A large number of organisations worldwide have taken it upon themselves to ensure that marginalised producers in the developing world get a fair deal. They research into trade practices, create awareness among consumers and inspect and certify products and producers who follow fair, humane and equitable trade practices. The most significant among these organisations is Fairtrade.The definition of “fair trade” which has been accepted internationally is the one agreed to by FINE, a working group of four international Fair Trade networks:

“Fair trade is a trading partnership, based on dialogue, transparency and respect, which seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalised producers and workers – especially in the South.”

The idea of “fair trade” is quite a few decades old, but certifying goods took off only in 1988 with the first Fairtrade label "Max Havelaar" by the Dutch development agency Solidaridad when fair trade coffee started being sold in the Netherlands. Incidentally, Max Havellar was a fictional character against exploitation of plantation workers in Dutch colonies! This was followed by similar efforts in markets of Europe and North America, including the "Fairtrade Mark" in UK and Ireland (1992) and "Transfair" in Germany, USA, Canada, Italy, Japan, etc.

In 1997, Fairtrade Labelling Organisation International (FLO) was formed in Bonn, W. Germany to unify and standardise certification across the globe. 21 labelling initiatives are members of FLO International. The FLO movement now has two distinct entities – FLO International lays down standards and provides business support to producers, while FLO-CERT looks after inspection, audit and certification of producers and traders.  In UK, the Fairtrade Foundation was formed in 1992 by CAFOD, Christian Aid, Oxfam, Traidcraft and the World Development Movement. A number of other organisations soon joined in, including the National Federation of Women’s Institutes. The Fairtrade Foundation has indeed come a long way from a tentative beginning in Fairtrade labelling in 1994, when the first Fairtrade certified product, Green & Black’s Maya Gold Chocolate with cocoa from Belize was launched.

Since then, a lot of water has flowed down the Thames. The Fairtrade Foundation has been a marvellous catalyst of social change. Awareness about the brand is now at nearly 60% of the adult population in UK. The number of Fairtrade certified products from food grains to footballs have crossed the 1500 mark. Among its patrons are a diverse range of organisations, including the House of Commons, The Transport and General Worker’s Union, the BMA, Youth Hostels, Salvation Army, the Co-operative Bank, Co-op stores and supermarkets like Sainsbury, Marks & Spencer, Tesco, Waitrose, Safeway and Asda. In 2005 itself, Fairtrade crossed the 100 towns and 1000 churches mark in the UK. Retail sales of products with the FAIRTRADE Mark were estimated at £290m in 2006.

Accolades have been pouring in, too. The Fairtrade Foundation won the King Baudouin International Prize for Development in 2003, the Charity of the Year award in 2004, and The Directory of Social Change’s ‘Social Change Award’ in the category of Influencer in 2007. Harriet Lamb, Executive Director of the Fairtrade Foundation, was appointed a Commander of the Order of the British Empire (CBE) in the 2006. The FAIRTRADE Mark also won Special Recognition as a Superbrand in 2005. 

What is more important is the fact that Fairtrade is now a movement with a great momentum, directly benefiting millions of marginalised producers across the globe. 

One of the most significant developments in the world of trade in the last couple of decades has been the opening up of economies across the world. International trade has got itself out of the fetters of tariffs (protectionist import duties) and quotas (quantitative import restrictions) to a large extent, leading to the an unprecedented boom in business globally under the WTO regime.

A direct fallout of this has been the relocation of many low-technology industries to low cost economies in the developing world. To remain competitive, a large number of companies have shifted their manufacturing base to low-cost economies of the “South.” The cost advantage in these countries has also helped consumers in the developed countries by keeping the prices of many essential commodities low. In the textile sector, most of the world production is today sourced from Latin America, Asia and Africa.

However, a completely different set of problems started surfacing soon after this transition. To keep costs low, the majority of producers looked for countries with the lowest possible wages to locate their manufacturing facilities. This in turn led to concentration of industries in countries with inadequate safety net for industrial workers – whether a poor legal structure or a poor record in their enforcement.

Horror stories soon began pouring out of many such manufacturing hubs, a return to the dimly lit, unventilated ‘sweatshops’ of the early days of the Industrial Revolution. A kind of industry where there are no maximum working hours, no overtime pay, no holidays, no benefits, no trade union or collective bargaining rights. Where little children work in the unhealthiest of environments, and getting pregnant can get a woman worker fired.  There have even been reports of indentured or bonded labour and sexual exploitation of workers. The victims are inevitably the weaker and marginalized communities without a minimum access to human rights and freedoms we take for granted.  Governments in such nations sometimes hesitate to crack down on such abominable practices fearing that the industries would simply relocate to other countries, creating even more poverty.

It is against such inequitable and unfair practices that the concept of ethical and sweatshop-free production first emerged. The movement presents a case for discouraging these unscrupulous producers by simply refusing to buy their products, unless they follow certain norms of behaviour. A number of organisations on both sides of the Atlantic have campaigned for consumers to be aware of where the things they buy are actually coming from, and whether blood and tears went into making them.