Professional Tutor in Social Enterprise Revd Tony Bradley discusses Fairtrade and ethical business.
There are no shortage of ethical business stories in today’s media. Or, should I say, there is no shortage of stories about unethical business. Whether it is the slew of allegations surrounding sexual harassment in the entertainments industry (and so many other workplaces); the eye-watering bonuses paid to some corporate top earners (£100M bonus to the CEO of Persimmon Homes); the gender inequalities in pay at the BBC (and across the corporate sector); the failures of giants such as Carillion, as they forced their SME suppliers into liquidation; or massive fines imposed on large-scale gambling industry brands, for not monitoring money laundering: the list of bad behaviour is apparently endless. So it’s high time for some good news, with Fairtrade Fortnight beginning for another year.
Worms in the bud
But sadly, not everything in the Fairtrade garden (which has recently added the $100BN per year cut flower industry to its list of products) smells of roses either. Since the split between the Fairtrade Labelling Organisation (FLO), who owns the familiar symbol of the ying-yang waving person, and FTUSA in 2011 - over the latter’s decision to trade with plantation-scale coffee producers - the ethical trade sector has been increasingly riven. More ethical label groups have emerged, such as the Rain Forest Alliance (RFA), which has been championed by Unilever’s PG Tips since 2006), Ethical Tea Partnership (ETP is organised by Taylors of Harrogate, Tetley and Twinings), Utz (promoted by IKEA) and the most recent trend of individual UK supermarkets to package their own ‘ethical labels’, such as Sainsbury’s Fairly Traded.
It is a bewildering market phenomenon for the poor old (or even rich young) consumer, who simply wants to do the right thing by shopping in a good way. So, what criteria is used and how reliable are they in getting your daily cuppa filled to the brim with goodness?
Are other labels sticking or peeling-off?
The main criticism of RFA is that only 30 per cent of any product has to be RFA certified for it to attract the label. Furthermore, RFA certification is often given to producers operating over huge areas. So for example, Unilever recently defended its RFA stance, despite increasing allegations of poor housing, ethnic discrimination and sexual harassment in its Kenyan tea plantations, by claiming in 2011 that “Our tea plantation is more than 75km (50 miles) long and employs 16,000 people, so we do not pretend that occasional issues never arise”. The RFA certified all the producers within that huge area rather than working with individual small producers on a specific basis. That said, RFA’s collaboration with the Forest Stewardship Council is very encouraging.
The ETP has very good credentials in that it uses fundamental principles devised by the Ethical Trading Initiative Base Code and the International Labour Organisation (ILO). Monitoring of these standards include energy and water use, conservation of ecosystems and soil conditions, waste management and use of chemicals, such as pesticides and herbicides. But the very small take-up of this initiative, means that it remains a minority player in the ethical labelling field.
Perhaps the most worrying, or interesting, depending on your standpoint, new development comes from individual retailers appearing to jump on the Fairtrade bandwagon, by promoting their own ‘ethical branding’. Sainsbury’s has followed Cadbury’s (now, of course, part of the US mega-food giant, Kraft) in developing its own self-verification label. It has received substantial criticism since the Summer of 2017, but the supermarket has responded with a robust defence: ‘The pilot aims to build on the Fairtrade model, providing a guarantee that our tea farmers will continue to receive all the funding currently in place, or more. This includes the minimum price guarantee and social premium to match Fairtrade levels –and crucially, additional benefits, including… advanced information across social, economic and environmental aspects of their business’.
It’s big business, Captain, but not as we know it!
And these changes really matter. The latest Ethical Consumer Report puts the size of the ethical purchases market in the UK alone at more than £38BN. Our own research at Hope indicates that when ethical financial products and services are added-in this represents some 13 per cent of all consumer purchases. And the UK accounts for 25 per cent of all global Fairtrade sales. We value ethical trade more than any country, by a large margin.
So, there is quite a disruption taking place in the market around ethical labelling. Even so, it is our view that only Fairtrade and the FLO mark guarantees minimum pricing for small farmers and growers and all the benefits of the FT premium, in terms of access to better housing, water, health care, sanitation and, crucially, educational provision. This means that Fairtrade Fortnight is no small issue for us to take account of. Whether it is buying a romantic bunch of flowers for your significant other or just brewing-up a cuppa in Our Place, looking at the label can make a world of difference to the families who produced your purchase in the first place. From Monday 26th February – Sunday 11th March, get supporting and maybe you’ll discover just how sweet justice tastes.
 Unilever (2011) ‘October 2011: Unilever Response to Report by SOMO into our Tea Plantation in Kericho, Kenya’.