Fair Trade: A Sustainable Way to Alleviate Poverty While Providing Quality Coffee for Generations to Come

The goal of Fair Trade USA is to use trade as a means to help alleviate global poverty and improve standards of living in ways that are economically, socially, and environmentally sustainable. The statement is simple, but the responsibility is enormous.

Using trade to help alleviate global poverty and improve standards of living

Fair Trade in the United States stands at a crossroads. Over the past 50 years, the Fair Trade movement has empowered farmers around the world to improve their lives, protect the land, and develop their communities. We are proud of what we have accomplished – farmers, responsible companies, NGOs and conscious consumers – all working together.
Yet, the need is much greater. According to the World Bank, more than 2 billion people live on less than two dollars a day. Today’s Fair Trade model reaches only a small percentage of them. Fair Trade can and must do more.
For years, many stakeholders have rightly criticized the Fair Trade system for inconsistencies in how Fair Trade principles have been applied. In some product categories, such as coffee, cocoa, and sugar, Fair Trade certification is limited to cooperatives. In other categories, such as rice in India, communities of small, unassociated farmers are allowed to obtain certification. Moreover, in still other categories, like bananas, tea and flowers, farm workers on larger farms or estates can also receive Fair Trade benefits. In short, Fair Trade has historically excluded some of the poorest of the poor. This represents a serious and often harmful inconsistency that must be addressed if Fair Trade truly seeks to alleviate global poverty on a larger scale.

Fair Trade: A comprehensive model of sustainability

Fair Trade looks at sustainability holistically, using our standards to simultaneously address economic, social and environmentally sustainability and the interdependence among them.

Economic Sustainability

Fair Trade provides farmers with better access to markets and buyers, while encouraging long term supply chain relationships that provide a more stable livelihood for farmers. When farmers understand the needs of the market, they can work towards producing the quality levels buyers expect.
Our recently introduced Co-op Link program further strengthens the economic benefits of Fair Trade. Co-op Link builds off Fair Trade USA’s history of partnering across the supply chain to provide more economic benefits to cooperatives. Since 2006, Fair Trade USA and our partners have invested over $7.4 million in product quality, market access, business capacity, and biodiversity initiatives in Africa, Asia, and Latin America.
Co-op Link expands these efforts. For example, at the April 2010 SCAA Expo, during our annual Fair Trade USA Producer Forum, we surveyed over 200 producer groups about their most pressing needs. Based on their input, we raised funds from industry and NGO partners, and through the use of local service providers, we have already conducted price/risk management training for more than 100 cooperatives in four countries. This training enables cooperatives to manage more effectively in the face of pricing volatility, decreases the likelihood of defaults, and strengthens the cooperatives economically.

Social Sustainability

Fair Trade standards improve the lives of farmers by prohibiting child labor and discrimination; by ensuring adequate safety training and equipment; and by empowering women to take leadership roles in Fair Trade cooperatives.
Here is an example of social sustainability in action. OROMIA is a coffee cooperative in Ethiopia with over 180,000 coffee growing households in its ranks. Since becoming Fair Trade Certified in 2002, OROMIA has funded the construction of wells that provide potable water, bridges that connect communities during the rainy season, and schools in areas with no prior access to education. In a region characterized by rampant poverty and chronic lack of infrastructure, Fair Trade has helped improve the lives of entire communities.
Environmental Sustainability
Fair Trade standards protect the environment by prohibiting the use of the most hazardous chemicals and GMO’s; by giving farmers additional incentives for farming organically; by requiring responsible waste management practices; and by ensuring environmental plans have been created and progress against those plans is being tracked.
For example, COOPAIN, a cocoa and coffee cooperative in Naranjillo, Peru, invested Fair Trade premiums in 2007 in an environmental education and productivity improvement program aiming to make strides in the implementation of organic agriculture systems without sacrificing productivity – a common challenge when transitioning to organic agriculture. At the program conclusion in 2010, the number of coop members carrying organic certification had tripled and productivity actually increased from 800 lbs per hectare to 1,400 lbs per hectare. Fair Trade helped Naranjillo add value to their product and increase their export capacity while simultaneously protecting the environment.

The Fair Trade Difference: Bringing it all together

While Fair Trade standards simultaneously address economic, social, and environmental challenges, it’s the “Fair Trade Difference” that brings them all together.
The Fair Trade Difference consists of pre-determined economic benefits in the form of required community development premiums, and mechanisms for empowering groups of farmers and workers to determine how to spend those premiums in ways that best meet the needs of their communities. Empowerment can take many forms: Farmers can join together in cooperatives; workers on large estates can form workers’ associations or unions.
Since 2007, farmers have chosen to invest about half of their community development premiums in projects to improve quality and protect the environment, with the other half going to projects that improve lives via programs in areas such as education, healthcare, and clean drinking water.
The community development premiums, and the ways farmers choose to spend them, underscore the holistic approach to sustainability that underlies Fair Trade. Working together with our partners, this approach enables Fair Trade to alleviate global poverty and improve standards of living in ways that are economically, socially and environmentally sustainable – and enables coffee farms to flourish for generations to come
Jennifer Gallegos is the Director of Business Development for Coffee at Fair Trade USA. With over 20 years sales and marketing experience, ranging from Fortune 50 brands, start-ups and non-profits, Jennifer has spent over half of her career in the coffee industry. Most recently, she was VP of Sales with Coffee Bean International where she helped national retailers understand the value of differentiating their private brands and meeting consumer demand with specialty coffee, including certified coffees. At Fair Trade USA, she sets the strategic direction and future of their coffee category, while leading a team to make Fair Trade Certified™ coffee an integral part of every successful coffee program and delivering the greatest impact back to coffee farmers around the world..