Fair trade is a term for an arrangement designed to help producers in developing countries achieve sustainable and equitable trade relationships. The fair trade movement combines the payment of higher prices to exporters with improved social and environmental standards. The movement focuses in particular on commodities, or products that are typically exported from developing countries to developed countries but is also used in domestic markets, most notably for handicrafts, coffee, cocoa, wine, sugar, fruit, flowers and gold.
The cocoa bean or simply cocoa, also called cacao, is the dried and fully fermented seed of Theobroma cacao, the cacao tree, from which cocoa solids and cocoa butter can be extracted. Cocoa trees are native to the Amazon rainforest. They are the basis of chocolate and Mesoamerican foods including tejate, an indigenous Mexican drink.
A cash crop, also called profit crop, is an agricultural crop which is grown to sell for profit. It is typically purchased by parties separate from a farm. The term is used to differentiate marketed crops from staple crop in subsistence agriculture, which are those fed to the producer's own livestock or grown as food for the producer's family.
The Solidaridad Network is an international civil society organisation founded in 1969. Its main objective is facilitating the development of socially responsible, ecologically sound and profitable supply chains. It operates through eight regional expertise centers in over 50 countries.
A smallholding or smallholder is a small farm operating under a small-scale agriculture model. Definitions vary widely for what constitutes a smallholder or small-scale farm, including factors such as size, food production technique or technology, involvement of family in labor and economic impact. Smallholdings are usually farms supporting a single family with a mixture of cash crops and subsistence farming. As a country becomes more affluent, smallholdings may not be self-sufficient, but may be valued for the rural lifestyle. As the sustainable food and local food movements grow in affluent countries, some of these smallholdings are gaining increased economic viability. There are an estimated 500 million smallholder farms in developing countries of the world alone, supporting almost two billion people.
The Rainforest Alliance is an international non-governmental organization (NGO) with staff in more than 20 countries and operations in more than 70 countries. It was founded in 1987 by Daniel Katz, an American environmental activist, who serves as the chair of the board of directors. The NGO states that its mission is “to create a more sustainable world by using social and market forces to protect nature and improve the lives of farmers and forest communities.” Its work includes the provision of an environmental certification for sustainability in agriculture. In parallel to its certification program, the Rainforest Alliance develops and implements long-term conservation and community development programs in a number of critically important tropical landscapes where commodity production threatens ecosystem health and the well-being of rural communities.
Sustainable procurement or green procurement is a process whereby organizations meet their needs for goods, services, works and utilities in a way that achieves value for money on a life-cycle basis while addressing equity principles for sustainable development, therefore benefiting societies and the environment across time and geographies. Procurement is often conducted via a tendering or competitive bidding process. The process is used to ensure the buyer receives goods, services or works for the best possible price, when aspects such as quality, quantity, time, and location are compared. Procurement is considered sustainable when organizations broadens this framework by meeting their needs for goods, services, works, and utilities in a way that achieves value for money and promotes positive outcomes not only for the organization itself but for the economy, environment, and society. This framework is also known as the triple bottom line, which is a business accounting framework. The concept of TBL is narrowly prescribed, and even John Elkington, who coined the term in the 1990s, now advocates its recall. Indeed, procurement practitioners have drawn attention to the fact that buying from smaller firms, locally, is an important aspect of sustainable procurement in the public sector. Ethics, culture, safety, diversity, inclusion, justice, human rights and the environment are additionally listed as important aspects of SPP.
UTZ, formerly called UTZ Certified, is a program and a label for sustainable farming. The organization was founded as a non-profit in the Netherlands in 2002. The UTZ label is featured on more than 10,000 product packages in over 116 countries. In 2014, UTZ was reported to be the largest program for sustainable farming of coffee and cocoa in the world. The UTZ program addresses agricultural practices, social and living conditions, farm management, and the environment. In January 2018, UTZ officially merged with the Rainforest Alliance in response to the increasing challenges of deforestation, climate change, systemic poverty, and social inequity.
Olam International is a major food and agri-business company, operating in 60 countries and supplying food and industrial raw materials to over 20,900 customers worldwide. Its value chain includes farming, origination, processing and distribution operations.
Paul Rice is the Founder & CEO of Fair Trade USA, the leading third-party certifier of Fair Trade products in North America. Since launching Fair Trade USA in 1998, Rice has brought Fair Trade into the mainstream and built a movement to expand its impact. He has challenged and collaborated with hundreds of companies to rework their global supply chains to obtain high-quality products that support community development and environmental protection.
Sustainability measurement is a set of frameworks or indicators to measure how sustainable something is. This includes processes, products, services and businesses. Sustainability is difficult to quantify. It may even be impossible to measure. To measure sustainability, the indicators consider environmental, social and economic domains. The metrics are still evolving. They include indicators, benchmarks and audits. They include sustainability standards and certification systems like Fairtrade and Organic. They also involve indices and accounting. And they can include assessment, appraisal and other reporting systems. These metrics are used over a wide range of spatial and temporal scales. Sustainability measures include corporate sustainability reporting, Triple Bottom Line accounting. They include estimates of the quality of sustainability governance for individual countries. These use the Environmental Sustainability Index and Environmental Performance Index. Some methods let us track sustainable development. These include the UN Human Development Index and ecological footprints.
Supply-chain sustainability is the impact a company’s supply chain can make in promoting human rights, fair labor practices, environmental progress and anti-corruption policies. There is a growing need for integrating sustainable choices into supply-chain management. An increasing concern for sustainability is transforming how companies approach business. Whether motivated by their customers, corporate values or business opportunity, traditional priorities such as quality, efficiency and cost regularly compete for attention with concerns such as working conditions and environmental impact. A sustainable supply chain seizes value chain opportunities and offers significant competitive advantages for early adopters and process innovators.
Purchase for Progress (P4P) is an initiative of the United Nations World Food Programme (WFP), involving over 500 partnerships, including Bill & Melinda Gates Foundation, the Howard G. Buffett Foundation, FAO, ACDI/VOCA, TechnoServe and others. Launched in September 2008 as a five-year pilot, P4P sought to explore programming and procurement modalities with the greatest potential to stimulate agricultural and market development in ways that maximized benefits to smallholder farmers. The program, largely developed by the eleventh Executive Director of the WFP, Josette Sheeran, arose as the WFP desired to purchase food in a way that was part of the "solution to hunger". These efforts are aligned with recommendations issued by the UN Committee on Economic, Social and Cultural Rights that call for an establishment of programs in support of socially vulnerable groups. and to the Zero Hunger Challenge launched by the UN Secretary General Ban Ki-moon. Special UN Reporter 2012–2014, Olivier De Schutter, claimed that public procurement systems favour economically-strong bidders, thus excluding smallholder farmers. His conclusion was that public procurement schemes supportive of smallholders could have "powerful impacts on the reduction of rural poverty." P4P is built upon this very principle as it enables low-income farmers to supply food to the WFP's operations. Eventually the transaction can be regulated by a forward contract, with the farmer agreeing in selling in the future a certain amount of output at a fixed price. Essentially, the P4P program aims to create a wide and sophisticate market for commodities in developing countries.
A fair trade certification is a product certification within the market-based movement fair trade. The most widely used fair trade certification is FLO International's, the International Fairtrade Certification Mark, used in Europe, Africa, Asia, Australia and New Zealand. Fair Trade Certified Mark is the North American equivalent of the International Fairtrade Certification Mark. As of January 2011, there were more than 1,000 companies certified by FLO International's certification and a further 1,000 or so certified by other ethical and fairtrade certification schemes around the world.
Sustainable coffee is a coffee that is grown and marketed for its sustainability. This includes coffee certified as organic, fair trade, and Rainforest Alliance. Coffee has a number of classifications used to determine the participation of growers in various combinations of social, environmental, and economic standards. Coffees fitting such categories and that are independently certified or verified by an accredited third party have been collectively termed "sustainable coffees". This term has entered the lexicon and this segment has quickly grown into a multibillion-dollar industry of its own with potentially significant implications for other commodities as demand and awareness expand.
Sustainability standards and certifications are voluntary guidelines used by producers, manufacturers, traders, retailers, and service providers to demonstrate their commitment to good environmental, social, ethical, and food safety practices. There are over 400 such standards across the world.
The Ethical Tea Partnership is a Private Limited Company that has been working with tea producers and tea companies to improve the sustainability of the tea industry since 1997. This industry-wide initiative, which was originally called the Tea Sourcing Partnership, was established by a number of large UK tea packing companies who decided to work together to improve the social conditions in their supply chains. Later on, ETP membership opened up to non UK-based tea packers, and extended the scheme to include environmental issues as well.
Climate resilience is defined as the "capacity of social, economic and ecosystems to cope with a hazardous event or trend or disturbance". This is done by "responding or reorganising in ways that maintain their essential function, identity and structure while also maintaining the capacity for adaptation, learning and transformation". The key focus of increasing climate resilience is to reduce the climate vulnerability that communities, states, and countries currently have with regards to the many effects of climate change. Efforts to build climate resilience encompass social, economic, technological, and political strategies that are being implemented at all scales of society. From local community action to global treaties, addressing climate resilience is becoming a priority, although it could be argued that a significant amount of the theory has yet to be translated into practice.
Sustainable Development Goal 12, titled "responsible consumption and production", is one of the 17 Sustainable Development Goals established by the United Nations in 2015. The official wording of SDG 12 is "Ensure sustainable consumption and production patterns". SDG 12 is meant to ensure good use of resources, improve energy efficiency and sustainable infrastructure, provide access to basic services, create green and decent jobs, and ensure a better quality of life for all. SDG 12 has 11 targets to be achieved by at least 2030, and progress towards the targets is measured using 13 indicators.
Globalization of supply chains and pressure to lower production costs have negatively impacted environments and communities around the world, especially in developing nations where production of high demand goods is increasingly taking place. Since the 1990s, awareness of these negative impacts has grown, leading stakeholders to push companies to take responsibility and actively work to improve the sustainability of their supply chains. It has come to be understood that a company is only as sustainable as the start of its supply chain, bringing about the need for sustainable sourcing. Sustainable sourcing refers to the inclusion of social, environmental, and economic criteria in the sourcing process.
