Mining in Botswana takes place through the mining company Debswana,a 50-50 joint venture with the Government of the Republic of Botswana. In Namibia it takes place through Namdeb, a 50-50 joint venture with the Government of the Republic of Namibia. Mining in South Africa takes place through De Beers Consolidated Mines (DBCM), 74% owned by DeBeers and 26% by a broad based black economic empowerment partner, Ponahalo Investments. In Tanzania it occurs through a partnership with the government of Tanzania, 75% owned by De Beers, 25% by the government. In 2007 De Beers began production at the Snap Lake Mine in Northwest Territories, Canada; this is the first De Beers mine outside of Africa. In July 2008 De Beers opened the Victor Mine in Ontario, Canada.
Trading of rough diamonds takes place through the Diamond Trading Company through wholly-owned and joint venture operations in South Africa (DTCSA), Botswana (DTCB), Namibia (NDTC) and the United Kingdom (DTC). The various DTCs within the Family of Companies sort, value and sell approximately 40% of the world’s rough diamonds by value.
The Family of Companies employs about 20,000 people around the world on five continents, with 17,000 employees in Africa. Over 7000 people are employed in Botswana, over 7100 in South Africa, 3800 in Namibia, 700 in Canada and over 800 in Group Exploration.
In 2001, De Beers entered into a retail joint venture with French luxury goods company Louis Vuitton Moet Hennessy (LVMH) to establish an independently managed De Beers diamond jewellery company.
The joint venture, called De Beers Diamond Jewellers Ltd sells diamond jewellery. The first De Beers store opened on Old Bond Street in London and there are now De Beers retail stores in the following locations:
In the year 2000, Advertising Age magazine named "A Diamond Is Forever" the best advertising slogan of the twentieth century.
Other successful campaigns started by De Beers include the "eternity ring" (as a symbol of continuing affection and appreciation), the "trilogy" ring (representing the past, present and future of a relationship) and the "right hand ring" (bought and worn by women as a symbol of independence).
De Beers is also known for its television advertisements featuring silhouettes of people wearing diamonds, to the music of Palladio by Karl Jenkins.
The diamonds sold by the DTC are sourced primarily from De Beers’ own mining operations in South Africa and Canada, and through its joint venuture partnerships with the governments of Botswana, Namibia and Tanzania.
Technicians in London, Kimberley, Windhoek and Gaborone sort these diamonds into approximately 12,000 different categories based on size, shape, quality and colour, for DTC Sightholders.There are 79 Sightholder companies who buy the rough diamonds from the DTC and its partner offices. Sightholders travel to London, Kimberley, Gaborone and Windhoek ten times a year for their Sight. DTC Sales in 2007 were $5.9bn.
The Diamond Trading Company develops diamond technology and operates a research and development facility based in the United Kingdom, to support the consistency of DTC rough diamond assortments for Sightholders and downstream industries in the DTC’s producer partner countries.
Sightholders are required to comply with the De Beers’s Best Practice Principles, which set out various objective standards of conduct within three main areas: business, social, and environmental responsibilities. The Best Practice Principles ensure that the De Beers Family of Companies, Sightholders and applicable third parties operate to an ethical, legal, professional, social and environmental standard, including being committed to the Kimberley Process.
This was done through a single channel marketing structure that was favoured by most in the diamond industry and producer countries for creating structure and stability, and maintaining consumer confidence in gem diamonds. Currently De Beers sorts, values and sells approximately 40% of the world's rough diamonds by value, but as a result of company transformation, is now more profitable than when it maintained a greater market share.
A range of factors contributed to the need for change in the De Beers model. In the 1990s it became increasingly evident that De Beers’ industry custodianship and supply-controlled model was no longer viable. De Beers was also unable to conduct business in several jurisdictions where it had interests or a corporate presence due to their dominance in the diamond industry. In addition, more producers from varied locations such as Russia, Canada, and Australia chose to distribute diamonds outside of the De Beers framework.
Also, diamond jewellery markets had fallen in comparison to other luxury goods. The behaviour of consumers had changed and the diamond industry, being in a world unto themselves, had been slow to respond to market dynamics.
To address this, on behalf of its own interests and that of the industry as a whole, De Beers conducted a strategic review with Bain & Company, consequently changing its business model from a supply-controlled industry to that which was driven by demand. De Beers also implemented their Supplier of Choice sales strategy.
The diamond industry of today is markedly different to that of a decade ago, and is a complex and constantly evolving geo-political phenomenon.
Current major players in the diamond industry are the African producer countries, i.e. the Government of the Republic of Botswana, the Government of the Republic of Namibia, De Beers, Rio Tinto, BHP Billiton, Lev Leviev, Harry Winston, and Alrosa.
In December 2000, the United Nations General Assembly adopted a landmark resolution supporting the creation of an international certification scheme for rough diamonds. By November 2002, negotiations between governments, the international diamond industry and civil society organisations resulted in the creation of the Kimberley Process Certification Scheme (KPCS). The KPCS sets out the requirements for controlling rough diamond production and trade. The KPCS became effective in 2003.
De Beers states that 100% of the diamonds it now sells are conflict-free and that all De Beers diamonds are purchased in compliance with national law, the Kimberley Process Certification Scheme and its own Diamond Best Practice Principles.
De Beers is active in the Kimberley Process, and a participant in the Diamond Development Initiative (DDI). The Diamond Development Initiative aims to address the political, social and economic challenges facing the small-scale informal diamond mining sector and to optimise the beneficial development impacts of small-scale formal diamond mining to diggers and their communities.
Industrial diamonds - In 2004 De Beers pleaded guilty and paid a $10 million fine to the United States Department of Justice to settle a 1994 charge that De Beers had conspired with General Electric to fix the price of industrial diamonds.
European Competition Commission - In February 2006, De Beers entered into legally binding commitments with the European Commission to cease purchasing rough diamonds from Alrosa as of 2009. In January 2007, the European Commission announced it had rejected all outstanding complaints against the Diamond Trading Company's Supplier of Choice sales strategy.