A new approach to sourcing that brings businesses, farmers and workers together to tackle evolving challenges such as low wages and incomes, climate change and new legislation.
Our industry is changing
Businesses are facing rising pressure to respond to consumer expectations, comply with new regulation, and reach sustainability targets. Yet, companies are trying to tackle all of these realities on their own.
Farmers and workers around the world face significant pressure to respond to various risks, including poor working conditions, climate change, and multiple reporting requirements. As they frequently earn low wages or minimal incomes, they often lack the resources and long-term income security needed to effectively address these challenges.
Going it alone isn’t working
Currently, many individual businesses pay for and hold supply chain risks alone, often switching from producer to producer in an attempt to maintain their advantage, but this can add extra costs, burdens and inefficiency to supply chains. This also creates great uncertainty for farmers and workers who struggle to make critical & much-needed longer term investments in their farms and communities.
Shared ImPact, a new collaborative approach to sustainable sourcing
Built on the principles of cross-industry collaboration, long-term commitment, and collective action, Shared ImPact brings multiple businesses together, to buy on Fairtrade terms from the same pool of producer groups under long-term contracts.
What are the benefits of Shared Impact?
- Fairtrade’s Standards promote sustainable and equitable farming practices.
- Producers receive the Fairtrade Minimum Price, which aims to cover producers’ average costs of sustainably producing their crop. It acts as a safety net when market prices drop.
- The Fairtrade Premium is an extra sum of money that farmers and workers receive to invest in community and development projects of their choice.
- Business can share the costs of risk mitigation, such as child labour and deforestation.
- Businesses can also unlock greater supply chain transparency and more enhanced and authentic storytelling.
- Farmers and workers benefit from selling more Fairtrade products and earning additional Fairtrade Premium.
- The security of long-term contracts and Fairtrade’s price stability provides farmers with the confidence to invest in more expensive or extended projects and initiatives focused on areas such as climate, wages, and income, which they would not have been able to afford otherwise.
Exciting new Shared ImPact pilots go live in 2025!
We’re piloting Shared ImPact in 2025 across Cocoa, Coffee and Banana supply chains. We’re working with a number of UK and EU retail partners, and hope to update on progress soon.
If you’re keen to learn more about how Shared ImPact and a Fairtrade Partnership can work for your business, please reach out to us today.
Contact us: commercial@fairtrade.org.uk
Shared ImPact FAQs
How can Shared ImPact support my business objectives?
Increase your impact and mitigate critical risks
Fairtrade Minimum Price aims to cover producers’ average costs of sustainably producing their crop and acts as a safety net when market prices drop. Meanwhile, the Fairtrade Premium is an extra sum of money that farmers and workers receive to invest in community and development projects of their choice.
By pooling your sourcing this way together with other businesses, collectively we increase the volumes sold on fairtrade terms for specific producer groups. This gives farmers and workers in your supply chains the funds and confidence to invest in projects for the long-term to mitigate risks on livelihoods, human rights and climate.
Share the cost of meeting your sustainability targets
Pooled your sourcing into specific producer groups means that the burden and cost of delivering against sustainability objectives can be shared across multiple businesses in the supply chain. With less cost per objective, creating the opportunity to deliver greater impact together.
Access enhanced data and insights from across your supply chain
Fairtrade Foundation can collect and collate data, insights, monitoring, research outputs from across the specific groups. This will provide greater visibility of your impact and stronger insights that can support the mitigation of key supply chain risks.
Communication and storytelling
By forging longer term and stronger relationships with farmers and workers in your supply chain, you’ll be able to find important stories which resonate with your customers, employees and investors. You’ll be able to collaborate with those producers at the heart of those stories and amplify their voices.
How could Shared ImPact create positive impact for farmers and workers in my supply chain?
Selling more on Fairtrade Terms
The Fairtrade Minimum Price and Premium combined mean that farmers and workers are able to invest in areas such as climate adaptation, mitigation, crop productivity and quality, education and healthcare. For some farmers and workers, however, due to a lack of market demand, they can only sell a portion of their total production on Fairtrade terms.
This can mean that they still lack the funds to make the most impactful investments needed in their farms and communities. Because Shared ImPact pools longer term sourcing from multiple businesses into specific producer groups, these producers should be able to sell a higher percentage of their produce on Fairtrade Terms, which means they benefit from greater sales, a more stable income, and increased Fairtrade Premium on the goods they sell.
By piloting this approach, we’re aiming to build demand for Fairtrade across business and consumers, continuing to make the case for Fairtrade and collaborative sourcing practices, thus growing the market for other producers around the world.
Longer term contracts providing income security
With businesses changing their suppliers frequently, sometimes as much as every six months – Farmers and producers around the world often lack the security of long term contracts. Meaning that they aren’t able to forward plan in the same way that most other businesses across the world can.
With an unclear picture of how much income they’ll earn in the future, farmers and works are less able to invest in more costly or longer-term projects such as climate mitigation schemes.
One of the core principles of Shared ImPact is that sourcing relationships are built to last. Once past pilot stage, all businesses sourcing from Shared ImPact producer groups will commit to contracts, with a minimum length of three years. This length of contract will allow producer groups to forecast income, and make strategic investments to benefit their businesses in the long run.
Partnering for the future
Alongside Fairtrade terms of trade, and long-term contracts, Shared ImPact is designed in a way that should facilitate a deeper sense of partnership across supply chain actors. Bringing multiple businesses together to collaborate on shared challenges. Farmers and workers who are part of Shared ImPact could build stronger relationships with the traders and businesses they supply, supporting conversations around additional opportunities for investment in areas such as Living Wages or climate programmes.
Contact Fairtrade about Shared ImPact today
Business enquiries: commercial@fairtrade.org.uk
Media enquiries: media@fairtrade.org.uk