INCREASING THE RANGE OF FAIR TRADE
PRODUCTS
83. The Fairtrade Labelling Organisation at present
has certification only for a limited range of products. These
are mainly in the food sector—for example tea, coffee, honey,
sugar, bananas and oranges. Non-food certification schemes also
exist for products such as flowers, cotton and wine. The Fairtrade
Foundation believes that there is a market for a much wider range
of products. However the Foundation points out that developing
product standards for fair trade is both time-consuming and expensive.
They explained that if a commercial company were to develop a
new sub-brand of chocolate already on the market it might spend
£10-15 million on marketing the product.[141]
The Foundation does not have access to this level of funds and
is therefore disadvantaged.
Fair trade clothing
84. One sector where new fair trade standards could
be developed is in the manufacture of clothing. While companies
such as Marks & Spencer, Sainsbury's and Tesco will all sell
a range of fair trade clothing by the end of 2007, in fact it
is only the cotton material which is fair trade. There are currently
no fair trade standards for the manufacture of garments in factories.[142]
The company People Tree, which is registered with the International
Fair Trade Association (IFAT), does produce a range of fair trade
clothing under IFAT standards using fair trade organic cotton.
They ensure that labour represents a large percentage of the cost
of their end product by using traditional craftspeople to spin,
hand-weave, dye, embroider and otherwise embellish the products.[143]
In addition companies such as Artisan Hut in Bangladesh own a
share in the company People Tree. People Tree estimate that their
workers earn 30-50% more than they would through conventional
trade.[144]
85. War on Want's report, Fashion Victims[145]
and ActionAid's report, Who Pays,[146]
both identify poor working conditions in factories supplying garments
to British retailers most of whom are members of the Ethical Trading
Initiative (ETI). Written evidence from ActionAid describes some
of the buying practices of UK supermarkets.[147]
As discussed in Chapter 2, the practical application of written
standards often falls short. More robust ways of monitoring working
conditions are needed. The current Competition Commission inquiry
into supermarkets offers an opportunity to investigate whether
their business practices undermine attempts to improve ethical
standards in supply chains in developing countries.
86. According to People Tree there have been some
improvements in the garment industry:
"consumer pressure has pushed conventional
manufacturers into improving their standards of corporate social
responsibility in an industry renowned for its abuse of health
and safety standards, poor working conditions, payments below
national minimums, forced overtime and trade terms and increasingly
short lead times that promote exploitation of people and the environment."[148]
Marks & Spencer commented that fair trade cotton
certification has helped the company provide a higher degree of
traceability "from the fibre mill back into the field"
which it had been unable to effect alone.[149]
However the creation of fair trade standards for the manufacture
of clothing would require a high level of investment in the supply
chain which would not see returns in under five years.[150]
To date there has been little donor support for fair trade garment
manufacturing, even though the clothing industry is a major employer
of low-paid workers in developing countries and the creation of
fair trade standards could help raise the level of corporate responsibility
across the sector.[151]
87. The garment industry is one which involves
large numbers of low-paid workers in developing countries and
is a sector where improved standards would be particularly beneficial.
The development of fair trade certification for the manufacture
of fair trade cotton garments will assist in ensuring higher standards
of traceability along the supply chain as well as better working
conditions for garment workers. Fair trade standards will not,
on their own, improve working conditions for the majority of garment
workers but could provide a model of how an ethical garment industry
can work and could contribute to raising standards across the
wider industry. This is a specific area where we believe DFID
could make a useful contribution and we recommend that it actively
seeks out projects in this sector where it can support the private
sector.
INVOLVING MORE PRODUCERS
88. In addition to investing in the development of
new product standards, fair trade organisations also have to ensure
that producers can meet these standards. There has been a significant
increase in the number of certified fair trade groups in Africa
in recent years from 42 in 2002 to 137 in 2005. However the biggest
growth has taken place in South Africa, from nine in 2003 to 43
in 2005.[152] In the
most developed African economy with relatively good infrastructure
and transport links, it is easier to establish and monitor standards
with organised producer groups. Similarly in the Windward Islands,
also relatively more developed, and with a long history of trade
unions, 90% of banana farmers are now fair trade certified.[153]
In contrast many of the poorest countries in Africa, for example
Sierra Leone, do not have any fair trade certified groups, while
Benin, Togo and the Democratic Republic of Congo each only have
one.
89. Assessments of fair trade have shown that it
has often benefited farmers who are not the poorest, who are able
to become organised, and who can meet fair trade standards and
pay the relevant producer fees.[154]
The most remote, poor, small farmers in fragile economies have
largely been excluded. One study comments that:
"whilst fair trade aims to target disadvantaged
producers in accessing the market, there are evidently many deserving
cases of producers that could be linked to fair trade but are
not, as they have not heard of fair trade, are too remote from
organisations linked to fair trade buyers, or are producing something
for which there does not appear to be a fair trade market."[155]
Marks & Spencer suggested that there was a role
for the Government in supporting fair trade organisations to work
with the poorest producers and ensure they have fair opportunities.[156]
The Fairtrade Foundation indicated that they would like to expand
their work in countries such as Mozambique, Malawi and Sierra
Leone.[157] We believe
that fair trade should become more pro-poor and help the most
disadvantaged producers in the poorest countries. We recommend
that this pro-poor focus becomes a key area for future Government
funding for fair trade.
137 Q 17 [Ms Lamb] Back
138
Fairtrade Foundation, Draft concept: Investment in the future
of fair trade. Back
139
Q 17 [Ms Lamb] Back
140
FLO, Strategic fair trade funding programme. Back
141
Q 17 [Ms Lamb] Back
142
Q 97 [Ms Minney] Back
143
Q 93 [Ms Minney] Back
144
Q 94 [Ms Minney] Back
145
War on Want, Fashion Victims, The true cost of cheap clothes at
Primark, Asda and Tesco, 2006. Back
146
ActionAid, Who Pays? How British supermarkets are keeping women
workers in poverty, 2007. Back
147
Ev 139 [ActionAid] Back
148
Ev 112-113 [People Tree] Back
149
Q 77 [Mr Barry] Back
150
Q 96 [Ms Minney] Back
151
Ev 112 [People Tree] Back
152
Ev 102 [Fairtrade Foundation] Back
153
Ev 91 [Fairtrade Foundation] Back
154
Q 278 [Mr Chandler] Back
155
Anne Tallontire, "Challenges facing fair trade and ethical
sourcing", p 5. Back
156
Q 278 [Mr Barry] Back
157
Q 12 [Ms Lamb] Back
