Fairtrade and Fairmined gold standards launched
- • Alleviating poverty faced by artisanal and small-scale gold miners
- • Minimising environmental impacts of gold mining
- • Traceable gold
Fairtrade Labelling Organisations International (FLO) and the Alliance for Responsible Mining (ARM) launches the first ever third party independent certification for gold, opening up market opportunities for millions of impoverished artisanal small-scale miners and their families.
The new Fairtrade and Fairmined gold standards will mean that interested licensees can apply for certification of gold products such as jewellery, commemorative coins, ingots, medals, trophies and religious artefacts. An industry market survey of 96 companies across 11 countries identified consumer products such as wedding rings, dress rings, necklaces, earrings and bracelets as potential products.
Globally, over 100 million people who depend directly or indirectly on artisanal and small-scale gold mining are characterised by high levels of poverty and are trapped in unfair supply chains, and struggle to get a fair price for the gold they mine. The democratic organisation of miners, combined with added premium and increased access to markets, will allow miners’ organisations to improve the technology and working conditions at their mines, and also to develop community projects in education, health, environmental restoration and other forms of income. This would lead to more enduring and sustainable development in mining communities.
Artisanal and small-scale miners produce just 15% of global gold supplies, but make up 90% of labour in gold extraction. Through Fairtrade and Fairmined certification, miners can improve their economic, social and environmental conditions.
The Fairtrade and Fairmined standard means that:
1. Miners will get a better price for their gold, with increased security of the Fairtrade guaranteed minimum price. The Fairtrade minimum price for the pure gold content in unrefined gold is set at 95% of the London Bullion Market Association’s (LBMA), fixing at the FOB export point.
2. Miners will receive a Fairtrade social premium, calculated as 10% of the applicable LBMA fixing. For Ecological Gold, gold that has been extracted without the use of chemicals and with strict ecological restoration requirements, an additional ecological premium, calculated as 5% of the applicable LBMA fixing on top of the Fairtrade premium must be paid.
3. Miners have the opportunity to empower themselves through their organisation. They form groups to give themselves better bargaining power with traders, to get a fairer return for their produce, and gain greater control over the jewellery supply chain. Though the price of gold is widely known in gold mining communities, miners often receive less owing to the number of middle-men between the miner and exporter. Once everyone takes their percentage, the miner may receive as little as 70% of the LBMA. Fairtrade and Fairmined certification will provide miners the chance to ask for pre-financing from prospective buyers, and provide miners with a minimum price for their product creating more competition in local markets and so improving trading relations to the benefit of the miner.
4. Certified miners must use safe and responsible practices for management of toxic chemicals in gold recovery, such as mercury and cyanide. Chemicals have to be reduced to a minimum, and where possible eliminated over the years. Miners earn an additional ecological premium when they recover gold through gravity only.
5. The Fairtrade and Fairmined gold will not contribute to conflict or violence. On the contrary, where certified organisations are located in conflict areas, increased economic stability, transparency and traceability from sale of their certified gold may help contribute to peace-building.
Harriet Lamb, Executive Director of the Fairtrade Foundation said:
‘Companies and consumers will embrace this golden opportunity to make a real difference to miners’ lives. The launch of Fairtrade and Fairmined standards for gold provides a lifeline for communities who find themselves at the mercy of unbalanced markets, when agriculture and other livelihoods are not viable. Many face exploitation from middle men who pay below market prices and cheat them on weight and purity of the gold content. Mining community members lack basic sanitation, clean and safe drinking water, poor housing, little or no access to education and healthcare and are financially unstable. The Fairtrade and Fairmined standards are an important development tool, and will complement other development interventions.
‘Our research shows that customers believe buying jewellery for a special occasion holds greater value and significance if it carried the Fairtrade and Fairmined hallmark. People said that the label reassures both the giver and receiver that the miners are getting a better deal.’
Cristina Echavarria, ARM´s Executive Director, said:
‘The Fairtrade and Fairmined Standards are the best standards in the market today for gold in terms of development impact on mining communities. They even set an example for the large-scale mining industry on issues such as traceability. Fairtrade and Fairmined is the premium among consumer labels, taken up by the most conscious consumers, a growing market segment that is setting future trends. Through them artisanal and small-scale miners all over the world will gain legitimacy and recognition by the mining sector and governments so that a historically disenfranchised group, often abused by illegal groups, can finally get recognition for its contribution to the livelihoods of millions, and access the hearts and minds of consumers who want to ensure that through their jewellery purchase, they can improve the lives and the environment of mining communities. Their decision is already impacting the whole of the mining and jewellery industries. This is a fundamental reason why we at ARM are so proud to have achieved this partnership with FLO and why the miners are so keen to deliver responsibly produced Fairtrade and Fairmined gold to ethical jewellers and consumers.’
The standard was piloted by ARM with nine legally established mining organisations in Bolivia, Colombia, Ecuador and Peru and will now be open to applications all small-scale and artisanal gold mining organizations in Latin America. More producer organisations from Latin America are expected to join the system in 2011 and beyond. As from 2010 ARM will establish a network of pilot projects in Africa, and later in Asia.
Manuel Reinoso Rivas, President of the Association of Artisanal Miner Producers of Central and Southern Peru, and ARM Board member says: ‘Fairtrade and Fairmined certification motivates all artisanal and small-scale miners, men and women alike, to press for better working conditions and above all improved health and safety. We need to learn how to use clean, non-polluting technologies that will not only preserve our environment but also help us recover increased quantities of metals. We are determined to cut the number of accidents and reduce the impact of occupational disease and help our workplaces and our communities to provide our fellow miners, our families, our wives and our children with a secure quality of life and an environment free from major risks and able to coexist with ours and others productive activities. In fulfilling this responsibility we are contributing to a better quality of life and setting an example to our own children and to future generations.’
Fairtrade and Fairmined gold will be initially launched in the UK and then rolled out to other countries with a long term vision of capturing 5% of the gold jewellery market over a 15-year period, totalling 15 tonnes of Fairtrade and Fairmined gold annually. Fairtrade and Fairmined gold will be co-labelled, bearing both the FAIRTRADE Mark and the FAIRMINED Mark in order to present to the consumer the strength of the partnership between the two organisations.
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Notes to Editors
1. The FAIRTRADE Mark is a certification mark and a registered trademark of Fairtrade Labelling Organisations International (FLO) of which the Fairtrade Foundation is the UK member. The Fairtrade Foundation is an independent certification body which licenses the use of the FAIRTRADE Mark on products which meet international Fairtrade standards. This independent consumer label is now recognised by 72% of UK consumers and appears on products as a guarantee that disadvantaged producers are getting a better deal. Today, more than 7.5 million people – farmers, workers and their families – across 58 developing countries benefit from the international Fairtrade system.
2. The FAIRMINED Mark ensures that the gold has been extracted and processed in a fair way and responsible manner. This means that the miners receive a fair price, eliminate child labour, good health and safety practises, care for the environment and participate in the social development of their communities.
3. The partnership between the Fairtrade Foundation and ARM will create differentiated market access for gold products to support social, environmental and economic development outcomes for artisanal and small scale miners through:
o A credible programme of support and development for artisanal and small scale miners.
o A high profile and trusted product label to drive market access on terms that support development.
The Alliance for Responsible Mining (ARM) have the experience and networks to provide the necessary support, and Fairtrade labelling to create differentiated market access on terms that support development.
The work of the partners will be communicated publically via product co-labelling: FAIRTRADE Mark as the senior mark, with ARM’s FAIRMINED Mark as a junior supporting mark. The rationale is to present to the consumer the strength of the partnership without diluting the immediate impact of FAIRTRADE Mark brand recognition.
4. Over 4,500 products have been licensed to carry the FAIRTRADE Mark including coffee, tea, herbal teas, chocolate, cocoa, sugar, bananas, grapes, pineapples, mangoes, avocados, apples, pears, plums, grapefruit, lemons, oranges, satsumas, clementines, mandarins, lychees, coconuts, dried fruit, juices, smoothies, biscuits, cakes & snacks, honey, jams & preserves, chutney & sauces, rice, quinoa, herbs & spices, seeds, nuts & nut oil, wines, beers, rum, confectionary, muesli, cereal bars, yoghurt, ice-cream, flowers, sports balls, sugar body scrub and cotton products including clothing, homeware, cloth toys, cotton wool and olive oil.
1. 7 in 10 households purchase Fairtrade goods,, helping Fairtrade sales reach an estimated £800m in 2009, up from £712m in 2008. There are over 460 producer organisations selling to the UK with 872 certified producer groups in the global Fairtrade system, representing more than 1.5 million farmers and workers.