Fairtrade: Frequently Asked Questions
What is Fairtrade and how does it work?
1. What does the Fairtrade Mark mean?
2. Who sets the Fairtrade standards for producers and how are they monitored?
3. What happens if producers don’t meet the standards?
4. Who monitors the supply chain?
5. Why are some farmers seeing less benefit from Fairtrade than others?
6. Is Fairtrade just about food? What about other commodities?
7.Does Fairtrade cover the manufacturing process?
8. How can we tell if a product really is ‘Fairtrade’?
9. Do Fairtrade products have to be more expensive?
10. What is the incentive for traders to sell Fairtrade products?
11. Where can I find Fairtrade products?
2. Who sets the Fairtrade standards for producers and how are they monitored?
3. What happens if producers don’t meet the standards?
4. Who monitors the supply chain?
5. Why are some farmers seeing less benefit from Fairtrade than others?
6. Is Fairtrade just about food? What about other commodities?
7.Does Fairtrade cover the manufacturing process?
8. How can we tell if a product really is ‘Fairtrade’?
9. Do Fairtrade products have to be more expensive?
10. What is the incentive for traders to sell Fairtrade products?
11. Where can I find Fairtrade products?
How can supporting Fairtrade contribute to sustainability in Crystal Palace?
12. Why is Fairtrade a sustainability issue?
13. How does Fairtrade ensure environmental standards?
14. Shouldn’t we be buying local? What about food miles?
15. Shouldn’t farmers in the developing world be producing food for their own populations?
16. What will happen when oil runs out or is too expensive for us to continue importing food from abroad?
17. How relevant is fairness to sustainability?
13. How does Fairtrade ensure environmental standards?
14. Shouldn’t we be buying local? What about food miles?
15. Shouldn’t farmers in the developing world be producing food for their own populations?
16. What will happen when oil runs out or is too expensive for us to continue importing food from abroad?
17. How relevant is fairness to sustainability?
How can we promote Fairtrade and sustainability?
18. ..... in shops?
19 ..... in the community?
20. .... in schools, colleges, places of worship and our workplaces?
19 ..... in the community?
20. .... in schools, colleges, places of worship and our workplaces?
The answers:
What is Fairtrade and how does it work?
1. What does the FAIRTRADE Mark mean?
When you buy a product with the Fairtrade Mark, you know that it has been produced according to an internationally agreed set of social, economic and environmental standards. In the case of small-scale farmers, this means organising themselves into democratically run cooperatives and covers issues such as child labour and sustainable use of resources. In the case of hired labour, there are criteria regarding environmental protection, wages, safe working conditions and the freedom to join unions or other worker organisations.
The standards also apply to the chain of trading relationships.
The traders or buyers (whether a specialised Fairtrade company like Café Direct or a supermarket chain like Sainsbury’s) have to agree contracts with the producer that allow for long-term planning and up-front payments when requested. Crucially, the buyers have to pay at least an agreed minimum price that covers the cost of sustainable production when market prices are low, and the full market price when they are high. The buyers are also required to pay a development premium. This premium is often used to improve health and education and to provide facilities for the community, including environmental improvements such as tree planting, reduced use of chemicals and conversion to alternative sources of energy.
2. Who sets the Fairtrade standards for producers and how are they monitored?
The Fairtrade Standards are set by the Fairtrade Labelling Organisations International (FLO) which is owned jointly by 21 national labelling initiatives covering 22 countries, and Fairtrade producer networks.
Whilst FLO sets the standards, and works with producers to help meet them, a separate international certification company (FLO-Cert) uses regionally-based inspectors to regularly inspect and certify the producers.
3. What happens if producers don’t meet the standards?
Fairtrade producers are initially issued with a certificate which is valid until an agreed date (usually for one year) that can be renewed following re-inspection. As well as the core requirement, there are also development requirements, which are continuous improvements that have to be audited after a certain number of years. If producers fail to meet the standards, they are given specific actions to rectify the situation within a given time frame. If they fail to take these actions in time, they are suspended for a fixed period, after which they must show compliance or be decertified and barred from trading under Fairtrade terms.
4. Who monitors the supply chain?
Producers, processors and exporters in the producer country are monitored by FLO-Cert (an independent certification company owned by the Fairtrade Labelling Organisations International).
The importers and companies involved in the supply chain in the importing country are certified and monitored by the Local Labelling Initiative (LLI). In the case of the UK the LLI is The Fairtrade Foundation. The Fairtrade Foundation licences companies to use the FAIRTRADE Mark on products that comply with the international standards across the supply chain.
5. Why are some farmers still not seeing much benefit from Fairtrade?
A Channel 4 documentary programme highlighted the fact that poverty and poor living conditions still exist on some Fairtrade farms or estates. Where this does occur it is because the co-operatives or farming organisations, despite fulfilling all the Fairtrade standards, are still only able to sell a very small proportion of their produce on Fairtrade terms. This means that when the additional income from Fairtrade is shared among all the farmers, the benefit to the individual can be quite small. The only way for these producers to further improve their living and working conditions is for consumers to buy more of their produce under the Fairtrade terms of trade.
6. Is Fairtrade just about food? What about other commodities?
No. There are around 4,000 different Fairtrade products and the number and range is constantly increasing. The food category includes bananas, cocoa, coffee, tea, dried fruit, fresh fruit and vegetables, honey, juices, nuts, seeds, oil, quinoa, soyabeans and pulses, rice, herbs and spices, sugar and wine. Non-food products include cotton, cut flowers, ornamental plants, sports balls and beauty products. Fairtrade has recently extended to mining and you can now buy Fairtrade and Fairmined gold, mined by small-scale and artisanal miners in a way that respects the miners and the environment.
There are also composite products, such as cakes, biscuits, ice cream and chocolate, where the ingredients are a mixture of Fairtrade ingredients (such as sugar, cocoa, honey, vanilla) and ingredients sourced more locally (such as milk, flour or eggs). These can be certified Fairtrade if at least 50% of their ingredients are Fairtrade (or 20% if the rest is water).
7. Does Fairtrade cover the manufacturing process?
Currently the only manufactured Fairtrade product is footballs. When you buy a shirt made from Fairtrade cotton, there is no guarantee regarding the conditions under which it was manufactured, but The Fairtrade Foundation is careful to ensure that working conditions are not exploitative. In the case of Divine chocolate, the company is 45% owned by the Fairtrade cocoa producers in Ghana.
8. How can we tell if a product really is ‘Fairtrade’?
Unless a product carries the recognisable FAIRTRADE Mark there is no guarantee that it has complied with the Fairtrade standards concerning its production or supply chain. However, currently the FAIRTRADE Mark only covers raw materials, not the manufacturing process (apart from footballs). There are many other products that have been ‘fairly traded’ according to different criteria, such as handicrafts sold by some development agencies, but they cannot carry the FAIRTRADE Mark unless they have been officially certified Fairtrade.
9. Do Fairtrade products have to be more expensive?
No, and often they are not. The principle of Fairtrade is that it is the trader that pays the fair price and the development premium, rather than the consumer. Producers will often offer their best quality products to be certified as Fairtrade and the price negotiated with the trader will reflect this. It is not in the trader’s interest to make Fairtrade products prohibitively expensive as this would put consumers off. The price the consumer pays should reflect the quality of the product, rather than the fact that it’s Fairtrade.
10. What is the incentive for traders to sell Fairtrade products?
Traders want to sell products, so they respond to consumer demand. If they can improve their image in terms of providing ethically produced goods, they will attract the ethical consumer. However, if consumers are either unaware of Fairtrade or do not demand it, retailers will not stock it or continue to stock it. This is why public awareness is so important. The more people become aware of the issues surrounding Fairtrade (particularly their links with sustainability issues) and demand Fairtrade products in their shops, the more traders will want to sell them.
11. Where can I find Fairtrade products?
Our local shops stock some Fairtrade products, and we hope to persuade them to increase their range of products. We will be drawing up an audit in the near future. Meanwhile, there is a list of wholesale suppliers at www. fairtrade.org.uk/products/wholesaler_ suppliers and local catering suppliers at www.fairtrade.org.uk/products/catering_products
How can supporting Fairtrade contribute to sustainability in Crystal Palace?
12. Why is Fairtrade a sustainability issue?
Most Fairtrade producers are small-scale farmers* and small farmers manage a large share of the world’s water and vegetation cover. There is evidence to show that small farms use water more efficiently, use less energy and maintain greater biodiversity than large farms.
Without Fairtrade, many small-scale farms would be unable to survive and risk being replaced by agribusiness, which is a far greater user of energy, water, chemicals and other natural resources.
By supporting Fairtrade we are helping to protect environmental resources globally, and therefore contributing to the transition to greater sustainability for communities everywhere.
*The majority of Fairtrade producers are small-scale farmers, although Fairtrade also supports workers on some farming estates and, more recently, artisanal mining communities
13. How does Fairtrade ensure environmental standards?
In order for a product to be certified Fairtrade, the producers have to comply with a set of internationally agreed standards. The environmental criteria within the Fairtrade Standards are intended to ensure that environmental protection is made an integral part of farm management. There are clear rules relating to the use of chemicals, disposal of waste, and protection of natural resources. Genetically modified organisms are prohibited and producer organisations are required to work gradually towards more organic practices.
Many farmers are only able to make the changes towards more organic farming, diversification and alternative sources of energy because of the guaranteed minimum price and the development premium that traders are obliged to pay under the Fairtrade trading standards.
“We’ve used the Fairtrade premium to buy environmentally friendly ovens to dry our coffee. These are powered by coffee skins and macadamia nut shells, which mean we no longer need to cut up to 50 acres of forest every year." Gerardo Camacho, Fairtrade coffee co-operative, Costa Rica.
14. Shouldn’t we be buying local? What about food miles?
CPTT believes that we should buy local wherever possible, but that if we have to buy imported, it should be Fairtrade. Most Fairtrade products (currently all except flowers) are transported by ship, which has the lowest per tonne impact of any form of transport. Also, transportation of products is only one small element of the total carbon footprint of any product –how it is grown, packaged, distributed to shops within the UK, and the consumer journey to the store and waste disposal can be far more significant. For example, a flower grown in Kenya and flown into the UK emits 5.8 times less carbon than one that has been industrially produced in a hot-house in the Netherlands. (Williams. A, 2007, Cranfield University)
15. Shouldn’t farmers in the developing world be producing food for their own populations?
Farmers that rely on the local market to buy their produce are increasingly being put out of business because they cannot compete with the subsidised food crops produced in the U.S. and Europe and exported to developing countries under ‘free trade’ rules.
Before globalisation, many farmers in the developing world eked out a living growing a variety of crops to feed themselves and to sell in the local market place. With the advent of globalisation, based on the theory of ‘comparative advantage’, international banks, the IMF and the World Bank offered producers in the developing world loans to buy seeds and inputs to develop cash crops for the international market. Farmers saw the opportunity to improve their standard of living, but this eventually led to dependency on their cash crops. A return to producing for the local market is not currently viable for most farmers both because of the cost of conversion and the continued competition from subsidised imports.
16. What will happen when oil runs out or is too expensive for us to continue importing food from abroad?
If, or when, we reach the point where importing our food and other commodities from abroad is no longer viable, by the same token, exporting to the developing world would also presumably have to come to an end. Governments in the more industrialised countries would no longer be able to afford to subsidise their own energy intensive farming and would therefore cease to compete with local producers in the developing world. If this happens, it could also be an opportunity for local farmers to then revert to producing for the needs of their own communities. However, in the meantime we need to continue supporting small farmers through Fairtrade.
17. How relevant is fairness to sustainability?
“A response to climate change that is not seen to be fair is not only morally inappropriate but is likely to prove politically unsustainable”.*
In order to make the transition to sustainability for our own communities as peaceful as possible, we need to take actions that will minimise the chance of unrest and violence on a global scale. Quite apart from the morality of punishing those who are not only the most vulnerable but also the least responsible for climate change and energy depletion, support for third world farmers can help to prevent unrest both in rural areas and also urban areas, where increasing migration would otherwise swell the already overcrowded city slums.
Fairtrade is a means not only for farmers to better prepare for the effects of climate change and energy depletion, but also contributes to maintaining peaceful and resilient communities during the transition to self reliance.
* from Egalité, Fraternité, Sustainabilité, a Fairtrade Foundation Discussion Paper, Oct 2009
How can we promote Fairtrade and sustainability?
18. ... in shops?
CPTT aims to work with local shops and businesses to discuss issues such as waste, use of energy, and stocking local products. We aim to incorporate arguments for stocking and promoting Fairtrade products alongside these other issues.There is help for this from the Fairtrade Foundation, and also a list of retail suppliers, at www.fairtrade.org.uk/products/wholesaler_ suppliers
19. ... in the community?
Every year The Fairtrade Foundation runs a ‘Fairtrade Fortnight’ during which it supports local communities to organise events such as tastings, fashion shows, film shows and invited speakers from Fairtrade producers. They can provide aids such as flyers and posters, T-shirts, bunting, mugs and even banana costumes! As well as celebrating Fairtrade Fortnight, we could combine our messages in various ways, such as Fairtrade and locally produced tastings, Fairtrade and re-used clothing fashion shows, and speakers that explain how Fairtrade has helped them improve their environmental practices. If there is enough interest, Crystal Palace could even aim for ‘Fairtrade Town’ status. (fairtrade.org.uk/get_involved/campaigns/fairtrade_towns)
20 .... in schools, colleges, places of worship and our workplaces?
There are lots of ideas, including detailed Action Guides and ready-to-use materials to help pupils and staff attain the five goals required to become Fairtrade Schools. Many of the nearly 5,000 schools already embarked on this path are already Eco-schools, or share the same steering group, recognising the many similarities between the goals. (fairtrade.org.uk/schools).
Similarly, there are schemes for becoming Fairtrade colleges and Fairtrade places of worship, each with their goals and specially tailored Action Guides. (fairtrade.org.uk/get_involved/campaigns). Finally, there is guidance and lots of ideas on how to make your workplace more Fairtrade (fairtrade.org.uk/work)