Fair trade, fairtrade and ethical - what do they mean?

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The terms fair trade, fairtrade and ethical are being used with increasing frequency to describe goods for sale on eBay - but what exactly do these terms mean, and do they always mean the same thing?

In this guide I will explain what fair trade, fairtrade and ethical trade mean, and hopefully give those people who are looking to buy these goods some useful information about this important, fast growing and exciting area of commerce.

What is "Fair Trade"?                                         

Unfortunately there is no universally agreed definition of the term "fair trade", however there are moves to rectify this. Over the past few years the International Fair Trade Association (IFAT) has established its definition of fair trade as the most widely accepted:

"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 have a clear commitment to Fair Trade as the principal core of their mission. They, backed by consumers, are engaged actively in supporting producers, awareness raising and in campaigning for changes in rules and practice of conventional international trade. They can be recognised by the FTO mark.

Fair Trade is more than just trading: it proves that greater justice in world trade is possible. It highlights the need for change in the rules and practice of conventional trade and shows how a successful business can also put people first."

As a mission statement for the fair trade movement this is extremely admirable, but it doesn't really explain what fair trade means in practice.

So, as a UK consumer, what exactly does it mean when you purchase fair trade products?

Well, if you purchase something that is described as fair trade, then:

  1. The company that made it received a fair price for it,
  2. The individual who made your product was paid a fair wage for their work,
  3. Those workers were provided with favourable working conditions,
  4. The producers gained increased security by developing long-term business relationships, and
  5. Issues such as environmental protection and social development were considered.

This is brilliant in principal, but you might ask,

"Can I always be sure that something that is described as fair trade actually does all of this?"

Whilst I would love to say "yes", unfortunately the answer is "no". When purchasing fair trade goods you should look for some assurance of the fair trade credentials of either the product being sold or the company selling it, such as membership of one of the fair trade organisations.

For purchases made on eBay the most useful name to look out for is BAFTS (The British Association for Fair Trade Shops). BAFTS is a UK member of IFAT, and its members are bound by their "General Criteria for Trading". This means that if you buy goods from a BAFTS retailer, or buy goods that are sourced from a BAFTS importer, you can be assured that fair trade standards have been applied across the whole supply chain.

It should be noted, however, that just because a fair trade retailer's goods do not come from a BAFTS importer that they are not genuine fair trade. There are many organisations out there that are trading perfectly "fairly" but are not members of BAFTS - Oxfam, for example! Unfortunately, without a respected organisation such as BAFTS behind your eBay purchase you will never know for sure.

What is "Fairtrade"?

The Fairtrade Mark is a consumer label that appears on products as an independent guarantee that disadvantaged producers in the developing world are getting a better deal. The standards required to use this label are set down by the Fairtrade Labelling Organisations International (FLO), and are managed in the UK by the Fairtrade Foundation.

Whereas "fair trade" could apply to any product, the FLO have mainly focussed the Fairtrade Mark on agricultural products. Therefore, whilst you will regularly see the Fairtrade logo in your local supermarket on products such as coffee, wine and bananas, it has not yet been licensed for use on items such as clothes or accessories (although some cotton producers have recently received Fairtrade accreditation).

The aims and objectives of "fair trade" and "fairtrade" are very similar, and the terms are often used interchangeably. It is, however, important to understand the difference if you are looking for the Fairtrade Mark as a guarantee of fair trade principals. At the moment it is not possible for many products to carry this logo simply because the Fairtrade Foundation has not got around to licensing many categories of goods.

What is "Ethical Trading"?

Ethical trading is mainly concerned with working conditions in developing countries, and seeks to ensure that third world suppliers to western companies are respecting the rights of their workers and providing a safe working environment.

The main organisation co-ordinating this in the UK is the Ethical Trading Initiative (ETI), which is an alliance of companies, NGOs and trade unions, and was formed mainly because of pressure from consumers who wanted retailers to act responsibly.

Whilst ethical trading is extremely important, its focus is much narrower than fair trade, which considers working conditions as only one of a number of criteria for dealing fairly with producers in developing countries.

                                                                               

I hope that this brief guide has helped to clarify the main differences between fair trade, fairtrade and ethical trade. More information can be obtained from any other the organisations listed above, or you can contact me through my shop at etiko Fair Trade.

All of the bags and accessories stocked by Etiko are fair trade, and come from BAFTS registered importers (yes - I've shamelessly sneaked a plug for my eBay shop in here!!). We work hard to bring you fair trade products that are high quality, look great and are excellent value for money. Visit our shop to see our full product range, or visit the Etiko me page to find out more about the company and why you should buy fair trade.

Happy fair trade shopping,

Colin,

Etiko Fair Trade.

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