Fair Trade: Understanding the Organizations and Labels

Fair trade may be a movement to support farmers and laborers, but it’s also a system of organizations that label products and certify manufacturers.

public goods coffee bags, beans, cup, saucer, fair trade usa logo

Because there isn’t a single entity that manages the production of fairly traded goods, there are multiple labels. By learning more about fair trade cooperatives and nonprofits, you’ll understand what’s behind each label and whether you care to choose one over another.

All fair trade organizations have the overarching mission of ensuring farmers and laborers can receive fair wages and prices for the goods they produce. Some of these nonprofits and cooperatives issue certifications to manufacturers and brands who have proven they are facilitating just labor practices and adequate conditions for workers. Certified brands can leverage fair trade labels to attract consumers who value ethical production and don’t mind paying a little extra.

The fair trade industry covers a growing range of products, but the most common ones are coffee and chocolate. These two are the ones you’ll most likely see at the supermarket. Leaders in the movement also tend to focus on bananas, tea, cotton and clothing.

The qualities that separate these organizations are their legal statuses, organizational structures, histories, values, priorities and market shares. There are also subtle differences in what each organization considers fair trade.

Here are the major players:

Equal Exchange

Equal Exchange is the most dedicated to the cooperative structure that has defined the fair trade movement. Their co-op has more than 120 workers who are entitled to an equal stake and vote in the business. A vote from an executive director or board member is worth the same as one from a lower-level employee or farmer partner. The organization claims it is a “democratic worker co-operative,” meaning its workers are also owners and managers.

The co-op specializes in standard fair trade staples such as coffee, chocolate and bananas, but their team also focuses on the avocado industry. Equal Exchange products are not available in many major stores or chains, but they do have an online shop. Unlike other fair trade organizations, many of their products feature the Equal Exchange brand. It’s a lot like shopping at an online version of Trader Joe’s.

Fairtrade International

Fairtrade International is the oldest and largest fair trade organization in the world. In 2004 it split into two independent organizations: Fairtrade Labeling Organizations International [FLO] and FLOCERT, a certification body that helps companies implement and follow fair trade standards. Fairtrade International is the abbreviated version of FLO and has been the official name of the organization since 2011.

In 2013 Fairtrade International amended its constitution to give farmers and workers more voting power to influence the direction of the movement. This decision reflected their commitment to cooperative principles and the power of helping farmers and workers organize.

Today the federation has many member countries, including Fairtrade America. The organization is recognized by ISEAL Alliance, a global association that sets sustainability standards.

Fairtrade International manages a wide range of products, everything from bananas and chocolate to gold and wine. In the U.S. their chocolate-related work has been especially impactful. Ben and Jerry’s, for example, works with Fairtrade International to source and certify many of their core ingredients.

Fair Trade USA

After more than a decade of working with fair trade farmers, Paul Rice launched Fair Trade USA in 1998. The organization was an affiliate of Fair Trade International but left the federation in 2012, leading to the establishment of Fairtrade America.

According to Fair Trade USA representatives, the nonprofit became independent because its leaders believed abandoning the cooperative structure was necessary to scale business and ultimately help more farmers. The change allowed Fair Trade USA to collaborate with large farm owners and plantations.

Other fair trade organizations criticized this move because they believed the new business opportunities betrayed the fair trade principles of working with small farms, limiting commercialization and relying on cooperatives for worker empowerment. Prominent voices in the movement worried that workers associated with Fair Trade USA would be more likely to face abuse or be denied a living wage.

Regardless of moral debates, it’s clear the strategy allowed the nonprofit to expand, work with more farmers and serve a higher number of consumers. Fair Trade USA developed its own certification standards and trademarked “Fair Trade Certified,” which is now the most common fair trade label in America.

Fair Trade USA doesn’t cover as many categories as Fairtrade International. Unlike Fairtrade International and Equal Exchange, however, Fair Trade USA does focus on clothing. Their brand partners include large apparel companies such as Patagonia and REI.

The expansion seems to have made fair trade products more accessible and affordable across the country. Goods that were once limited to local markets and expensive grocers are now distributed in Walmart, Kroger and Publix, among many other retailers. For years many consumers perceived the fair trade movement as being primarily for white middle or upper-class consumers in cities, but that image is changing.

Does It Matter Which Organization You Support?

All of these organizations deserve support because they have a strong record of helping farmers and workers improve their quality of life. Depending on your values and preferences, however, there might be one you’re more comfortable with.

Equal Exchange and Fairtrade International tend to appeal to fair trade purists. Fair Trade USA was once plagued with controversy, but it’s up to you to decide whether those criticisms are valid.

Fairtrade International and Fair Trade USA seem to have comparable prices. Equal Exchange is significantly cheaper, but they don’t offer many products.

The quality of the goods is subjective. It depends on which brands, farms and manufacturers you like.

No matter which organization you support, the ethical choice is to buy fair trade when possible. At Public Goods we collaborate with both Fair Trade USA and Fairtrade International, and we are figuring out how Equal Exchange might fit into the equation. If you haven’t already, check out our fair trade coffee and tea!

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Comments (2)

  • Good to hear Public Goods involves themselves in some form of fair trade. Yet, I only see that fair trade is recognized in the coffee and tea. What about the other 95% of the products?

    • Hi Amber,

      The fair trade industry doesn’t cover most of our products. Generally those labels are limited to tea, coffee, chocolate (coming soon) and textiles. For example, it would be impossible for us to pursue a fair trade certification for shampoo.

      Fortunately there are many other labels and certifications that apply to our products: RSPO certified sustainable palm oil, USDA organic, etc. With every product we try to make sure the manufacturing workers are treated well and that the ingredients are clean.

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