Fair trade certification has long straddled several contradictions within it. The question of whether fair trade was a movement or a market niche was hotly contested for many years. Is the goal of fair trade to upend trade imbalances rooted in colonization, or grow market share at a better price for small-scale farmers?
Yet as the fair trade world has discussed this question, certification has grown into something far more than a market niche.
In a new paper, we look at the current state of ethical certification, especially labels making fair trade claims. This paper looks at the latest research on the impacts of ethical certification, as well as changes in the food system over the past decades, including increasing corporate consolidation, and the impacts that has had on attempts at market-driven change.
Ethical Certifications: Growing in Scope
Fair trade, and ethical certifications more broadly, have become enshrined in companies’ Corporate Social Responsibility Programs. Certifications have become a de facto benchmark for what’s fair, for pricing, baseline working conditions, and more. Certifications are used to guide billions in public procurement, and are being pointed to as possible partners for corporations in adhering to the European Union’s forthcoming mandatory due diligence legislation. From food safety to forced labor, certifications are promoted as a solution. Most recently, as Environmental, Social, and Governance (ESG) ratings grow as a hot trend in finance with over $35 trillion in global assets invested in funds that make claims around vetting companies on ESG principles, certifiers are promoting themselves as a solution there as well.
While many of us working for justice struggle to make legislative progress due to corporate capture of elected officials, certifications offer themselves as a solution to regulatory gaps and government failure to enforce basic rights. Yet these certifications, with rules written by corporate-friendly multi-stakeholder processes, offer an even more corporate-friendly form of soft law.
Thus, the broader movements for food justice, human and labor rights would do well to pay attention to ethical certifications – they’re definitely not just about choosing a chocolate bar these days.
We Urgently Need Real Corporate Accountability
As multinational corporations have adopted fair trade and other certifications to fulfill compliance requirements within their supply chains, the rules-based language of compliance has overtaken the initial purpose of the movement. At this point, fair trade labeling focuses more on prohibitions for those with least power in supply chains vs challenging the power of the biggest brands. There needs to be a reckoning with the scope of multinational corporations and their disproportionate market leverage to couple that with responsibility–and levers of power that are suited to holding them to account for the consequences of the decades, and centuries, of extractive purchasing practices that have left communities in poverty.
What comes next?
Fair trade certification reveals the complications and inherent flaws of looking to a market-based, voluntary system to address the fundamental injustices of our food and trade systems that are built on 500 years of colonization and extractive capitalism. Without a deliberate effort to recognize the power dynamics inherent in these relationships, too often certification has helped replicate, and even reinforce, the dynamics between worker and boss, and between the so-called Global South (producers) and Global North (purchasers).
The mechanics of exploitation rely on defining some people as expendable, putting their human rights and their humanity, below the goals of protecting profits and maintaining business as usual. Oppression based on race, gender, caste, national origin, and immigration status, to name just a few factors, helps to define these categories of marginalization. Adding more rules alone does not change the fundamental power dynamics.
Our new paper focuses on the flaws of certification, the critical weaknesses where well-intentioned programs are falling short, and even causing harm. Fundamental transformations are urgently needed to change our food, farming, trade, and economic systems to put food justice, racial justice, and climate justice at the center.
Transformation is urgently needed. Our new paper includes some suggestions for reforms that could help shift the balance of power within supply chains, using the levers of purchasing and certification systems as they currently exist.