46 Pandora Brilliance
For taking lab-created diamonds into the mainstream
"Diamonds are not only forever, but for everyone," says Pandora CEO Alexander Lacik. As part of its strategy to bring in new customers, the company recently wrapped a project to develop an entirely lab-created diamond jewelry collection. The move was a direct response to increasing concern from consumers—especially younger ones—who have criticized the environmental toll and poor labor conditions considered part and parcel of mined diamonds.
Pandora execs say they launched the project because it was the "right thing to do,” but also admit it will mean a substantial drop in cost and production time—which the retailer is also hoping will lead to increased sales. Its manufactured stones cost roughly one-third that of mined ones and can be produced within weeks, versus the billions of years the Earth's natural geological processes take.
The lab-grown diamonds are also made with more than 60 percent renewable energy, with greenhouse gas emissions offset through a CarbonNeutral certification. And when the collection goes global next year, Pandora expects to be using 100 percent renewable energy.
As part of the project development, the Danish jewelry company also hired consulting firm Sphera to identify environmental and social impacts in the value chain created with the chemical vapor deposition technology used to make the product.
The company tested customer reception with a U.K. rollout in May, but Pandora's plan is already having a ripple effect across the diamond jewelry retail industry. A report by Bain & Co. estimated the market at US$64 billion, and while the sector fared better than some luxury industries during the pandemic, the consulting firm uncovered many of the same sentiments influencing consumer behavior—and pointing to a new direction.
"In the U.S., and especially in China and India, younger consumers say sustainability is part of their decision-making process and could influence whether they buy diamond jewelry,” Bain said in its report.
Yet many of the leading diamond industry associations have criticized the project—calling Pandora's positioning of lab-grown diamonds as a more ethical choice as a "false and misleading” narrative. Insiders also contend the shift will take a heavy economic toll on mining communities.
Still, the tide seems to be turning. Silicon Valley's Diamond Foundry hopes to quintuple its production of lab-grown diamonds by 2022, after securing a US$200 million investment in March 2021. And mined-diamond giant De Beers Group completed a new US$94 million production facility for its Lightbox lab-grown collection in October 2020.