Fairtrade International refutes core alleged evidentiary claims made by Bloomberg’s new article of December 23rd

23 December 2011

Bloomberg article “Fairtrade Proving Anything But in $6 B market” published earlier today claims that the Fairtrade movement is prioritising the interests of its corporate partners at the expense of the development aims for producers and workers which lie at the heart of the organization, and attempts to substantiate this with a number of other specific claims. We refute both the main contention of the article and the core claims used to evidence this.

Fairtrade’s unique approach puts producers at the centre of everything we do.  Farmers and workers are at the heart of the system. They are represented at the highest levels of governance and have a voice in all major decisions. In fact, just this year, members of the global Fairtrade system voted unanimously to increase producer representation in the general assembly to 50%, making producers half owners of the global Fairtrade system. This new shared ownership model means that producers will now have an equal voice in the highest decision-making body of Fairtrade. 

We are absolutely clear that we have increased Fairtrade sales to meet some of the most pressing producer and their community needs. During our strategic review in 2007 – 8, producers told us their greatest need was more Fairtrade sales. Despite our best efforts, many producers still tell us that they would wish to sell much more of their produce on Fairtrade terms, but do not have access to markets. It is important to note within this context that while Fairtrade sales have increased they still comprise only a tiny fraction of overall trade.

The Fairtrade Premium is based on sales volumes and therefore greater sales facilitate greater investment on the ground. We have just released our annual Monitoring Report, covering 2010. This report shows that Fairtrade is working for producers, who reported a 24% increase in their sales value. The report also shows that the Fairtrade Premium of €51.5 million paid to farmers and workers in 2010 was 22% above that paid in the previous reporting period. While many producers select to invest this Premium in improving their communities, for example through improving healthcare and education, the report particularly notes that small producer organisations are increasingly investing in the development of their businesses, for example, through processing, productivity quality improvements and investments in strengthening their organizations.

As Fairtrade has grown, we have strengthened our certification systems and our global operations so that Fairtrade is more robust now than ever before.  We have partnerships with more than twenty outside organisations to provide additional on-the-ground training and services for producers, such as access to financing, market opportunities and capacity building. Fairtrade farmers have also gained access to other programmes and support mechanisms through funding initiatives set up by companies. 

We have prioritised the development of systems to tackle some of the endemic problems within the communities in which we work, such as child labour.  The process we used prior to commissioning an independent assessment of our approach to child labour in cocoa communities in West Africa, referred to in the article, is in fact an excellent example of the rigorous and inclusive approach we are using to strengthen our child labour and child protection work. As with all our work, soliciting input and involving Fairtrade producers and their community members (including women, children and young people) in Fairtrade developments is an essential aspect of how we operate. During the 18 months, Fairtrade undertook consultations with our producer partners and heard from children and young people in Fairtrade communities in Ghana and Cote d’Ivoire, which went through serious security issues. We outline the chronology of events below.

At the close of the 2010 Cocoa and Child labour Forum hosted by Fairtrade International  in Bonn, Germany, referred to in the article, Fairtrade indicated to participants, including NGOs and companies, that we would engage Fairtrade cocoa producers in Cote d’Ivoire and Ghana to also get their input on our approach and that Fairtrade was interested in directly speaking to children and young adults in Fairtrade communities to ask them questions in a focus group format about their wellbeing. We indicated that it was essential to collect input from producers and this was agreed.

Immediately following the 2010 Forum, Fairtrade contacted producers identified in the BBC Panorama documentary to request holding a joint forum either in Ghana or Cote d’Ivoire where Fairtrade West African cocoa producers could receive presentations on Fairtrade’s approach to child labour elimination and give their feedback and make recommendations. Both groups of producers were open to this idea but as the cocoa harvesting season was about to occur they requested that this forum not be held during their busy season. Thus the Producer Forum was planned to be held in March 2011 jointly with Ivorian and Ghanaian producers.

In preparation of the March Forum, in mid February we sent out invitations to cocoa producers asking them to engage in a pre-assignment exercise, namely to consult with their communities (including women, children and young people) on effective ways to identify, remediate and prevent child labour and to share their aspirations, needs, norms and strategies in ensuring increased well being of children and young people in their communities. Inputs from these consultations would be received and discussed in the Producer Forum.

However, the conflict that broke out in Cote d’Ivoire during the elections and post elections meant we could not involve Ivorian farmers in the Producer Forum as the border between Ghana and Cote d’Ivoire was officially closed in March. Despite this, Fairtrade held the Forum in Ghana with Ghanaian and Cameroonian cocoa producers, where we shared, among other things, the request made at the Bonn Forum to conduct a child labour assessment and solicited their feedback on this. At the close of that forum a recommendation was made by these producers that Fairtrade should still do everything possible to hold a Producer Forum in Cote d’Ivoire with Ivorian Fairtrade cocoa farmers and obtain their feedback and recommendations. This was agreed.  

Given the unpredictability of the security situation in Cote d’Ivoire we tentatively decided to host the Ivorian cocoa Producer Forum in October/November of 2011. Once we obtained clearance of the security situation, we held the Forum in early November and engaged in a similar process as we did in Ghana of first consulting with children and young people in Fairtrade communities and then hosting the Forum with producers. At this Forum, we obtained feedback and recommendation of Fairtrade’s approach to child labour elimination and informed them of the proposed Child Labour assessment.

During the course of these events Fairtrade also focused on building relationships with Child Rights NGOs to accompany us in conducting child safe focus groups with children and young people on issues to do with their well being. Given our internal Child Protection Policy and Procedures, conducting these focus groups with child rights NGOs was deemed important because we believed that had we encounter protection issues during these focus group sessions, we would be able to respond immediately to ensure the safety of impacted children.

During the 18 months, Fairtrade International also brought together an Advisory Committee to the CEO on Child Labour Assessment made up of companies, NGOs, producers and a producer network representative to develop the Terms of Reference, call for applicants and select the candidates to undertake the assessment. For additional work undertaken during this period please click here.

In 2012, Fairtrade will assess inputs from all three forums, July 2010, March and November 2011 and obtain the findings of the independent child labour assessment. These will inform Fairtrade’s strategy for increased wellbeing of children and youth in Fairtrade communities. The strategy developed will be circulated for further comment and once adjusted will be implemented in partnership with an international child rights NGO. It will include among other things, child inclusive community based monitoring and remediation on child labour.

Fairtrade is building, through a continuous improvement process, increased assurance on the adherence to our relevant child labour standards and also involving those most impacted by child labour (children themselves) in the development of our approach. 

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