Governance and ethics
Our commitment to governance and ethics excellence ensures that good corporate citizenship permeates the business. We understand that the value of our exquisite diamonds is determined by the way we mine. We therefore produce and distribute rough and polished diamonds according to the highest ethical and legal standards.
Related sustainability principles
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Creating a safe and healthy work environment
Related UN SDGs
We launched the first rolling three-year cycle to embed the UN SDGs into our systems, processes and decision-making during the year. The following UN SDGs relate to our governance and ethics pillar:
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Refer to our Annual Report and Accounts 2021 and Our Approach to Climate Change Report for more information on our approach to integrating these UN SDGs into our business operations.
Snapshot of our performance
Our goals
Our future
Our context
The Board ensures that good governance, including ethical conduct, is practised throughout the Group. Leading by example, the Board oversees performance and activities such as, among others:
We are also committed to adopting and complying with best practice standards such as the Equator Principles, the Global Industry Standard on Tailings Management and other appropriate standards.
Our approach
The Board is ultimately responsible for overseeing the Group's activities, strategy and financial performance, efficient use of resources, and improving its health, safety, social, environmental and climate change resilience performance. During 2021, the Board appointed Rosalind Kainyah as a non-Executive Director, this appointment strengthens the Board’s capacity and skills in terms of ESG matters.
Gem Diamonds consistently applies the principles of good governance contained in the 2018 UK Corporate Governance Code and voluntary disclosures in relation to the Miscellaneous Reporting Regulation. Further information on our compliance with the code's provisions is available in our 2021 compliance statement in the Annual Report and Accounts 2021.
During 2021, formal governance structures were adopted to ensure climate-related risks and opportunities are identified and elevated to the Board through the appropriate sub-committees. The Group also implemented an employee engagement strategy to ensure that the employees’ key concerns are addressed at the highest level.
Our performance
Our context
With business integrity and good corporate citizenship remaining our top priority, we recognise the value of our stakeholders and endeavour to protect their human rights. This includes preventing forced or child labour, and promoting a culture of non-discrimination and ethical leadership, underpinned by our human capital policies.
Our approach
Our sustainable development framework and code of ethics ensure our compliance with the legislation and regulations of our host countries as well as voluntary codes for labelling, products and service and our commitment to international best practice. Supply chain control ensures our contractors comply with the same principles.
We continuously refine our human rights policies and procedures, and provide training in human rights, our code of ethics and values for employees as part of the Letšeng induction programme, and all staff receive annual human rights training. Letšeng aligns itself with the principles on security and human rights as included in the ISO 18788:2015 Management system for private security operations, which has been adopted at Letšeng. The entire security department has received training on human rights and voluntary principles, as outlined in ISO 18788.
Our human capital policies also enforce the fair treatment of employees through negotiated remuneration, non-discrimination, and strict health and safety practices.
As an ethical and accountable organisation, we supply rough and polished diamonds of the highest quality. Responsible business practices are incorporated into every step of our journey from production to market, and we remain compliant with, and committed to, the Kimberley Process. This preserves our reputation for ethical mining and distributing diamonds without harming people or the environment.
We have strong relationships with our customers through our commitment to transparency and integrity. In addition, we communicate openly with our customers – when we conclude a diamond tender, a complete list of the winning bids is electronically circulated to all participants in the sales process.
We continue to mature our reporting and in 2021 we adopted the TCFD framework (with reporting taking place for the first time in 2022, and started reporting through the CDP in 2021.
Our performance
Our context
The Board reports to shareholders and stakeholders on the Group’s financial, social, environmental, governance, and health and safety performance, while promoting an ethical culture and embedding good governance principles in the business for the benefit of investors, host nations and PACs.
Our approach
The Board conducts a formal and rigorous annual evaluation of its own performance, and that of its Committees and Directors, so that no individual or group dominates decision-making. In December 2021, Bruce Wallace Associates facilitated this evaluation of the Board and Company’s response to events of the preceding months, strategy formulation, stakeholder engagement and risk management. The findings were consolidated into a report circulated to Directors and discussed at the March 2021 Board meeting, along with several recommendations. The overall findings were positive and demonstrated significant progress from the previous year’s evaluation.
The Board is committed to medium and long-term value creation for stakeholders by ensuring efficient use of Group resources in day-to-day operations. Each Board member has experience and knowledge of the diamond industry to identify opportunities and enhance operational efficiencies.
The Remuneration Committee, comprising two independent non-executive Directors and a Chairperson, meets formally at least twice a year to determine the remuneration of the Chief Executive Officer, the Chief Financial Officer and the senior Executive team. Executive and senior management as well as external advisers may be invited to attend these meetings as deemed appropriate. The Remuneration Committee also determines the terms and conditions of performance-related remuneration, with sustainability-linked KPIs included in Executive Management’s personal performance objectives.
Our performance
See our Annual Report and Accounts 2021 for more information.
Our context
We keep abreast of legal, regulatory and governance requirements as well as industry best practice to embed sound corporate governance principles in our business, and thus create sustainable value for our stakeholders. Our Social and Environmental Impact Assessments (SEIAs) are aligned with the International Financial Corporation (IFC) Performance Standards on Environmental and Social Sustainability, the Equator Principles and the Free and Prior Informed Consent (FPIC) guidelines.
Our host country's legal and regulatory terms, conditions and performance expectations are outlined in the Letšeng mining lease, granted by the Government of Lesotho until 2039. This lease includes a framework for our partnership with the government, securing our operation's long-term and sustainable future.
Our approach
We amend our governance policy when the UK Corporate Governance Code and other relevant standards change, and the Group has an internal Governance Committee that drives the work to adopt and implement these changes. We are also implementing the recommendations of the TCFD and the social and environmental management plans governing operational activities are aligned with best practice. A robust internal and external audit framework exists to ensure regular compliance checks with the legal requirements and best practice standards that the Group has adopted.
Our performance
Refer to the Governance chapter of our Annual Report and Accounts 2021 for more information.
Our context
Our lifelong duty of care requires that the way we do business enhances the mining industry's reputation. The continued implementation of responsible workplace practices in the face of the global pandemic has ensured our workforce remains safe and the Group could manage operational disruptions. Our multi-layered supply chain supports our production of raw, direct and indirect materials as well as our technical, legal, administrative, engineering and other professional services, and skilled labour. The Group continues its efforts in research and development into innovative ways to improve and optimise our mining and treatment processes.
Our approach
Standards and practices adopted throughout the Group ensures our processes, and those of our suppliers, align with our code of ethics and reputation. Our governance processes proactively identify and mitigate risk. In addition, our whistleblowing policy encourages employees to anonymously report unethical behaviour and we appropriately address reported incidents.
Our operational HSE system is based on the ISO standards of Environmental Management (14001) and Occupational Health and Safety (45001). Independent auditors conduct compliance audits on our systems on an annual basis, and in 2021 we once again received a positive recertification audit.
Our stringent procurement process assesses suppliers in line with best practice and we continuously work to mature the process as appropriate. Suppliers are assured of equal opportunity to tender although we proactively promote in-country procurement. Formal contracts are concluded with suppliers with clear terms and conditions, including our governance policies, to confirm adherence to those policies and ensure they adopt our way of doing business.
The way we do business is governed by the following policies that govern our procurement process:
We do not tolerate bribery and corruption and are compliant and supportive of the UK’s Bribery Act. We also demand the same from our suppliers through clauses included in supplier contracts. To this end, Group internal audit regularly reviews our anti-bribery and anti-corruption policy.
Cybersecurity is a crucial focus area, as our operations rely on secure information technology (IT) systems for efficient and secure financial and operational management, to avoid material adverse impacts on the business. We continually upgrade our systems, processes and security firewalls to reduce the risk of sophisticated attacks.
Our IT controls, processes and systems are built according to industry-accepted standards. We also have appropriate two-tier back-up procedures with firewalls and other security applications. In addition, we frequently test our back-up restorations and, to the extent necessary, external professional advisers help mitigate evolving risks.
Processes in terms of "Know Your Client" are in place across the Group and senior Executives sign off on risk assessments and appropriate due diligence. Our whistleblowing line, which is monitored by an independent audit company, provides a platform for employees and other partners to anonymously report any breaches of law, policy or procedure. Once the notifications are received by the Group Internal Auditor and CFO, they are distributed to the appropriate representatives for investigation.
For more information refer to the innovation section in our Annual Report.
Our performance