6 November, 2014

The future of Fairtrade

Fairtrade shopping basket
by Michael Gidney, Chief Executive of Fairtrade Foundation

Back in 1994, the year that the FAIRTRADE Mark launched in the UK, I was working in southern Africa. After years when civil war seemed inevitable, there was a tangible sense that hope and peace would triumph over despair, as the era of Apartheid came to an end. That same spirit of optimism was present too when three far-sighted brands – Green & Blacks, Cafédirect and Clipper tea – offered the first Fairtrade certified products in the UK.

In those early days, there were many who thought that Fairtrade would never catch on. But thanks to the commitment of companies backed by incredible public support, Fairtrade has helped start a revolution in the way we see trade. And with sales of £1.7 billion last year, it has shown that another way of trading, which puts people first, is not only possible but is scalable too.

Yet we are only at the beginning of the journey to make trade fair. So, what does the future hold for Fairtrade? President Ellen Johnson Sirleaf of Liberia, said: “The size of your dreams must always exceed your current capacity to achieve them. If your dreams do not scare you, they are not big enough”. In 1994, people dared to dream big. Now, as we look to the future, I think there are three big dreams we should bring to life.

1. Trade must put producers first

It is simply unacceptable that the smallholders who grow our cocoa or the wage workers who grow our tea remain locked in chronic poverty while we enjoy the fruits of their labour.

Once again governments and companies are paying attention to agriculture, where 20 years ago it seemed that agriculture was yesterday’s news. But too many initiatives still do not put farmers and workers first. We must seek to enable producers to increase their stake.

We may need an architect, highly trained, once or twice in our lives. We may need a doctor, highly paid, occasionally. But we need a farmer three times a day, so let’s make sure we value them equally.

How would the world look different if producers could increase their stakeholding? When producers have better access to market intelligence, to finance, are more competitive? When their communities are better educated, have better access to healthcare, are less hungry? These are the areas that producers are working on now. This investment, through the Fairtrade premium, is helping them trade their way out of poverty towards becoming price-setters, not just price-takers.

Fairtrade is unique in requiring producers to be organised, democratic and accountable. Fairtrade is also the only certification scheme to insist on improved terms of trade from day one. We know from our own research these requirements are the ones producers value most.  While we must retain that strong core, Fairtrade will also adapt to ensure we continue to play a lead. We are moving from simply certifying products to collaborating on development programmes that run alongside – from labelling to enabling – so we can increase impact in areas such as child labour, climate change and trade in conflict zones. We are also playing a lead in seeking to embed the concept of a Living Wage. As challenging as that is to achieve (given the need to involve governments, unions, businesses and workers) this is something that Fairtrade must tackle.

We are stepping up our work on gender, too. According to the FAO, women make up 60% of the chronically hungry and in agriculture their voice is hardly heard.  Together with Fairtrade Africa, we are launching a new initiative to support women coffee farmers in East Africa. This will reach 3,000 people initially and has exciting potential to scale up.  But let’s go further. Let’s together make the next decade of Fairtrade the decade of women’s empowerment and champion women’s entrepreneurship and equality in global trade.

2. Companies must be truly accountable

Many businesses now have sustainability programmes and make claims about their products. So how do consumers and producers navigate this crowded ethical marketplace? The need for independent, third-party assurance is greater than ever, and as the most widely-recognised ethical label in the world, the FAIRTRADE Mark is highly trusted. But alongside certification, we need new and additional tools that will enable companies to contribute to sustainable development in ways that really matter to producers.

We need to separate the leaders from the laggards. There is a great deal to learn from social enterprises like Divine, Cafédirect and Traidcraft. We will work to help these and other pioneering Fairtrade brands succeed; we launched the Fairtrade Deepening Fund earlier this year, to encourage innovations in pro-poor trade. Projects already approved include a new rice supply chain from Burma, a cocoa value chain in Uganda, and Fairtrade juice from West Africa. 

In cocoa, sugar and cotton, we will launch new commodity sourcing programs in the UK, to boost the volumes that farmers are able to sell on Fairtrade terms and to offer businesses an additional way to source Fairtrade, alongside the existing FAIRTRADE Mark. There is real commitment from some companies to create truly sustainable supply chains, which Fairtrade welcomes and supports. But we will also continue to challenge businesses where appropriate, as we seek to drive greater impact for farmers and workers. Companies must see accountability as their license to operate. This can only go one way.

3. Government must play a stronger role

After the banking crisis, the horsemeat scandal and the Rana Plaza factory disaster, it’s clear that ‘free trade’ is not only a myth (when you look at the billions spent in subsidies and the endless rigged rules), but it also still benefits the powerful few at the expense of the many. If we want better progress towards real sustainability, it is unreasonable to expect companies to do all the running themselves. We need governments to step in. 

It’s good to see the passage of the Modern Slavery Bill in the UK, which will require companies to disclose what they are doing to eradicate slavery from their supply chains, but we also need better trade policy that is simply more joined up.  For trade to be made fair, government will need to act in the long-term interest of society and not be swayed by five-year election cycles. That will require bravery and leadership. 

The challenges that still face us in making trade fair are many. But there are many of us, too. There are thousands of local groups campaigning for Fairtrade in the UK. More than a third of British schools are working towards Fairtrade status. This could be the country that sees regulation as the floor, not the ceiling, where companies compete in a race to the top on impact, not a race to the bottom on price. Then, truly, we would get the trade we deserve.

Fairtrade is small still, yes, imperfect, of course, but slowly we can see the incredible impact that can be achieved when we act together. By using our power – as shoppers, campaigners, companies, government or donors – we can go much further in our quest to make trade fair.

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