Fairtrade International Updates Smallholder Fair Trade Standards

Small-scale farmers are at the heart of the fair trade movement. Now Fairtrade International has updated their fair trade standards for small-scale farmer organizations. The updates seek to strengthen small-farmer organizations and improve their capacity to respond to climate change. They do that—and also reveal the inherent limits to a market-based system of change.

Fair World Project advocates for strong standards—indeed, within the movement, we are criticized for pushing too much or for standards that are too high. Yet this is a case where a good standard has made itself even stronger, adapting to changing circumstances, new studies, and understandings of best practices, and stakeholder feedback. Indeed, before we even get into the details of the changes, the process is important. According to Fairtrade International, more than 500 producer organizations from 70 countries provided ideas and recommendations to improve the standard. Final changes were then voted on by their Standards Committee, which includes small-scale farmer and worker representatives—a transparent, democratic process by which those who are most impacted by the standards were able to speak up about what would help them meet the fair trade objectives of sustainable livelihoods for all.

The changes to the standards fall into a few general categories: responding to climate change, increasing organizational capacity, and updating focuses on rights.

Fairtrade Increases Commitment to Climate Resilience

The revised smallholder standards make it clear: Fairtrade is taking the threat of climate change seriously. The new standards embrace the lessons from farmers around the world who are practicing agroecology and the research around regenerative, organic farming techniques. The new requirements include:

• Identifying land at risk of soil erosion.
• Taking steps to enhance soil fertility, including crop rotations, agroforestry, the use of compost and green manure.
• Deepening requirements around protecting land from deforestation.
• Protecting and enhancing biodiversity through agroforestry, the planting of buffer zones, replanting with native plants, and other locally appropriate solutions.
• Taking measures to adapt to climate change, including installing rainwater collection systems, mulching crops, crop diversification, improved pruning practices, and other practices that make sense for the community and crop in question.
• Reducing Green House Gas (GHG) emissions and increasing on-farm carbon sequestration.

These requirements are markers of continuous improvement from the first inspection with some taking effect three to six years later.

Strengthening Small-Scale Farmer Organizations.

Small-scale farmer cooperatives are at the heart of fair trade. Revisions to the standard continue to strengthen those producer organizations and further define who is intended to benefit from fair trade certification.

In addition to standards further defining a “small” producer (no bigger than 30 hectares for any crop), the standards also increase the requirements for the balance of small-scale producers within an organization (now 2/3 of both members and sales volume must be from small-scale producers).

Recent reports underscore how vital strong, well-managed producer organizations are to securing sustainable livelihoods for farmers. Additional requirements provide a blueprint for building strong, democratic institutions and professional management within organizations, including:

• Documenting internal management systems and building stronger internal controls, including requiring internal management plans, and formation of a new “surveillance committee.”
• Further strengthening the role of the Fairtrade Development plan document, requiring a process to evaluate and document the needs of the organization, members and their communities.
• Requiring more planning and transparency of the Fairtrade premium spending, including requirements for 3^rd party financial auditing (for organizations whose premium receipts were more than $150,000 USD in the last year), and annual reporting to Fairtrade International or their regional Producer Network.

These changes, plus others spelling out requirements for the makeup and role of the General Assembly and other elements of democratic decision-making, set up fair trade standards as a roadmap for what transparent, democratic producer organizations can look like.

Protecting the Most Marginalized

Fair trade began as a movement by and for small-scale farmers and artisans to create solidarity markets and address the historical imbalances of power created by centuries of colonialism and extraction from their communities. In addition to looking outward to address some aspects of those power imbalances in trading relationships, fair trade standards also seek to apply fair trade principles to the internal workings of the producer organizations.

The latest updates to the small-scale producer standards continue to update standards to reflect new thinking and improve protections for workers on small-scale farms, foster greater gender equity, and better address the risk of forced labor. Updates include:

• Protecting more workers by making more standards apply to farms with 10 or more workers (before the threshold was 20 workers), including requirements for freedom of association.
• Making more safety standards around storage and labeling of pesticides and other hazardous materials applicable as core standards (vs. phased in later).
• Strengthening requirements for responding to forced labor.
• Expanding requirement for workers to have written employment contracts.
• Adding a requirement for access to clean drinking water for all field workers.
• Tasking producer organizations with developing and implementing a gender policy to better engage and empower women in the organization.

Small-scale farmers have long struggled to get ahead in the global economy. And the workers who work alongside farmers and their families, especially on the smallest farms, have struggled to connect with the benefits of fair trade. The updates to these standards address some of the basics of a decent, safe workplace, balancing that with the reality that small-scale farmers have limited resources.

All Fair Trade Standards Are Not Created Equal

Overall, it’s good news to see that Fairtrade International continues to develop and evolve their standards based on research and producer input. Now more than ever, all fair trade standards are not created equal. In a marketplace that is flooded with labels advancing different visions of “fair trade” under similar names, Fairtrade (the one-word version) has made clear that theirs is the label taking strong stands for democratic small-scale farmer organizations and climate resilience as essential to the vision of fair livelihoods for small-scale farmers.

Now it’s time for the industry to take notice—especially those buying coffee and cocoa, the biggest fair trade crops from small-scale farmers. The people who grow those crops are in crisis. Coffee prices are below $1/pound and producers at the big coffee trade show recently wore black ribbons to highlight the dire situation facing their communities. Cocoa farmers too are facing complicated crises as low prices, climate change, and climate-fueled diseases converge.

The challenges are huge. Yet there are plenty of people doing good work—the time is now to support them.

Market Solutions Require Market Support

Much of the language used to promote fair trade products calls on us to use the power of the market to support small-scale farmers, artisans, and workers. Yet the reality of a market-driven solution is that it only stands a chance at working if it is used to channel money to producers. Better marketing alone will not achieve results.

It’s time to step away from the labeling confusion—it is now more clear than ever that there are distinctions between the major fair trade labels. If we believe in market-driven solutions as part of the equation to build a more fair food system, then we need to put the force of the market—and not just our marketing materials—behind them.

Unfortunately, too many of the big companies continue to prioritize their own marketing over producers’ livelihoods. Recently, Target announced a commitment to make more of their Archer Farms brand coffee certified by Fair Trade USA* (a commitment that was initially released as “all,” but has since been edited). When given the choice between strong standards or a bigger marketing splash, the latter won out.

Growing the Fair Trade Market

As noted in our Fairness for Farmers report, just 33% of cocoa and only 28% of coffee produced by fair trade certified farmer organizations actually gets sold on fair trade contracts. That means that only a fraction of their harvest earns the fair trade premium dollars—despite the fact that their members are meeting ever-stricter standards.** If the goal is for purchases to support farmer-led development and empowerment, the purchases must be there.

The revised Fairtrade International standards clarify the choice. Instead of lowering the bar for brands, let’s keep raising it. Fair trade producers have committed themselves to strong democratic organizations, to increasing gender equity, to combatting climate change, and to basic protections for workers. Will businesses step up and meet that commitment?

*Fair Trade USA is not part of the Fairtrade International system. Instead of increasing standards, they have sought to lower the bar and bring in more corporate licensees.

**Fairtrade International has made an attempt to address at least an aspect of this issue by adding a requirement that any new producer organization must demonstrate that they have a market for their product via signed contract(s) before they can be certified. Yet the difficulty of a market-based system for change ultimately remains.