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Issues surrounding fair trade certification
January 17, 2006
10:48 pm
oz_choc
Kandos, Australia
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Forum Posts: 98
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January 10, 2006
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Hi all. I’d like to start my post by saying that I’m thrilled to have found this community of people who are so obviously passionate about good chocolate, and who, judging by earlier posts, are also very interested in related social issues such as fair trade.

I’m based in rural NSW, Australia (about 200km north west of Sydney). I’m two years into the long and arduous process of setting up a factory that manufactures chocolate from the bean (I even press my own cocoa butter, which I believe is unique in Australia). I have a degree in agricultural science, and a graduate degree in anthropology, so I approach chocolate from a social, environmental, and science perspective rather than a confectionery perspective. I love fine chocolate, but my driving passions are fair trade (lower-case f and t) and organic agriculture. I buy my cocoa beans from growers in Vanuatu (previously known as New Hebrides – a chain of several dozen islands, roughly 2500km north east of Sydney).

I would like to offer some words of caution (and encouragement!) to those of you who are looking for fair trade and/or organic chocolate. I have done quite a bit of cocoa-related travel in Asia, the South Pacific, and South America, and have seen some very bold “guarantees” from chocolate manufacturers regarding things like labour conditions, the environment, and cocoa varieties that are, at best, questionable.

For example, I toured a cocoa-growing area of Ecuador last year that has Rainforest Alliance certification. I was expecting to see rainforest. There wasn’t any. By this, I mean that the plantations were just that: plantations (i.e. rows) of cocoa trees, with the odd remnant banana tree growing here and there. The only “rainforest” trees providing shade were the cocoa trees themselves. When I got home I went to the Rainforest Alliance website and carefully combed through their certification standards. I was surprised and disappointed to discover that their standards are nowhere near as strict as I had assumed (and please note that the mistake here was on my part, because I hadn’t previously read the standards documentation).

Following this little piece of research, I trawled the net looking for references to Rainforest Alliance (RA) certified chocolate. I discovered that there seems to be an assumption amongst consumers that RA certification is basically organic and fair trade certification rolled into one. This is not the case. For example, RA certification allows the use of synthetic chemicals, and does not require the presence of rainforest, per se (my interpretation of the standards suggests that rainforest preservation is only required in areas that actually have rainforest at the time of certification. When you think about it, this makes sense – obviously you can’t “preserve” what isn’t there in the first place).

Furthermore, unlike Fairtrade certification (with a capital F), RA only requires that growers receive the minimum wage as set by their country of residence for the activity in question. Unfortunately, in many countries (not least the USA, where I believe the minimum wage is US$5.15 per hour) earning the local minimum wage is no guarantee of financial security. By contrast, Fairtrade uses the local minimum wage as a starting point, with the requirement that “salaries are gradually increased to ‘living wage’ levels above the regional average and official minimum”. (For what it’s worth, I think that Fairtrade certification has its own drawbacks, and, despite my passion for fair trade, I have no intention of trying to obtain Fairtrade certification for my product).

I will try not to go on for too much longer (trust me, I could write a book), but one issue that I did find particularly upsetting was the use of child labour. The RA certification standards (which, incidentally, were substantially overhauled and re-published the month after I aired a very long list of grievances with them) state that “Certified farms do not use [...] child labor”. There is a serious enforcement problem here. I witnessed (and photographed) children labouring at a fermentation co-op which (as I was told by a chocolate maker who bought his beans there) is certified by RA. These pre-pubescent boys were engaged in heavy lifting (they were carrying large sacks of wet beans), which is considered to be one of the worst forms of child labour. I don’t doubt that the RA does its best to enforce its certification standard – the point is that some things are almost impossible to control on a day-to-day basis. And of course, what I saw may have been an isolated, one-off incident (I was only at the fermentation co-op for an hour or so).

To go back to the wages issue – my research into child labour suggests that the best way to prevent child labour is to pay adults a fair “living wage” (a la Fairtrade).

What I have written will probably come as a disappointment to some of you who (like me) had considerable blind faith in various certification programs. All I can suggest is that you research any certification standard that interests you (this information is usually readily available online). Be critical! (I don’t mean “be negative”, I mean “be discerning”). Ask questions and make comments. If you get the opportunity, visit certified areas. Don’t rely on certification. And finally, ask questions of small chocolate manufacturers – anybody who’s as passionate about these issues as I am will happily field questions regarding environmental and social issues. Heck, I’ll even take you on a tour of the islands where I buy my cocoa … meet the growers … catch malaria …

Sam

January 18, 2006
12:40 am
ellie
london, United Kingdom
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March 17, 2005
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Thank you so much for the thread, right on time. Proves quite a lot my long-standing scepticism. We here talk quite a lot about how reliable sertification process could be.

January 18, 2006
10:35 pm
Hans-Peter Rot
USA
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Forum Posts: 1462
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August 1, 2006
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It doesn’t necessarily come as a surprise, since there are always people and issues that fall through the cracks. But wouldn’t you regard the current situation as perhaps a “starting point?” By this, I mean that the way things are right now, people are probably earning more money and living better lives than they were previously, and perhaps as time passes, conditions will only improve. Despite the hardships that exist right now, do you think that mere consumerism can affect drastic improvements? I know that’s probably wishful thinking, considering the global demand for chocolate, particularly the type that requires bulk beans. On a similar note, though, I’ve been contemplating several thesis topics (anthropology) for some time now and have researched many areas. This topic is one area that has caught my interest, and I’ve been corresponding with some people regarding the fair trade and organic industries, and it is indeed frightening to realize that there are quite a few atrocities still around. My only problem here is how to offer a plausible solution.

January 19, 2006
2:54 am
oz_choc
Kandos, Australia
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Forum Posts: 98
Member Since:
January 10, 2006
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Ellie – thanks for your encouragement, and
Montegrano – thanks for your thoughtful reply, which I would like to respond to …

You ask me whether I regard the current situation as a starting point. Well, I think it definitely is a starting point – one that we’ve had thrust upon us. Sadly, I don’t think it’s a good starting point. I appreciate the fact that your problem is “how to offer a plausible solution”, and I wish that I had a simple answer. I don’t.

I’d like to begin the body of my response with a disclaimer: I have no training in economics or international law. I am more familiar with Australian laws than those in the US or the UK, where I gather most of the seventypercent forum members come from. I have gone to considerable effort to find facts, figures, and illuminating examples, but please don’t take what I say as gospel. Also, I use the Rainforest Alliance and Fairtrade to illustrate my points simply because these are two organisations that I know enough about to comment on.

So – leaving aside issues of compliance for a moment, the Rainforest Alliance guarantees that employees of organisations certified by them will receive at least the local minimum wage. Montegrano, you yourself have made a post on this forum stating that “Plantations is fair trade, since they operate through the Rainforest Alliance”. To me, this is akin to saying that Wal-Mart is a leading example of ethical business in the USA because, for the most part, they pay above minimum wage. But guess what? Paying at least minimum wage is actually required by law. So, in effect, the Rainforest Alliance has set itself up as a qausi enforcer of local labour laws. The only drawback is that they’re based in New York City, a long way from the nearest cocoa plantation, and I’ve seen first hand that they are unable to effectively monitor and enforce the implementation of their standards.

But the thing that really gets up my nose is that the Rainforest Alliance (RA) never even refers to itself as “fair trade” – they don’t have to, because they can seduce intelligent and influential people like you into saying it for them.

According to their website, RA has an annual budget of $12million. From what I could find in their 2003 annual report, this is something like seven times the annual budget of TransFair USA (the American member of FLO, the international Fairtrade Labelling Organisation). On the one hand, I have to say “good luck to them”. It’s (theoretically) a free world, and I have no reason to doubt that RA is operating totally within the law. On the other hand, I would say that $12million will buy you some pretty slick marketing, and get you an audience with some pretty lucrative potential partners. And look at the attraction from the point of view of large and small businesses that want to get themselves an ethical image: all they have to do is pay minimum wage (which they would be required to do by law anyway).

Meanwhile, I would argue that by only insisting on paying minimum wage, this kind of arrangement perpetuates conditions where child labour will be almost impossible to eradicate (after all, if parents can’t earn enough to support their large families, then sending children out to work will always be an attractive option). Also, unlike Fairtrade, RA will only certify organisations or areas where children have access to schooling. This might sound like a really good way of supporting education, but what does it really mean for an area where no school exists? Basically it means “tough luck”. By contrast, part of the substantial bonus paid to communities under Fairtrade certification is earmarked for spending on things like building schools, with a requirement that children must have access to schooling within a certain period of time after Fairtrade certification has been implemented.

But what does all this mean? Well, Fairtrade-certified products will almost always be more expensive than RA-certified products. So, RA certification is more attractive to businesses and consumers for obvious financial reasons … and, so many people are out there singing the praises of RA certification that most consumers don’t perceive a practical ethical difference between the two labels. Meanwhile, the RA gets bigger and bigger, while Fairtrade struggles more and more with a much smaller budget to win the consumer’s ethical dollar. And the poor old cocoa grower’s stuck on local minimum wage, with no realistic hope for improvement.

One more point to illustrate the financial hardship of cocoa growers. When I was in the RA-certified Azuay province of Ecuador, I saw a sight that would bring tears to the eyes of anybody who cares about the safeguarding of heirloom cocoa varieties: field after field of Arriba cocoa trees, freshly cut down to stumps about 6 feet high. Many of the trees had one or two lonely red pods still hanging from their trunks. Discussions with locals quickly revealed that these productive cocoa trees had been cut down to make way for maracuya (passion fruit). In some areas, we saw farmers already using the dead cocoa stumps as stakes to string wire between. The wire was then used to support the new passion fruit vines. According to the farmers, they had done their sums and were confident of making more money from passion fruit than they could from selling RA-certified Arriba cocoa.

Personally, I think that the quality of the Arriba beans coming out of the Azuay province is way over-rated … but that’s a) mostly because of poor fermentation, and b) totally beside the point of this post. The fact remains that relatively rare Arriba trees are being destroyed, and you are probably amongst the few people on earth who care. The big question is, what to do about it?

Personally, I subscribe to the theory of “One Thing”. As a teenager (I’m 31 now), I wanted to save the world. I could be reduced to utter despair several times a day by hearing about the latest example of injustice or cruelty in the world. You could say that I was paralyzed by the enormity of every rotten thing that I couldn’t change. Eventually, just over two years ago, I heard a short story on the radio about some poor cocoa farmers. The story resonated with me, and I picked that – buying cocoa, making chocolate, helping poor farmers – as my One Thing. I put every dollar that I had (as well as plenty more that I begged and borrowed) into making my One Thing happen. I infected my significant other with my enthusiasm, and today we actually live in a giant factory complex out in the middle of nowhere. We’ve already procured 30 tonnes of cocoa beans at well above the local market price, and this has had a real impact on real people’s lives. My point is that I am not in a position to save Arriba cocoa trees or growers in Ecuador … but maybe one of you could choose that, or some other chocolate-related issue, as your One Thing … and maybe you can make a critical difference.

Sam

January 19, 2006
5:25 am
Hans-Peter Rot
USA
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Forum Posts: 1462
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August 1, 2006
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What you say is interesting, especially with the RA vs FT distinction. Basically, RA is a cheaper and more profitable means of obtaining labor than FT because it is imposed not by outside influence but within country of operation. As such, RA chocolate does not bear the FT label but only that of the RA. And as you say, for the same chocolate to actually be called FT depends on people like us to automatically assume that RA equals FT when in fact it does not. That’s quite a disturbing development, to say the least, and I’m both shocked and unsurprised by this. Shocked to hear that these organizations are basically robbing their own people, yet unsurprised because the wording was contrived in such a manner as to imply something entirely different. Such deception.

Honestly, though, what I think is happening here is that cacao is just too finicky of a plant to produce profitable incomes, so as a result, people are turning to other crops, such as passionfruit. This happens all the time, but in Ecuador, the RA isn’t helping matters one bit. The only thing they accomplish is to insure the farmers at least minimum wage with little or no chances of earning anything greater.