Briefing for '98: The glittering prize and the harsh reality
Industry: Nicky Oppenheimer
Sunday 04 January 1998
"Let's not kid ourselves, he's been groomed and trained for many years," says Eli Haas, president of the Diamond Dealers Club in New York. "He's a very capable, competent man - and of course the fact that he's an Oppenheimer doesn't hurt."
Yet Oppenheimer will be called on to represent the interests of the De Beers-Anglo American diamond and mining empire in ways his father and his father's father never dreamed of.
The Central Selling Organisation, the London-based De Beers marketing arm formed by Sir Ernest to protect diamond prices, regulated the distribution and price of the world's uncut diamonds for the greater part of this century. Now it is under threat as producers worldwide consider bypassing the cartel. Some already have.
In September, after a year-long dispute, Russia's diamond-marketers and producers agreed to sell $550m (pounds 329m) of uncut diamonds, half their annual production, through the CSO each year. But the agreement expires in 13 months. If it is not extended, Russian mines, the second-largest diamond producers in the world, will be free to sell all their output directly, or "leak" to big diamond markets such as Tel Aviv.
"His role will be to put a different face on this monopoly and present the case of De Beers in more human terms," says Martin Rapaport, publisher of the Rapaport Diamond Report in New York. "De Beers has been seen as having taken too much, if not all, of the pie."
Oppenheimer brings to the chairman's post extensive knowledge of the diamond and mining business, a reputation for sound leadership and the security that comes from having been bred to lead the De Beers empire, a web of more than 100 companies with interests in six continents.
It is widely expected that one day he will also be named chairman of Anglo American Corporation, the precious metals and industrial company founded by Sir Ernest in 1917 that owns 32.5 per cent of De Beers.
He has been chairman of the Central Selling Organisation for the past 13 years. Just last month, he was also named chairman of Anglogold, Anglo American's new gold company.
"I don't like the word cartel," he once said of the CSO. "It has a connotation of exploitation." He prefers "producers' co-operative".
Oppenheimer has worked in the family business all his life. He began his career as personal assistant to his father, who waschairman from 1957 to 1984, and occupied various posts in the De Beers-Anglo American empire, primarily in the Anglo gold division and the diamond side.
He grew up on the family estate in South Africa and was educated in England atHarrow and Oxford.
The Russians are not the only opponents he now has to contend with. The New York-based World Federation of Diamond Bourses, the association that represents about 25 diamond exchanges around the world, recently passed a resolution criticising the CSO's monopoly.
Opposition has emerged in other parts of the world, too. Last year Australia's Argyle Mine, part-owned by Rio Tinto, the world's largest mining company, broke away and marketed its output alone. Argyle was previously responsible for 6 per cent of CSO sales.
De Beers is also worried that some new Canadian mines, the Broken Hill Proprietary-Diamet Lac de Gras, located just south of the Arctic Circle, will not join the CSO when they begin production in about a year.
The company must also cope with flagging sales due to the slump in Asian economies. Last week, De Beers Centenary AG said sales of uncut diamonds in the second half of 1997 fell 16 per cent to pounds 1.06bn compared with the same period last year.
Also unclear is the impact of the recently announced restructuring of Anglo American and De Beers. In November, Anglo American's gold operations were split off to form a separate business unit. In Christmas week the group's diamond interests were also split off.
While the diamond selling organisation is under threat, Oppenheimer is taking steps to ensure that the dynasty endures. His son is clearly being groomed in the family tradition. Educated at Harrow and Oxford, 28-year-old Jonathan Ernest Oppenheimer now works in Harare, Zimbabwe for Anglo American.
- 1 Which country would be hardest to invade?
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 4 Floyd Mayweather's mouthguard costs $25,000 - enough to fly to Las Vegas and back 18 times
- 5 Royal baby girl born: Duchess of Cambridge's second child will be a princess thanks to Queen
Which country would be hardest to invade?
Morgan Freeman on the riot-focused coverage of the Baltimore protests: 'F**k the media'
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
The man who filmed the Freddie Gray video has been arrested at gunpoint
Nepal earthquake: Many survivors receiving no help despite relief effort
Over 50,000 families shipped out of London boroughs in the past three years due to welfare cuts and soaring rents
EU asylum policy is 'a direct threat to our civilisation', says Nigel Farage
Indonesia executions live: 'Hysterical' families heard prisoners being shot dead by firing squad
General Election 2015: SNP and its activists 'openly racist' towards the English, Farage says
EU exit would hit UK economy much harder than neighbouring countries, study finds
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
iJobs Money & Business
£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...
£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...
£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...
£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...