Fair Trade month is observed in October to raise awareness about fair trade practices and products. It’s a time to celebrate ethical and sustainable shopping and support products that prioritize fair wages, safe working conditions, and environmental responsibility. When products are sold as Fair Trade Certified™, a fraction of the sale returns to the producer communities as Community Development Funds. These funds allow farmers and workers to invest in development projects that address their community’s greatest needs, such as water, education, housing, and healthcare.

Fair trade empowers producers and enables businesses to support sustainable livelihoods, safe working conditions, protection of the environment, and community development.

Fair Trade and workers’ protections

Farmers, fishers, and factory workers often face challenges. In 2022, the United Nations reported that nearly 3 million people around the globe die every year due to risk factors in the workplace, including accidents, work-related diseases, and extreme working hours. The benefits of strong workplace safety standards are immeasurable for workers and their families.

When a company’s safety standards are verified through a reputable third-party organization, brands, retailers, and traders can source their products with confidence, improving traceability and credibility for their business and align with consumers who care about sustainability.

Fair Trade Certified standards include specific requirements related to workers’ protection, sanitary conditions, and clean water access. Here are some examples of those requirements:

• The Fair Trade minimum price, a baseline price established for certain agricultural products to ensure producers receive a fair and stable income for their goods even when market prices fluctuate.

• Reasonable working hours and the prohibition of child labor.

• Nondiscrimination and gender equity.

• Reasonable accommodation for any work that poses a risk to workers’ health. In hot climates and in hot workplaces, workers are provided with suitably cool water and shade for rest breaks to protect against heat stress. Adequate first aid supplies and access to medical services are provided in the case of workplace incidents.

Businesses also benefit from a strong safety and health culture as it leads to reduced costs, improved morale, and enhanced production.

Fair trade and the environment

The production of food and goods can have a range of impacts on the environment such as pollution, deforestation, soil erosion, climate change, and more. Fair Trade Certified’s standards approach to protection of the environment includes:

Prevention and/or reduction of risks to local environments through legal compliance and management systems. The standards focus on the prevention and reduction of direct harm to the local environment from production activities and the management and proper disposal of waste, hazardous materials, and wastewater. Fair trade certification also provides an incentive for producers to meet their region’s environmental laws and regulations.

• Empowerment and capacity-building of farmers, fishers, and workers to produce sustainably. The standards ensure individuals have the capacity, knowledge, and funds to produce sustainably and protect the environment by empowering, educating, and supporting producers at origin.

Fair trade and community development

The Fair Trade Premium is a key component of Fair Trade Certified’s model.  It is an additional sum of money paid to producers of fair trade products. These funds allow farmers and workers to invest in development projects that address their community’s greatest needs, such as water, education, housing, and healthcare.

Community Development Funds can help mitigate the impact of the unknown and grant people the agency to make their own investment decisions according to each community’s own needs.

Some examples of projects include:

• Emergency Funds: COVID-19 relief, disaster relief

Water: deep water pumps granting access to clean, safe drinking water

Environment: regenerative and reforestation efforts

Health: health clinics, sanitary facilities, septic systems, food cards

Education: building and improving schools, scholarships, school supplies

Housing: build and improve workers housing

Childcare: childcare facilities, community centers

Improving Business Operations: technologic advances, job training, safety gear

Other: libraries, laptops, laundry facilities, etc.

Ethical sourcing and stories of impact

Ethical sourcing storytelling is a powerful way to communicate business commitments to responsible and sustainable practices. Consumers are increasingly valuing transparency, sustainability, and ethical considerations in their purchasing decisions. Many consumers may not be fully informed about the impact of their choices and messaging stories of impact can educate and empower them to make informed choices. Consumers genuinely want to do their part in positively impacting the environment and are increasingly choosing businesses that care.

Transparency is key in ethical sourcing storytelling. Sharing detailed information about supply chains, including where products come from, how they are made, and the conditions under which they are produced increases brand trust. Human stories resonate with consumers as well as highlighting the people behind the products, such as the farmers and workers and their positive experiences with fair trade and community development projects.

Brands that ethically source their ingredients and products often gain loyal customers who appreciate their values. Customers are more likely to stick with brands they trust. Ethical sourcing signals a commitment to responsible practices, which can boost a brand’s reputation and help mitigate risks associated with supply chain disruptions or negative publicity related to unethical practices. A transparent and ethical supply chain is most often a more resilient one, too.

About Fair Trade USA

Fair Trade USA, a tax-exempt 501(c)(3) nonprofit organization, is the leading certifier of fair trade products in North America. Offering award-winning, rigorous, and globally recognized sustainable sourcing certification programs that improve livelihoods, protect the environment, and build resilient, transparent supply chains, its trusted Fair Trade Certified™ seal on a product signifies that it was made according to stringent fair trade standards. Fair Trade USA is building an innovative model of responsible business, conscious consumerism, and shared value to eliminate poverty and enable sustainable development for farmers, workers, their families, and communities around the world. Visit www.fairtradecertified.org to learn more.

Hi there 👋
Want the inside scoop on all things CPG?

Get the latest CPG and retail insights, trends, and business best practices sent directly to your inbox, every week.