On September 22, the Alexander Solzhenitsyn House of Russian Émigré Community Abroad held a presentation of “The Epoch-Destiny-Collection,” the memoirs written by well-known diamond expert Nikita Lobanov-Rostovsky. He reached the peak of his diamond career working for De Beers in 1988-1997, where he participated in the tricky negotiations for the supply of Yakut diamonds to London and supervised the Russian vein of business in general.
The book highlights the delicate aspects of internal organization of De Beers, its corporate management system, ways to protect internal and external information. For instance, the trade relations between De Beers and the USSR in the 1980s were a complete secret: in London there was always present a group of Soviet diamond experts, but even the Soviet embassy knew nothing about it. The De Beers Board used to keep secrets... by way of entire absence of strategic documents as such (key points were discussed only orally and not in the office - for example, at the famous Royal Ascot races outside London). Every area manager had a significant credit of trust from the company owners and was given wide latitude for operational maneuver – such people were never held accountable for trifles.
The book is pungent in raising the problems of good conscience while implementing diamond agreements. For example, it refers to the episode in 1992-1996 when Gokhran (then subordinate to Evgeny Bychkov) carried out a number of "parallel" transactions with diamonds bypassing the agreement with De Beers. The book also reports about barter deals of Sahakomdragmet involving discounts of up to 40% meant for further secret resale to the West.
Some readers may be surprised to find out that partners within joint ventures and one-off transactions (Mendy Kazirer, Samuel Wexler, Marcel Tugendhaft, Charles Romner, Jack Roth) secretly and promptly informed the De Beers Board about all the commercial details of transactions with Russian diamonds. They "literally lined up in the London office of De Beers to “woodpeck” on each other and Bychkov," Nikita Lobanov writes.
Nikita Lobanov’s book will be of interest to professionals for its unique observations and conclusions. For example, the author describes a positive experience of business management while dealing with low-qualified professionals and even roguish diamantaires. He says it is necessary to seek psychological compatibility of the company’s own employees sitting on the Board with those working in the corporation’s departments. According to him, literary and artistic events appear to provide a convenient platform for competitive intelligence. General cultural erudition and even bon ton of corporate leaders contribute to competitive advantages of modern corporations. Gathering information about potential partners should not be limited to their credit history and favorite jokes; secret and covert interests and preferences may play the role of driving belts for a long-term business. Informal relationship with national elites is also useful. In diamond transactions one should prefer reliable and loyal partners with whom it is possible to start a stable business and have although modest but steady income. It is strictly necessary to protect and nurture one’s goodwill; if there is an agreement (often oral, as it is widely accepted in the diamond business), it is necessary to comply with its terms, even at a loss for oneself. Any company should always treat its trade representatives abroad with care for it is very difficult for them to carry out their duties in a situation when they sometimes have to “run with the hare and hunt with the hounds.” Finally, one should build long-term contacts with intelligence officers from all the countries where business is conducted not betraying, of course, one’s own national interests and avoiding to be exposed to all sorts of violations of written and unwritten rules.
Vladimir Teslenko for Rough and Polished
