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WHAT MAKES A BRAND FAIR TRADE?

We agree with UK ethical fashion brand PeopleTree that “fair trade doesn’t just mean paying a fair price. It is an entirely different way of doing business.” Fair trade is all about the 3 P’s: making a profit, respecting people and protecting the planet.

The 10 principles of fair trade promoted by the World Fair Trade Organization include:

  1. Creating Opportunities for Economically Disadvantaged Producers with the aim of eliminating poverty and promoting economic self-sufficiency and ownership amongst marginalized producers
  2. Transparency and Accountability with the aim of promoting transparent supply chains and business management practices, as well as accountability to all stakeholders
  3. Fair Trading Practices with the aim of promoting trading practices that are concerned for the social, economic and environmental well-being of marginalised small producers, not maximizing profit at their expense, and protecting cultural identity and traditional skills.
  4. Fair Payment with the aim of promoting equal pay for equal work by women and men, fair prices and the payment of a local living wage, or a wage sufficient to afford a decent standard of living that covers essential needs.
  5. Ensuring no Child Labour and Forced Labour with the aim of promoting adherence to the UN Convention on the Rights of the Child and national/local laws, as well ensuring no employment of children or forced labour is used in production
  6. Commitment to Non-Discrimination, Gender Equity and Women’s Economic Empowerment, and Freedom of Association with the aim of promoting non-discrimination in regard to race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, HIV/AIDS status or age, as well as equal pay for equal work, women’s full employment rights, and the right of workers to form and join trade unions.
  7. Ensuring Good Working Conditions with the aim of promoting safe and healthy working environments and working hours that comply with national and local laws and ILO conventions.
  8. Providing Capacity Building with the aim of developing the skills and capabilities of marginalized producers, employees and members with particular focus on increasing access to markets.
  9. Promoting Fair Trade with the aim of raising awareness of Fair Trade and of the need for greater justice in world trade through Fair Trade.
  10. 10 Respect for the Environment with the aim of promoting the use of raw materials from sustainably managed sources, buying locally when possible, using production technologies that reduce energy consumption, using renewable energy technologies that minimise greenhouse gas emissions, minimizing waste streams, and using organic or low pesticide use production methods.

TERMS

Living Wage or Fair Wage vs. Minimum Wage
A living wage or a fair wage is a wage paid to a producer or worker that takes into account the basic cost of living in a specific geographic area. Hourly wages are calculated at a rate that allows workers to meet their basic needs, such as food and shelter. It differs from place to place and in many countries is still extremely low compared to U.S. cost of living. (Click here for a summary of global living wages.) It’s based on the principle that no working person should live in poverty because his/her wages are too low. A minimum wage, on the other hand, is a floor set by a government. In places where jobs are scarce and economies weak, minimum wage laws are low or even not enforced, which often attracts businesses looking only to minimize costs and not taking into account other social and moral principles that factor in to wage calculation. The good news is that many business owners and consumers are recognizing that there is a difference between wages being legal and wages being fair, and many are choosing to pay workers and suppliers a fair wage while still making a profit. It’s a win-win for business owners and workers, and it’s a win for the consumer!

Fair Trade vs. Free Trade
Free trade and fair trade are concepts that often seem at odds with one another. Free trade is the idea that countries should trade with one another with little government restriction and regulation, allowing the free market systems to determine the rules and outcomes. Advancements in technology, communication and modes of transportation have truly made our markets global, and free trade agreements are opening up markets that once had little opportunity to expand. A common theme heard amongst free trade advocates is that people living in developing countries benefit when business moves in and offers job opportunities where none existed. Fair trade proponents point out that, more often than not, workers in these countries do not have legal protections for safe working conditions, adequate health standards, appropriate age limits, etc. Moreover, profitable corporations should not take advantage of these circumstances for economic gain only because there aren’t laws to enforce a higher standard,. They should instead hold themselves to a higher standard of conduct and ethics that promote human welfare and do not exploit workers. While some fair trade advocates are protectionist toward their own country’s markets and concerned about job opportunities at home, the reality is that trade can be both global and fair, providing opportunities for people all over the world!

Fair Trade vs. Fairtrade
Fair Trade refers broadly to the fair trade movement and to the organizations and businesses that adhere to its principles and ethics. The technical term Fairtrade describes the certification and labelling system governed by Fairtrade International. Not every fair trade organization or business applies for certification.

ORGANIZATIONS, CERTIFICATIONS AND SYMBOLS

While there are many fair trade certifying organizations (see below), and even more auditing, accrediting and advocacy organizations , not all companies or brands that practice fair trade have gone through the certification process or are members of these various associations.

Fair for Life
fairforlife.org

For Life and Fair for Life are two complementary standards that share a common ground: respect of human rights and fair working conditions; respect of the ecosystem and promotion of biodiversity, sustainable agriculture practices; respect and betterment of local impact. Fair for Life brand holder companies commit to fair sourcing practices and responsibilities towards their primary producers down the commodity chain. Fair for Life certification of products also confirms traceability of all certified products from production to sales. Fair for Life Certification assures that human rights are safeguarded at any stage of production, workers enjoy good and fair working conditions and smallholder farmers receive a fair share. Fair trade improves the livelihood of thousands of smallholder farmers and workers by providing the means for social community projects and empowerment of people.

Fair Trade Federation
fairtradefederation.org

Fair Trade Federation members strive to create positive change through all of their work: socially, economically, and environmentally. These relationships go beyond ensuring fair wages and safe working conditions — they empower producers to strengthen their communities and grow their businesses sustainably. All FTF members undergo a rigorous screening process to evaluate their internal commitment to all 9 FTF principles. Only those organizations which have passed the screening process are admitted as members and permitted to display the FTF logo.

Fair Trade USA
fairtradecertified.org

Fair Trade USA enables sustainable development and community empowerment by cultivating a more equitable global trade model that benefits farmers, workers, fishermen, consumers, industry, and the earth. We achieve our mission by certifying and promoting Fair Trade products.

Fair Wear Foundation
fairwear.org

Fair Wear Foundation is a non-profit organisation that works with brands, factories, trade unions, NGOs and sometimes governments to verify and improve workplace conditions for garment workers in 11 production countries in Asia, Europe and Africa. FWF keeps track of the improvements made by the companies it works with. And through sharing expertise, social dialogue and strengthening industrial relations, FWF increases the effectiveness of the efforts made by companies. The basis of the collaboration between FWF and a member is the Code of Labour Practices. The core of this code is made up from eight labour standards derived from ILO Conventions and the UN’s Declaration on Human Rights. This means the FWF Code of Labour Practices is based on internationally recognised standards which have been set through tripartite negotiation.

Fairtrade International (formerly Fairtrade Labelling Organizations International or FLO)
fairtrade.net

A global organization working to secure a better deal for farmers and workers. For a product to display the FAIRTRADE Mark it must meet international Fairtrade Standards. These standards are established by Fairtrade International and are set in accordance to the requirements of the ISEAL Code of Good Practice in standards setting. The standards are the result of broad consultations with farmers and workers, traders and companies, and other external experts. Producer organizations supplying Fairtrade Products are then certified against these standards by FLOCERT, a separate certification body, owned by Fairtrade International, which carries out regular audits and inspections.

World Fair Trade Organization (formerly International Fair Trade Association)
wfto.com

A membership organisation of over 400 Fair Trade enterprises, and the organisations that support them. There are five types of member: Fair Trade Organisations, Fair Trade Networks, Fair Trade Support Organisations, Associate Organisations and Individual members (Associate and Honorary). A Fair Trade enterprise has Fair Trade as its identity. This means a full commitment to the 10 principles of Fair Trade as their core mission. WFTO members have been assessed by their peers and have been independently audited to confirm this. Our Standard looks at every aspect of a business and confirms whether it is truly a Fair Trade enterprise. We verify that the entire business and its systems for managing their supply chains have embraced Fair Trade. The label is the symbol of Fair Trade enterprise. Verified WFTO members use the label to tell consumers, customers and their communities about their identity as a verified Fair Trade enterprise. As members, many can use the WFTO label on their products.

WRAP (Worldwide Responsible Accredited Production)
wrapcompliance.org

WRAP is an independent, objective, non-profit team of global social compliance experts dedicated to promoting safe, lawful, humane, and ethical manufacturing around the world through certification and education. WRAP is the world's largest independent factory-based social compliance certification program for the sewn products sector. WRAP’s 12 Principles are based on generally accepted international workplace standards, local laws and workplace regulations, and include the spirit or language of relevant conventions of the International Labor Organization (ILO). The Principles encompass human resources management, health and safety, environmental practices, and legal compliance including import/export and customs compliance and security standards.