Climate change experts on how luxury brands, buyers and investors can ensure sustainability

There is also, says our anonymous water consultant, a massive health consideration to mining. “That affects lives completely and leads to public health issues such as cholera and other waterborne diseases.”

All these issues are interconnected. While designing sustainable strategies for luxury clients, we can’t look at one thing without looking at the other because their internal practices and how they impact the environment have a snowball effect. This, in turn, has a massive impact on a group of people in those geographies.” With this comes an extra layer of the impact on women: a consequence of climate change. “This has a lot to do with access to clean and safe water,” she adds.

Some brands imply that they are doing their part to solve some of these issues by using recycled gold and lab-grown diamonds. However, the reality is that “luxury maisons are operating on limited resources, which are becoming scarcer by the day,” says Ray. “It’s not that they always want to choose sustainable practices; they don’t have a choice—they have to.”

These days, factoring sustainability into a business model means far more than just devising Corporate Social Responsibility (CSR) activities. Ray says, “Previously, luxury companies only considered CSR to give back to the community. Some of these businesses are still operating in this manner, but it will only generate short-term publicity.”

To remain profitable, Ray continues, the luxury industry must take the broader issue of sustainability more seriously—and prove it is doing so. “It’s all about the money,” he says. “These days, investors understand that century-old luxury maisons and watchmakers must appear to be sustainable in their outlook, or else they risk being tackled by the competition, or worse, becoming irrelevant in the next ten to 15 years.

“Investors are also aware of the threat posed to most mines that are prone to flooding and rising sea levels, so they tend to fund organisations that are finding creative solutions to the climate crisis, rather than those that are doing business as usual.”

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Our anonymous former Colombian diplomat points to further problems caused by illicit production methods. “Illegal mining is a huge problem in countries like mine and other parts of the world. They extract precious metals not only for jewellery or watches, but also to construct or develop new technology. The lack of a strong regulatory framework is the first red flag for this industry.”

Such illegal work also means that traceability of materials along the supply chain, awareness of good and bad practices, and even knowledge about the materials are all lacking. The practices used in Colombia are vastly different from those used in South Africa, for example, and there is no global rule book to refer to. He also mentions that the local mafia plays an important role in controlling the produce in mining areas in Colombia. These criminal organisations charge a set fee to allow mining activity, which may endanger human life. “It is critical to assess each mine in the world and how mature the regions are in terms of human rights and regulations,” he says.

This, however, has heightened geopolitical tensions as a new wave of “resource nationalism” has swept mineral-rich countries in 2023. With the slow but steady stabilisation of supply-chain management, places such as Indonesia, Zimbabwe and South America are all preparing to raise mining taxes while reducing precious commodity exports. Ray says, “All of these factors are considered when developing a successful sustainability strategy for the luxury sector. To ensure the product is truly sustainable, one must work respectfully with raw materials, the environment, internal employees, external stakeholders, investors, auditors, NGOs, supply chain partners and, ultimately, the governments of various regions.”

The water consultant, meanwhile, is cautiously hopeful. “Companies are doing their best, which is no easy task, but it is also just the beginning, Of course, luxury maisons and watchmakers are going to give you amazing press releases, and things to show they care about the environment, and they want to give you a guilt-free purchase, but whether that buyer is really guilt-free? I don’t believe so.” Is there room for improvement? “Yes, absolutely,” she says.

“Fifty per cent of all precious materials, especially gold, are used in jewellery. Another 40 per cent are used in making bullion bars and gold coins. Only ten per cent are used in dentistry and in industry practices,” says Luke Garcias, an environmental expert who began his career in the coal mining industry nearly 27 years ago, when the concept of environmental activism was still in its infancy, and who has worked in environmental management, approvals and clean energy technologies throughout his career. In his video call with Tatler Garcias described gold as nothing more than a “vanity material”. On the other hand, the Earth is home to some critical minerals which will propel us to the next stage in life; they help in building batteries, electric vehicles, solar panels and so on. The problem is that these critical minerals are so called because they are increasingly rare. This is slowly going to be the reality with gold as well.

Ray says: “We are in the middle of a crisis, but it is still code amber. We are not coding red just yet.” The only difference between gold and the critical minerals is that “we can do without gold”, Garcias says; it does not help us decarbonise the environment. As for the brands, Breitling’s Figueroa says, “Ultimately, sustainability is a very complex topic with highly personal values attached to it. This is why we focus on traceability so that the individual customer can be informed and make decisions in line with their own personal values.”

However, a lost-in-thought Garcias believes that “The real questions we must ask ourselves are: do we really need gold? Is having all these piles of glittering bars locked up in vaults really worth our time? Should we turn it into jewellery?” Finally, he is resigned to the fact that the answer ultimately remains in the demand created by consumers for haute horlogerie and high jewellery. Figueroa believes dialogue will be essential “to drive the change we need, and transparency is a vital baseline for meaningful exchange”.

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