Assuming the reigns of the World Gold Council (WGC) in January 2009 amidst the worst global economic collapse since the Great Depression, Aram Shishmanian knew he was in for an interesting ride.

When the sub-prime mortgage crisis entered its darkest days in 2008, gold performed exactly as it always had – being the constant of value in uncertain times, and so investors turned to the commodity to provide them with financial security.

According to WGC’s Gold Demand Trends Full Year and Fourth Quarter 2008 report, gold’s resilience made it an ‘asset of last resort’ at a time when many institutions were utilising the commodity to ensure they had access to funds in times of emergency.

When other assets plunged in value and investors started to bail, these institutions were able to sell their gold to raise much-needed funds, in turn inspiring confidence in the commodity among investors.

This widespread confidence is something Mr Shishmanian has sought to bolster and reinforce during his tenure with the WGC, a market development organization rooted in motivating and sustaining the demand for gold and providing an authoritative, credible and respected voice on the global gold market.

Holding a Bachelor in Economics and an MBA, Mr Shishmanian has worked amongst leading financial institutions in a number of leadership roles, including as a Non-Executive Director of UK insurance firm Resolution, a senior partner at management consulting and professional services company Accenture and an independent member of global law firm Hogan Lovells.

Labelling his 35 years of professional experience as an ‘apprenticeship’, Mr Shishmanian stepped into the WGC role at a time when the council was more needed than ever.

As he prepares to stand aside in mid-2019, the outgoing CEO reflected on his time spent guiding the WGC from a marketing-orientated organisation to a market- development one.

“In recent years, the organisation has produced guidance, research and practical tools to allow gold miners to report production costs in a more comprehensive and consistent manner, to operate responsibly and with transparency in potentially high-risk or conflict-affected areas and to be able to demonstrate their significant contribution to social and economic development,” he told National Mining Chronicle.

“Responsible gold mining practices are increasingly being demanded by regulators, corporations who use gold in their products and investors who require that the provenance of their assets demonstrate robust environmental, social and governance (ESG) credentials.

“Furthermore, civil society is also making these same demands. Accordingly, it is extremely important that we work with our members – the leading gold mining companies worldwide – to address these needs.

“We have developed standards and guidance to address ESG requirements, such as our Conflict-Free Gold Standard. We are now working with members to develop responsible gold mining principles aimed at creating a credible and widely recognised framework to address key ESG issues across the gold mining sector.”

Working with regulators and government to ensure their policies are appropriately pro-gold, strengthening and improving market infrastructure and opening up new gold investment markets, Mr Shishmanian said a significant portion of his role was to ensure gold’s relevance remained intact.

“We have worked hard to establish gold as a mainstream investment asset so it becomes integral and a highly valued asset within the financial system,” he said.

“Thereby, it becomes a core risk-mitigation asset in household savings and institutional investment portfolios.”

Advancing the gold industry and increasing demand

The World Gold Council has been instrumental in numerous policy developments across the world. This has included the liberalisation and growth of the Chinese market, working with the Shanghai Gold Exchange to establish the Shanghai Gold Benchmark and support its internationalisation. It has also encouraged policy changes in India, such as the establishment of a gold exchange and the enforcement of mandatory hallmarking.

“We have continuously promoted gold as a financial asset across a wide range of market segments. This is supported by our depth and quality of research into gold fundamentals and promoting the investment case for it,” Mr Shishmanian said.

The gold market has undergone significant change during the past decade, according to Mr Shishmanian, becoming larger, stronger and more widely understood.

“The World Gold Council has been a key player in many of the initiatives that have driven that change,” he said.

“Central banks around the world have changed from being net sellers to net buyers and are now consistently increasing their allocations to gold, while there has also been a significant shift in gold demand from the west to the east, supported by the growing wealth in China and India (the two largest consumers of gold).

“In addition, the ongoing development of the gold market in these countries is supporting their further growth. In particular, China is poised to take an increasing leadership role in the industry worldwide.

Looking ahead, Mr Shishmanian said the WGC had an important and ongoing role to play.

“It is an honour to have influenced the development of the industry and increase demand,” he said.

“The scope and breadth of the role has been broad and has brought with it challenges, as well as much satisfaction. I could easily continue for another decade – needless to say I will miss the role.

“Gold in all its forms has been highly valued across virtually all societies for thousands of years, and I have no doubt that its relevance and value will continue in the future.”

Image: Aram Shishmanian, Credit: Ben Hilder.