...issues that should be taken into consideration when buying a diamond or additional precious jewelry. In today times, the issue of diamonds obtained from questionable sources has come up in the public, in the movies, and among top executives at Tiffany & Company. Members of several action groups question the ethics of obtaining diamonds from sources that are enmeshed in bloody conflict. As we take a look at the market, when most women are buying or receiving a diamond, probably do not give much thought to where the stone came from. Furthermore, whenever a man purchases a ring for his lady, how often does he think to ask the jeweler where the stone originated? In recent years, there has been a large movement to pressure jewelers, such as Tiffany & Co. to be more socially responsible in ensuring that their diamonds are not blood diamonds. The major issue that Tiffany & Co. faces in regards to these so-called blood diamonds would be classified as an issue of social responsibility. Tiffany & Co. admits openly that it has a responsibility to society to keep from supporting the atrocities that are committed by such groups as the Revolutionary United Front (RUF), who are from Sierra Leone, who act in conflict-stricken countries around the world, who uses the diamond trade to fund their wars, often terrorizing the innocent populations of their own countries. Tiffany & Co. could now use Thorne et. al.’s “Framework for Ethics and Social Accountability” (2008) in order to meet these...
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...I would like to begin my essay with a movie called “blood diamond”, and it came from a true story. The title refers to blood diamonds, which are diamonds mined in African war zones and sold to finance conflicts, and thereby profit warlords and diamond companies across the world. Set during the Sierra Leone Civil War in 1996–2001, the film depicts a country torn apart by the struggle between government loyalists and insurgent forces. It also portrays many of the atrocities of that war, including the rebels' amputation of people's hands to discourage them from voting in upcoming elections. Interestingly, once the film released many celebrities maintained a very low profile of diamond decorated and caused a moral panic for a while. I believed what happened is not an accident. Currently, the social consumption is no longer confined to the material needs of surviving but also psychological needs. People need luxuries to highlight the personal social position or to show off themselves. Unfortunately, I am not an exception, I bought diamond earrings, I use handbags that made from animals’ skin, I drive large displacement car and I do not cherish the grain. I thought no cheating, no stealing, no robbing, no bad things to people and I am a moral person. However, after I took this course, I must choose a better and more moral way to attitude my life and my future consumption. From Natural Law Ethics that we learned before, each aspect of life had a place in an overall hierarchy...
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...CLA-6 Assignment #3 – Ethics Ethics is the study of the general nature of morals and of the specific moral choices made by individuals. Ethnics govern our behavior everyday of our lives. There are many different factors that shape our ethical world view such as family, religion, experience, and authority. Everyone does not have the same concept of ethics, everyone have his or her own ideas of right and wrong. Since ethics are different for each person, there would be different paths on the process of making a ethical decision. Beyond personal ethics, there are ethical systems are defined by religious systems and by our governing system. In our country we follow a “Judeo-Christian ethnics” system. That type of system lays out such behaviors such as respecting other’s property, honoring parents, and being kind to others. So overall, as society we try to adhere to such guidelines. But even with an ethical system like that, there are still laws in place by our government to ensure everyone is treated ethically. Even though each person follows a set of ethical standards, ethics works effectively when there are consequences to our actions. Knowing that there are consequences, people will choose different ethical choices than if there is no consequences. There are many laws and rules established by our government just to make sure we all are following ethical standards. By placing forms of punishments, our ethical decision making is always influenced to avoid punishment. Religions...
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...as new sources of competition and suspicion about conflict diamonds, Gareth Penny had to rethink the basics A diamond may be forever, as De Beers' famous advertising slogan contends, but is the same true of a business model? That was the question facing Gareth Penny, managing director of De Beers, in the late 19'90s, when the famed diamond cartel found itself beset by a series of events that ultimately forced it to examine and then retool its business strategy. Since the company was founded in 1888, De Beers followed a strategy of supply control. In addition to mining its own diamonds, it bought diamonds from other producers and had what it called the "central selling organization," controlling some 90% of the world's diamonds. Its tight control over such a vast amount of supply enabled De Beers to keep prices high for a commodity that is neither particularly scarce nor useful. If a competitor offered diamonds on the market outside of De Beers' central selling organization, De Beers would simply flood the market with similar stones, thus eliminating any pricing power the competitor might offer. By the end of the 1990s, the business model of controlling supply and managing how much of its inventory went to market at any time was no longer effective: New sources of diamonds were discovered in sufficient quantity that they could be sold competitively outside of De Beers' central selling organization. Demand for diamonds was dropping at a time when demand for other luxury goods...
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...Beers and the Conflict Diamonds De Beers is the most recognizable name in the diamond industry and since it was established in 1888 by Cecil Rhodes; the company have been linked to the “blood diamond” trade because for a long time they had the control of supply and demand of the diamond industry. De beers dominated the diamond market for the best part of the 20th century, but the creation of synthetic diamonds and the discovery of new diamond deposits in other countries have created new challenges and De Beers have been obligated to deviate from their traditional ways of doing business. Q1. The diamond industry is exclusive in comparison to other industries because of the nature of their product. Diamonds are unique and the competitive rivalry is limited to only a few producers. The diamond industry has been able to create a high demand of their product because they have the ability to control the supply. Other industries such as electronics and technology face stiff competition and do not have the ability to control the market as the diamond industry does. Industries other than the diamond industries offer a great deal of alternatives for their services and products, but when it comes to the diamond industry; the alternatives are somewhat limited. While other industries struggle to stay afloat; the diamond industry continues to grow and presents an attractive opportunity for investors. Q2. I believe that anyone or any company that purchase conflict diamond has no regards for...
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...Diamond Ethics Blood Diamonds, also referred to as conflict diamonds, are diamonds that derive from areas controlled by forces or sections opposed to lawful and internationally recognized governments, and are used to fund military action in resistance to those governments, or in breach of the decisions of the Security Council. These radicals sell these diamonds, and the money is used to acquire weapons or to fund their military actions, and used to bribe foreign officials. Blood Diamonds are often created through the involuntary strained labor of men, women and children. They are also stolen during delivery or stolen by attacking the mining operations of lawful manufacturers. These assaults can be on the extent of a large military operation. The stones are then smuggled into the international diamond trade and sold as legitimate gems. These diamonds are often the main source of funding for the radicals, however, weapons businesses, smugglers and dishonest diamond traders enable their actions. Vast amounts of money are at stake and kickbacks, intimidation, torment, and murder are methods of maneuver. This is why the term "blood diamonds" is used. That diamond tainted and terminated many lives and the report of that stone bears a strong ethical significance. Angola Angola gained independence from Portugal on November 11, 1975. Although independent, the Popular Movement for the Liberation of Angola (MPLA), the National Union for the Total Independence of Angola (UNITA), and...
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...From Dirt to Distribution: The Diamond Purchasing Process and its Flaws Gregory Greenberg SCM 302 Sullivan University Fall 2013 Abstract: The diamond industry has often time been at the center of controversy due to the way that diamonds are excavated, refined and purchased. The term “blood diamond” is often applied to those stones which are mined in area’s of Africa that suffer from civil war due almost entirely to bloodshed over diamond mine rights. In response the diamond industry enacted the Kimberley Process in 2003. This process basically now requires all major diamond distributers to purchase diamonds from legitimate channels. This paper will discuss the process beginning at diamond excavation all the way to final distribution and the serious ethical issues and controversies that are hidden inside. From Dirt to Distribution: The Diamond Purchasing Process and its Flaws In order to understand the process and appreciate the work and time that goes into diamond distribution it is best to start right off with a visual aid. The following is a step-by-step process from taking a diamond from dirt to distribution (Oriana, 2012): ORIANA DIAMONDS (SURAT) PRODUCTION AND TECHNOLOGY ↓ Rough purchases Worldwide ↓ Oriana Diamonds Surat polish factory ↓ Weight Check and Sorting Varieties Head Loupe, Loupe, Lights, Scale ↓ Sorting by purity and shape Head Loupe, Loupe , Light, Sieves ↓ Separating each stone in individual packets ↓ Blocking 4 Auto Blocking machines...
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...De Beers Diamond Company Social Performance of Organizations Business 475 August 4, 2014 De Beers Diamond Company De Beers is a multinational privately owned diamond mining company established in 1888 by Cecil Rhodes. The company specializes in trading and manufacturing diamonds. Rhodes invested capital made from renting water pumps to miners and started buying mining claims. Rhodes knew the acquirement was on an untapped market. He purchased diamond fields owned by two brothers named “De Beer.” He even began purchasing from his rival Barney Barnato. The Rothchild family, Ernest Oppenheimer and JP Morgan were some of the companies first financial partners, their investments helped expand the business. By 1902 De Beers controlled 90% of the world’s diamond production. Ernest Oppenheimer, a rival diamond producer, owned the production company (Anglo American Corporation). Oppenheimer essentially bought his way onto the De Beers board of directors. In 1927, he became the chairman. Under his leadership, De Beers began making exclusive deals with its suppliers and buyers; this strategy made it impossible to have transactions with other companies and quickly became monopolized. De Beers is known for maintaining a strong hold on the industry and for absorbing its competitors by using it’s dominate position in the diamond industry. De Beers has been implicated in multiple scandals that involve price fixing and antitrust behaviors. There have been revolts against...
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...Organizations The De Beers Diamond Corporation Dr. Beth Kane Business 475: Business and Society January 28, 2014 The De Beers Diamond Corporation is a multinational diamond mining, hops, trading, and manufacturing business. In this paper the nature, structure, and types of product this corporation is involved well be analyzed. As with every large corporation stakeholders salient stakeholders are involved with the shaping of the companies direction, three key stakeholders relationships and roles will be evaluated. There are five key points for primary stakeholders wielding influence inside the corporations mainframe and the evidence of this behavior at De Beers. During the building and development of most businesses there are social issues that arise to challenge the structure and integrity of the corporation, De Beers faced this as well. This paper will detail the issue in which De Beers faced as well as the corporate and social changes that were wrought from the situation. This paper will also cover a hypothetical situation were a first person narrative of the roles of forming a stakeholder coalition. During this hypothetical situation the leader role will explore three (3) potential holdups for the the forming of a stakeholder coalition. The De Beers Diamond Corporation is a privately owned multinational conglomerate established in 1888 by Cecil Rhodes. Rhodes invested money made from renting water pumps to diamond miners into buying mining...
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...leads and dominates the diamond industry in diamond mining, diamond trading, and industrial diamond manufacturing. In 1871 a South African man named Cecil Rhodes created De Beers. Rhodes rented water pumps to miners then invested his profits by buying up small mining operations. In 2011 the De Beers Group sold their remaining stake to Anglo American for $5.1 billion in cash. (DeMarco, 2011). Before the sale the diamond company was owned by the Oppenheimer family. Now Anglo American own 85 percent of De Beers making them the primary stockholder while the Republic of Botswana owns the remaining 15 percent of the company. Mining diamonds involves a lot of factors that can effect a company’s external environment. In order for De Beers to operate it has to account for things such as: local and foreign governments, globalization and trade, the ethics of business and labor, the effect on the environment, the perception of society, and the importance of new technology. In the case of the De Beers Diamond Company the two most important factors to the organization’s external environment are globalization and trade, and the perception of society. Salient Stakeholders When producing a product as fragile such as diamonds, a company needs many factors to come in place. In actuality a diamond is just a shiny rock found in the earth. A lot of people play a major role in insuring the value of the diamond. Three groups that have important stakes in De Beer Diamond Company are the stockholders...
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... De Beers Introduction For generations, diamonds have been marketed as tokens of power and love. For some however, diamonds have a more utilitarian appeal. Easily concealed, immensely valuable and largely untraceable, stones from rebel-held mines have raised billions of dollars on world markets to finance revolution in Angola, Sierra Leone and the Democratic Republic of Congo (DRC). For years these "conflict diamonds" have encourage rebel leaders to arm and equip their armies in violation of UN weapons and financial sanctions. Diamond monopoly De Beers is notable for its monopolistic practices throughout the 20th century, whereby it used its dominant position to control the international diamond market. The company used several techniques to exercise this manipulation over the market: Firstly, it persuade independent producers to join its single channel monopoly, it flooded the market with diamonds similar to those of producers who refused to join the cartel, and lastly, it purchased and stockpiled diamonds produced by other manufacturers in order to price control through supply. In 2000, the De Beers forced to change the model, due to certain unavoidable factors such as the decision by producers in Russia, Canada and Australia, to distribute diamonds outside of the De Beers channel, thus effectively ending the monopoly. The De Beers family of companies started operating under a set of guiding rules known as the Diamond Trading Company Best Practice Principles (BBP)...
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...Unethical Values Within De Beers Consolidated Mines Limited De Beers Consolidated Mines Limited is a South African-based mining and trading company, which controls the flow of diamonds in the United States marketplace (Aurora, 2008). De Beers distributes diamonds, ships them, and distributes them to significant intermediaries, wholesalers and retailers (Atkinson, 2000). 1. Unethical behaviour: Unfair trading and competition The first unethical conduct identified within the De Beers example is unfair trading and competition, particularly in the formation of cartels. Unfair competition is unethical in terms of the Teleological Framework, as it focuses on the negative result of the conduct of an individual or company as a juristic person, which forms the basis of self-interest (ethical egoism), thereby going against the rights of others (Stanwick & Stanwick, 2009). This section will briefly explain the De Beers example of this form of unethical conduct, and look at ways in which De Beers could redeem their reputation. We will begin with the definition of a cartel. A cartel is a group of people, organisations, or companies that cooperate together to control production, marketing, and pricing of a product (Smith, 2003). Cartels are an example of unethical conduct and are thus explicitly illegal under antitrust laws in many countries of the world, as they eliminate fair market competition. A cartel’s biggest effect is driving the price of a commodity up and well beyond what is...
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...DeBeers “A Diamond is Forever” Prepared April 16, 2012 For decades, De Beers has been the preeminent name in diamonds. Thanks to a stockpile of the world's rough diamond supply, indelible marketing schemes and even negotiations with foreign governments for their diamonds, De Beers has been the most important name in one of the world's most lucrative businesses for almost a century. This paper will review the billion dollar rise and fall of a monopoly that has crushed competitors and cash-strapped governments since the 1800s. Diamonds became a symbol of love thanks to De Beers, which is fitting, since De Beers became what it is today because of a love story: the love of money. In the beginning, the diamond trade took place mostly in India and Brazil. With the discovery of diamonds in South Africa, the trade simultaneously took off and became much less profitable. Up until the mid-1800s, diamonds were a rarity and could be seen only on the hand of a monarch. But the diamond rush that began in South Africa in the second half of the 19th century flooded the market with diamonds, killing demand. It would take some ingenious plotting and advertising to keep the diamond's reputation as intrinsically valuable and desirable, which is where De Beers comes in (Goldschein, 2011). Company History and Overview De Beers got its start when English-born businessman Cecil Rhodes, broke into the diamond business in South Africa by renting water pumps to miners before buying diamond fields...
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...This essay will analyse key issues between companies and stakeholders and how corporate social responsibility has been accepted worldwide but it is not clear which companies or government companies behave in a social responsible manner. The relationship between companies and stakeholders is key ingredient in the success of any organisation. Making managerial decisions upon different circumstances is more difficult because the existence of different ethical approaches. A stakeholder is an individual or a group of individuals that affect or can be affected by corporate activity. Stakeholders are often loose grouping of factors that may be brought together and stirred into action by some specific circumstances as an example Shell and the kidnappings in Nigeria where militant groups have been kidnapping workers from oil companies in exchange of jobs. The key issue in this case is poverty and the lack of jobs in the region. Individuals who have been affected by this phenomenon created groups against the government policies and how the country is run. This stakeholder (militant groups) argue that the distribution of revenue from oil related activities is not fair, in the other hand the money made is been used to develop other part of the country while the area where the oil is exploited remains in poverty. Oil extraction activities are highly pollutant; it has affected the lives of fisherman and farmers. GlaxoSmithKline and Developing Country Access to Essential Medicines is...
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...chosen organization, and two (2) key factors in the organization’s external environment that can affect its success. Provide explanation to support the rationale. De Beers Diamond Company is an industry that currently produces $13 billion worth of rough diamonds each year, leading to the employment of 10 million people globally from mining to retailing. 70% of rough diamonds are sold for industrial purposes with the remaining 30% “gem quality” being distributed to experts for cutting, polishing and jewelry manufacturing (Stein, 2001). The global jewelry market has increased three-fold in the last 25 years and is currently worth $72 billion each year. Jewelry diamonds are unjustifiably expensive given that they are not actually scarce. Upon the discovery of other diamond reserves globally, De Beers set up a subsidiary called the Central Selling Organization (CSO), responsible for buying the production for all mines worldwide then selling the produce to dealers in return for a percentage fee (10 – 20 %) from producers (Stein, 2001). The CSO was able to maintain illusion of scarcity by deciding the quantity of diamonds to be supplied to the world market and in turn, allowing individual producers to produce a certain percentage of that amount (De Beers Group, 2012). The CSO then sold batches of rough diamonds to selected dealers at their exclusive sightings. The CSO were able to dictate inflated prices to dealers, as if dealers tried to negotiate on price, they were not invited the...
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