What Is Fair Trade
The World Fair Trade Organization (WFTO) defines Fair Trade as ‘a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers – especially in the South.
The most popular logo associated with Fair Trade is the Fairtrade International (FLO) mark which is blue, green and black. This logo is a registered trademark and has to be awarded following strict standards.
What’s the difference between Fair Trade and Fairtrade?
Fair Trade (two words) deals with the production and manufacturing process. It is all about making sure that the way products are made adheres to a set of ethical principles. WFTO is the body overseeing the accreditation and regulation of large-scale Fair Trade organisations, measuring them against the 10 principles of Fair Trade.
Fairtrade (one word) is concerned with what things are made from. This includes raw materials ingredients and how they have been farmed, mined or harvested. There is a huge range of ingredients that can be Fairtrade accredited including tea, coffee, sugar, cocoa, bananas, flowers, cotton, wine and gold.
The organisation in charge of Fairtrade accreditation is Fairtrade International (FLO). For a product to receive the Fairtrade mark, all the ingredients which can be Fairtrade must be.
10 Principles of Fair Trade
PRINCIPLE ONE:
Creating Opportunities for Economically Marginalised Producers
Poverty reduction through trade forms a key part of the organisation’s aims. The organisation supports marginalised small producers, whether these are independent family businesses, or grouped in associations or co-operatives. It seeks to enable them to move from income insecurity and poverty to economic self-sufficiency and ownership. The organisation has a plan of action to carry this out.
PRINCIPLE TWO:
Transparency And Accountability
The organisation is transparent in its management and commercial relations. It is accountable to all its stakeholders and respects the sensitivity and confidentiality of commercial information supplied. The organisation finds appropriate, participatory ways to involve employees, members and producers in its decision-making processes. It ensures that relevant information is provided to all its trading partners. The communication channels are good and open at all levels of the supply chain.
PRINCIPLE THREE:
Fair Trading Practices
The organisation trades with concern for the social, economic and environmental wellbeing of marginalized small producers and does not maximize profit at their expense. It is responsible and professional in meeting its commitments in a timely manner. Suppliers respect contracts and deliver products on time and to the desired quality and
specifications.
PRINCIPLE FOUR:
Payment of a Fair Price
A fair price is one that has been mutually agreed by all through dialogue and participation, which provides fair pay to the producers and can also be sustained by the market. Where Fair Trade pricing structures exist, these are used as a minimum. Fair pay means provision of socially acceptable remuneration (in the local context)
considered by producers themselves to be fair and which takes into account the principle of equal pay for equal work by women and men. Fair Trade marketing and importing organisations support capacity building as required to producers, to enable them to set a
fair price.
PRINCIPLE FIVE:
Ensuring no Child Labor and Forced Labour
The organisation adheres to the UN Convention on the Rights of the Child, and national /local law on the employment of children. The organisation ensures that there is no forced labour in its workforce and /or members or homeworkers.
Organisations who buy Fair Trade products from producer groups either directly or through intermediaries ensure that no forced labour is used in production and the producer complies with the UN Convention on the Rights of the Child, and national / local law on the employment of children. Any involvement of children in the production of Fair Trade products (including learning a traditional art or craft) is always disclosed and monitored and does not adversely affect the children’s well-being, security, educational requirements and need for play.
PRINCIPLE SIX:
Commitment to Non Discrimination, Gender Equity and Women’s Economic Empowerment and Freedom of Association
The organisation does not discriminate in hiring, remuneration, access to training, promotion, termination or retirement based on race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, HIV/Aids status or age.
The organisation has a clear policy and plan to promote gender equality that ensures that women as well as men have the ability to gain access to the resources that they need to be productive and also the ability to influence the wider policy, regulatory, and
institutional environment that shapes their livelihoods and lives
PRINCIPLE SEVEN:
Ensuring Good Working Conditions
The organisation provides a safe and healthy working environment for employees and /or members. It complies, at a minimum, with national and local laws and ILO conventions on health and safety.
Working hours and conditions for employees and / or members (and any homeworkers) comply with conditions established by national and local laws and ILO conventions.
Fair Trade Organisations are aware of the health and safety conditions in the producer groups they buy from. They seek, on an ongoing basis, to raise awareness of health and safety issues and improve health and safety practices in producer groups.
PRINCIPLE EIGHT:
Providing Capacity Building
The organisation seeks to increase positive developmental impacts for small, marginalized producers through Fair Trade.
The organisation develops the skills and capabilities of its own employees or members. Organisations working directly with small producers develop specific activities to help these producers improve their management skills, production capabilities and access to markets – local / regional / international / Fair Trade and mainstream as appropriate. Organisations which buy Fair Trade products through Fair Trade intermediaries in the South assist these organisations to develop their capacity to support the marginalized
producer groups that they work with.
PRINCIPLE NINE:
Promoting Fair Trade
The organisation raises awareness of the aim of Fair Trade and of the need for greater justice in world trade through Fair Trade. It advocates for the objectives and activities of Fair Trade according to the scope of the organization. The organisation provides its customers with information about itself, the products it markets, and the producer organisations or members that make or harvest the products. Honest advertising and marketing techniques are always used.
PRINCIPLE TEN:
Respect for the Environment
Organisations which produce Fair Trade products maximize the use of raw materials from sustainably managed sources in their ranges, buying locally when possible. They use production technologies that seek to reduce energy consumption and where possible use renewable energy technologies that minimize greenhouse gas emissions. They seek to minimize the impact of their waste stream on the environment. Fair Trade agricultural commodity producers minimize their environmental impacts, by using organic or low pesticide use production methods wherever possible.
Buyers and importers of Fair Trade products give priority to buying products made from raw materials that originate from sustainably managed sources, and have the least overall impact on the environment.
All organisations use recycled or easily biodegradable materials for packing to the extent possible, and goods are dispatched by sea wherever possible.
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