Fairtrade Impacts: Lessons from around the world - Softcover

Softcover

ISBN 10: 1853399078 ISBN 13: 9781853399077

Publisher: Practical Action Publishing, 2017

Synopsis

This book seeks to contribute to the lively debate on the impact of fairtrade schemes by showing the diverse outcomes and impacts that such schemes have as they are adopted or implemented in different geographical production and value chain contexts around the world.

About this title

Excerpt. © Reprinted by permission. All rights reserved.

Fairtrade Impacts Lessons from Around the World

By Valerie Nelson

Practical Action Publishing

Copyright © 2017 Practical Action Publishing
All rights reserved.

ISBN: 978-1-85339-907-7

Contents

1. Introduction: the impact of Fairtrade Valerie Nelson, 
2. Exploring issues of rigour and utility in Fairtrade impact assessment Valerie Nelson and Adrienne Martin, 
3. Why 'place' matters in the development and impacts of Fairtrade production Cheryl Mcewan, Alex Hughes, David Bek and Zaitun Rosenberg, 
4. Partnerships in Fairtrade coffee: a close-up look at how buyers and NGOs build supply capacity in Nicaragua Jason Donovan and Nigel Poole, 
5. Enhancing Fairtrade for women workers on plantations: insights from Kenyan agriculture Muhaimina Said-Allsopp and Anne Tallontire, 
6. Access to the Fairtrade system: the geography of certification for social justice Alastair M. Smith, 
7. Fairtrade, sustainability standards, and the informal economy: What role for hired labourers? Valerie Nelson and David Phillips, 
8. Fairtrade, fair-trade, fair trade and ethical trade: reflections of a practitioner Adam Brett, 
9. Debate: 'Does Fairtrade have more impact than conventional trade or trade certified by other sustainability standards?' Matthew Anderson, Philip Booth and Sushil Mohan, 
10. Conclusion: Fairtrade expectations and Fairtrade futures Valerie Nelson, 

CHAPTER 1

Introduction: the impact of Fairtrade

Valerie Nelson

Abstract

This chapter introduces the concept of the Fairtrade movement as well as an introduction to the chapters that follow. It asks whether or not Fairtrade can revise its methods, addressing issues such as share of value and assurance to buyers. Each chapter ultimately concludes that it is important for Fairtrade to adapt to a more flexible approach and understand its limitations better; otherwise it is at risk of falling behind and giving way to new strategies of international companies.

Keywords: Fairtrade, expansion, cultural economy, conventional trade, decentralization, strategy revision

The fair trade movement combines the efforts of many different organizations with a shared aim of achieving more equitable trading partnerships between disadvantaged producers and mostly Western consumers. This book focuses on one strand of this movement commonly known as 'Fairtrade' – the product certification system operated by Fairtrade International. Fairtrade has expanded rapidly in recent years, particularly in certain products such as tea and cocoa, but there is still a way to go before sector coverage is achieved in many commodities. Recent developments, such as the decision by one major chocolate manufacturer to promote their own brand rather than Fairtrade, albeit continuing an informal collaboration with them, means that the position of Fairtrade is also not secured in international markets. Fairtrade is a pioneer amongst the voluntary sustainability standards with a consumer label and particularly high visibility in certain markets. Unsurprisingly it has attracted more attention than other market-based mechanisms, including other voluntary sustainability standards to date, although this is now beginning to change.

This collection of chapters emerges at a critical juncture for Fairtrade. Its market expansion has been accompanied by increased attention to its effectiveness and there is increased questioning of its impact and relevance in many quarters. The case studies and overview chapter on impact assessment draw on detailed empirical studies of Fairtrade around the world and practical experience of conducting impact studies. The case studies highlight the context specificity of Fairtrade outcomes and impacts, suggesting that broad generalizations about Fairtrade effectiveness are unwise. What is needed is in-depth understanding of the complex interplay of multi-scale factors which shape livelihoods and environmental change at the local level, and of the role that Fairtrade plays in this dynamic over a period of time.

The chapter authors cast a critical eye over the key factors and processes in each place which influence the implementation and uptake of Fairtrade by producer organizations and companies and the eventual outcomes. The overview raises questions about how best to understand the outcomes and impacts of Fairtrade in a way which minimizes bias and supports rigour, but which also pays attention to usefulness and learning. Taken collectively, these chapters ask pertinent questions about the efficacy of Fairtrade and also provide practical suggestions given as to how improvements might be achieved.

Chapter 1 by Nelson and Martin situates the current (often polarized) debate on the impact of Fairtrade in the wider evaluation context. Approaches to monitoring and evaluation have emerged over past decades within international development, but appropriate approaches are contested. Mixed method approaches are highly valued, but have resource and skill implications and are not always that feasible in complex situations. Theory-based evaluation has come to the fore as a way of closely tracking and evaluating the contribution of a project or initiative against its intended theory of change, relying upon a different approach to causality. The politics of 'evidence-informed' policymaking require closer attention in international development than has been the case to date, and this includes in relation to Fairtrade. For example, even where there may be strong evidence, this evidence is not always used and can be ignored by decision-makers. In what is being called 'the post-truth' era it is not always easy to reconcile the push for evidence with the decision-making of governments or companies.

Fairtrade and other sustainability standards with limited resources face major challenges in responding to the evidence agenda. Many of the independent studies they have commissioned are criticized for not being sufficiently rigorous by those who hold to a very narrow idea of the gold standard. The Nelson and Martin chapter questions what is appropriate for Fairtrade in this context. Fairtrade, and the other sustainability standards, are already improving their own monitoring and evaluation systems, with support from their membership body ISEAL, but they continue to grapple with issues of rigour, cost, learning and utility.

Beyond the practical challenges of evaluation there are also strategic challenges. Many of the more rigorous impact evaluations funded by donors are showing mixed results. There are different reasons for this. One reason is that some impacts may not be visible as statistically visible differences, because of the high degree of variability, and the limited scale and coverage of impact assessments compared to the overall standard system implementation (many different countries and commodities) and the 'spillover' influence of Fairtrade on local markets. However, these findings also present growing questions about the capacity of Fairtrade to bring benefits to producers and its ability to tackle poverty in a transformative way, particularly in the light of the challenges facing global agriculture. Fairtrade needs to learn from evaluation work not only in a limited instrumental sense in specific localities, but to challenge the assumptions that it holds within its theory of change in order to scale up and deepen its impact.

The chapter authors in this book seek to inform debates about fair trade more widely, as well as the specific role of Fairtrade and its effectiveness, shining a light on the specifics of place and teasing out the varied strengths and weaknesses of attempts at fairer trading relations in agricultural commodities.

In the first of four case studies, McEwan, Hughes, Bek and Rosenberg provide a fascinating analysis of the cultural economy of Fairtrade raisins produced by smallholders in the Ekseteenskuil Agricultural Cooperative, South Africa. The raisins are supplied to the alternative trade organization Traidcraft plc in the UK. Following an emerging strand of fair and ethical trade critical thinking, the authors explore how Fairtrade co-produces outcomes in a particular place in interaction with local geography, history and institutions. The Ekseteenskuil farmers live in an area favourable to seedless grape and high-quality raisin production, but are highly disadvantaged by the legacies of apartheid, spatial marginality and increasing environmental risks. The communities are more riven with disputes, than they are drawn together by a sense of collective enterprise, affecting the cooperative's functioning and the effective use of the Fairtrade premium as well as being somewhat at odds with the Fairtrade conception of community. Fairtrade has delivered more stable markets, but the organization and its members face significant challenges. To build up legitimacy amongst their membership, the cooperative needs to decentralize, build upon informal inter-group networks, and improve internal communication and utilize the skills of a wider group of members across the different communities. Traidcraft and other external actors, such as municipal government and commercial farmers' groups, should support the development of disaster risk reduction plans and diversification of income streams.

A similarly insightful, grounded study is provided by Jason Donovan and Nigel Poole in chapter 4 which explores the specific case of the Nicaraguan coffee cooperative, Soppexcca, and associated supporting buyers and NGOs. The authors find that significant positive outcomes for the cooperative have been achieved in terms of improvements in infrastructure, membership numbers and financial stability. But there are challenges pertaining to weaknesses in cooperative governance and service provision and issues of future growth and stability. The members (especially the poorest) have not been able to intensify their coffee production and fully capitalize on the benefits of preferential market access. Both buyers and NGOs have not sufficiently questioned the impacts of their own interventions or engaged the cooperative to achieve more inclusive governance by decentralizing or delivering more effective services. More coordination and collaboration amongst stakeholders is needed, including involving buyers and NGOs in a process of mutual learning.

Said-Allsopp and Tallontire provide the third detailed case study in chapter 5, which compares a Fairtrade and a corporate code mechanism in terms of their efficacy in empowering women workers in Kenyan flowers and tea. Fairtrade has various mechanisms through which it seeks to empower workers, the most visible of which is the Joint Body. This committee decides upon the use of Fairtrade Premium funds, and is composed of representatives from management and workers. FLO (Fairtrade International) encourages equal representation of women and men amongst the workers. But many of the companies have found it difficult to achieve equal representation and women have had weak influence on decision-making in a mixed entity in the context of entrenched gender inequalities. Some of the Fairtrade Premium projects have met women's practical needs, for example funding childcare facilities, but gender bias was also exhibited in several projects which focused on issues more of interest to male than female workers, because of a lack of transparency and male dominance in decision-making.

In contrast, Gender Committees have been promoted by the Kenya Flower Council (KFC) following labour rights campaigns to give women workers greater voice in KFC code auditing. Overall, the Gender Committees have had greater success than the Joint Bodies in the cases analysed because of the support given by management, an all-women composition, broad-based training of members, encouragement to share learning with peers, and early success in tackling sexual harassment. Some have also supported rotating savings and credit associations for workers and other livelihood diversification projects, benefiting the whole community.

Surprisingly, the Joint Body, the Fairtrade tool explicitly designed to empower workers, appears so far to have been less effective than the Gender Committees which had less lofty ambitions and resulted from a more top-down process relating to social auditing in more mainstream ethical sourcing. Fairtrade is already making changes to its hired labour standard, for example requiring greater articulation with national labour legislation and social protection measures, more dialogue with trade unions to avoid undermining collective bargaining, and more flexibility in the use of the premium to reflect local conditions. But more could be done by Fairtrade to understand and respond to gender relations in the local context. Lessons can be learned from good practice in other standard systems.

Alistair Smith's chapter on access to the Fairtrade system illustrates how far the system has come in expanding the geographic scope of its operation to 70 countries. Nevertheless more needs to be done, both in extending the Fairtrade International standards to some of the least developed countries that have not yet been reached at all, and by enabling certain products that are currently only certified in a limited number of countries to be produced and certified more widely. This is particularly important because, given the growing demand for goods certified by Fairtrade International in some markets, producers unable to access certification and reach these markets consider themselves to be disadvantaged. This is the opinion of stakeholders working with NASFAM, the National Smallholder Farmers' Association of Malawi, described in a case study in this chapter.

Chapter 7 explores the current invisibility of hired labourers in certified global value chains. Smallholder farmers often rely upon temporary workers in diverse sets of institutional arrangements. Casual workers on smallholder farms may not be able to benefit from sustainability standards, because the latter tend to work with and through farmer organizations, and membership of these organizations usually means access to land title. The chapter explores cases from various sectors, including tea, sugar, non-timber forest products, coffee, cocoa, and cotton to demonstrate the varied terms of integration for hired labourers in global value chains. The authors conclude that more research is needed on the horizontal labour relations of specific geographies and on informal worker organization and agency and how sustainability standards can improve their reach.

Chapter 8 presents the views of a fair trade business owner. Adam Brett established Tropical Wholefoods in 1990 and his chapter reflects on the changes in development fashions in the last 25 years as well as the swings in commodity markets that fair trade is intended to cushion. He considers the impacts of fair trade and concludes that the most important benefits are the enduring business relationships that provide farmers with a certain degree of stability and security. Their grown-up children, often educated to a high level, are evidence of the long-term stable incomes that have been achieved.

The debate 'Does Fairtrade have more impact than conventional trade or trade certified by other sustainability standards' rounds off the collection. Matthew Anderson argues that despite some limitations, Fairtrade is a unique tool for promoting development and empowerment of marginalized rural communities in the South. Philip Booth and Sushil Mohan counter that while Fairtrade is a welcome addition to markets because it opens up alternative trade channels which meet the needs of some producers, it will never reach the very poorest farmers, it will remain a niche market, and it is not tackling market fundamentals. Other factors such as free trade, peace and stability, are far more relevant than Fairtrade when assessing relative contributions to poverty reduction in developing countries. It is conventional trade, they argue, that sets the demand and supply conditions for Fairtrade products (as well as for other VSS certified products and speciality market producers) and in which mainstream corporates and retailers have increasing power.

While accepting the positive poverty impacts of conventional trade and enterprise, Anderson points to the limited trickle down of benefits to smallholders in many global value chains and says that changing market fundamentals takes time. He suggests that the role of Fairtrade as moral entrepreneur, disrupting institutions and creating new ones, is somewhat undervalued (something Nelson and Martin also refer to in their chapter, calling it 'discursive impact', i.e. the influence of Fairtrade on the broader narratives which frame understandings of sustainability and fairness in trade). Scaling up is the overriding challenge for Fairtrade, but Anderson gives examples of retailers and major brands switching major product lines to Fairtrade certification as indications of potential future growth. However, for Booth and Sushil, while Fairtrade in itself is a positive institution, more improvements in broader policy and institutional enabling environments and reductions in trade barriers in poor economies should be the focus in development, with Fairtrade being of little relevance.

Essentially, all of the chapters in this book point to the need for Fairtrade to learn more about its effectiveness in different value chain contexts and places and to find ways to respond in a more flexible, adaptive manner to local conditions and to look more deeply at its underlying assumptions. Fairtrade has to provide assurance to buyers, which has in the past meant standardization. But unless Fairtrade can demonstrate strong impact, then the risk of not acting, of not improving producer support and of not changing and being more flexible and adaptive, could challenge Fairtrade's credibility.

Fairtrade cannot overcome deeply embedded structural and institutional constraints on its own and does not claim to. But it needs to be more strategic in its collaboration with, or advocacy of external stakeholders. Achieving this engagement with the key stakeholders in a particular locality or territory in itself requires resources, facilitation skills, and a willingness on the part of other stakeholders to engage. Fairtrade is supporting decentralization via its regional producer networks and in some cases through newly emerging national networks, but this type of brokering (or support for ongoing stakeholder participatory processes) needs to happen at the local or sub-regional level as well, anchored in a full understanding of the local context and its dynamics and characteristics. A reconnection with political economy more fundamentally is also overdue – Fairtrade's move into the mainstream does not enable it to tackle agribusiness concentration in global value chains. Tackling poverty has to mean tackling the root causes of farmers' and workers' vulnerability.

(Continues...)

Excerpted from Fairtrade Impacts Lessons from Around the World by Valerie Nelson. Copyright © 2017 Practical Action Publishing. Excerpted by permission of Practical Action Publishing.
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Edition details

• Publisher: Practical Action Publishing
• Publication date: 2017
• Language: English
• ISBN 10: 1853399078
• ISBN 13: 9781853399077
• Binding: Paperback
• Number of pages: 148
• Editor: Nelson Valerie