Fairtrade’s living income cocoa programme
Grow Further: For companies seeking to go beyond certification and commit to stable incomes, resilient supply chains and long-term impact.
Global supply chains are under increasing pressure due to climate change, ecological limits, social instability and regulatory requirements, while many farming regions are on structurally low incomes.
When farming households can barely make ends meet, they lack the scope for investment—for example, in better farming practices, climate-resilient systems, education, or long-term planning. Income poverty therefore is not an isolated issue, but a systemic problem.
This is where living income steps in: it defines a level of income that covers basic living costs and also enables economic stability. For companies, this means that living incomes are not an optional benefit, but a human right and an essential requirement for resilient and reliable supply chains.
Fairtrade’s approach to living income
Fairtrade has been working for many years to improve income structures in the Global South the sustainable way. Living income is a core component of our strategy. A living income covers: • food, housing, and healthcare expenses • education and social participation • mobility and essential infrastructure • reserves for unexpected events • investments in business As such, living income goes beyond mere production costs. It combines social minimum standards with economic sustainability and strengthens the long-term stability of agricultural households.
Why living income matters for business
Insufficient incomes have a direct impact on the reliability, sustainability, and long-term viability of supply chains.
Adaptation to climate change
Without sufficient scope for investment, measures to adapt to climate change will not be implemented. Resilient farming systems will only emerge if farms have the economic capacity to act.
Preservation of natural resources
Income pressure increases the pressure on natural resources. Sustainable environmental and biodiversity protection requires economic prospects.
Industry preservation
Low incomes limit opportunities for education, health, and development for families. Structural improvements require economic stability. This also gives young people the prospect of a future in agriculture and strengthens the next generation.
Fairtrade: pioneer in the field of living income
Fairtrade was the first certification system worldwide to introduce binding minimum prices and systematically involve producers in governance processes. Fairtrade also calculates and publishes Living Income Reference Prices (LIRP) and transparently links pricing to cost of living data.
While many stakeholders talk about living income as a goal, Fairtrade has specific tools to make it happen and has been running pilot projects for years.
Fairtrade standards at the core
- The Fairtrade minimum price protects against market volatility.
- The Fairtrade premium enables collective investment.
- Clear monitoring mechanisms ensure compliance with standards.
These elements create stability – but do not automatically guarantee a living income. That is why Fairtrade complements existing standards with additional instruments and programme-based approaches.
Living Income Reference Prices (LIRP)
Living Income Reference Prices are benchmarks. They show the price required for a typical farming household to earn a living income under regional conditions.
The calculation takes into account:
- regional cost of living
- household size
- sustainable yields
- available cultivation area
Discover Fairtrade reference prices: https://reference-prices.fairtrade.net/de
FAQ on methodology and application: https://reference-prices.fairtrade.net/faq
From guidance to implementation
Reference prices alone do not necessarily lead to a living income. Coordination between the following factors is crucial:
- pricing
- productivity
- diversification
- climate resilience
- strengthening cooperatives
- long-term partnerships
Fairtrade's structured programmes combine all these elements within an integrated framework.
Grow Further
Living income for the cocoa sector: Fairtrade’s structured programme
“Grow Further” is Fairtrade's programmatic approach for cocoa from West Africa, aimed at companies that want to go beyond certification and make a meaningful contribution to living incomes in the cocoa sector.
Why cocoa?
West Africa produces around two-thirds of the world's cocoa. At the same time, many cocoa farmers in Ghana and Côte d'Ivoire face systemic challenges.
Some of which are:
- small farm sizes
- fluctuating world market prices
- climate risks
- limited scope of investment
Even high world market prices do not necessarily lead to stable incomes that provide a decent standard of living. That is why Fairtrade takes a structured, multi-stage approach to cocoa trade.
Grow Further: the impact
Living incomes are not created by a single lever. They are the result of the synergy between shared responsibility, standards, pricing, investment and partnerships with cooperatives.
Grow Further impact logic – the tree
To visualise its impact logic, think of Grow Further as a tree. The tree represents a structured, interconnected approach: From the roots to a tangible impact in the cocoa sector.
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The roots – the foundation
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The trunk – provides strength and distributes resources
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The branches – growth in multiple directions
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The fruits – living incomes and sustainable impact
Why invest in better incomes?
In the cocoa sector, income gaps are a structural issue, short-term price boosts alone aren't enough.
Grow Further merges:
- standards
- reference prices
- targeted investment
- direct collaboration with cooperatives
- into a consistent programme framework.
Lidl leads the way: First Grow Further partner from Germany
With Lidl, Grow Further has gained its first programme partner in Germany. The discounter is the first partner to participate in Fairtrade's Living Income Programme in Germany, demonstrating how companies can make a concrete contribution to closing the income gap beyond certification. The plan is to convert the entire range of bar chocolate to the Living Income Programme.
Join the pioneers
Grow Further is currently available for the cocoa sector. Companies that trade in cocoa or process cocoa can participate in the programme.
Get started with living income and Grow Further now
Future-proof your supply chains with Fairtrade's structured living income approach. Find out more about Grow Further and discuss with us how you can get started in the cocoa sector.
Regulatory relevance (EU context)
Living incomes are also gaining importance from a regulatory perspective. As part of • Corporate Sustainability Due Diligence Directive (CSDDD) • EU Deforestation Regulation (EUDR) companies are increasingly being held accountable for addressing human rights and environmental risks along their supply chains. Income poverty is considered one of the main causes of child labour, deforestation and structural instability. Living incomes are therefore a relevant component of preventative due diligence. Programmes such as Grow Further support companies in implementing this responsibility in a structured and collaborative manner.
Living income prices and the Anker methodology
Fairtrade calculates living income prices using the Anker methodology, which takes into account local costs of essential goods to determine a fair income for producers. This method considers differences in the cost of living across regions and ensures that living incomes are context-specific and appropriate.
New tool provides reference prices for living incomes
Fairtrade has developed a comprehensive pricing model for setting reference prices for a living income (Living Income Reference Prices – LIRP), which is an essential component of the Living Income Strategy. A Living Income Reference Price indicates the farm gate price needed for a typical farmer household with a viable crop area and a sustainable productivity level to earn a living income from the sales of their crop. A living income is sufficient income to afford a decent standard of living for the household members, including a nutritious diet, decent housing, education, health care, other essential needs and a provision for unexpected events.
Explore the interactive reference price tool