What is Fair Trade?

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Conventional trade seeks to gain profit with little to no consideration of worker’s rights, community development, or environmental stewardship. Fair Trade is a system of exchange that honors producers, communities, consumers, and the environment. It is a model for the global economy rooted in people-to-people connections, justice, and sustainability.

Fair Trade purchases support the following nine principles.

  • Create Opportunities for Economically and Socially Marginalized Producers
    • Fair Trade is a strategy for poverty alleviation and sustainable development.  Members create social and economic opportunities through trading partnerships and marginalized producers. Members place the interests of producers and their communities as the primary concern of their enterprise.
  • Develop Transparent and Accountable Relationships
    • Fair Trade involves relationships that are open, fair, consistent, and respectful.  Members show consideration for both customers and producers by sharing information about the entire trading chain through honest and proactive communication. They create mechanisms to help customers and producers feel actively involved in the trading chain. If problems arise, members work cooperatively with Fair Trade partners and other organizations to implement solutions.
  • Build Capacity
    • Fair Trade is a means to develop producers’ independence.  Members maintain long-term relationships based on solidarity, trust, and mutual respect, so that producers can improve their skills and their access to markets. Members help producers build capacity through proactive communication, financial and technical assistance, market information, and dialogue. They seek to share lessons learned, to spread best practices, and to strengthen the connection between communities, including among producer groups.
  • Promote Fair Trade
    • Fair Trade encourages and understanding by all participants of their role in world trade.  Members actively raise awareness about Fair Trade and the possibility of greater justice in the global economic system. They encourage customers and producers to ask questions about conventional and alternative supply chains and to make informed choices. Members demonstrate that trade can be a positive force for improving living standards, health, education, the distribution of power, and the environment in the communities with which they work.                                                                                                                                       
  • Pay Promptly and Fairly
    • Fair Trade empowers producers to set prices within a framework of the true costs of labor, time, materials, sustainable growth, and related factors. Members take steps to ensure that producers have the capacity to manage this process.  Members comply with or exceed international, national, local, and where applicable, Fair Trade Minimum standards for their employees and producers.  Members seek to ensure that income is distributed equitably at all times, particularly equal pay for equal work by women and men. Members ensure prompt payment to all their partners.  Producers are offered access to interest-free advance payment for handmade goods, or pre-finance of agricultural harvest with favorable terms.
  • Support Safe and Empowering Working Conditions
    • Fair Trade mans a safe and healthy working environment free of forced labor.  Throughout the trading chain, members cultivate workplaces that empower people to participate in the decisions that affect them.  Members seek to eliminate discrimination based on race, caste, national origin, religion, disability, gender, sexual orientation, union membership, political affiliation, age,marital, or health status.  Members support workplaces free from physical, sexual, psychological, or verbal harassment or abuse.
  • Ensure the Rights of Children
    • Fair Trade means that all children have the right to security, education, and play.  Throughout the trading chain, Members respect and support the UN Convention on the Rights of the Child, as well as local laws and social norms. Members disclose the involvement of children in production.  Members do not support child trafficking and exploitative child labor.
  • Cultivate Environmental Stewardship
    • Fair Trade seeks to offer current generations the ability to meet their needs without compromising the ability of future generations to meet their own needs.  Members actively consider the implications of their decisions on the environment and promote the responsible stewardship of resources. Members reduce, resuse, reclaim, and recycle materials wherever possible.  They encourage environmentally sustainable practices throughout the entire trading chain.
  • Respect Cultural Identity
    • Fair Trade celebrates the cultural diversity of communities, while seeking to create positive and equitable change. Members respect the development of products, practices, and organizational models based on indigenous traditions and techniques to sustain cultures and revitalize traditions. Members balance market needs with producers’ cultural heritage.
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Under conventional trade (sometimes called “free” trade), workers’ wages are squeezed—and their safety sometimes compromised—in order to make bigger profits for the owners and stockholders. That’s why sweatshops and child labor exist.

Fair trade upholds people’s dignity. Many fair trade businesses are cooperatives: workers own equal shares in the company or farm. These worker/owners set the conditions and value of their work. Essentially, they tell us (we who distribute and sell their products) how much their goods are worth. Paying them a fair price does not necessarily mean higher prices for the consumer. For instance, a pound of shade grown, arabica bean, gourmet coffee that is fair trade is no more expensive than shade grown, arabica bean, gourmet coffee that is sold on through the conventional market.

Source: Ohio Fair Trade

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