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Kit Kat goes Fair Trade

Today’s chocolate news is this - Nestle are going to get Fair Trade certification for the four-finger Kit Kat. The bar should be seen carrying the distinctive blue and green logo from mid-January 2010.

So, the question is, is this a good thing or not? (If you’re not aware of the issues surrounding Nestle and ethics, you might want to read my earlier post http://millyj.posterous.com/chocolate-fairtrade-and-nestle)

To get Fair Trade certification Nestle must agree to pay a minimum price to cocoa suppliers, plus a premium of about £90-£100 per tonne. In addition they will have to sign up to a number of ethical promises, such as a guarantee that no child labour will be used. 

My initial reaction is - fantastic! Only recently Cadbury announced their flagship chocolate Dairy Milk was to be Fair Trade. And now Nestle are jumping on the bandwagon. While some people sneer at Nestle, with the attitude that they are only doing it to boost profits, I really don’t mind that. I don’t mind what the motivation behind the move is - whether it’s self-serving or truly altruistic. The main point is that they can only achieve certification by proving that they pay a true and fair price to the cocoa suppliers. Therefore, irrespective of why they are doing it, the ultimate purpose is being achieved - people are being paid what they deserve for the work they have done. 

[It reminds me of the Bible passage where men were preaching the Gospel of Jesus out of the motivation to cause trouble for the Apostle Paul, to get him deeper in trouble. Paul’s reaction - carry right on! So long as Jesus is being preached, don’t worry about why they are doing it! ]

Kit Kats sell in vast quantities. In fact, a 2006 report stated that one Kit Kat is eaten every 47 seconds in the UK(1)! (If this is true, just imagine the amount of chocolate which is being produced - and now fairly paid for! It signifies an estimated 6,000 African farmers now having their lives improved simply because Nestle commit to paying them a fair price. And all this done without Nestle having to put up the price of the chocolate - so the money is coming from their profit margin rather than from the consumer.  This has to be celebrated as good news. 

But here is my dilemma. Do I buy the FT Kit Kat or not? 

While it is just the 4-finger bar which will have FT status initially, Nestle have stated they intend to expand it to other Kit Kats and possibly other Nestle products once more FT chocolate is secured. Nestle will be watching carefully the sales figures for the FT product. If it sells well, then they will be more inclined to roll out the FT process - which is costly in finances as well as time - to their other products. Meaning that more people benefit. 

It is my desire that Nestle are encouraged to continue on the path to Fair Trade, whether financially motivated, or even because they want to turn away from their unethical past. So I should buy Kit Kats. Right? 

But Nestle still have numerous outstanding unethical issues. I still feel uneasy about my money going to fund such practices. Even just buying the one FT branded product, I am giving money to a company which is doing things I just can’t support. (EG aggressive marketing of baby milk substitutes in third world countries; ecological damage to water sources; child slavery in its cocoa sourcing; adverse impact in the dairy industry(2)) Can I feel easy in myself to buy a Kit Kat? 

At the end of the day I do not know whether to buy them or not. I will think and pray about it and see what I feel is right when I stand at the counter. But, no matter that I am left with this quandry, I am in no doubt that today’s announcement is good news, and I shall be watching closely for further Nestle Fair Trade developments.

¹ http://www.telegraph.co.uk/foodanddrink/foodanddrinknews/6730155/Nestles-Kit-Kat-goes-Fairtrade.html

² http://www.babymilkaction.org/press/press4march08.html

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Fair trade futures: Open space: EPAs (economic partnership agreement)

The fundamental principle for EPAs is a free market. This may work for Europe as they are at the same level of development, economical infrastructure is in place. However it does not work for the ACP (Africa, Caribbean, Pacific). It is not an even playing ground; odds are heavily stacked against ACPs not least because of the negotiation process required to trade in the EU (for example intellectual property rights – some countries may not be able to negotiate this). Bilateral trade agreements have a major drawback: they take no account of development needs.

Trade negotiations may seem dull but when it comes to rich countries ripping off poorer countries the fair trade movement can understand this and empathise with this so should be a part of that process. (Mike Gidney).

How far do we see campaigning for long term sustainable change going? Buying fair trade does help of course; but for the long term we need to be campaigning in a more robust and coherent way.

The EU is trying to downgrade the political component and look at the technical negotiations. These do not make headlines though; as you need to fully understand these technical aspects in order to report as a journalist (also it is not very exciting!). EPAs campaign has done a good job of raising the profile but still the ACPs are in a weak negation situation. There is a race between the EU and the US for a market share in China.

‘Engagement v boycott’

This was later summed up in the closing session: ‘from the producers’ perspective, networks are not succeeding as much as they could as they have been sidelined somewhat in political activism; dissipated somewhat as fair trade has gone mainstream. This is a travesty for the 76 countries from the ACP; we must bring this to light. It is treated as a technical issue but it’s not – it will kill people’.   

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Should the fair trade movement include policies to ensure that fair trade is environmentally sustainable; so that climate change becomes a part of that movement?

(This is an open space session so I will try and draw out the main themes of discussion as it flows).

Studio Allaya is a craft based organization that supports producers so that they can take charge of their own enterprises themselves. Climate change is a part of this.

Café Direct is at the end of a 3 year project: chaotic weather conditions had impacted sales however the producers did not see this as a result of climate change. There is a need for education of climate change alongside fair trade. It would make sense for fair trade organsations to partner up with organisations that specialise on climate change.

75% of the environmental issues of coffee trade is the kettle boiling over here, not where it’s made.

Sustainability is seen as an add on – it must be a part of fair trade.

Children and young people are 'where it’s at' with climate change – it sits well with this age group, they are open to learning and can carry it forward. They’re the future (and not corrupt!). Children of the 80s and 90s are ‘brand obsessed’ and move from one project to the next (we talked about children of the 60s/70s growing up worrying about the costs of electricity so cutting back on expenditure; and children of the 80s/90s not having money worries or long term concerns about energy resources and the climate – yes it was a generalisation; however children of today are the ones who will be living with what we do – or don’t do - now).

There is a short window of time to change as by 2050 we will see the impact of climate change and fair trade has to play a part of this now.

‘Our land is barren; not because we can’t grow on it but because we can’t sell from it’

Environment education is needed at both ends of the chain; producers and consumers.

‘Live simply’ : do we really need to buy flowers in winter? but if we stop now - we have already instigated the supply-demand... ‘To trade or not to trade: let it be fair trade’.

We need to address adaptation requirements of producers; what are the climate change implications for them? Should it be funded by the big organisations as they are getting so much benefit from fair trade?

The fair trade movement will need to move from an ‘enable-centric’ market to an ‘equal-centric’ market.

We need to adopt a more cautious approach to consumption: FLO (fair trade labeling) is one part and the other is the fair trade market run by WFTO-type organization.

Could social media could help change this?

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Fair trade futures event: Two perspectives of accountability and impact of fair trade: grant makers and producers

The grant makers perspective of accountability and impact: Louise Herring talking about Comic Relief and its role as grant maker and fundraiser, a charity and a business.

How do you measure the impact of supporting fair trade producers? It’s a qualitative & quantitative process but how do we get everyone’s views?

We could build relationships with producers directly but you need to fully understand the relationships within that and how they work together.

Rather than just using the data Comic Relief collects themselves they will try and share it with chains (e.g. Sainsbury’s) so they fully understand it.

Comic Relief’s Fair Trade Focus on Africa, committed £5m over 5 years to support fair trade producers in Africa by building the capacity and accountability of the African fair trade network.

What are the key factors for ensuring that women workers and producers benefit equitably from trade?

What change has been made? (how can we prove the impact)

HOW has that change been made? (improving the impact).

How can all the key players share that data?       

Joan Karanja, COFTA on the role of producers; the importance of including them in standards development

COFTA is a network of fair trade producer organisations in Africa, working to eliminate poverty, by strengthening African membership in fair trade. COFTA is a grassroots network working with all levels of fair trade. It is a forum for collaboration and networking with over 100 members in 24 African countries touching 250,000+ beneficiaries. No data / stats – this is something they are trying to measure.

Joan explains some of the issues encountered by producer organisations in Africa. Some cannot pay the fee to be accredited fair trade when they may well be practicing fair trade (the fee is $2000 – seems high).

Common producer challenges:

Collaboration and cooperation; business planning and production efficiency; product quality and product innovation; market understanding – e.g. there are no seasons in Africa so if selling to the West it’s important to know the seasonal market; gaining direct market access; access to finance is difficult as it is seen as an informal sector (so banks don’t lend); local infrastructure – important to understand all the nuances; and communication is essential.

COFTA programs focus on:

Network development

Membership development

Advocacy and lobbying

Market access (improving south to south trade not just access to Northern markets).

 ‘The overall idea of fair trade is to change the market’ (Joan Karanja), for example scaling up production through clustering (Swaziland, SWIFT) and Common Coordination (COFTA networks).  

Fair trade is against child labour: the question is raised, ‘what is the solution when the head of a household is 17 and needs to earn a living?’

Joan suggests the solution is spending morning at school and the afternoon at work; we must remember the idea is to protect the young.

In providing direct market access for exporting in to Europe, COFTA provides linkages but currently is unable to supervise this any further.

80% trade is non food handicrafts. Issues surrounding coffee production and food are very different to craft – is it often forgotten? Do we need a fair trade mark for craft? Standardisation?

If we think producers should be involved in defining ‘fair trade standards’ - how to organise local producers (by broadcasting? Use of Technology?). A discussion for the open space session...

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Fair trade futures event: Accountability & Impact (Ian Barney, TWIN Trading)

Fair trade futures event: Accountability & Impact (Ian Barney, TWIN Trading)

TWIN is a membership organisation that has been running for 25 years. Focused on Latin America and Africa, TWIN’s work started around bartering; e.g. swapping cigars from Cuba for coffee in Africa.

TWIN only works with small holder farms, building democratic systems. They believe in a better equitable distribution of risks and rewards; a different kind of relationship (networks of alternative trades). Part of their role is being an intermediary between buyer and seller, strengthening governance of farming organisations; enabling basic business management with a focus on quality. TWIN works to influence trade, with practical support on how to do this.

The development of brands such as Cafe Direct, Divine chocolate, Agrofair, Liberation, has helped change UK attitudes to food sourcing policies and to underpin the Fairtrade market in the UK.

Case studies presented by Ian:

Divine & Kuapa Kokoo: Participation in Divine has improved confidence in farmers after their trading suffered; it is now recognised as one of the best coffees.

Ian spoke about their partnership with Southern African Nuts. Integrated supply chains were developed; 2005 saw the first sales through the fair-trade market (the co-op), and supermarket partnerships in 2006; liberations established in 2007 (42% farmer owned); aflatoxin testing was brought in (2008), and mechanised processing in 2008/9.

Established fair trade supply chains have since been used to feed in to nutritional supplements (tested in Darfour, with significant improvement measured).

The fair trade premium is not hugely different to mainstream.

There have been various studies to show that fair trade in the region has captured more than just monetary value.

Ian talks about the international nut producer cooperative.

‘Liberation’ works by bringing the producers together to explore issues with the whole value chain. By understanding the complex distribution chain producers can be empowered to contribute to decision making about the strategic direction of their businesses.

By promoting democratic structures at community levels, greater governance issues can be brought down to the grassroots. As shareholders, famers have a direct link to the West; and a more democratic process has helped the farmers get involved in all aspects.

At the AGM for the international nut producer cooperative (where 5 candidates are elected to represent farmers) debates are held with farmers from Brazil, Bolivia, Malawi, Mozambique. All are engaged and addressing problems, brainstorming, everybody contributing together. Fairly. This is ‘democracy in action’. It is solidarity; people coming together from different environments as equals. 

Sales yield premiums which is important but there are other benefits, such as the importance of social empowerment. Increasing the self esteem of farmers can impact many other areas.  

Trade is not enough; Ian talks about the other aspects TWIN gets involved in. The quality of the product must be good enough; businesses must be run effectively; risks must be managed. Enhancing income, access to expertise and ability to influence all need to be considered.

To create long term sustainable impact, long term real commitment is required. This involves investment in capacity, collective action/network, transparency and trust, participation in decision making, connecting further up the chain (ownership) results in sustainability, increased confidence /accountability, enhanced capacity and influence.

The TWIN model is a bottom up approach, using farmer organisation partnerships. But are they really taking control themselves?

How can producers have more of a voice in fair trade?

We discussed the concept of ‘fairness’ in fair. Who decides what is fair? Farmers need to be involved in the strategy of determining what is fair. Imposing democracy v fair trade.  

What is the real impact of co-operatives? (needs more research).  

What about the mainstream? In terms of Twin’s work with Africa and South America, competing in a global market will have a significant impact particularly with competition from China. Ian believes the time to invest is now – though he acknowledges the risks.  

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Behind the Designers Interview Series: Kimarie Designs, fair-trade jewelry pioneer

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Equator Estate Coffees: America’s 2010 Roaster of the Year

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Pay The Writer! A Rant.

Refreshing to see a Hollywood writer who stands up for himself. In this case, it's a writer who needs no introduction. Harlan Ellison is known for being outspoken. But it's good to be reminded as a creative that your value is in what you create. You should be paid for it.

(BTW, NSFW if foul language gets you in trouble.)

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Fairtrade chocolate update

Last year I undertook research into the ethical standards of chocolate companies Nestle, Mars & Cadbury. Since then Cadbury has gained Fairtrade certification for one of its top products - Cadbury Dairy Milk. 

What great news! Through this single move, Cadbury has tripled the sales of cocoa under Fairtrade terms for cocoa farmers in Ghana (1). In addition it has brought Fairtrade onto the shelves of every grocery shop, newsagents and petrol station around the country - for who doesn’t stock Dairy Milk? No longer is Fairtrade a speciality only carried by some shops. No longer can it be considered too expensive to buy Fairtrade - Cadbury has gained this certification for its flagship product without needing to raise the price. It is a landmark step, which should lead to other mainstream chocolate producers to joining in if they don’t want to give Cadbury a competitive edge. 

And excitingly Cadbury have stated that this is ‘just the start’. 300 million bars of Cadbury Dairy Milk are sold every year - the company could have started with a less popular bar - and who knows they could have several certified as Fairtrade by now. Instead they started with their most popular - a brave move and one which I hope will be recognised for what it is achieving. 

All of which makes me very happy. But I will be honest, and say a large part of what makes me happy is I can now buy Cadbury without feeling guilty. A little pleasure has been restored to me. Thanks Cadbury, and well done! 

http://www.fairtrade.org.uk/press_office/press_releases_and_statements/march_2009/cadbury_dairy_milk_commits_to_going_fairtrade.aspx

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Yay for @starbucks #muffinmonday for #fairtrade :)

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