Fair Trade is a trade relationship based on dialogue, transparency and mutual respect, which seeks greater equity in international trade. It contributes to sustainable development by offering better trade conditions and ensuring the rights of producer communities and marginalized workers, especially in the South. This is the definition agreed upon within the framework of the World Fair Trade Organization (WFTO), which the international movement uses as a basis for building an alternative and supportive model of production and consumption for the transformation of the current economic system that generates inequalities and poverty and environmental degradation of our planet.
Fair Trade involves a double perspective: on the one hand, it is an instrument of development cooperation in impoverished communities in southern countries, and on the other hand, it represents a responsible consumption option for their products for people who live in northern countries, which implies that our consumption criteria favor environmental conservation and social justice in producer communities.
Therefore, Fair Trade organizations, supported by consumers, are actively involved in supporting producers, raising awareness and developing campaigns to achieve changes in the rules and practices of conventional international trade while providing, through their marketing process, consumption options that are consistent with social and environmental criteria that many people consider on a day-to-day basis.
Although in the 1950s some development cooperation organizations in the United States such as Ten Thousand Villages and SERRV had already started to market handicrafts made in Puerto Rico and other communities in the South, opening the first formal “Fair Trade” store in 1958, we can consider that the origin of Fair Trade occurred at the II United Nations Conference on Trade and Development (UNCTAD) held in 1964, under the slogan “Trade, not aid”, where southern countries requested the approval of fairer trade rules. In this context, organizations and individuals promoted the creation of “UNCTAD” stores, which sold products from impoverished countries in Europe, avoiding entry tariffs1.
A few years later, in Europe, the NGO Oxfam in the United Kingdom began to sell handicrafts made by Chinese refugees in their own premises, creating the first Fair Trade organization in Great Britain. In 1967 Fair Trade Organisatie was created, the first Fair Trade importer in the Netherlands that opened the first European store2. From this moment on, the network of solidarity stores began in several countries: Holland, Germany, Switzerland, Austria, France, Sweden, Great Britain and Belgium.
In the 1970s, Fair Trade producer organizations were established in Africa, Latin America and Asia, and coffee distribution began, the first food item starred by the Guatemalan farmers’ cooperatives “Indio Solidarity Coffee” in 19733. Throughout the 1970s and 80s, activities and development of many producers increased4. In addition, other food products (tea, honey, sugar, cocoa, nuts, etc.) and handicrafts were incorporated. In 1986 the first Fair Trade initiatives emerged in Spain, in San Sebastián-Donostia (Basque Country), by the organization Traperos de Emaús, and in Cordoba (Andalusia) by Cooperativa Sandino (today, IDEES).
The evolution of the movement favored network collaboration processes among the different organizations that emerged, in 1989 the World Fair Trade Organization (WFTO, by its acronym in English) was created and in 1996, nineteen organizations constituted the State Coordinator of Fair Trade, which is currently made up of 31 entities.
In the 90s, most of the current Fair Trade organizations were established. Throughout those years, stores were opened throughout the territory and the importing entities were consolidated. This was the decade of the expansion of Fair Trade in our country, a development that motivated the first sales analysis, in 2000
The 10 criteria that Fair Trade products must meet
The World Fair Trade Organization (WFTO) establishes 10 criteria that must be met by organizations working in Fair Trade:
1.Creation of opportunities for producers with economic disadvantages.
The reduction of poverty and inequalities through trade is the fundamental part of the organization’s objectives and supports marginalized small producers, whether independent family businesses or grouped in associations or cooperatives. Its goal is to enable them to move from poverty and income insecurity to economic and self-sufficiency. The organization has an action plan to carry it out.
2.Transparency and accountability
The organization is transparent in its management and commercial relationships. It is accountable to all its stakeholders and respects the sensitivity and confidentiality of the commercial information provided to it. The organization finds appropriate and participatory means to involve employees, members, and producers in its decision-making processes. It ensures that relevant information is provided to all its trading partners. Communication channels are good and open at all levels of the supply chain
3. Fair trade practices
Fair trade involves the following practices in trade relations:
• The organization trades with concern for the social, economic and environmental well-being of marginalized small producers and does not maximize their profits at their expense. It is responsible and professional in fulfilling its commitments in a timely manner. Suppliers respect contracts and deliver products on time and with the desired quality and specifications.
• Fair Trade buyers recognize the financial disadvantages that producers and suppliers face, ensuring that orders are paid upon receipt of documents and in accordance with the attached guidelines. A prepayment of at least 50% is made if requested. When Fair Trade suppliers from the South receive a prepayment from buyers, they ensure that this payment is transferred to the producers or farmers who make or develop their Fair Trade products.
• Buyers consult with suppliers before canceling or rejecting orders.
• When orders are canceled due to causes beyond the control of producers or suppliers, adequate compensation is guaranteed for work already done. Suppliers and producers consult with buyers if there is a problem with delivery, and ensure that compensation is provided when the qualities and quantities delivered do not match the invoiced.
• The organization maintains long-term relationships based on solidarity, trust and mutual respect that contribute to the promotion and growth of Fair Trade. It maintains effective communication with its trading partners. The parties involved in the trade relationship seek to increase the trade volume between them and the value and diversity of their product offer as a means of growing Fair Trade for producers in order to increase their income. The organization works
4. Payment of a fair price
A fair price is one that has been mutually agreed upon by all through dialogue and participation, that provides a fair payment to producers and can also be sustained by the market. When Fair Trade price structures exist, these are used as a minimum. Fair payment means the provision of a socially acceptable remuneration (in the local context) considered by the producers themselves as fair, and that takes into account the principle of equal pay for equal work between women and men. Fair Trade and Importing Organizations support capacity building as needed to producers, enabling them to set a fair price.
5. Ensuring no child labor and forced labor
The organization adheres to the United Nations Convention on the Rights of the Child, and to national/local law on child employment1. The organization ensures that there is no forced labor in its workforce and/or members or homeworkers
Organizations that buy Fair Trade products from producer groups either directly or through intermediaries ensure that no forced labor is used in production and producers comply with the United Nations Convention on the Rights of the Child, and national/local law on child employment. Any participation of children in the production of Fair Trade items (including learning a traditional art or craft) is always communicated and monitored and does not negatively affect their well-being, safety, educational requirements and need for play.
6. Commitment to non-discrimination, gender equity and freedom of association (union)
The organization does not discriminate in hiring, remuneration, access to training, promotion, termination or retirement on grounds of race, caste, national origin, religion, disability, gender, sexual orientation, union membership (union affiliation), political affiliation. HIV/AIDS, status or age. The organization provides opportunities for women and men to develop their skills and actively encourages applications from women for jobs and leadership positions in the organization. The organization takes into account the special health and safety needs of pregnant women and breastfeeding mothers. Women fully participate in decisions concerning the use of benefits resulting from the production process.
The organization respects the right of all employees to form associations and join unions of their choice and to bargain collectively. When the right to join unions and collective bargaining is restricted by law and/or the political environment, the organization will allow independent and free means of association and bargaining for employees. The organization ensures that employee representatives are not discriminated against in the workplace. Organizations working directly with producers ensure that women are always rewarded for their contribution to the production process, and when women do the same work as men they are paid at the same rate as men. Organizations also seek to ensure that, in production situations where women’s work is valued less than men’s work, women’s work is revalued to equalize remuneration rates and women are allowed to perform jobs according to their abilities
7. Ensuring good working conditions
The organization provides a safe and healthy working environment for employees and/or members2. The organization 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 homeworker) comply with the conditions established by national and local legislation and ILO conventions.
Fair Trade organizations are aware of the health and safety conditions in the producer groups from whom they buy. They seek, on an ongoing basis, to raise awareness on health and safety issues and improve health and safety practices in producer groups.
8. Facilitating capacity development
The organization aims to increase the positive development effects for marginalized small producers through Fair Trade.
The organization develops the skills and capacities of its own employees or members. Organizations working directly with small producers develop specific activities to help these producers improve their management skills, production capacities and access to local, regional or international Fair Trade and mainstream markets, as appropriate.
Organizations that buy Fair Trade products through Fair Trade intermediaries in the South assist these organizations to develop their capacity to support the marginalized producer groups they work with.
9. Promotion of Fair Trade
The organization raises awareness about the aim of Fair Trade and 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 organization provides its customers with information about itself, the products it markets, and the producer organizations or partners that make or harvest the products. Honest advertising and marketing techniques are always used.
10. Respect for the environment
Organizations that produce Fair Trade products maximize the use of raw materials from sustainably managed sources in their distribution areas, buying locally when possible. They use production technologies that seek to reduce energy consumption and, as far as possible, renewable energy technologies that minimize greenhouse gas emissions. They try to minimize the impact of their waste on the environment.
Fair Trade agricultural product producers minimize their environmental impacts, by using organic or low-pesticide pesticides in production methods whenever possible.
Buyers and importers of Fair Trade products prioritize the purchase of products made with raw materials that originate from sustainably managed sources, and have the least global impact on the environment.
All organizations use recycled or easily biodegradable materials for packaging as much as possible, and products are shipped by sea whenever possible.
How do you know if a product is fair?
According to the World Fair Trade Organization (WFTO), the most representative entity of the Fair Trade movement at the international level and of which the State Coordinator of Fair Trade is part, it can be assured that a product is Fair Trade when it meets the 10 criteria previously explained, either through the accreditation of the entity or the certification of the products.
Accreditation of Fair Trade Organizations
It is considered Fair Trade if it has been produced by a member organization of WFTO. Organizations that are part of the World Fair Trade Organization must pass an accreditation system in which compliance with the 10 international principles of Fair Trade is evaluated. This accreditation system includes a self-assessment, an external audit and evaluations by other member organizations. Membership is reviewed and monitored periodically.
World Fair Trade Organization (WFTO)
In 1989, WFTO was founded to promote the exchange of information and ideas around fair trade. The founding members focused mainly on supporting artisan groups in the Global South to gain access to markets in the Global North. Since then, it has focused on supporting those organizations committed to fair trade values.
WFTO members have established the “10 principles of fair trade”, which are based on ILO conventions, human rights and fair trade values.
Likewise, the State Coordinator of Fair Trade has established its own accreditation system for Fair Trade organizations that carry out their work in Spain.
Coordinadora Estatal de Comerç Just (CECJ)
La Coordinadora Estatal de Comerç Just (CECJ) és la plataforma espanyola que agrupa organitzacions vinculades al Comerç Just, actualment 31 (26 organitzacions membre i 5 entitats col·laboradores). El seu treball se centra en potenciar aquest sistema comercial alternatiu i solidari, donant servei a les entitats membre. Forma part de l'Organització Mundial del Comerç Just (WFTO). La seua finalitat és la transformació de la realitat social i les regles del comerç internacional a través de la incidència en les polítiques públiques, la sensibilització i mobilització de la societat i l'enfortiment del sector de Comerç Just. Tota l'activitat de la CECJ s'emmarca en l'Estratègia d'Educació per al Desenvolupament
Certificació dels productes
Així mateix es consideren productes de Comerç Just els que compten amb alguna de les següents certificacions que atorguen els segells de garantia de Comerç Just:
Fairtrade International Organization (FLO)
Fairtrade Labelling Organizations International (també conegut com FLO) reuneix les entitats de certificació de Comerç Just.
Es va crear en 1997, però la seua història es remunta a 1988 quan a Holanda va ser creada Max Havelaar amb l'objectiu que els productes de Comerç Just es diferencien dels altres mitjançant un segell de garantia.
Actualment hi ha 20 organitzacions nacionals de Fairtrade, les principals funcions de les quals consisteixen a desenvolupar els mercats i promoure el comerç just.
Així mateix, Fairtrade International duu a terme labors d'incidència política per a millorar les condicions de vida dels productors i productores del Sud i per a canviar les regles del comerç internacional
Symbol of Small Producers (SPP Global non-profit organization)
The Symbol of Small Producers (SPP) appeared as a label in the fair trade sector and in the international market in 2011. This label has been created and is managed by the producers themselves, who constitute the majority of the actors involved (a minimum of two-thirds) in all decision-making bodies.
This label was born as a result of CLAC’s opposition to the expansion of the Fairtrade/Max Havelaar label to actors considered direct competitors of small producer groups: large producer organizations with hired workers and unorganized producers hired by large companies.
Fair for Life Program
“Fair for Life” is a Certification Standard program for fair trade and responsible supply chains, managed by Ecocert SA.
The “Fair for Life” certification is available for operations in very diverse sectors worldwide, combining three types of requirements throughout the entire supply chain: environmental responsibility, social responsibility and fair trade.
Naturland Association for Organic Agriculture
Pioneering organization in the European ecological sector of the eighties. Naturland is now one of the largest international organizations promoting agroecology worldwide.
The additional certificate from the Naturland Fair organization combines the ecological sector with fair trade under a single logo, applicable to products from both the Global North and South.
Fair Trade at the University of Valencia
The University of Valencia, after the impulse of different training and promotion initiatives of Fair Trade among the university community since the early years of the 21st century, was declared “University for Fair Trade” by IDEAS organization in February 2013, within the framework of the development of the Fair Trade and responsible consumption program of “Sustainable Campus”, corresponding to the area of Social Commitment and Participation. This declaration involved the creation of a working group that promoted different activities such as the University Weeks for Fair Trade from 2011 to 2016 or the celebration of World Fair Trade Day, which is celebrated on the second Saturday in May each year in more than 40 countries, promoted by the World Fair Trade Organization (WFTO) and in our territory by the State Coordinator of Fair Trade and the Valencian Coordinator of NGOs.
Since the new constitution of the Sustainability Commission in 2019, in which the Fair Trade and Proximity Working Group is created, actions to promote Fair Trade among the university community have been reactivated, such as the integration of these products into the Agroecological Market of the University of Valencia or the preparation of this guide.
With the aim of adding efforts, sharing experiences and promoting good practices in the promotion of Fair Trade in the university communities through academic, research and management activities, the Fair Trade and Responsible Consumption group has been reactivated within the framework of the Cooperation sector of the CRUE and in which 15 universities are integrated.
Fair Trade in Spain
The State Coordinator of Fair Trade has been preparing since 2010 an annual report that collects data on Fair Trade sales in the Spanish state, reflects and analyzes the trends and challenges of this area of solidarity economy.
The progress of Fair Trade in our country is constant but slower than the rest of Europe, the average consumption per inhabitant in Fair Trade during 2020 was 3.01 euros, an amount that is still far from other European countries and the volume of turnover obtained by Fair Trade products in Spain during 2020 was 143.7 million euros, corresponding to 97.3% to food products.
Despite the pandemic, in 2020 Fair Trade consumption in Spain increased by 3.6% compared to the previous year. This is a slight increase compared to the growth that had been recorded in the last two years, but it consolidates its upward trend and its increasing presence in consumption spaces and in the daily shopping basket. The main factor that has generated this result is the increase in sales of products with the Fairtrade Fair Trade label and the incorporation of companies into this certification.
The impact of the pandemic has been felt in retail establishments, particularly in the 75 Fair Trade stores managed by CECJ organizations that have suffered a significant decline in sales due to the closure caused by the State of Alarm, restrictions on hours, capacity and mobility, the impossibility of organizing activities or participating in events such as fairs or markets, together with the economic crisis have taken their toll on the sector.
