Sakhila Mirza, Deputy CEO & General Counsel, LBMA

Anyone familiar with LBMA’s Responsible Sourcing Programme will know that our approach to Responsible Sourcing is guided by an ethos of continual improvement. This is synonymous with action.

Our Three-year Sustainability and Responsible Sourcing Strategy (2024-2026) is a testament to this. The overarching objective of this Strategy is to adapt and define best practice by identifying what needs to change, determining how to effect that change and then intentionally guiding change in line with our overarching approach of ‘continuous improvement’.

Three-year Sustainability and Responsible Sourcing Strategy

LBMA’s core values of leadership, integrity and transparency have guided all five focus areas of the Strategy.

The deliverables that we are publicly committed to in year one are highlighted below. Each deliverable will be the result of actions, and each is a measure of progress towards our objective.

LEADERSHIP: MEANINGFUL COLLABORATION AND ENGAGEMENT

Key Deliverable: Undertake a stakeholder mapping exercise to support with the key deliverables.

LBMA cannot implement this Strategy alone. Engagement with valued stakeholders including civil society, LBMA Members and Committees, and industry working groups is already underway as we embark in earnest on the deliverables determined for this year. Through this engagement, we determine priorities and key actions needed to advance mutual goals. The Sustainability and Responsible Sourcing Summit in March saw an all-time high attendance, providing LBMA with a unique opportunity to bring stakeholders together from across the industry to discuss the areas where there is a need for improvement.

LBMA has been actively engaged with the ISO Working Group on the definition of recycled gold. We understand the need to ensure that we all have a consistent understanding of recycled gold in order to ensure we only have responsible gold in the supply chain.

Furthermore, engaging with civil society and government agencies has been important to LBMA as is highlighted in this report. We look forward to continuing those important conversations again in person at the Global Precious Metals Conference this month and urge anyone who is not yet involved to come forward to support. We also want to take this opportunity to thank those already involved for their contributions – we couldn’t do it without you.

INTEGRITY: STRENGTHENING OVERSIGHT AND STANDARDS

Key Deliverable: Strategy for Assurance Provider training.

Key Deliverable: Revise mutual recognition policy and process.

LBMA advances and enforces standards for the common good of the global industry, but we also look into possible solutions to pressing issues of concern raised by our Members and the public at large.

Responsible Sourcing Programme

The Responsible Sourcing team has grown over the last year with the addition of a Standards & Assurance Manager and a Responsible Sourcing Coordinator. We have also expanded other teams who support the Responsible Sourcing Programme (RSP), whether it be via due diligence, data, policy or projects.

This is fundamental progress, acknowledging the growth in the Programme’s scope and requirements, and ensuring LBMA continues to enforce its own rules.

Assurance Provider Training Strategy

Part of supporting the integrity of the Programme is developing a robust training programme that equips Assurance Providers with the necessary knowledge and skills to provide assurance under ISAE 3000 against LBMA Guidance. To this end, best practice has been considered, and key stakeholders consulted, to gain a better insight into the assurance approach and Assurance Provider training.

In addition, in the coming years, we will be introducing risk-specific training. This year we are launching the Anti-Money Laundering training for Assurance Providers to help them better understand the importance of KYC due diligence in fighting financial crime.

TRANSPARENCY: PROMOTING AND ENHANCING PUBLICATION OF DATA

Key Deliverable: Annual publication of aggregate data on gold and silver origin by country.

Annual Publication of Data

LBMA currently publishes annual Country of Origin (CoO) data for gold and silver, but in line with our ethos of ‘continuous improvement’, we are now working to enhance this reporting. LBMA’s CoO data is an aggregated dataset giving an insight into the global physical flow of gold and silver - from the country or region of origin, where the Good Delivery List (GDL) Refiners source their feedstock, to the country of destination, where the material is refined. This was reported annually in previous iterations of this report, but we now have the full data set available on our website in an easier-to-read format which also allows comparison of regions and comparison of data across four years from 2018.

Reporting has not just been enhanced because of how we present it; internally, we now have a dedicated data analyst, and enhanced data checks and sense checks which are carried out when comparing CoO data (input/sourced material) with Refiner output (processed material). However, next year we will be consulting on how to improve reported data and gain feedback from stakeholders on Refiners' disclosures. Some of that work has already started through our discussions with civil society, but we intend to increase that focus in 2025.

Gold Bar Integrity

Work is now underway on implementing the Gold Bar Integrity project at LBMA in the form of a database where Refiners will submit their data to LBMA from 2025 onwards. This database will create opportunities for enhanced reporting by creating a timely and efficient method for Refiners to upload data with less room for reporting errors. It is our hope that the GBI Database initiative will eventually provide more granularity and increased frequency of sharing data, which will provide the global market with greater trust and confidence.

Understanding Progressive Improvement

Whilst leadership, integrity and transparency continue to guide our priorities and our deliverables, it’s important to also highlight the importance of progressive improvement, and that this is fundamental to support important supply chains such as responsible ASM.

Progressive improvement implicitly accepts that some level of imperfection is the starting point in the journey toward better outcomes. This principle has often been ignored and overshadowed by industry actors more focussed on demonstrating compliance with sourcing schemes, than mentoring and remediating suppliers toward more responsible business conduct. With the launch of our ASM Initiative, LBMA is revisiting this principle, conscious that, in the past, the pursuit of perfection may have unintentionally reinforced ASM’s market exclusion.

Looking Ahead to 2025

As we move into 2025, our intentions are to continue building on what we have achieved this year, and ensure that collaboration and collective engagement remain at the very core of our progress.

RESPONSIBLE GOLD GUIDANCE VERSION 10 (RGG V10)

The drafting of RGG v10 will be the mainstay of efforts in year two, and will reflect on learnings from the implementation of RGG v9, and also from feedback from stakeholders. In the spirit of continuous improvement and collaboration, there will be at least two rounds of consultation, as we look to introduce an updated version of the Guidance by the end of 2025.

Implementation will follow in 2026 with the accompanying suite of updated Guidance and Assurance Provider Training to be released beforehand.