Erinch Sahan of the World Fair Trade Organization says the social enterprises that are producing chocolate from bean to bar show the value that can be generated for communities when the global movement thinks beyond the farm gate
The Fair Trade movement gathered for its biennial meeting in Lima in September to ask itself the big questions. Should we update the 10 principles of Fair Trade to intensify our fight against the climate crisis? Do we need new models of business if we are to remain relevant in a new economy? Can and should we go circular? The answer from the movement to each of these questions was an emphatic “yes”.
Millions of farmers who grow our food are hungry and exploited. Despite a multitude of initiatives and certifications, partnerships and back-slapping, by and large global commodity markets work to keep farmers poor. This is a point of shame for all of us who spent years trying to fix supply chains. Perhaps our efforts have remained too incremental. We have lacked ambition. A clear message from the Fair Trade movement coming out of the Lima Fair Trade Summit is that we must not be crippled by incrementalism and an acceptance of the status quo. And when it comes to food and farming, we must take Fair Trade beyond the farm gate.
When Fair Trade enterprises build brands, they channel the value they capture to benefit producers and communities
For it to transform our economies, Fair Trade must dive into the heart of businesses trading and processing, manufacturing and marketing. Across the supply chain, we can build, foster and promote businesses that exist to benefit farmers. Sounds like a fantasy? It’s not, and it is already happening.
Let’s take chocolate. One question the Fair Trade movement asked of itself in Lima is how it can take over the chocolate supply chain. We found that an increasing amount of Fair Trade Enterprises are already doing this.
Take Maquita, for instance, a farmer-owned business operating several social enterprises in Ecuador. Maquita isn’t content to merely supply global markets with cocoa. It is processing and manufacturing its own chocolate, capturing more of the value, and channelling this to support its farmers and community. In Peru, Candela is doing the same. And so is Pacari in Ecuador and Zotter in Austria. They’ve gone bean-to-bar and are making it work. Trade Aid in New Zealand has also now built its own chocolate factory and is already seeing sales growth. The idea is working.
These are all World Fair Trade Organization (WFTO) members, and as such are social enterprises who fully practise Fair Trade. Fair Trade Enterprises are required to reinvest the majority of their profits into their social impact, although 90% of them reinvest all their profits. When such Fair Trade enterprises build brands and move up the chocolate supply chain, they channel the value they capture to benefit producers and communities. In Lima, our movement began plotting a future where such enterprises become the norm.
The climate crisis has always been a part of the struggle of Fair Trade, but it was time to elevate efforts. Explicitly recognising that the climate crisis will result in famines, migrations and wars and negate or overwhelm the efforts of Fair Trade, WFTO members voted to update the 10 principles of Fair Trade. The environmental principle of Fair Trade will be renamed Climate Crisis and Protecting our Planet and its criteria will be tightened. In particular, reducing CO2 emissions, promoting sustainable production and eliminating waste and plastics will become more central to Fair Trade.
No one knows the dangers of the climate crisis better than the farmers, workers and artisans in communities that are already feeling the impacts
Fair Trade is producer-led, and no one knows the dangers of the climate crisis better than the farmers, workers and artisans in communities that are already feeling the impacts. The Lima Fair Trade Summit galvanised these voices to challenge the Fair Trade movement to go further in the fight to save our planet. We’re rolling up our sleeves.
The circular economy is all the rage in Fair Trade. In Bangladesh, Fair Trade enterprises are reusing waste of the fast-fashion factories to create bags and home décor. In India and Sri Lanka, they are working with wastepicker groups to recycle plastic to make new bags, sunglasses, belt-buckles and bottles (including through a partnership with WFTO Associate, The Body Shop). Others across South Asia are turning discarded saris into new fashion items. In Tanzania, Fair Trade Enterprises are cleaning up the beaches of Zanzibar to create furnishings and accessories, and helping refugees turn food sacks into baskets.
For years, these social enterprises did upcycling and recycling to simply clean up their neighbourhoods. They wanted clean streets and beaches so the children of artisans and workers could play. What’s exciting is that something that comes naturally to enterprises embedded in their communities – upcycling and recycling – is becoming a hit with consumers. There’s now also a market pull.
In Lima, the Fair Trade movement looked long and hard at how it can spread these ideas, scale up efforts and accelerate innovation. Fashion is where the most potential was found, but eco-friendly packaging for all products is growing across Fair Trade. The enterprises with on-trend product designs and savvy marketing are seeing growth in circular product lines. Meanwhile, many others are investing to embrace these ideas. The movement is poised to go circular.
The Lima Fair Trade Summit was a critical juncture for the Fair Trade movement. A new future can be glimpsed where Fair Trade proposes a new model of business, where people and planet are the priority, and profits are used to transform the lives. This is happening from garments to chocolate, quinoa to jewellery. Fair Trade is becoming a vision of a new economy, populated by mission-led enterprises. Our ambition has gone up a notch.
Erinch Sahan is chief executive of the World Fair Trade Organization, the global community and verifier of social enterprises that fully practice Fair Trade. Members of WFTO include producers, importers, brands, retailers and campaigners.