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- 6 Oct 2010
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The New Luxury Era: People, Planet & Profit


Jonathan Kendall, a commission president of CIBJO, the World Jewellery Confederation, and global operations director of De Beers Forevermark, offers an exclusive digest of CIBJO’s new report, ‘Responsible Luxury’

A global economic downturn forces us to do many things. It forces us to rethink the way we live. The way we work. And the way we run our businesses.

The search for greater efficiency in business can result in non-essential elements getting the axe. This is no bad thing. Except that it can be tempting to regard corporate responsibility (CR) initiatives as an expensive indulgence that companies can no longer afford.

For luxury companies, this is dangerous. The recession has given people a chance to reflect on their inherent values and beliefs and expect more from a purchase than the product alone. According to a TIME Magazine poll in 2009, for instance, nearly 40% of Americans purchased a product because they liked the social or political values of the company that produced it.

Concerns for social, ethical and environmental issues are stronger than ever, and promiscuous trophy brand purchasing by luxury consumers is becoming increasingly outdated. There is every reason to believe luxury consumers will be loyal to those brands that they engage with on a deeper level.

What does this mean for luxury businesses? Understanding the new motivating factors behind consumer decision making is key to responding correctly and profitably post-downturn. Any industry recovery will be underpinned by an increase in conscientious business practice but true recovery will not be sustainable without it.

 CR is not just an optional extra; being good is not an add-on 

This is because we are an aspirational industry that heralds new trends in fashion, beauty and retail. Historically, excellence lies at the heart of what we do. Exceptional quality, exquisite craftsmanship, incredible beauty and real passion are the hallmarks of our trade. Our customers have always demanded the best in terms of product quality. As they become more socially-conscious, we have to reflect their values in the way we conduct our affairs too.

The changing landscape of CR is not just outward facing but also at the heart of company growth. New talent will be drawn to companies who embody positive, environmental, humanistic, ethical and moral values. These young talented people are the future guardians of a brand – and luxury customers too.

We are almost certain now that corporate responsibility is not just an optional extra for successful companies enjoying good times. In a post-downturn society, being good is not an add-on. Actions are signs of authenticity and essential for creating a virtuous circle where responsible behaviour enhances sales.

However, the challenge in the current market is: spend too much on marketing CR and jeopardise profits; don’t spend enough and risk losing market share to competitors that do. The solution is to change the internal mindset within a company. Proving shareholder returns on CR investment lies at the heart of securing their buy-in internally. Good and sustainable action must be strategic and not negate the profit motive.

 Sub-contracting out these activities without firm internal commitment is inadvisable 

Equally sub-contracting out these activities without firm internal commitment is inadvisable. These practices will form the foundations of business practice and can’t be boxes ticked by external agencies.

While committing resources to complementary CR programmes is advisable, marketing the activity should be measured and subtle. Transparency is one of the most valuable virtues of a robust luxury market.

The truth is that the days of talking about corporate responsibility in our industry are fast coming to an end. In the future, CR should become an invisible part of day-to-day business practice. Ultimately this will lead to the best, most admired, most influential and most profitable businesses being the ones who exploit not the population and planet, but the opportunities to improve them.

Jonathan Kendall, a commission president of CIBJO


Jonathan Kendall is president of the marketing and education commission at CIBJO, The World Jewellery Confederation, where he is responsible for providing marketing and evaluation tools to retailers and supply chain members in the areas of environmental, ethical and social responsibility. As part of this role, Jonathan represents the jewellery industry to the United Nations and has been a key speaker at a number of industry events around the world.

He has overseen the development of a number of educational guides at CIBJO, including the Retailer’s Guide to Trust, Retailer’s Guide to Marketing Diamond Jewellery and the comprehensive Retailer’s Reference Guide. Jonathan is also global operations director for De Beers’ Forevermark, the company’s new diamond brand which are responsibly sourced. A full copy of the report, ‘Responsible Luxury’ can be downloaded from here.