Despite a sluggish context, fair trade market continues its growth. In France, it it reached 429 million euros and 11.1% growth in 2013. But before being a “market” trade fair is an innovative approach to national and international trade. Supported by an economic movement of producers and companies, fair trade has been evolving for over 40 years. Its players do not always have converging interests, which is its evolutions, particularly in the area of labeling, are often debatable.
Fairtrade International, the pioneer (but not unique) fair trade label, opened 2014 by introducing a new label to expand the market for labeled products. This development, insufficiently coordinated, led to controversy. In France, several players have also come together to develop a Local Fair Trade Charter. This expansion of fair trade to local trade is the result of a long-term trend, producers and consumers in the North and South being more and more aware of their belonging to the same trade system.
The new Fairtrade Sourcing Programme
Fairtrade International launched a new program this year, creating controversy between stakeholders. The Fairtrade Sourcing Program (FSP) identified by new logos (above) identifies the “fair” sourcing of an ingredient in a consumer product, even if the other ingredients are not guaranteed to be fair.
What’s new
According to the original fair trade rules, all raw materials that can be “sourced” for a product as fair trade should be, and certified ingredients must represent at least 20% of the finished product. The FSP label is clearly different from the usual Fairtrade label, as it removes that requirement, allowing the company to focus solely on the main ingredient of a product, such as cocoa.
The debate
The FSP label introduces a breach in the guarantee system developed by the historical fair trade labels. Generally, within a certified Fairtrade product, any ingredient that could be found as fair trade should be fair trade. This new program was launched in early 2014 without sufficient consultation with internal and external stakeholders of the organization. The Latin American and Caribbean coordination of small producers of Fair Trade (CLAC) denounced the dangers of the program. As for retailers, Alter Eco (a French retail brand) was reluctant, as well as its competitor Ethiquable brand, while the General Assembly of the Federation Artisans du Monde decided in July that no product bearing the new label (FSP) will be distributed by the Artisans du Monde shops, even under a different brand.
Our analysis
The rule for composite products within the regular Fairtrade label included flexibility, since, recognizing “no one is required to do the impossible”, an ingredient not available in fair trade can be replaced by a conventional ingredient without threatening the label on the final product. The FSP program will help to make a rule from the exception. While it may be useful in some cases, it is a label to be used sparingly because savvy consumers will soon make a difference with the products 100% guaranteed by the historical Fairtrade label, or other labels like Ecocert ESR, BioEquitable, or Forest Garden Products. Giving manufacturers the opportunity to choose non-certified providers for certain ingredients, this choice can be made for cost reasons, but also for better reasons, such as choosing a local producer, in a non-commercial supplier fair (in the case of beet sugar cane rather than, for example).
Fair Trade is evolving. What about you?
Our Fair Trade training allows our clients to gain a full understanding of the issues of this movement, which is relevant for all businesses, whether they aim at certification or not.
We also offer personalized support for a more ethical and sustainable trade relations. Feel free to contact us to expose so we can discuss your particular situation.
