Editor’s Note
This article highlights key barriers to gold investment, particularly for first-time buyers. As the World Gold Council’s research indicates, building trust and improving financial education are crucial for broadening participation in the gold market.
Over the years, the World Gold Council has been working to enhance trust and transparency across the gold market through a number of different projects and initiatives.
Comprehensive research reveals that some first-time individual gold investors encounter trust and education-related barriers. Nearly half of these potential investors cite a lack of trust in retail gold investment products or the businesses that sell them. Furthermore, two-thirds stated that a lack of education and awareness holds them back from buying bullion.
These insights led to the creation of a framework to improve understanding of the responsible gold market and establish a voluntary, adaptable structure for dealers to demonstrate credibility and trustworthiness to consumers. This framework, called the Responsible Gold Investment Principles (RGIPs), covers a range of topics including Fairness and Integrity; Transparency; Protection of Client Assets; Responsible Gold Sourcing; Regulatory Compliance; Commercial Prudence and Operational Professionalism.
These Principles, which provide foundational guidance for best practices in the gold industry, have been widely recognized and adopted, gaining support in some of the world’s largest retail markets, including India, North America, Germany, and the UAE.
The project is now progressing to evolve these principles from a voluntary framework into a standardized and globally recognized audit framework for gold dealers. To achieve this, the World Gold Council has partnered with the British Standards Institution (BSI). Once finalized, the BSI framework will allow retail gold dealers to independently demonstrate to customers and other stakeholders that they meet the industry best practices outlined in the RGIPs.
As part of the commitment to transparency and raising industry standards, an industry consultation for the assurance framework has been launched and is hosted on the BSI website. The consultation is open until January 31, 2025.
Retail gold investment accounts for over a quarter of annual demand. In 2023 alone, retail investors acquired almost 1,200 tonnes of gold, worth approximately $74 billion.