So Who Can You Trust?

Last time I blogged about the rift in the fair trade movement caused by Transfair USA's (now Fairtrade USA) decision to leave the international fair trade organization (FLO), go it alone, lower the standards to allow plantations in, and dilute ingredient requirements for supposed fair trade products. While this is causing joy in the corporate boardrooms, it is creating a lot of confusion in the kitchens. I have been bombarded by emails to come out swinging and let fly the truth (or at least my tarnished, cynical yet experienced version of it) about who you good folks can trust out there.

Being a sailor, let me start with a little play on words. We are drowning in a sea of seals! There are so many different seals on products these days, all promising to solve this or that problem and make the world a better place. What do they really mean? Who do they really benefit? Here is a very rough primer to help navigate around the seals, at least the ones that swim in your coffee:

Fair Trade Certified FTC (or Roboman, as affectionately known to the roasters). Originally this was the best. It only applied to a product containing 100% certified fair trade ingredients and was never meant to certify a company -only a product. But over time, Transfair sneakily changed the requirements for logo usage and for ingredients. I say sneakily because we could never find out who made the decision, how it was made or if any of the farmers or roasters were ever consulted on these creepy changes. Transfair has always been a secretive, top down organization, not in any way reflecting the transparency, accountability and democracy that it demanded of the southern producers. There have also been many reports that unscrupulous exporters in the coffeelands have gamed the system and that some farmers aren't getting the price and premiums they are supposed to under fair trade. This can only happen when the regulator (are you listening, FTC?) is asleep at the switch or too busy courting the Big Boys to do its job properly. Unfortunately, it is now necessary for consumers to look behind the label on any given FTC product and see exactly what in the product is certified and what is not. That certainly doesn't make it easier for the harried shopper, does it? In fact, even I was confused recently when I was at a conference and saw an Honest Tea display full of sample teas, each containing the FTC logo on the bottle. I looked at the ingredients and found that only a few were FTC. This is how I learned that Transfair had changed the rules (even though theoretically that change shouldn't kick in until next year, guess the corporate Big Boys - meaning Coke, the real owner of Honest Tea-knew a little inside info, eh?). For small roasters who buy FTC from brokers, this logo will continue to be useful, although I certainly don't want to be associated with its corrupted form anymore. Hey, don't think I give up easily! For years I tried to work with Transfair to reform the organization and finally gave up last year (even before this stuff came to light).

Fair Trade Canada. Here come the Mounties! Just as Transfair USA was the national licensee of FLO for the good ol' USA (until recently), Transfair Canada was the licensed body for the Far North. Unlike Transfair USA, Transfair Canada was always very mission-based and stuck to the agreed upon international rules. For several years, some of us tried to get Transfair Canada to license US companies, but being the good doobies that they were, they wouldn't cross the line (border, that is). So unlike their brethern and cistern in the USA, Transfair Canada wasn't swayed by the potential licensing revenues to fudge the rules. Recently, in response to Transfair USA's absconding with all our good karma and name recognition (it's FairTrade USA now, get it?), Transfair Canada is revisiting whether to license USA companies, so this may be the best answer to FairTrade USA's defection and the confusion it will cause in the marketplace. Time to learn a little French, mon cher. Actually, "Equitable" sounds pretty cool with a French accent.

Fair Trade Federation (FTF). This is not actually a certification, but rather a membership organization limited to 100% fair trade companies. Didn't your Mom tell you that we are judged by the company we keep? To join FTF, you need three peer reviews from existing members or highly regarded groups such as FLO certified farmers. A very nosy, err I mean extensive, application reveals who you buy from, how you buy, what you know about the living standards of those from whom you buy and what impacts your work has. FTF has always kept the moral high ground, and doesn't let its members put the FTF logo on packaging, so as not to give the impression that it was a certifying body. A little anal, I think, but well intended and certainly honest and movement-oriented. Members can put the logo on their websites and generic information so that folks will know who is and who isn't in. We were members of FTF for a long time, let the membership lapse (didn't pay those dues!) and have now had to fully reapply (no grandfathering in the fair trade movement!). We will get the thumb up or down in January. In any event, these folks are my peeps! They are the truly committed coffee roasters, sweater knitters, jewelry makers and nicest people in the world. Enthusiasm, integrity and business smarts - what's not to love? Support FTF members at all cost!!

Rainforest Alliance (RA). This group was originally started by enthusiastic, educated environmentalists who sought to bring a measure of sustainability to coffee and other products. I really respect that. It was never meant to raise farmers' incomes, a least not directly. However, over time (IMO) Rainforest Alliance has been sleeping in the soil bed of the largest coffee exporters, importers and brokers in the world, basically allowing them to avoid organic certification but claim those mushy "sustainability" metrics that corporations love to shovel out in their marketing materials. Follow the money! Who funds this group these days? Who benefits most from their seal? It is the Big Boys, plain and simple. Now, I actually like what Rainforest Alliance does for the farm environment. I have read some of their Memoranda of Understanding with farms (a few coops but mostly larger farms) and they read like rock solid graduate student papers on what a responsible farming operation should look like. If RA had kept to this approach, they would be golden in my view. But, no!, they had to move into social standards as well (hmm, did the Big Boys want to steal the market niche of fair trade?), claiming that the farms with RA certification took care of their workers. The devil, my friends, is always in the details. A simple look at what those social standards are will make you shake your head. Farm worker wages? Not living wages or even fair wages, just that the wages have to be in line with the "national standard" (they call it the less developed world for a reason - in Guatemala, I think the national wage for farm workers is something like fifty cents a day). I have also spoken to farm workers who say they get that pay, but are forced to work longer than the law states. Also, seasonal migratory workers, a big part of harvest labor, may not even be covered by these standards. So if the environment is your bag, there is some good stuff here, but don't be fooled into thinking that RA is anything like fair trade (used to be) or even like certified organic.

Starbucks CAFE standards (now called some other clever marketing name, Shared Planet, I think). This is Starbucks self-designed and self-enforced program for sustainability or whatever. For years I couldn't find anyone at Starbucks (and I know some pretty high ups there) who understood what this was all about. And good luck finding out for yourself! In the old days, anyway, farmers could earn up to ten points for things like quality, environment, labor standards and such. Starbucks added a penny to the price paid to the farmer per point earned. Of course, it was Starbucks that set the price (always below fair trade), so even if a farmer got all ten points (which I never heard of) it was still adding ten cents to a lower price. Interestingly, a farmer might earn two cents more for quality but not be docked for, let's say, child labor. By the way! Farmers had to pay to be considered for the program and weren't guaranteed they would be used. So Starbucks managed to make money on some farmers even without buying their beans! And just so the consumer couldn't ask too many questions, Starbucks doesn't identify which of its coffees fall under the CAFE standards and which don't, or which bag contains plantation coffee with child labor and which score high on the CAFE list, or if they are all mixed together. Great program, guys! You would think a company with as much marketing smarts and money as Starbucks could come up with a clearer, easier to understand program...if they really wanted to. But the consumer shouldn't have to figure that our for him or herself.

Direct Trade. This was a concept invented by a few companies (there is no independent Direct Trade seal or certifying organization, it is simply what the company claims it is). It was invented by the self appointed quality freaks in the industry who think that if only the farmers would grow better coffee they would earn lots more money, the inefficient farmers will wither and die and only great coffee will be in the market (sort of Ayn Rand meets Barista Champion). You can go on the website of Direct Trade companies and see their trade practices, which most post and some have outside audited. Generally, they all say they pay more then the Fair Trade minimum, but the minimum is only used when the world trade price is lower than that. The fair trade price floats above the world market price, so saying you pay more than the minimum doesn't really tell you anything. I have always thought Direct Traders could do better than saying that, if they really have something to say. Their standards on the environment, labor, etc. are all rather squishy and ill-defined, probably because they really onle care about quality. You can decide for yourself if this approach, which may provide a higher price but little, if anything else, is where you want to spend your hard-earned cash (warning-they are wicked expensive!). Actually, Direct Trade has done a lot to raise the awareness of coffee quality, as many claim Starbucks has. So props for that. Direct Trade claims to cut out the middlemen and deliver more money than fair trade to the farmers. On a transaction by transaction basis it may, but fair trade is not just about paying somebody the most money and walking away. It is about long term relationship, working to strengthen coops and communities, bringing in allies such as development organizations, you get the picture. Direct Trade can also be misleading in one respect. I rarely meet anyone who knows just what percentage of a Direct Trade company's purchases were done that way, and what percentage were just bought through brokers like the mainstream coffee companies. If a company is 100% Direct Trade I would be really impressed, and I will take my hat off to them. We may differ politically, but if someone is sincere in their values, presents them honestly and lets the informed consumer decide, lord bless them. None of us has a lock on virtue (but there are plenty trying to make a buck off the pretense of it!). But I do think you have to be really self-absorbed to pay seventeen to eighty-eight dollars for any coffee. Don't people have better things to do with their money?

Certified Organic. I thought I'd leave you with one I have full confidence in. I know there are shenanigans in the multinational food processor world of organics, but that is not the coffee world. In coffee, farmers have to participate in a three year program of soil, water and waste management, including not using chemical fertilizers. pesticides or herbicides for three years. Then and only then can they qualify to be certified (it ain't just "our farmers don't use chemicals" that you hear from cafe owners who don't want to pay the extra money to the farmers and don't understand the system anyway). As a practical matter, certified organics are most applicable to smaller farms, as the larger plantations grow huge swaths of coffee monoculture, which require chemicals to make up for what the soil and lack of surrounding interplanted species can no longer supply (basically, the soil becomes a junkie that the plantation owner must feed for it to produce). Ceritified organic guarantees a price premium in the marketplace (generally an extra 20 cents per pound) which is an economic incentive for the farmers besides the obvious health incentives. For us, fair trade, direct trade and whatever forms will come and go and morph all over the place, but we have been and will always be committed to certified organics. Take that, Rainforest Alliance and Transfair! (Neither of which requires organics, nor does Direct Trade).

Okay, so I have totally trashed, dissected and exposed the seals, brutally but fairly. But I am not first and foremost a businessman. I am a social activist and I take this stuff really seriously. It is one thing to claim that your detergent gets clothes cleaner than the other detergent, but it is a totally different thing to claim that what you are doing is helping people or the environment when you are not. There is a difference between commercial puffery and unethical misrepresentation (see? I learned something in law school!). There are plenty of coffee companies out there doing things in an honest and straightforward way. For example, Equal Exchange, the granddaddy of US fair traders, has always purchased in accordance with fair trade rules and has been an honest dealer with farmers and consumers alike. Similarly, the twenty six or so members of Cooperative Coffees (which I co-founded a decade ago but am no longer a member of since we arrange our own purchases and I needed my equity in the coop to pay for my kids college) are all committed to the ideals and practices of fair trade, whether some of them carry the beached seal of Transfair or not. We have all worked hard to raise the bar on fair trade over the years and try to hold Transfair accountable. My hats off to all of them!

Right now there is a major conversation among true fair traders and their allies, like Catholic Relief Services, Fair Trade Federation and others about what to do to keep the dream and the system alive. But consumers can't wait for an answer, at least, not from us.

Our program is much as it always has been. Fair Trade is an important tool in our toolbox of social justice, but it is only one of them. Our program is as follows:

  • Only buy from FLO listed (or on the waiting list) cooperatives, and work with those cooperatives and their organizations to strengthen them with trainings, financial and other resources. This is really important, if unsung work, but it really makes a major impact on the farming communities and the individuals involved.
  • Only buy certified organic coffees and work with farming groups to get certified or improve their farming practices for both environmental and quality purposes. Quality matters, but it can't take priority over the health of the earth and of those who labor upon her.
  • Always pay above the current fair trade price (it is a great guide, but really the farmers need and we can afford to do better). Make pre-harvest financing available when we can (we work with our only broker, Royal Coffee, and organizations such as Root Capital and Green Development Fund for that). This year we haven't done too much of that as the high price of coffee has really impacted our ability to do much more than pay for the beans. Just being honest.
  • Continue to support the development goals of the communities we work in by designing and funding people-centered development projects that are identified and managed by the farmers themselves. This takes the form of wells, schools, health care, reforestation, expanded markets for their products and creation of new products, small business loans and so much more. As we get bigger and work in so many places, we need to do a better job of coordinating with the communities and reporting to you. Lots of work there!
  • Lecture, teach, advocate in universities, communities of worship, high schools, state and national political and international political bodies,and civic groups to help people understand and to advocate for improvements in the farmers lives, international trade, indigenous and womens rights, environmental and other matters of great importance to us all today and tomorrow.
  • Expanding our approach to include more students and our purchasers (that means you!) into direct and meaningful community with our farmer partners (wait til you hear about our new programs next year!We are not talking about coffee tourism here. Pack your bags and brush up on your Spanish and Indonesian!).
  • Expanding our independent, external audit of our trade and social practices to provide more information to customers and non-believers. Real information for real people.

We may or may not go back to swimming with a seal. To us, we hope that by providing open and honest information about who we are and what we do will provide customers with the information they need and want to make an informed coffee buying choice. Whatever you decide, "Choose wisely".

Dean and the crew at the Beanery

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