Bulgari conducts independent visits to mines, ethics report reveals

Bulgari ranking by HRW – Moderate

Bulgari is an Italian jeweler, owned by the French luxury group LVMH Moet Hennessy Louis Vuitton S.E. (LMVH). The company has about 200 stores worldwide.

LVMH’s jewelry companies had a total revenue of $3.4 billion in 2016; the revenue of individual companies is not made public.

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Bulgari responded to Human Rights Watch’s request for information with a detailed written letter and met with Human Rights Watch staff by conference call.

Bulgari is one of very few jewelry companies that has been certified under the RJC’s Chain-of-Custody Standard. However, Bulgari does not have chain of custody for its diamonds and does not require all suppliers to undertake human rights due diligence and third-party audits. On the basis of available information, Human Rights Watch considers Bulgari to have made moderate efforts to ensure human rights due diligence.

Supply chain policy: Bulgari has a Code of Ethics that includes a brief statement requiring suppliers to respect labor rights; Bulgari also has a separate Anti-Slavery & Human Trafficking Statement. Bulgari’s parent company, LVMH, has a more detailed Supplier’s Code of Conduct with provisions on labor rights and environment that also apply to Bulgari. LVMH’s Code was under revision in late 2017 and Bulgari has informed Human Rights Watch that it will reviewing its Code of Ethics to reflect the changes. Respect for the codes is part of Bulgari’s contracts with its suppliers. Diamond suppliers must be in compliance with the Kimberley Process and the World Diamond Council’s Standard of Warranties.

Chain of custody: Bulgari sources gold only from refiners that are certified against the Chain-of-Custody Standard of the RJC. As described above, the Chain-of-Custody Standard does not require comprehensive human rights due diligence and is mostly focused on a documentation of business transactions.

Bulgari informed Human Rights Watch in a letter that it uses transfer documents for each batch of gold purchased, which include information on the kind of material (such as mined or recycled) and the country of origin. However, the company subsequently stated that it does not always have information on the country of origin, but complies with the Chain-of-Custody Standard by ensuring that the gold does not originate from conflict-affected areas. With regards to the diamond supply chain, Bulgari does not trace diamonds back to the countries or mines of origin.

Assessment of human rights risks: Bulgari has put in place a Suppliers Risk Management Process to implement its Supplier’s Code of Conduct. As part of this process, Bulgari requests suppliers to provide self-assessments on their social and environmental performance. Bulgari uses this information to assess human rights risks, and to deploy auditors to conduct announced and unannounced visits to suppliers, such as its factories in Italy.

The risk assessment also includes visits approximately once a year to countries where Bulgari sources or is considering sourcing, and that are considered more high-risk. In October 2017, Bulgari stated that it intends to work with suppliers to reinforce and enlarge its due diligence processes, to ensure it applies to the whole supply chain, including on-the-ground mine assessments.

Response to human rights risks: Bulgari states that, “We are aware that our business could have adverse impacts on human rights and local communities,” and that it is therefore committed to continuously assess and reduce these impacts.[177] When Bulgari finds that a supplier is not in compliance with its standards, the company says it usually gives the supplier between one and six months to correct the problem.

Third-party verification: Bulgari is certified against the Code of Practices and the Chain-of-Custody Standard of the RJC.[179] Bulgari states that it conducts third-party audits of its suppliers. All of its gold suppliers are certified against the RJC’s Chain-of-Custody standard, and its diamond suppliers are certified against the RJC’s Code of Practices.

Report annually: Bulgari’s parent company LVMH publishes an annual report and a yearly environmental report, covering all LVMH brands. The 2016 environmental report includes a section on Bulgari’s chain of custody for gold, and various environmental risks, but does not provide audit summaries, mention noncompliance issues, or steps to address noncompliance.

Publish suppliers: Bulgari does not publish the names of its suppliers. It shared the names of its gold suppliers with Human Rights Watch on a confidential basis.

Support for artisanal and small-scale mining: Bulgari does not participate in a dedicated program to source from artisanal and small-scale mines or support initiatives for responsible small-scale mining.

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