the road at Adler, the interiorsconvey a different kind of warmth.Their Turkish charm with tapestrycarpets against wooden floors,antique glass bottles and Middle East-ern art, sculptures and masks, hint atexoticism.

Interest in jewellery is such thatCartier opened its second store onBond Street last year. Tiffany & Cohas also upped the ante, refitting itsBond Street store and increasing it insize by almost 50%. Even the stain-less steel chandeliers with bevelledpolished edges are designed to looklike cut gemstones.

Meanwhile, the Van Cleef & Arpelsstore on Bond Street has reported adramatic rise in demand for bespokeitems and the brand has now dedicat-ed a whole team in Paris to respond. Adiamond necklace for your cat, any-one? Other fascinating commissionsat Van Cleef & Arpels include thebespoke wedding jewellery collectionfor the Iranian Shah incorporating200 family gems. Since the stoneswere not allowed to leave the country,Van Cleef & Arpels designers andcraftspeople flew out to Tehran andheld meetings in The National Jew-ellery Treasury housed within Iran’sCentral Bank.

But it doesn’t stop there. Jewellersstill keep making London their home.Quintessentially British Mappin &Webb opened its flagship store thisspring on Regent Street. This Augustsees Selfridges open its long-awaitedWonder Room with fine jewelleryfrom Cartier, Chanel, Chopard, Bul-

gari, Theo Fennell, Chrome Heartsand Tiffany & Co.

Parisian jewellers Chaumet openedtheir own Bond Street store lastmonth. And Bond Street’s other newkid on the block is the British family-owned Boodles, whose amusing, car-toon-filled Look before you Leapengagement ring information bookletis the perfect antidote for anxiety-ridden fiancés everywhere.

Even Hatton Garden, the historicalheart of the UK diamond industry, hasbeen enjoying a makeover in recentyears.

The opening of new branded dia-mond jewellery shops like NicholasJames, Futuro and Raphael, the intro-duction of 24 hour security and theopening of an indoor jewellery mar-ketplace, the Heart of Hatton Garden,modelled on New York’s 47th Streetdiamond district, are modernising thearea and bringing back the sparklefactor. Diamondshop.co.uk invitescustomers into its Hatton Gardenworkshop, capitalising on the area’sunique buying experience.

Home to hundreds of Britain’s dia-mond dealers, retailers, jewellerydesigners, manufacturers and crafts-people, many of which harbour

expert knowledge passed downthrough families who have beenthere for generations, Hatton Gar-den has long been known as theplace to go to bag a diamond bar-gain. All the top jewellery design-ers buy their stones there so youbenefit from competitive pricesand service from specialists. Manydiamond dealers selling primarilyto the trade routinely take on pri-vate commissions, sometimes onthe quiet, making the neighbour-hood the perfect destination formore affordable engagementrings.

Progressive jewellery designersbased in the area include ShaunLeane, 2006 luxury jewellery ofthe year, who regularly collabo-rates with fashion designerAlexander McQueen. Then there’sNew Zealand-born Jessica McCor-mack, known for her quirky glam-our which includes creating beau-tiful diamond jewellery fromantique pen nibs. Both Leane andMcCormack will participate inSothebys London Rocks this Sep-tember, a selling exhibition show-casing the work of 18 cutting edgeBritish jewellers.

When a world record-breaking diamond isuncovered, there are only a handful of people inthe world in the market for buying it. Bidding

needs to be swift and accurate,but trying it on for size isn’t an

option.BY CLAIRE ADLER

Laurence Graff has handled more impor-tant diamonds than any individual thiscentury. When the 15th largest roughdiamond ever discovered came to lightin the Maluti Mountains of Lesotho last

September, the president of Lesotho himselftelephoned Laurence Graff with the news.

Within days, diamond experts fromSafdico, Graff’s manufacturing and trad-

ing arm, were in Lesotho. In Antwerp,

bidding parties each spent four hours examining the 603 carat rough stone.Two days later they had presented their sealed offers.

At a record-busting $20,500 per carat, Laurence Graff secured the stone formore than $12 million. “I am literally holding a piece of history in my hands,”he said. In May, the first cut was made, marking the start of a stressful, timeconsuming and precise year-long operation to transform this huge roughcrystal into magnificent flawless diamonds. Graff has developed cutting edgesoftware, tools and cutting machines specially for the Lesotho Promise and ithas yielded 24 stones so far.

There is no try-before-you-buy with rough diamonds. Since no-one hasever cut a stone of this size and complexity using such advanced technologybefore, Graff’s master cutter Pascal has an exacting mission ahead. “It is ahuge and monumental task. But it is a great honour to be responsible for suchan important and historical stone,” he says.

A new book, The Most Fabulous Jewels in the World, tells the full Graffstory in Laurence Graff’s own words. Graff shares how he became one of theworld's most famous jewellers, from his early years in London's East End andhis travels selling jewels in remote parts of the world in his twenties, to hisnewest and most beautiful diamond jewels. Out in late September, it is pub-lished by Cultureshock Media, distributed by Thames & Hudson and availablein all good bookshops.

History in the making - the Lesotho Promise

The Lesotho Promise

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Engagement rings Diamonds

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Pushkin Antiques, Gray’s Antique Market 1940s platinum diamond flower cluster treasuretotalling 2.5 carats, £2500. (07900 000 562)

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Leviev 1.14 carat oval-shaped H, VS2 diamond with fancy intense yellow ovals at each side on a yel-low gold and platinum band. £15,000 to £20,000. (020 7493 3333)

Robinson Pelham White gold three band ring with cushion cut central diamond and pavé shoulders,£18,500. (0207 828 3564)

Theo Fennell (From left to right) Cradle rubelite and diamonds, £6000; Cornerstone diamond andsapphire ring, £14,000; Cornerstone tanzanite and diamond ring, £15,000. (020 7623 4380)

Van Cleef & Arpels Large diamond Cosmos ring in white gold totaling 3,65 carats, £19300. (020 74930400)

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www.graffdiamonds.com

The Graff Vivid Yellow100.09 carats