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The World Federation of Diamond Bourses had launched a code of ethical business practices for diamond exchange members in an effort to boost consumer confidence and restore credibility to the industry.
"We must take severe actions against transgressors, to protect our collective reputation and the global diamond business's integrity at large," said Shmuel Schnitzer, outgoing president of the WFDB at the 32nd World Diamond Congress in Tel Aviv on Tuesday.
Members of diamond exchanges around the world will be required to sign a document verifying that they know and understand their ethical obligations to the code of principles of diamond production in order to receive the WFDB Mark.
"The WFDB Mark is a quality seal, by which clients and suppliers will know that the diamantaire that they are dealing with complies with the strict ethical code of the WFDB," said Schnitzer.
Speaking at the Congress, where the WFDB Mark was launched, Jeffrey Fischer, president of the International Diamond Manufacturers' Association said that too many members in the industry were still not recognizing ethical codes of practice.
The code, among other things, prohibits child labor, conflict and "blood diamonds" and money laundering.
"Our industry needs to remain clean and ethical through more transparency in every part of the diamond industry while each member has to take responsibility," said Avi Paz, president of the Israel Diamond Exchange.
Industry fears 'Blood Diamond' movie
As profit margins in the diamond market decline, industry leaders are worried about the impact the release of the Warner Brothers movie The Blood Diamond will have on profits and sales.
"We are concerned that the movie will provide people with the wrong picture of the state of blood diamonds and, as such, have an influence on consumer behavior and demand," Eli Izhakoff, chairman & CEO of the World Diamond Council told The Jerusalem Post. "The problem we have is not the airing but the fact that the content portrays the facts which were true for the 1990s."
The film, which is about to bring the conflict diamond issue to the big screen stars Leonardo Di Caprio and Jennifer Connelly and is expected to be released by the end of this year or beginning of next.
Set in Sierre Leone in 1999 amid civil war, the movie tells the story of a poor Mende farmer who gets caught up in a conflict between an American diamond smuggler (Di Caprio) and the syndicate that controls local diamond mining, producing what are called "blood diamonds" because of their ties to violent, political conflicts. His son kidnapped to become a soldier in the rebellion's child army, the farmer must team up with the smuggler on an adventure that takes them around the world, through three major diamond centers in New York, London and South Africa.
Industry leaders, however, say things have changed over the past few years.
"The trade in conflict diamonds has been reduced from 4 percent to 0.5% by the so-called Kimberley Process," said Avi Paz, president of the Israel Diamond Exchange.
The Kimberley Process, set up in 2000, aims at cracking down on the multi-billion dollar trade in the gemstones that have been mined in war zones.
Izhakoff said the diamond industry was preparing for the movie's release through efforts such as the planned launch of a Web site in August about diamond facts to educate the public and alleviate consumer concerns regarding the origin of their diamonds.