The term “Fair Trade” is getting more familiar to many consumers. But what exactly is involved in ensuring that products meet this standard?
The Fairtrade Labelling Organizations International (FLO) is part of a global network trying to change international trading conventions. It acts as an umbrella organization for 20 separate groups across Europe, North America, Japan, Australia, and New Zealand. For many years, the concept of supply and demand has driven many transactions – but there are intrinsic flaws in the model. In recent years, the problems have become more evident and publicized, leading to the establishment of organizations trying to redress the balance.
The fair trade concept centres on sustainable development with self-sufficient producers. Rather than negotiating to pay a pittance to hard-working farmers and workers in developing countries, Fair Trade recognizes the value of the product and the need to compensate appropriately. Key elements lie in meeting both environmental and labour standards.
In fact, fair trade has been around for about 50 years, but has only gained a stronger foothold over the past two decades. FLO has a certification mark that demonstrates products that have met stringent standards (although Canada and the US have maintained their own separate logos). From the initial product, coffee, Fair Trade now includes a variety of items such as tea, rice, cocoa and chocolate, sugar, and more.
The standards are constantly reviewed and updated in accordance with changing conditions. The basic aspect of the standard is a guaranteed minimum price for producers. Products are more expensive than conventional versions, but the price includes a premium to be invested in development projects. Environmental, social, and economic initiatives are important, as are long-term and stable trading partnerships.
Small-scale farmers require fair prices, while other workers may need decent wages and adequate working conditions. As a result, there are various standards depending on the type of product. In addition, FLO sets out a list of prohibited materials to ensure high quality – these include various chemicals used as insecticides, herbicides, and so on.
It does get confusing, because there is also the Fair Trade Federation (FTF), which operates under a similar mandate but different logo. In the case of the FTF, a wide range of items is possible, from furniture to jewellry to house wares. The same values are in place, about offering equitable wages and compensation, as well as ensuring sustainable practices. Typically, goods are purchased straight from the artisans and producers. Often collectives and other groups are involved, with money returning to local community projects. For example, women who weave fabrics can be fairly paid for their work and skills, generating money to finance education, community wells, and other basic needs. In this way, cultural techniques are valued, preserved, and shared.
The important thing is to recognize the certification and intent behind various Fair Trade initiatives. From small beginnings, it is becoming big business. Starbucks has agreed to sign a licensing agreement with Ethiopian coffee farmers. The project gives the farmers the right to control their specialty coffees – Harar, Sidamo, and Yirgacheffe. In this way, premium coffee prices are passed along to the farmers, rather than getting collected by international coffee traders.
Surely it enhances that delicious chocolate along with a cappuccino, knowing that the people who laboured over your cacao pods and coffee beans are benefiting. It is harder to choke down the treats that come from less sustainable transactions. Isn’t it worth paying a little more to make a positive difference? Residents in Malmö, Sweden certainly think so – the city became a Fair Trade City two years ago. Other European countries have established strong fair trade practices, well ahead of North America.