In an open letter addressed to entities with international influence in the field of gold, a dozen organizations linked to the sector ask that they stop greenwashing what is known as recycled gold and that, instead, they commit to promoting good environmental and social practices in mining. The call occurs in a historical context of high prices for this precious metal, which have boosted the demand for recycled gold, which already represents a quarter of the annual supply, according to data from the World Gold Council. Specifically, the volume of gold refining of recycled origin has increased by 34% between 2018 and 2021 in the London market, while refining of newly extracted gold has grown by 2%.
Why is recycled gold not as green as they make it out to be? “Companies take advantage of the good image of the word recycling to supply themselves from a market that for them is cheaper, closer and easier than resorting to responsible mining, but in reality what they are doing is buying gold of controversial origin. , harming mining that does do things well and destroying jobs among the most needy population,” says Patrick Schein, president of the board of directors of the Alliance for Responsible Mining. The price of recycled gold is 10% lower than that extracted under the Fairmined mining standard of the Alliance for Responsible Mining.
The first controversy lies in its origin, because old jewelry, coins, ingots or manufacturing byproducts can hardly be considered waste, due to their high economic value. Furthermore, most of the so-called recycled gold is not such. The signatories of the letter warn of “loopholes that are exploited to introduce problematic gold into legitimate supply chains.” The NGO SwissAid reported in 2020 that much of it was newly extracted, sometimes by Sudanese militias involved in human rights abuses. The London Bullion Market Association has also described it as “a particular money laundering risk, because the origin of scrap gold bars and jewelery can be easy to conceal”. All these bad practices end up discouraging the real recycling of gold from electronic waste.
Another big but is that “the effect of replacing mined gold with recycled gold in the supply to justify an ecological and carbon-free advantage simply does not work for gold,” point out the entities behind the letter. “Gold is not extracted based on existing demand, but rather it is extracted for its value, by playing a role as a financial asset,” explains Schein. Roc Majoral, from the jewelry firm Majoral and spokesperson for the responsible jewelry collective Origen, agrees, stating that “gold extraction will not stop as long as there are veins, so it is better to focus efforts on more responsible mining.”
In relation to Roc Majoral’s statement, the organizations that signed the letter indicate that “sourcing only recycled gold means disengaging from artisanal and small-scale mining, contrary to OECD recommendations.” They add that “not engaging” with this artisanal mining “is probably the biggest missed opportunity for gold supply chains to have a real positive social and environmental impact.” Artisanal and small-scale mining directly employs 18.2 million people, representing 90% of the miners dedicated to gold extraction.
