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The Glossary: What is Fair Trade and how is it Assessed

  • Glossary
  • 3 min read
The Glossary: Fair Trade

The 11th of May celebrates Fair Trade – a truly global movement. Over a million small-scale producers and workers are organised in as many as 3,000 grassroots organisations in over 70 countries. Fair Trade is not only concerned with trading, but also just working conditions, local sustainability, and self-deveoplment opportunities for farmers and workers in the developing world.

Defined by the World Fair Trade Organisation (WFTO), Fair Trade is:
a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions o, and securing the rights of, marginalised producers and workers – especially in the South.
Fair Trade is more than just trading. It is highlighting the need for greater justice in world trade and the fact that purpose and profit are not contradictory notions. In addition, it allows consumers to make their own contribution to the fight against poverty, climate change, and economic inequality.

How did it start?
The Fair Trade movement began over 60 years ago in the late 1940s. The fundamental concept was to build trading partnerships between Fair Trade Organisations – ‘FTOs’ – in the USA and Europe and small-scale producers in Africa, Asia and Latin America. The aim was to create development opportunities for marginalised and impoverished communities in the Global South, not through aid but by providing fair access to export markets – the “trade-not-aid” strategy.

Until the 1980’s, Fair Trade products were mainly sold in the niche market of “Fair Trade Shops” in the USA and Europe. As more focus was put on raising awareness among consumers about the unjust and unfair practices and structures in international trade, the demand for Fair Trade products began to grow exponentially and it became evident that this simple concept had powerful potential for influencing consumer behaviour on a very large scale.

As Fair Trade products started becoming available in more mainstream distribution channels, their consumers required proof of the Fair Trade claims. Since then, many Fair Trade certifiers and labels have been established with the most notable being Fairtrade Foundation in the UK.

What is the process of Fair Trade verification?
Amidst the complexity and variety of Fair Trade certification methods, WFTO has constructed a clear system that can be understood and used effectively by small enterprises.

WFTO’s Fair Trade Standard contains the ten Fair Trade Principle and also defines compliance criteria. The Principles are set by WFTO members and based on common Fair Trade values, the International Labour Organisation (ILO) conventions, human rights and other internationally recognised principles.

The Principles are:

1. Creating Opportunities for Economically Disadvantaged Producers
2. Transparency and Accountability
3. Fair Trading Practices
4. Fair Payment
5. Ensuring No Child Labour or Forced Labour
6. Commitment to Non Discrimination, Gender Equity and Women’s Economic Empowerment and Freedom of Association
7. Ensuring Good Working Conditions
8. Providing Capacity Building
9. Promoting Fair Trade
10. Respect for the Environment

Organisations are expected to apply the WFTO Fair Trade Standard and implement the criteria in a diligent and transparent manner while working on continuously improving their Fair Trade practices. Compliance with the Standard is assessed by various means including Self Assessment, Peer Visit and Monitoring Audit. The last two components are external verifications.

Many of the compliance criteria must be met right from the beginning, but some are to be reached over a set period of time. The approach of continuous improvement is to encourage the highest level of achievement among member organisations with measurable and tangible advancements in their Fair Trade practices.

Here are 5 brands who are Fair Trade certificated:


Toak Chocolate campaign 2


Michi hero 3

Stephen Webster


Six senses hotels resorts spas


Written by - Alex Lilienfeld

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