What Is Fair Trade?

Fair Trade is a social consumer movement that helps farmers and producers in developing countries. Fair Trade goods are certified by Fair Trade USA (or FLO in Europe) to meet standards of fair pay, sustainability and development, in order to benefit disadvantaged farmers. Consumers of Fair Trade certified products know that they are contributing to the social and economic development of people through their purchases.

How Is Fair Trade Different?

The goal of the traditional business model known as "free trade" is to maximize profit for shareholders. In a supply chain, the goal of a business may be at odds with both suppliers and consumers. As a result, in developing nations, farmers who are already living marginally are driven out of work by unfair business practices. In some cases, child laborers are forced to work long hours under harsh or dangerous conditions. In the 1990s both Nike and Wal-Mart faced scandals when it was discovered some of their products were made by children in sweatshops.

Social consumerism (also known as ethical purchasing or ethical consumerism) is not a new phenomenon. In America, in the early 1800s, the Free Produce Society fought slavery through an economic boycott of slave-made goods. At the same time in Britain, the Rochdale Pioneers started the first consumer-based cooperative and opened the first co-op shop. Consumers want to know that their purchases are ethical, and that they make a difference in the world.

How Does Fair Trade Help?

Fair Trade helps farmers and communities in many ways. Fair Trade guarantees fair minimum prices for producers. It encourages sustainable, organic farming practices. And Fair Trade returns a premium to the farming community itself, via farming cooperatives, for improvements.

The ten principles of Fair Trade, as described by the World Fair Trade Organization, are:

1. Creating opportunities for economically disadvantaged producers
2. Transparency and accountability
3. Fair trading practices
4. Payment of a fair price
5. Ensuring no child labor and forced labor
6. Commitment to non-discrimination, gender equity and freedom of association
7. Ensuring good working conditions
8. Providing capacity building
9. Promoting fair trade
10. Respect for the environment (maximize use of local, sustainable raw materials)

How Does Fair Trade Benefit Consumers?

When consumers see the Fair Trade Certified mark, they know their purchases go directly to help farmers and communities in developing nations. Beyond simple ethical goals, Fair Trade certification creates sustainability, high-quality goods, stabilizes the market with fair prices, and reduces shortages. Fair Trade is an excellent way consumers can affect the global marketplace through their day-to-day purchases.

Companies like Spicely® Organic Spices, Starbucks and Nestle are taking initiative by offering Fair Trade Certified products. Look for the Fair Trade Certified and Global Fair Trade logos on all your purchases. For more information, visit Fair Trade USA's website at http://www.fairtradeusa.org.