Is Fairtrade ‘right thing to do’?


If you cast your eyes around the shelves of supermarkets, notably those displaying wine, coffee and chocolate, you’ll notice a number of Fairtrade certified products available.

For those not in the know, if you buy Fairtrade products, you’ll be making an ethical decision, as a percentage of the sales goes towards the workers who laboured to get the product on the market.

In South Africa, Fairtrade has only really been around for six years; but in Europe and America, Fairtrade has its roots long before it was promoted as an ethical concept in the late 20th century.

The idea of a “moral economy” prescribes rights for ethical trading and free trading and, in 1827 in Philadelphia, a moral and economic boycott of slave-derived goods began with the formation of the Free Produce Society, founded by Thomas M’Clintock and other abolitionist members of the Religious Society of Friends (Quakers). Free Produce countered slavery by promoting the labour of free men and women and they attempted to determine the hidden costs to goods such as cotton and sugar which came about from slave labour.

Across the Atlantic, in another example in which fair trade in the “old moral economy” was focused on producer rights, Dutch author Multatuli (the pen name of Eduard Douwes Dekker) in his novel Max Havelaar, questioned the injustice of colonialism.

His absorbing fictional tale, penned in 1859, recounts the story of Max Havelaar, a Nederlandse Trade Company employee who left everything to work with local Indonesian workers. The author drew a direct correlation between the wealth and the prosperity of Europe and the poverty of the suffering of other parts of the world.

This theme was continued in the 20th century when the modern fair trade movement was born in Europe. In 1969, the first “World shop” opened in the Netherlands, bringing the principles of fair trade to the retail sector by selling hand crafts produced under fair trade terms in under-developed regions. Similar shops soon went into business in other Western European countries.

The alternative trade movement burgeoned and in 1988 the first Fairtrade label, Max Havelaar, was launched. Independent certification allowed goods to be sold outside the “Worldshops”, reaching more consumers and boosting fair trade sales. Fairtrade labelling enabled both customers and distributors to track the origin of the goods to confirm the products were really benefiting the producers at the end of the supply chain.

Today, according to Fairtrade statistics, more than 125 countries sell Fairtrade products and there are 30 000 products carrying the Fairtrade mark worldwide.

Locally in South Africa, according to FairtradeSA, consumers have, since its launch here in 2010, spent more than R294 million on Fairtrade-labelled products and the market has increased fivefold to date.

At a workshop on Fairtrade, held recently as part of the Sustainable Brands Conference, sustainable and ethical certification was highlighted.

Arianna Baldo, the executive director of Fairtrade SA, said as consumers become more discerning, all aspects of systems in the supply chain need to be accountable. “Fairtrade exists because consumers want to purchase products that solve the world’s problems, not add on to them,” she said.

Stringent criteria need to be met in order for Fairtrade producers to affix the label to their products. This is done through the independent auditing company Flocert, in which Fairtrade certifies agricultural supply chains worldwide.

But several participants questioned why the cost, for example, of Fairtrade coffee, a “fashionable” commodity, that sees many single origin coffee plantations in Africa made up into premium coffees, is warranted.

Jonathan Robinson, director of Bean There Coffee in Cape Town, and Marius Louw, chief executive of Du Toitskloof Wines, both Fairtrade certified, said certification came with a price, despite its tremendous impact on their brands.

“When you do the right thing it comes at a price, but there is a growing trend among young people who actively make ethical choices about the products they support,” commented Mr Robinson, whose sentiments were echoed in another way by Mr Louw, who manages a co-operative wine farm.

“We also have to consider every aspect of certification as we have 22 members, so we need to ensure that a high standard of ethical and sustainable farming activities is maintained in the entire Du Toitskloof value chain,” he said.

Pick * Pay supports Fairtrade products and André Nel, general manager of Sustainable Development at the supermarket chain, said there is a societal shift in South Africa towards community.

“Pick * Pay has seen a shift from products being business-driven to community-driven, and we need to focus our efforts through social media awareness on why ethical and sustainable certification is important.”

“While in the past we have all been driven by big business, it’s now coming back to the individual,” he said.

He added that, in general, and with the current economic downturn, “as far as labelling, very few look out for Fairtrade. Most people are buying very basic food stocks. But because people are poor it does not mean they are unaware.”

Yashvir Maharaj, who manages the B2B Insights Survey Market Research Company, said according to surveys they had conducted, “there is growing consumer pressure in the upper income group who want to know where their products come from and how they are produced”.

At the workshop, participants were informed that worldwide, the retail sales of Fairtrade is making a strong impact on the market.

As was explained, the Fairtrade premium, is an additional sum above the purchase price paid directly to the producer organisation. It works in the same way in every country: farmers and workers democratically decide on how to invest the premium according to their priorities. Worldwide, workers on plantations have spent 24% of their premium on education; and 38% on improvements to their housing; small producer organisations invested 48% of their premiums back into improving their organisations.

As Mr Robinson commented at the close of the workshop, “While there is not yet a boom in Fairtrade, there’s a growing trend of those seeking out its products. From the products we buy, we can see the difference it has made to farmers’ lives.”

To which Mr Maharaj added, “It’s necessary to see what the bigger picture as far as Fairtrade is concerned. The premiums also leave something behind for the farmers’ children and, surveys have demonstrated that eight out of 10 people believe buying Fairtrade is “the right thing to do. As far as marketing is concerned, it is also considered to be a ‘unique selling point’.”