Fair Trade in Scotland: review

Chapter 1 Scotland: A Fair Trade Nation: Review of progress

1.1 Introduction: What is Fair Trade? What Does it Mean in 2020?

The terms 'Fair Trade', 'fairly traded' and 'Fairtrade' are often used interchangeably, yet only the latter term refers to the Fairtrade mark certification scheme (hereafter referred to as FT), operated through Fairtrade International. The Fairtrade Mark certification scheme to which businesses apply to become license holders, is the focus of the Fairtrade Foundation's work and certifies individual products, most often (but not exclusively) harvested by farmers in the developing world. The World Fair Trade Organisation (WFTO) also offers a certified organisational membership scheme, which applies to the whole organisation and the way it operates, rather than specific products. The Scottish Fair Trade Forum (SFTF), which is Funded by the Scottish Government International Development Team (SGID), is now a full networking member of WFTO.

Both schemes offer rigorous systems of audit but a minority of Scottish Fair Trade Organisations (FTOs) are certified by them (or deliver products to market that carry these certifications). Instead, Scottish FTOs could be regarded as complying with the following definition of Fair Trade agreed by the FINE informal network of international FTOs in 2001 and becoming the International Fair Trade Charter:

'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 to, and securing the rights of, marginalized producers and workers - especially in the South.

Fair Trade organisations, backed by consumers, are engaged actively in supporting producers, awareness raising and in campaigning for changes in the rules and practice of conventional international trade.'

International Fair Trade Charter 2018

This review uses this definition in exploring the opportunities and challenges for Fair Trade in 2020 and beyond. In doing so the review is assessing two separate elements of 'Fair Trade' in Scotland, and of the wider Fair Trade movement: both consumer purchasing habits measured through sales of Fairtrade labelled products and a much broader commitment to reducing economic injustice in developing countries and changing the way trade works:

'Fair Trade has become a multifaceted political and economic phenomenon, driving and catalysing change in the way business is done, how consumers consume and how producers produce'.

Pauline Tiffen^[1]

The review will also refer regularly to the 10 Principles of Fair Trade, as adopted by the World Fair Trade Organisations (WFTO) and recognised by all major Fair Trade organisations and networks internationally, through their adoption of the principles in the International Fair Trade Charter.

Figure 1.1: The 10 Principles of Fair Trade

Infographic:

Infographic text:

1 Opportunities for Disadvantaged Producers
2 Transparency and Accountability
3 Fair Trade Principles
4 Fair Payment
5 No Child Labour, No Forced Labour
6 No Discrimination, Gender Equity, Freedom of Association
7 Good Working Conditions
8 Capacity Building
9 Promote Fair Trade
10 Respect for the Environment
Ten Principles of Fair Trade
World Fair Trade Organization

In 2019 Fairtrade (the certification scheme) celebrated its 25^th anniversary and redoubled its efforts to ensure that the Fairtrade Mark is widely recognised as the most reliable guarantee of the principles of Fair Trade being certificated and offering its unique social premium to build capacity and empower disadvantaged producers. At the end of 2016 there were 1,411 Fairtrade producer organisations in 73 countries, with the number of farmers and workers participating in Fairtrade growing to over 1.66 million. The Fairtrade Foundation estimates^[2] that, if the growth of Fairtrade sales and producers continues to grow at its current rate, the number of farmers and workers engaged in Fairtrade could grow to 8 million. A report by the Overseas Development Commission^[3] commissioned by the Fairtrade Foundation, revealed the following findings about the impact of Fairtrade certification scheme on producers in the developing world:

a. Fairtrade certified producers benefit from higher prices than non-Fairtrade certified producers during periods of low conventional market prices, thanks to the Fairtrade Minimum Price

b. The Fairtrade Premium supports the development of producer organisations and enables wider community level benefits, such as health and education services

c. Fairtrade certification contributes to the strengthening of producer and worker organisation and democracy

d. Fairtrade's impact on household income and well-being is generally positive, although this depends on many factors.

e. More schooling for children in households of certified versus uncertified producers

f. In addition, there have been renewed efforts to increase the range and volume of sales and to maintain and establish effective relationships with producers.

The Fair Trade movement will continue to face several major challenges, the most fundamental of which is the catastrophic impact of climate change on the sustainability of food producers (often small holders) and their livelihoods in the global south. This will become an increasing challenge for Fair Trade food production and supply, whilst volatile commodities markets (such as for coffee and cocoa) dominated by large global players continue to drive down living standards and prices.

Sales will continue to be challenged both by competing ethical 'brands' and certification mark 'fatigue' - or at the very least - confusion amongst consumers and procurers in both private and public sectors. The 'lowest price war' of major supermarket chains and bottom line cost efficiencies for major procurers in public and private sectors are already established as the key indicators for scalable purchasing choices, with fair, ethical and environmental factors only playing a secondary role to price.

There will continue to be those who question the efficacy of Fair Trade standards and audit procedures (even though Fairtrade certification itself is independently assessed under independent IS quality standards for certified products^[4]) and the movement has at times been slow to address criticisms of its verification processes and messaging.

Against the backdrop of all these challenges, this review seeks to reaffirm Fair Trade as an essential voice at all civic, government, third sector and corporate levels in seeking to enable a fairer world which challenges everyone - from individuals to government - to change behaviours towards an inclusive and 'shared value' approach to global citizenship. The review also makes recommendations which, if implemented, could ensure that Scotland strengthens and consolidates its position as a Fair Trade Nation. Many of these recommendations are not resource intensive but are rather about changing the current behaviours and doing things differently.

1.2 Objectives and Approach of the Review

The Review's purpose is to enable Scottish Government to further progress and maximise Scotland's potential to achieve inclusive growth through the delivery of increased sales and awareness of Fair Trade, as key actions in achieving the International Sustainable Development Goals (SDGs) adopted in the International Development Strategy published in 2016 and which are planned up to 2030.

The Scottish Government's stated objective, in commissioning the review, was to identify recommendations which, if implemented, would increase Fair Trade sales in Scotland, and through that for Scotland to contribute internationally to the achievement of the Global Goals by developing countries.

The main output of the review is this report which includes a framework for practical action to increase Fair Trade sales in Scotland. The consultants, Martin Meteyard and Associates, were commissioned to carry out the Review in June 2019 and in the tender document they highlighted the Review's key objectives as being:

a. To identify the key factors distinguishing the Scottish Fair Trade market and assess the potential to further maximise impact through a greater focus on key commodity categories

b. Through assessment, to provide clear and realistic guidance to Scottish Government on interventions to support Fair Trade sales growth in Scotland

c. To identify key needs and gaps in the delivery of current Fair Trade promotion and where awareness is poorest, recommending where support in pursuit of Global Citizenship should be targeted

d. To explore the Policy Coherence for (Sustainable) Development (PCSD) between existing Fair Trade Commitments and wider Scottish Government programmes in support of the SDGs*

The final objective (*) was added following an interim meeting with the commissioned consultants and the SGID team. It was agreed to expand the scope of the original brief of the review, to include a more in-depth investigation of SG's commitment to Fair Trade within the wider context of Scottish Government's commitment to the UN Goals for Sustainable Development and their embedding within the new National Performance Framework.^[5] This is reflected in Chapter 3 section 3 'Policy Coherence for Sustainable Development'.

1.3 Methodology for the Review

The review used a mixed research methodology for delivering its objectives. Please also refer to the appendices to this report for further detail. Our methodology comprised the following elements.

1.3.1 Secondary Research and Data Analysis

Analysis of existing data sources including existing Consumer Survey data commissioned by the Scottish Fair Trade Forum; identification and sourcing of commercial market data on Scotland's Fair Trade sales; wide ranging literature review of EU and international publications on the development of Fair Trade and consumer behaviour, trade and procurement policy and market data internationally; research on Scottish Government policies aligned to the Global Goals and Scotland's National Performance Framework.

1.3.2 Primary Research and Analysis

Over the course of the review five facilitated workshops were conducted involving Scottish Fair Trade Forum members, Scottish Fair Trade Organisations, retailers, social enterprise support agencies and importers (see appendices).

Two extensive online surveys were conducted: one aimed at Fair Trade campaigners (largely in volunteer roles) in Scotland, eliciting 93 responses and a second focused on (and distributed to) Scottish FTOs, UK Fair Trade Leaders Forum and through Fairtrade Foundation's business newsletter (49 responses).

A total of 43 qualitative 1:1 Interviews were conducted either face to face, through Skype or telephone calls. Those interviewed included leading retail/ethical trading academics; Sustainability sourcing Managers within retail chains and corporate global impact leads; FT leaders internationally, Scottish FTOs, business and social enterprise support agency lead officers and Scottish Government policy leads with reference to Fair Trade and the SDGs. The review also commissioned a current Scottish university student to attend and report on the International Fair Trade Towns Conference 2019 which took place in Wales in October 2019 (see Appendix 5).

Our analysis has identified both barriers and opportunities for growing awareness and sales of Fair Trade in Scotland and makes recommendations for growth. The review also includes a number of case studies to highlight producer and importer experiences of Fair Trade and to identify examples of leading practice in Fair Trade growth. Chapter 6 summarises the findings of a case study visit to Sweden conducted as part of the review.

1.4 Scottish Government and Fair Trade: What has Already Been Achieved?

Scotland can rightly be proud of its long history of campaigning for Fair Trade for disadvantaged producers in the global South. The Scottish Government places great importance on Scotland being a good global citizen which includes playing a part in tackling global challenges including poverty, health, injustice and inequality.

Figure 1.2: Ben Macpherson MSP, Scottish Minister for International Development, Martin Rhodes CEO of the SFTF. Aimable Nshimiye, Managing Director of Abateraninkunga Ba Sholi, a cooperative of 386 Fairtrade coffee producers (40% of women) in Rwanda during Fairtrade Fortnight 2019 in Scotland.

SGID already delivers an annual £10 million International Development Fund (IDF), the main aim of which is to support and empower partner countries: Malawi, Rwanda, Zambia, and Pakistan, within the framework of the UN Sustainable Development Goals. Chapter 3 will look at the Sustainable Development Goals in further detail in relation to Fair Trade in Scotland. Many of the projects and initiatives supported reflect individual FT principles such as supporting disadvantaged producers, promoting gender equality and capacity building, and climate crisis mitigation.

The Scottish Fair Trade Forum was established in January 2007 by a group of Fair Trade campaigners, Scotland-based non-governmental organisations and the Scottish Government, to promote the cause of Fair Trade in Scotland and, in particular secure Fair Trade Nation status for Scotland. It is funded through the SG International Development Team. It is an independent charity (not for profit company) with its own Board, but currently receives the majority of its funding from the Scottish Government. Its aims are:

a. To maintain and develop Fair Trade Nation status

b. To integrate Fair Trade principles into decision-making and procedures at all levels of government in Scotland

c. To encourage the business community to integrate Fair Trade principles and corporate accountability into all aspects of their business, and to encourage the growth of the Fair Trade sector in Scotland

d. To develop and enable strategic partnerships with communities and activists

e. To engage the broader public in Scotland's Fair Trade Nation campaign by raising awareness and encouraging understanding of the role of Fair Trade in creating a more sustainable world

f. To strengthen links with producer communities and continue to promote awareness of the mutual benefits derived by consumers and producers from Fair Trade.

As well as undertaking support and promotional work across Scotland through Fair Trade towns, regions, schools and college networks, the SFTF has undertaken extensive work in raising the profile of the principles of Fair Trade within public procurement and in supporting local authorities to adopt sustainable procurement practices, as well as making strategic alliances on specific issues (such as with Oxfam Scotland in reviewing the Scottish Business Pledge).

The SFTF strives to maintain and grow a membership base that reflects the diversity of Scottish society and much of the activities of the small staff team (3.5 FTE) and of its membership very much reflect Fair Trade in Scotland's strength as a community led, civic society initiative. Scotland first achieved Fair Trade Nation status in February 2013 and, after rigorous re-assessment by an independent panel, Scotland retained this status in 2017. The re-assessment found:^[6]

• 43% more consumers reporting that they bought Fair Trade products in 2016 than in the preceding year
• According to analysis by the Scottish Fair Trade Forum, in the last four years there had been a 30% increase in the number of towns with Fair Trade status, rising to 65 towns in 2016
• 75% of local authority areas now have Fair Trade status with 70% of higher education institutions and 20% of schools achieving the standard
• Scotland was the second nation in the world, after Wales, to achieve Fair Trade Nation status in 2013 and support sales of products that offer a better deal to workers in developing countries.

1.5 Fair Trade Movement in Scotland

Fair Trade in Scotland has its roots in the 'Alternative Trade' movement which developed over the 1970s, as an alternative trading model and institutional arrangement designed to help producers in developing countries achieve better trading conditions. Campaigners and organisations engaged in the Fair Trade movement advocated the payment of higher prices to developing world exporters, as well as improved social and environmental standards. The strength of the Fair Trade movement in Scotland has been driven by communities, individuals and civic society - rather than led by Government, in campaigning for Fair Trade practices and products in retail, food service and office environments. It builds on a proud history of social justice and the co-operative movement in Scotland. Figure 1.4 provides a timeline of the development of Fair Trade since its inception and Scotland's role in the movement.

1.6 Role of Fairtrade Foundation and Scottish Fair Trade Forum

The Fairtrade Foundation (FTF), based in London, earlier in 2019 celebrated 25 years of promoting Fairtrade certification and the licensing of the FT Mark. The FTF works with many larger scale manufacturers and food service providers in encouraging and supporting the adoption of FT products. It is also responsible for awarding FT status to cities, towns (and smaller communities) as well as educational establishments. It established 'Fairtrade Fortnight' in 1997 as an annual promotional campaign for Fairtrade producers and their products in towns, cities, schools and communities throughout the UK, which has become firmly established as the focus for any Fairtrade promotional activities.

Figure 1.3 Facts and Figures about Fairtrade 2019, Fairtrade International ‘Monitoring the Scope and Benefits of Fairtrade’ 10th Edition.

Infographic:

Infographic text:

More than 1.71 million farmers and workers in fairtrade certified producer organizations
21% of all farms and workers in fairtrade are women
1,599 fairtrade certified producer organizations in 75 countries
50% of all fairtrade farmers produce coffee
45% of all fairtrade workers produce tea

Figure 1.4: Timeline of Fair Trade's development in Scotland

Infographic:

Infographic text:

1950s
1960s - Alternative Trading begins: Oxfam in Scotland starts selling handicrafts and Christmas cards from producers
1970s - Traidcraft, Tearcraft and Campaign Coffee in Scotland
1980s - FLO launched; sales of FT coffee grow; FT shops and Equal Exchange opened in Scotland. First Scottish FT Conference
1990s - Launch of Café Direct and first Fairtrade Fortnight campaign
2000s - First Scottish FT Towns; by 2005 over 700 FT products on sale Scotland declared a FT Nation in 2013
2014-2017 - 2014 Stage 4 Scottish Procurement Reform Bill mentions FT; Scotland leads International FT Nation conference; 2017 Scotland FT Nation status reassessed
2018 - International Fair Trade Charter launched by WFTO and FT International defining common vision towards attaining SDGs
2019 - Scotland celebrates 25 years since launch of Fairtrade Mark

Figure 1.5: Fairtrade Foundation's infographic highlighting the importance of communities and civic society in the promotion of Fairtrade.

Infographic:

Infographic text:

Fairtrade Communities in 2019

Half a million people following local Fairtrade groups on Facebook and Twitter
Fairtrade communities worked with over 23,000 community groups
425 Fairtrade communities in the UK
Almost 4,000 champions leading Fairtrade community campaigns
Fairtrade communities engaged with over 14,000 local businesses
1.5 million people reached by Fairtrade campaigners at 16,000 local events
Over 50,000 people asked the PM for post-Brexit trade that tackles global poverty
Over 50,000 people asked the PM for a fairer deal for cocoa farmers
Average of 10 years since achieving Fairtrade community status
Nearly 6,000 local media stories about Fairtrade
98% of MPs lobbied for fairer trade by supporters in their constituencies

Increasingly the FTF has focused on its work in licensing the use of the Fairtrade mark in the UK, supporting market growth and new commodities and working with partners to support producer organisations and their networks. It also campaigns at UK Government level and with its Fairtrade International (FTI) partners, which brings together over 20 FT labelling initiatives across the globe, to secure better trading arrangements for FT producers in the developing world.

The Fairtrade Foundation has seen a reduction in grant funding (such as from DFID Programme Partnership Fund, which came to an end at the close of 2016) over recent years and is increasingly reliant on FT mark license fees for its income (which it continues to attempt to diversify through fundraising efforts). Comparing its 2016 and 2018 Annual Reports and Financial Statements,^[7] there is a marked reduction in staff numbers and costs which has directly impacted the level of support for promotional and educational initiatives focused on the development of Fair Trade at community level.

The Scottish Fair Trade Forum (SFTF) provides extensive support for town/ city steering groups, schools, colleges and universities through a team of 3.5 staff, a Board of Directors and many volunteers in discrete project specific roles. Inevitably the contraction in FTF employees, has led to further work for SFTF (as with FT Wales) in leading promotional and volunteer support activities.

FT Fortnight and campaign work has historically been led by at UK level by strong Fairtrade Mark branded messaging and promotional materials. As FTF finds itself unable to devote as much resource to these activities, the role of the SFTF and its corporate partners (such as the Co- operative Group which produces high quality FT material) will continue to increase and offers Scotland an opportunity to differentiate its Fair Trade message.

1.6.1 Fair Trade in Schools & Nurseries

There are 3 stages to becoming a FT school or nursery with the awards FairAware, FairActive and FairAchiever - guidance is provided on the Fairtrade Foundation website together with a database of all FT schools in the UK.

There are several links to the Curriculum for Excellence (CfE) including within Religious & Moral Philosophy, Social Sciences and Health & Wellbeing and SFTF has been pivotal in developing resources to help nursery staff incorporate Fair Trade into the learning experience of their children. Learning materials have been tailored to the CfE to help 3-5 year old children learn about FT through their experience in play, arts & crafts, music and discussions.

Schools and nurseries are encouraged to raise awareness within the nursery, with relatives and the wider community through a wide range of activities from bake sales to producer visits with many challenges available and nurseries encouraged to use FT products - in the staffroom, at meetings, in meals and snacks for children, in uniforms, in cooking and sports activities - including Fairtrade sports balls.

SFTF also produces a Fair Trade Schools and Nurseries Newsletter covering updates on resources, information and news. Resources for nurseries include event ideas, FT nursery rhymes, nursery book, animation and a resource pack and for schools for classrooms, teachers, speakers & campaigns and Just Business resources. In 2010 SFTF piloted a Fairtrade Cotton School Wear Campaign in East Dunbartonshire and this is now active across Scotland.

The themes and values of FT complement the many other awards and schemes such as Learning for Sustainability, Eco-Schools and Food for Life and our research found that many primary schools consider working towards FT school status, alongside their commitment to Eco-School initiatives.

The research also showed, both in workshops and through our survey, that there were often weak or no links between local educational establishments and wider community (e.g. Fairtrade Town) Steering Groups. This was most often reported as being due to a lack of time to engage, particularly for teachers. The re-assessment report for Scotland's FT nation status raised the role of SFTF in promoting and supporting regional networks in their work, which is attempting to address some of these issues and regional meetings are currently being held around Scotland to encourage more joined-up localised approaches for peer-to-peer support.

1.6.2 Fair Trade in Universities & Colleges

There are three Fairtrade colleges in Scotland and eleven Fairtrade universities, with FT status for colleges & universities being awarded through the Fairtrade Foundation. The student movement in universities has been central to the success of Fair Trade in Scotland (as in the UK), due to student interest in trade justice and exploitation of workers in developing countries. This has resulted, in some instances, in students' associations being the catalyst for institutional adoption of Fair Trade in their public procurement processes.

College authorities and student unions wishing to promote Fair Trade start the process by adopting a FT policy committing the institution to becoming Fairtrade and creating a steering group of staff and students to oversee the process. The policy must include several goals including FT foods being available for sale in all campus outlets, FT tea and coffee served at all meetings, FT cotton in staff uniforms and campaigning for increased consumption on campus.

The success of Fairtrade universities and colleges, through our interviews, seems to be dependent upon two factors: resources and internal influencers. For example, the University of Edinburgh^[8] is a strong example of a Fairtrade university, encouraged by its student body and professional services staff to become Scotland's first Fair Trade university.

Peter Hayawaka was recruited five years ago, following the Public Procurement Reform Act 2014, to lead on procurement policy with the Procurement Team. This capacity has enabled tailoring of the SG Sustainable Procurement tool^[9] to the university's needs, which enables higher levels of ethical and fairly traded procurement of goods and services than would otherwise be possible in less well-resourced educational institutions.

In another example, the reviewer spoke to a Further Education (FE) College where the Catering Manager was dedicated to Fairtrade and chaired the college's FT Steering Group. Without the officer's interest and commitment, over £200,000 worth of FT beverages and uniforms would not have been procured.

Chapters 4 and 5 will look in further detail at the challenges encountered with public procurement in relations to Fair Trade.