We know that a lot of World Vision-connected people are keen on their fairly-traded or environmentally-friendly products – we’ve seen your enthusiastic posts on Facebook and Twitter!
But we are part of the broader Canadian public, so it’s safe to say there are a lot of us who, for one reason or another, are not going out of our way (or our price zone) to buy products with a certification label. It’s true that most Canadians say they would pay more for ethical products; but it’s also true that Fairtrade coffee’s market share in Canada sits at just 1.6% of total sales.
Perhaps one reason Canadians haven’t fully bought in is lack of understanding. Just what is behind these labels? What are you actually supporting? Does it make a difference?
Shopping our values
Ethical certifications promote social good – such as ensuring fair working conditions or promoting environmentally-friendly farming practices. But they can also be viewed as a market efficiency tool – matching consumers who have a certain market interest with producers ready to meet that market.
The labels help us make choices aligned with our values. When a certification is well-trusted they provide an easy source of credibility for consumers making their daily choices. One study found that just the placement of fair trade logos on products in a major US grocery chain increased sales by 10%
Yet with so many certifications, it can be hard to keep straight just what the label represents. As a starter, it is helpful to think about these certifications in two categories: fair trade certifications and sustainable development certifications.
Fair Trade Certifications
Fair trade came about in the late 1980s because of a desire to improve the economic and social wellbeing of struggling small scale producers. Fair trade’s principle focus is helping producers through better trading conditions – in short, getting a fair price for their work. They also emphasize fair labour practices, supporting cooperative structures, protection of the environment, and ongoing education to help producers improve their situations. Well known examples are:
Fair Trade USA
Split from Fairtrade International to pursue a broader range of certification
Sustainable Development Certifications
Sustainable development certifications came about in the early 1990s as a result of global discussions on the need for improving environmental sustainability in businesses. Their principal focus is to ensure production activities protect the environment and preserve bio-diversity. Some sustainable development certifications have criteria on worker safety and social conditions, but only UTZ has criteria around pricing – and it is quite limited. Two well-known sustainable development labels are:
pronounced “U-T-Z,” from “Utz Kapeh” a Mayan phrase for “good coffee”
An Informed Cost-Benefit Analysis
As consumers, we make a mini cost-benefit analysis every time we make a purchase. We weigh different factors in the balance, including appearance, brand, perceived impact on our health, price. Ethically labelled products make it possible to add promoting social good to our choices. All of the certifications listed here prohibit the use of forced or child labour.
It is worth noting that producers also do a cost-benefit analysis in deciding to go certified or not. Growth in the availability of certified products is evidence that they are seeing the benefits. For example, Fairtrade Canada reported a 40% increase in the number of certified products available in Canada between 2012 and 2014.
There is other empirical evidence that the certifications work for producers and the environment. This will be covered in a subsequent blog.