1. DESCRIBE RESPONSIBLE GOLDTM IN A NUTSHELL
Responsible Gold™ is conflict-free and responsibly sourced gold with blockchain-based proof of provenance and supply chain traceability. The Responsible Gold Supply Chain Application (RG SCA), tracks gold custody transfers from mine-to-refinery–to-vault or to end user, while conforming with the Responsible Gold Standards (“Standards”). The RG SCA successfully combines blockchain technology with web and mobile applications that revolutionize the way different participants capture, communicate, access and audit supply chain information. The Standards, which encompass industry best practice regulatory requirements and environmental, social and governance (ESG) controls, provide the framework for the gold supply chain and its participants, so that its output can be affirmatively declared “Responsible Gold”. Available in physical format as bullion bars or wafers and in a digital format as the ERC20 G-Coin® digitized gold (minted under a unique proprietary asset tokenization patent), the Responsible Gold™ ecosystem is comprised of a growing number of trusted participants, including miners, refiners, logistics providers, and vault operators.
2. HOW DOES RESPONSIBLE GOLD™ SOLVE FOR ESG CHALLENGES?
Mining in general tends to have the general perception of being a conflict-ridden, dirty, and unsustainable business. As ESG becomes more mainstream, the primary customers of gold, including investors, jewelry manufacturers, industrial companies and central banks are demanding more transparency and information on the precious metals they purchase. Despite evolving regulatory and industry supply chain due diligence standards, challenges with gold sourcing remain prevalent. Inadvertently, this has led to blanket bans on sourcing from certain jurisdictions or types of material (e.g., artisanal and small-scale mining) that are perceived as highrisk, leaving several industry participants disenfranchised. The artisanal and small-scale mining sector provides a livelihood to 15 to 20 million people globally1 . Large-scale gold mining has numerous positive benefits for the host countries and local communities from royalties and taxes paid in-country, to local job creation and skills development, and infrastructure development in the form of roads and hospitalsWith increasing complexity in supply chain management, Responsible Gold™ delivers unprecedented visibility and transparency across the gold supply chain, and easily and efficiently connects trusted gold producers to end buyers, regardless of the jurisdiction or sector of operation.
3. HOW DOES RESPONSIBLE GOLD™ DIFFER FROM OTHER SUPPLY CHAIN TRACEABILITY TECHNOLOGIES? The current market for track-and-trace blockchain applications in the precious metals industry focuses primarily on digitization of asset transfer documentation. With the RG SCA, actual physical assets or doré at the mine site are digitized by attaching cryptographic seals. These seals are scanned with a mobile application to record custody transfer transactions directly onto the blockchain. Moreover, Responsible Gold™ provides the ability to immutably capture the many component parts of ESG, such as carbon emissions, that are associated with a specific gold asset, sourced from a specific miner, and the ESG policies and actions implemented by that specific miner. More than 80% of the largest companies in the extractive sector report on ESG,2 yet the biggest gripe for investors is the lack of consistent, comparable ESG data. Mid-tier and smaller mining companies are less advanced in their reporting. Responsible Gold™ has solved these issues by creating an ESG Tool to standardize and streamline ESG management and reporting. Supply chain partners are supported on every step of their ESG journey with over 180 ESG risk and control cards documented for gold miners, refiners, logistics providers and vault operators, a compliance monitoring tool that recognizes existing certifications and streamline compliance and audit processes, and ESG policy and risk assessment blueprints. By creating an end-to-end system of record for a physical gold asset, including provenance, custody and ownership traceability, Responsible Gold™ allows the market to value gold commodities based on both financial and ESG factors, ensuring that potential bifurcation in pricing based on ESG criteria is attributed fairly. In addition, it empowers gold producers to take ownership and accountability of ESG impacts and, by attributing value to this, draws in additional participants to lift the bar for the entire industry.
4. WHAT MAKES RESPONSIBLE GOLD™ CREDIBLE AS AN ESG PRODUCT IN THE MARKET? While the focus on recycled materials from an ESG perspective has increased in recent years, mined gold product still accounts for 70-80% of total new supply used in products.3 Moreover, recycled gold is not always traceable back to the point of extraction, making it significantly more vulnerable to illicit practices.4 Responsible Gold™, on the other hand, has been recognized as exceeding Shariah requirements for transparency and ethical trading, by the Shariah Supervisory Board of Amani Advisors. A UN Task Force has also recognized the Responsible Gold™ ecosystem as a positive contributor to the UN Sustainable Development Goals.
5. WHAT CAN WE EXPECT FROM RESPONSIBLE GOLD™ IN THE FUTURE?
ESG factors have been associated with mining for decades, but only recently become mainstream, as consumers, investors, and regulators seek products that are both commercial and sustainable. Much of this is driven by heightened scrutiny within both retail and institutional capital markets. ESG assets under management surpassed $35 trillion in 20206 and increasing ESG-related regulation, for example the EU Sustainable Financial Disclosure Regulation, is further fueling the creation of new ESG investment products. Responsible Gold™ is perfectly placed to meet new customer and market needs and in partnership with financial market participants, we will soon launch new Responsible Gold™- based financial products. We see gold as a powerful wealth creator and protector and, with the G-Coin® digitized gold token, our mission is to make it sustainable and accessible for everyone. Customers can start to own as little as 0.25grams (~$16 at today’s price) of Responsible Gold™ without needing to worry about storage facilities and costs. G-Coin® is currently available in 76 countries worldwide through digital asset platforms, and we are launching our proprietary digital wallet in new countries to enable customers to send or gift gold peer to peer, or even to spend in gold
. 1. https://www.gold.org/esg/artisanal-and-small-scale-gold-mining#:~:text=It%20 covers%20formal%20or%20informal,exploration%2C%20extraction%2C%20and%20 processing. 2. UN Environment Programme, Sustainability Reporting in the Mining Sector, 2020 https://wedocs.unep.org/bitstream/handle/20.500.11822/33924/SRMS. pdf?sequence=1&isAllowed=y 3. CME Group, Introduction to Precious Metals, https://www.cmegroup.com/ education/courses/introduction-to-precious-metals/understanding-supply-anddemand-precious-metals.html 4. https://www.responsiblemines.org/en/2019/10/is-recycled-gold-an-ethicalchoice/ 5. The UN ITU report can be found at https://www.itu.int/en/ITU-T/focusgroups/dlt/ Documents/d21.pdf Page 32 of the report references the Responsible Gold Ecosystem IND 006 as a contributor to SDG 12. 6. https://www.bloomberg.com/company/press/esg-assets-rising-to-50-trillionwill-reshape-140-5-trillion-of-global-aum-by-2025-finds-bloomberg-intelligence/
