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A JC Take on the FLO/TFUSA Split
Posted by Matt Earley at about 3pm on Tuesday September 20, 2011Earlier this week TransFair USA (aka "Fair Trade USA") and their parent organization the Fairtrade Labeling Organization (FLO) announced that they were parting ways due to, what amount to, irreconcilable differences. The press release that accompanied the announcement was very polite and positive, but only offered vague reasons for their separation. Now like my parents told me as a child: "Sometimes people just grow apart"-- and this is certainly true. However, most of us out here in FT land sensed that something important was afoot that was not being discussed very explicitly.
As you all may know, we at JC are nuts about transparency. To the point that we wear totally see-through clothing and drive invisible jets like Wonder Woman. With that up our (opaque) sleeves, we have set forth to try to understand what exactly the causes were that led to this rupture between FLO and its offspring TFUSA. After speaking with a few of you all, and to others around the FT scene, it seems pretty clear to JC the bone that broke the camel's spine.
Honestly, it is not a huge mystery at all when you read TFUSA's subsequent press release on the split:
"To create a more just and consistent Fair Trade model, Fair Trade USA will adapt existing international Fair Trade standards from tea, bananas and flowers, and apply them first to coffee and then to additional categories over time..."
In their press release TFUSA's outlines their goal as pushing to "double U.S. sales for Fair Trade farmers and extend Fair Trade benefits to millions of additional farmers and workers by 2015". This sounds great. They go on to further illustrate their self-described "bold new vision" by telling us that they will "include additional producer groups” in the FT coffee sector.
TFUSA has been pushing for several years to allow smaller farms and larger plantations into the FT system. They actually came to the SCAA conference a few years ago and announced that this was in the works only to be roundly opposed by coffee producers and FT activists. At the time they seemed completely baffled that FT certified small farmers would oppose including more producers into the FLO certified ranks.
This is a very interesting debate. On one hand, there are a lot of really great and responsible small farms out there that are not affiliated with co-ops. And there are reportedly some progressive larger-scale plantations in the world that treat workers and the environment well. These types of farms are currently excluded from FT coffee participation, although similarly structured farms are allowed in fruit, tea, and other types of FT certified products. So there seems to be a bit of a precedent for changing FT coffee rules.
However, on the other side you have cooperatives and small-scale independent growers. These are the farmers who were, by and large, being squeezed out of the market by unfair competition at the time that FT coffee kicked off. The FT coffee movement largely came about in order to highlight cooperatives as ideal organizational structures and as vehicles for farmers to create and exercise union power both socially and politically. In a sense, FT in coffee developed as a specific response to farmers wanting to remain viable and independent in an industry that relied on terrible treatment of (often indigenous) workers and concentrated profits derived from "sweatshop" labor in the hands of a wealthy few.
To me, it seems that there is a need for a program that can not only highlight the work of progressive and responsible non-coop farms, but also give incentive to "bad actors" to improve their practices. It is no secret that a large segment of plantations trafficking in tropical commodities still have deplorable working conditions for farm workers and their families. So while a well thought out program is needed to address non-coop farms, in my opinion Fair Trade is not it. There are still thousands of small scale coffee farmers in scores of cooperatives around the world that want to access the FT market and who need FT to help stabilize their livelihoods and help them stay on their land-- exactly what FT was initiated to do.
Like so many other instances in the past decade, TransFair USA seems to be hitting the ground running with something that will inevitably have a large impact on FT in general and have made this game changing decision with little or no discussion with "the movement"-- in particular the farmers-- that they claim to represent. Instead their moves seem to be more about pleasing their large corporate sponsors who pay their salaries and keep their lights on. I would feel much better about TFUSA's play to unilaterally change the rules of the game if they were more up front about their issues. Something like: "SBUX wants to do more fair trade, but does not want to change their business practices. We are economically bound to work with them and think that we can push them to do more good" or something like that.
That level of candor would be transparency in action, but unfortunately there is no reason, when we look back at their history, to expect that kind of straight forward dialogue with TFUSA. One thing is for sure, though: It will be much simpler to "double fair trade sales" by degrading the existing FT standards in order to retrofit sometimes sketchy actors into the FT system than it would be to strive to build a more just and cooperative world economy by promoting cooperatives.
In the end, for Just Coffee, this changes nothing about our approach as we left the TFUSA system years ago. We will continue to work with small-scale farmers in democratically organized co-ops in an effort to change the existing system into a more fair and just economy of equals. This is what we understand the spirit and ethic of fair trade to be.
As our man Don Quixote once said: "Bring on the next windmill".
Chasing windmills
Matt,
Thanks for this commentary. CRS Fair Trade is reaching out to FT USA staff, our staff living in coffee communities, and other leaders in the movement to get a variety of perspectives. As usual the view from the good folks at Just Coffee is key.
What particularly resonated for me in this post was:
"So while a well thought out program is needed to address non-coop farms, in my opinion Fair Trade is not it. There are still thousands of small scale coffee farmers in scores of cooperatives around the world that want to access the FT market and who need FT to help stabilize their livelihoods and help them stay on their land-- exactly what FT was initiated to do."
In addition to this point, I am troubled that the model is not working well enough for small scale farmers who ARE already participating. We've heard reports about the "hungry months" for farmers in Latin America. We've heard about the strains high markets put on cooperatives, etc. Given the weaknesses in the current approach, this may not be the time to innovate through expansion. Should we not do our core work better as a movement if we want to strengthen farming communities and ignite consumer involvement?
Similarly, I am concerned that up front consultation with stakeholders didn't happen and implications for our work weren't thought through. I am referring to NGOs like CRS who have to make the case for Fair Trade to our constituents. If FT USA is leaving the globally recognized system (flawed though it may be), then proponents of the model have even more complicated stories to tell. Not that I'm lazy or avoiding complexity, mind you, but really, did we need to stir this pot up right now, when there are so many other pressing priorities? And what assurances do we have that a "go it alone" system will maintain high standards that build consumer confidence and insure impact (in terms of lives and communities not just a numbers game)?
To its credit, FT USA has reached out to CRS and other NGOS to solicit feedback. I also understand they have agreed to do a series of webinars with the Fair Trade Resource Network. For our part, CRS will be hosting a visit from FT USA next week. We look forward to the chance for dialogue to address these concerns, and possibly be convinced of this new way forward. If you have questions you'd like me to pose, ask away.
Jackie DeCarlo
www.crsfairtrade.org
Fair World Project's Statement on FTUSA/FLO split
Hi Matt,
Thanks for another great post. Please find below Fair World Project's take on the FLO/TFUSA split.
Best,
Ryan/Fair World Project
Fair World Project's (FWP) Statement on Fair Trade USA’s Resignation from Fairtrade International (FLO)
Fair trade is a social movement and market model that aims to empower small-scale farmers and consumers in underdeveloped countries to create an alternative trading system that supports equitable trading, sustainable development and long-term trading relationships. Fair trade supports fair prices and wages for producers, safe working conditions, investment in community development projects, and the elimination of child labor, workplace discrimination and exploitation.
Certified fair trade products now represent a multi-billion dollar industry with over 10,000 products in the marketplace. Consumer demand for fair trade products has steadily risen over the course of the last decade thanks to the tireless work of dedicated advocates, fully committed companies, and students.
On September 15th, Fairtrade International (FLO) and Fair Trade USA (FTUSA) jointly announced that FTUSA is resigning its membership in FLO, effective December 31, 2011. FTUSA’s resignation from the FLO system is partially due to its new initiative, “Fair Trade For All” (http://fairtradeforall.com/) which it claims will “double the impact” of fair trade by 2015.
In an open letter, Rob Cameron, CEO of Fairtrade International, wrote: “I, the staff at Fairtrade International, and the entire global Fairtrade network sincerely regret FTUSA’s decision to pursue its own approach, rather than continue working within the global system. It is a decision they have taken themselves, and we have to respect their choice.”
Fair Trade USA’s move raises many questions for fair trade producers in the Global South. Many producers rely heavily on the US market for sales and distribution. FTUSA’s rash exit from the FLO system will most certainly cause chaos in the near-term as FTUSA has failed to publish its own standards or details regarding its new labeling scheme. In the long run, everything from consumer apathy to competing labels that make similar claims will undermine the fair trade market and the overall positive impact for producers.
At its core, “Fair Trade For All” is FTUSA’s unilateral decision to initiate certification of Fair Trade coffee on plantation and hired labor operations. FTUSA intends to open other commodities, like cocoa, to plantation and hired labor for certification as well. Fair trade was established on the values of supporting small-scale, disenfranchised farming communities, most often organized in democratic cooperatives. Despite claims to the contrary, hundreds of thousands of small producers organized in cooperatives still lack access to fair trade markets. To continue to make progress and expand the benefits of fair trade, these producers must be given priority and support when considering further expansion of the fair trade system. Without strict standards and implementation, the expansion of fair trade to include plantations in coffee and other sectors will most certainly erode standards and dilute fair trade’s impact.
While it is true that farmer and worker advocates are deeply concerned with the plight of farmworkers and other hired laborers in the Global South, it is not conclusive that the current fair trade system is the best antidote for their situation. Fair trade’s record as it relates to hired labor operations, like tea and bananas has been anything but successful. In fact, the literature suggests that fair trade certification often undermines national labor laws and the union presence that brings more benefits to plantation workers than fair trade.
FTUSA’s decision has drawn the widespread condemnation of fair trade producer networks, including the Network of Asian Producers (NAP), Latin American and Caribbean Network of Small Fair Trade Producers (CLAC) and Fairtrade Africa. It is inconceivable that an organization who’s organizational values include striving "to always act ethically and we value relationships built on honesty, mutual respect and trust” would advance a program without the knowledge or consent of the very producers it aims to support.
FTUSA’s move away from FLO comes on the heels of the organization’s controversial name change. In fall of 2010, FTUSA changed their name from TransFair USA, eliciting a significant uproar from within the FT community, with over 10k concerned consumers, advocates, and FT organizations sending letters to FTUSA expressing their concern about what many saw as an effort to monopolize the FT market and movement in the United States.
In January 2011, the Organic Consumers Association (OCA) filed a complaint to the Federal Trade Commission (FTC), charging that FTUSA authorized the misleading and deceptive labeling and advertising of the “Mark” brand products as “Fair Trade Certified” when, in fact, the products so labeled contain a minimal amount of fair trade certified ingredients. Over 8k people have signed letters in support of OCA’s complaint. OCA is awaiting the pending decision from the FTC.
FTUSA has repeatedly failed to apply FLO standards. Case in point is FLO’s commercial availability standard 2.2.Various brands and products lines which states that “Food composite ingredients must contain as many [FLO Fair Trade] certified ingredients as available.” (http://www.fairtrade.net/standards.0.html). Dozens of products in the marketplace, ranging from Honest Tea to Sunspire Organic Cocoa Chips, have failed to source fair trade ingredients, yet continue to display the FTUSA fair trade seal. This dilution of the standards undermines consumer confidence in fair trade and denies producers the full benefit of a fair trade market.
Finally, FTUSA has a poor track record of responsibly engaging stakeholders on new initiatives. For example, FTUSA’s textile and apparel multi-stakeholder process was contentious and divisive, not to mention a missed opportunity to create common cause and alliances with trade unions and labor advocates. For more information on this process, see the open “Letter to Transfair USA regarding Fair Trade Garments Pilot Project” signed by International Labor Rights Forum, SweatFree Communities, Presbyterian Hunger Project, STITCH, Workers United (an affiliate of SEIU), New York Labor Religion Coalition and the Organic Consumers Association.
The future of fair trade in the United States and beyond
Fair trade is at a critical crossroads. Despite the incredible potential in the United States to support ethical and fair companies and initiatives, the market is overrun with hundreds of social, ethical, green, and sustainable labels and certifiers, many with questionable ethics and standards. For consumers to maintain confidence in FTUSA and its certification program, FTUSA must actively and in good faith be accountable to producers and civil society at large.
FWP calls upon Fair Trade USA to do the following:
1) Suspend plans for certifying plantations and other hired labor operations in coffee and other commodities.
2) Promptly publish its new fair trade standards with clear mechanisms for accountable stakeholder review and engagement.
3) Open its Board of Directors to broad participation from members of producer networks, fair trade advocates, and students.
4) Commit to full transparency and traceability.
5) Create an ethical labeling scheme that clearly identifies percentage of FT ingredients on packaging and whether the product contains ingredients from plantations or estates.
6) Actively cooperate with FLO, IMO and other reputable certifiers to establish a “high bar” standard for fair trade certification.
Fair World
Thanks for posting this Ryan. And for the discussion on "linkedin". This is really important time in pushing FT forward and in redefining what we do, how we do it, and the impact that it has.