Scaling Up with Integrity – What does it mean for Fairtrade?

01 August 2013

Twenty-five years ago fair trade began as an ambitious concept that many said would never take off. The global Fairtrade system now represents over 1.3 million farmers and workers organized into more than 1,100 groups in 70 countries. Recently Fairtrade farmers and workers became half owners of the global system.

Fairtrade farmers now view themselves as integral to local economies and development; individuals who unite their actions through their organizations. For these producers, and those who work with them, growing their market is essential to improving their livelihoods and that of their communities.

Working with upwards of 3000 companies across the globe, Fairtrade has been ahead of the curve in recognising the key role that the private sector can play in wider development and working to enable it. A recent report from the High Level Panel of the UN on the post 2015 development agenda (PDF) cites the private sector as a vital partner in driving “a quantum leap forward bringing an end to extreme poverty and improving livelihoods.”

The private sector also has the responsibility within their sphere of influence to implement human rights, decent working conditions, and environmental protection, among other things.

A commitment to scaling up Fairtrade’s impact with integrity requires walking a line between socially and environmentally responsible production, and enabling trade that ultimately benefits producers, workers and their communities. Over the years Fairtrade has learned valuable lessons about meeting the often-conflicting needs of the private sector and disadvantaged producers. Growth can solve problems, but can breed others if core human rights are not considered.

Fairtrade has seen farmers take shortcuts with organic certification, turn to bad labour practices under pressure to meet deadlines or cut down forest to increase production. Fairtrade has also confronted significant human rights abuses. Fairtrade producer communities are not immune to the difficulties faced across the developing world, and indeed the developed world. Power dynamics can manifest themselves at every level, from cooperative boardrooms to the lives of individual farmers and workers

“This is a long, difficult journey. Fairtrade is not a sugar coated pill. Every day, we are dealing with the realities of centuries of oppression, none of which will be solved overnight,” said Harriet Lamb, CEO of Fairtrade International.

“Finding the right balance between facilitating trade, development and compliance is a sometimes difficult and arduous task that requires continuous improvement and fine tuning.”

To ensure we scale up responsibly, Fairtrade has dedicated increased attention and resources to the human rights and freedoms promoted in the core ILO Conventions, which are included in Fairtrade standards as minimum or core requirements. In particular, Fairtrade takes an uncompromising stance against trafficking, worst forms of child labour, sexual harassment, and discrimination of any kind.

Controlling compliance with the Fairtrade Standards is conducted by FLO-CERT, an independent, ISO-65 certified company. ISO 65 is the leading internationally recognized quality norm for bodies operating a product certification system. FLO-CERT follows the norm in all certification operations and is subject to external audits of the German Accreditation body DAkkS.

“Effective certification combines rigorous processes, risk assessment, and skilled auditors,” said Ruediger Meyer, CEO of FLO-CERT. “The biggest challenge is monitoring – no certification body can be on-site 24/7, which is why trustful relationships with producers and traders are crucial. By working together closely, we can minimize risks that can occur within supply chains.”

FLO-CERT auditors are experts in their field. They are familiar with the local and sector-specific realities they are facing on-site. They are also conscious of the elements in the Fairtrade Standards that carry the highest risk for non-conformities. Auditors receive regular training on identification and response required to mitigate those risks. Content and documentation of these trainings are included in the auditing process of FLO-CERT’s ISO 65 accreditation. In addition, FLO-CERT maintains an auditor rotation policy; an auditor cannot be assigned more than three consecutive times to the same Fairtrade client.

Any non-conformity in the area of a core Fairtrade Principle, such as those embedded in the core ILO Conventions, can lead to suspension and ultimately decertification. In 2012 FLO-CERT suspended a total of 141 producer organizations and 41 traders, with 35 and 12 decertified, respectively.

There are strict and transparent allegation procedures in place and every allegation is followed up by the FLO-CERT Quality Management department according to a standard operating procedure. Depending on the severity of the allegations made, FLO-CERT conducts a document check, includes the topic into the next regular audit or conducts an unannounced audit to investigate the allegation.

The challenges faced by farmers and workers in developing countries go beyond the scope of any certification system. Fairtrade International is building expertise in various programme areas that can affect farmers and workers across all products and developing global strategies to help the most vulnerable.

In addressing Child Labour issues, Fairtrade has adopted a children-first approach and works with experts and producers to go beyond the minimum requirements to improve real conditions for children and young people. We are building knowledge on trafficking patterns in areas of known risk and supporting producers to put preventative measures in place. When we find breaches to our child labour requirements, we take immediate action to protect children. We prevent the impacted farms using child labour from entering the Fairtrade system, and support them and their communities to tackle the problem. We are consulting with children and young people in Fairtrade communities to develop continuous improvements in the way we tackle this problem, making sure that we do not create new problems for children and young people involved in unacceptable labour practices.

Following the adoption of our ambitious Workers’ Rights Strategy in 2012, a full review of the Hired Labour Standard is being conducted to improve compliance with ILO Conventions and better empower workers on plantations so that they can make effective use of their rights, including the right to organize and bargain collectively. The vision of our Workers’ Rights Strategy is to promote fairness and dialogue in the workplace through mature industrial relations between workers, their unions and employers. As part of the expansion of the strategy to cover workers on small farms, we are actively gathering knowledge and information across our multi-stakeholder system, speaking directly to workers, male and female, and diligently working to better understand the complexities that accompany our wide range of commodities, countries and contexts to be able to inform our Standards and auditing process.

 “Growth with integrity means growing Fairtrade while taking into account all of the values and norms that are part of Fairtrade. Growth can never be at the expense of others,” said Marike de Pena, Vice Chair of the Fairtrade International Board, President of CLAC and Director of Banelino, a Fairtrade certified, small producer organization in the Dominican Republic.

More than ever, we remain convinced that Fairtrade is still the best option to address unfair trade terms and the rights of disadvantaged populations in international trade.

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