M&S, CO-OP AND FINLAYS AMONG LEADING UK BUSINESSES TO SUPPORT FAIRTRADE’S SHARED IMPACT INITIATIVE, FEATURED AS FIRST CONCRETE ACTION IN GOVERNMENT’S TRADE STRATEGY
- UK Government has published its Trade Strategy containing a real-life example of how pre-competitive collaboration can deliver for businesses and people in the UK and overseas through pooled sourcing.
- Fairtrade’s Shared ImPact initiative, which was green-lit by the UK competition watchdog last year, aims to bring supermarkets together to buy commodities on longer-term contracts, providing stability and investment certainty to struggling co-operatives.
- Major UK retailers have welcomed Shared ImPact which allows the pooled sourcing of coffee, cocoa and bananas and collective investment in more sustainable and ethical sourcing.
- Fairtrade’s recommendations to the trade strategy included encouraging pre-competitive collaboration to support environmental and social sustainability.
Leading UK retailers, manufacturers and traders have expressed support for building a fairer and more resilient global food system through pre-competitive collaboration, with more expected to follow.
This comes as the UK Government publishes its new trade strategy which features a real-life example of how companies can collaborate through Fairtrade’s Shared ImPact business model to deliver for people in the UK and overseas, and for their businesses, amid increasing pressures on global supply chains due to climate change, economic instability, shifting regulation and a volatile trade system.
The Fairtrade Foundation submitted evidence earlier this year to the Department for Business and Trade to encourage a trade strategy that supports social, economic and environmental sustainability and helps drive progress towards the SDGs. As a key innovation within the trade strategy, the Fairtrade Foundation recommended a commitment to support pre-competitive collaboration between businesses to protect human rights, tackle climate challenges and drive sector-wide changes.
Kerrina Thorogood, Partnerships Director at the Fairtrade Foundation said: “We’re delighted that so many retailers, manufacturers and traders welcome the need for precompetitive collaboration to address key sustainability challenges – including Shared Impact – and that the UK Government recognises the value of pooled sourcing and long-term commitments with our essential producers as key tools to address critical sustainability, resilience and livelihood concerns related to cocoa, bananas and coffee. We plan to share our experience and learnings as we roll out Shared ImPact over the coming months to help improve industry understanding of the benefits of pre-competitive collaboration.”
Signatories of Fairtrade’s joint statement of commitment – which outlines business pledges to explore longer-term sourcing commitments, greater investment in sustainability, and deeper collaboration with producers – also recognise the urgent need to transform procurement practises within supply chains to achieve both environmental and supply resilience, and producer equity. They acknowledge that addressing climate change and human rights requires collective action rather than individual efforts.
The Shared ImPact Initiative achieves its goals through a “pre-competitive arrangement” under which the Fairtrade Foundation identifies pools of producers who are able to provide additional product on Fairtrade terms. Retailers have welcomed Shared ImPact as a solution that enhances supply chain transparency, ensures fairer prices, and fosters stronger relationships between producers and buyers. Retailers will also benefit through enhanced reporting and sustainability credentials, aligning with increasing regulatory requirements in the UK and EU.
Key themes from the commitment:
- Producers are already experiencing the devastating effects of climate change, exacerbating price volatility and supply chain disruptions. The Shared ImPact Initiative was seen as a crucial step in tackling current challenges and mitigating future climate and environmental risks.
- Businesses must invest in sustainable sourcing models that improve farmer livelihoods and decision-making power to respond to their social and economic needs.
- UK consumers increasingly prioritise ethical sourcing, but stronger storytelling is needed to drive purchasing behaviours. Insights from the Shared ImPact pilot will help businesses better communicate their sustainability efforts.
With industry-wide collaboration, Fairtrade and its partners are committed to reshaping global trade so that farmers, workers, and businesses alike can thrive in a fairer and more sustainable food system.
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Notes to Editors:
- The round table was attended by retailers, traders, manufacturers, producers, policy makers and academic/think tank experts.
- The UK Competition and Markest Authority (CMA) has cleared the Shared ImPact initiative on competition grounds and said that it does not expect to take enforcement action against retailers or traders participating in the initiative. It has further said that the initiative could have positive environmental impacts and strengthen competition in the UK as retailers would have more Fairtrade products to choose from.
- Fairtrade’s Shared ImPact business model is a groundbreaking approach that enables retailers and traders to collaboratively source coffee, cocoa, and bananas. It pools resources and commitments, ensuring producers can sell more of their goods under Fairtrade terms and benefit from long-term (three-to-five-year) contracts that provide greater financial security and investment opportunities.
- Fairtrade is an independent non-profit organisation representing about two million farmers and workers worldwide. It owns the FAIRTRADE Mark, a registered trademark appearing on more than 30,000 products, which is the most recognised and trusted sustainability label in the world. The Fairtrade Foundation is a member organisation of Fairtrade International and collaborates with businesses, engages shoppers, activates civil society, and enables producers to take control in order to bring about a fair, sustainable future. To learn more, visit fairtrade.org.uk