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Fair Trade USA: Why We Parted Ways with Fair Trade International

3p Contributor | Wednesday January 11th, 2012 | 15 Comments

By Paul Rice, President & CEO of Fair Trade USA

The concluding months of 2011 were marked by a period of great change and innovation in the Fair Trade movement: a time of unprecedented forward thinking and passionate debate about what it means to be Fair Trade Certified. We now find ourselves at an exciting crossroads. Fair Trade USA has boldly questioned the status quo and is moving in a new direction to significantly increase the effectiveness and reach of the Fair Trade model. At the beginning of this New Year, we couldn’t be more hopeful about what lies ahead, knowing that as a result of these innovations, we could double our impact in just three years.

At a Crossroads

Fair Trade began modestly in the 1960s with a few committed individuals who believed that access to markets could transform the lives of those struggling under the crushing hand of poverty. The idea was simple: through commerce, people in developing countries could realize the benefits that we take for granted in North America and Europe.

With this foundation, Fair Trade developed into a market-based approach to alleviating poverty in ways that are socially, economically and environmentally sustainable. Through this model, farming families are able to eat better, keep their kids in school, improve health and housing, and invest in the future of their communities.

Still, Fair Trade can and must do more. This is why Fair Trade USA is embarking on a new vision, Fair Trade for All, aimed at doubling the impact of Fair Trade by 2015 by innovating the model, strengthening farming communities and igniting consumer involvement.

Innovating the Fair Trade Model to Benefit Far More People

There are many voices in the Fair Trade movement, all united under a common mission to alleviate poverty through trade. FLO, one group in the global movement, is focused on small farmers organized into cooperatives. Fair Trade USA, another voice, believes that Fair Trade has to work for all kinds of producers to make a meaningful dent in global poverty.

In its current form, Fair Trade principles are applied inconsistently. For some product categories, like coffee, Fair Trade certification is limited to cooperatives, while in other categories, like bananas and tea, workers on large farms can become certified.

Fair Trade USA resigned our membership from FLO in order to eliminate these inconsistencies which exclude so many from the benefits of Fair Trade.   Beginning in coffee, we are adapting Fair Trade standards for both workers on large farms and independent small holders. Through this more inclusive model, Fair Trade USA can reach over 4 million farm workers who are currently excluded from the system.

We plan to implement this change slowly, with 10 – 20 pilot programs over the next two years. Fair Trade USA will assess results at the farm and sector levels, and report on system-wide sales to ensure that the inclusion of new groups does not negatively impact existing cooperatives.

Strengthening Farming Communities

As we innovate, we must ensure that cooperatives remain strong and competitive, as they are truly the backbone of the Fair Trade movement. Part of this effort includes the development of innovative new partnerships with global financial institutions, industry partners, NGOs, leading social entrepreneurs and in-country service providers.

One noteworthy program, ‘Co-op Link’, recognizes the unique role Fair Trade USA can play in linking organizations from all areas of the supply chain to maximize impact for producers. It focuses on increasing market opportunities; improving access to capital; creating programs to improve quality and productivity; and expanding the training available to cooperatives.  We have raised $5 million in 2011 alone.

Igniting Consumer Involvement

Since Fair Trade launched 50 years ago, European consumer awareness about Fair Trade has grown to well over 80 percent. Yet in the United States, where the movement is younger, only about 34 percent of consumers are aware of Fair Trade.

Therefore, part of what makes Fair Trade for All so important is the unique opportunity it offers to spread awareness around Fair Trade to far more conscious consumers around the world. By showing American consumers that every purchase matters, that they have the power to change the world through something as simple as a cup of coffee, we can help make responsible shopping the new normal.

The Road Ahead

At the end of the day, these innovations will bring the benefits of Fair Trade to far more farmers and workers; enable more businesses to develop reliable and ethical supply chains; allow more retailers to offer more Fair Trade Certified products; and give consumers a broader selection of quality Fair Trade Certified products from which to choose.

We are proud of the work Fair Trade USA and our partners have accomplished, but as 2 billion people still live on less than $2 USD a day, there is much more to be done.  As we move into a new year, Fair Trade USA has chosen to buck the status quo, take a risk, challenge the norm, and go where no organization has gone before to make Fair Trade truly fair for all.

[Image credit: Katie Barrow, Fair Trade USA]

***

Paul Rice is President & CEO of Fair Trade USA, the leading third-party certifier of Fair Trade in the United States. Previously, Paul worked for 11 years as a rural development specialist in Nicaragua, where he founded the country’s first Fair Trade, organic coffee export cooperative. Paul holds a BA from Yale University and an MBA from Haas School of Business at the University of California at Berkeley . Follow Fair Trade USA on Twitter: @FairTradeUSA


▼▼▼      15 Comments     ▼▼▼

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  • Tiffany

    Fair Trade USA is a joke. I worked in the UK for the Fairtrade Foundation, a member of FLO and they have accelerated the growth of Fair Trade faster than Fair Trade USA ever will. Why? Because Fair Trade is about PEOPLE first, not profit in Paul Rice’s corporation Fair Trade USA.

    • Balboa Sam

      Might you elaborate a bit?  Criticism is fine, but without context it doesn’t really say anything.

    • Vlad

      That’s the problem, FLO only accelerated growth in Europe.

  • Rodney North

    On behalf of Equal Exchange, the enterprise largely responsible for introducing Fair Trade commodities to the US market back in the 80s, we respectfully disagree with Fair Trade USA and their claim that their new approach will “double Fair Trade’s impact”.

    Yes, it might double the tonnage of what carries a Fair Trade sticker, but we think the new certification seal (& associated standards) will actually represent little impact in producer communities. Plus, the new easier-to-get sticker will siphon sales away from importers adhering to Fair Trade’s original practices. This, in turn, will mean fewer exports for the small farmer co-ops who did so much for 25 years to create & supply the Fair Trade movement.

    Instead the small farmer co-op’s – the focus of Fair Trade at its inception – will see large plantations seize the Fair Trade market, and dominate it the way they already dominate the conventional and organic commodity markets.  Where Fair Trade certifiers have already extended certification to plantations (for ex.in the tea & banana markets) we have seen this play out.
     
    But because we, and other Fair Trade leaders, have already written about this at length I will not elaborate any further here, and will instead just offer some links where folks can dig deeper.

    Here is statement by a global network of Fair Trade small farmer organizations protesting the Fair Trade USA decision:
    http://smallfarmersbigchange.coop/2011/10/05/4153/

    Here is a similar statement on behalf of Mexican farmers, sent to us by Franz VanDerHoff, one of the co-founders of the Fair Trade movement:

    http://tinyurl.com/7asbtno

    And, lastly, here is the page where people may read more and sign our petition to support _authentic_ Fair Trade: 
    http://www.equalexchange.coop/fair-trade-campaign

  • http://twitter.com/aeidinger Adam Eidinger

    I’d like to understand exactly what Fair Trade Certified will mean under the new Fair Trade USA Standards?  This piece talks a lot about spreading the Fair Trade benefits to more people, but what are those benefits? The piece has an important typo too,as it’s not 2 million living on less than $2 a day, its 2 BILLION!  Funny that fact would be be goofed by FTUSA.  I think for to regain credibility, FTUSA needs to explain their benefits more clearly.  Licensing fees for the the FTUSA seal should not be related to total sales volumes so as to have no conflict of interest in enforcing their standard.  This point alone makes for greater integrity in other certfiers such as IMO Fair For Life who charge the same for inspection regardless of the sales volume.  It is highly unlikely a Wall Street corporation cheating the fair trade system will ever be held accountable by FTUSA as it would financially devastate Fair Trade USA to revoke certification. Sadly this op-ed leaves more questions than it answers and part of an ongoing campaign to regain credibility in the marketplace.

    • http://www.triplepundit.com Nick Aster

      Thanks for catching the Billion error, copy edit mistake! – I’ve updated the post!

  • Sophia

    Many of these comments are missing a big part
    of story, that these are pilots. How can real change be made if no one
    ever experiments? The article itself says that Fair Trade USA is testing
    the waters, and if the results are negative for anyone involved, well
    let’s hope they reassess the situation. I’d like to wait and see how it
    all plays out. Fingers crossed that the changes do make a big dent in
    poverty.

    • Miguel

      Hi agree – experimentation is really good.  But a genuine feedback loop requires multiple stakeholders.  Transfair (fair trade usa) has never had – and never will have any other voices at the table except for Paul’s.  100% committed fair trade roasters have lobbied for years to get industry and farmer representation on Transfair’s Board (a non-profit where Paul makes nearly 200K per year!)  Instead it is one person and his friends/funders. Transfair can spin it however they want – fair for all – but when the farmer’s they purport to partner with are outraged and against this move – what does that say?  Pull back the curtain, the emperor has no clothes!

  • Leon Kaye

    One criticism I have heard from many Fair Trade Certified companies is that FT USA is more concerned with their own branding than actually “doing good.” A lot of smaller companies are frustrated with the fact that they spend a lot of time and money making sure their products are FT certified, only to see companies with far more resources have a few marginal ingredients in their concoctions and therefore . . . they also get the same certification. I see and hear a lot of frustration from these small shops–I think a “listening tour” is in order. I believe in the concept, FT is great, but concerns like those that Adam expressed need to be addressed.

    • http://www.ethixventures.com Aria DiSalvo

      Great point Leon- I would echo that it’s the small companies I first heard these concerns from. Years ago I visited coffee coops on a tour with a small fair trade importer, and they reported the preferential treatment FT USA showed to larger coffee chains. Now in my role at Ethix Merch I see the move toward “fair trade certified” apparel as in likelihood being a pilot project with good small companies, only to start certifying the huge brands known for sweatshops soon enough.

      I’ve put further thoughts and critiques out on our blog if anyone is looking for more info specifically on the apparel project: http://ethixmerch.com/blog/fair-trade-month-news-usa-split-splitting-my-hairs

      Thanks for the conversation. It’s good to see something directly from FT USA on how they see the situation.

  • Pmeeks

    Why have so few universities in the US joined Fair Trade Universities (USA) compared to the scores in the UK. Since 2008, only six or seven universities out of 3000 +/- have joined despite its ideological appeal.

  • Kirsten

    I would be great to hear from farmers, small producer, coop owners and farm workers instead of the tiring debates  about the perfect system from those of us in the Global North. At this point we have multi-label world but far more products with no label..

  • Xan

    maybe it has also to do with the coming up of other seals like rainforest alliance,utz kapeh,4C etc

    here:
     www.clac-comerciojusto.org

    you can find small producers statements

  • ConfusedConsumer

    If you’re changing the rules, vision, and model of this movement, doesn’t it become a different movement entirely? Regardless of whether you feel like you have the high ground here, I don’t think you have an argument to call it Fair Trade if it’s starkly different from the way the Fair Trade pioneers  built this movement. It’s especially unsettling that you appear to be claiming ownership of the movement through your new name, too.

    • winnie baxter

      I have taught units on Fair Trade for 13 years and I believe I have followed the movement closely. I have a bad feeling when I read about financial institutions and NGOs being involved in anything having to do with small farmers and developing cooperatives. Suddenly it becomes a lot more complicated and the voices at the bottom. – the farmer – just gets lost in the shuffle. These people may not be rich but they’re not stupid. They have found their voice and I hope they use it.