Regular readers will know me to be a staunch defender of the Fairtrade certification system. Admittedly, I have a personal attachment to it, having visited the workshops of Fairtrade artisans in Agra, India, many years ago, and having worked as a volunteer at several Ten Thousand Villages stores in Canada, which sell all-Fairtrade items. But I sincerely believe the system does valuable work, based on years of reading and research about Fairtrade International and other such “multi-stakeholder initiatives” (MSIs).
Fairtrade’s reputation has been on a rollercoaster in recent years. It was criticized in a 2014 study by the University of London’s School of Oriental and African Studies as not benefiting poor agricultural workers as much as it should. Several companies have unsubscribed recently from its certification schemes, some going off to create their own. Other studies have said children can still be found laboring on certain West African cocoa farms. On the other hand, Fairtrade was praised as the most effective ethical consumer label in a comparative study last year and is widely considered a leader in sustainability and ethical standards.
So it wasn’t surprising to see yet another study analyzing Fairtrade’s effectiveness, although this one was a pretty clear condemnation. Titled “Not Fit-for-Purpose: The Grand Experiment of Multi-Stakeholder Initiatives in Corporate Accountability, Human Rights and Global Governance,” it was published in July 2020 by a group called MSI Integrity that has spent the past decade investigating “whether, when and how multi-stakeholder initiatives protect and promote human rights.” This 235-page report is the culmination of that research.
The report examined 40 multi-stakeholder initiatives (MSI) in total, including Rainforest Alliance, Forest Stewardship Council, Better Cotton Initiative, Roundtable on Sustainable Palm Oil, Alliance for Water Stewardship, UN Global Compact, Global Sustainable Tourism Council, Fairtrade International, and many more. These MSIs operate in 170 countries and engage over 50 governments and 10,000 companies.
Most of the MSIs we know today started in the 1990s as a response to growing public concerns about human rights abuses. Civil society organizations joined forces with corporations to write new codes of conduct that quickly became a “gold standard of voluntary business and human rights initiatives.” They were viewed as a solution to the problem of human rights abuses, with “minimal critical examination into its effectiveness or wider impacts.” But has it worked? The report authors say no.
There are two main reasons for this. First, MSIs tend to prioritize the wellbeing of corporations over that of the victimized workers. They have a top-down approach to handling human rights abuses, and the voices of workers are rarely heard by the people making decisions. From the Guardian, “Only 13% of the initiatives analyzed include affected populations in their governing bodies and not a single one has a majority of rights holders on its board.” Nearly one-third of initiatives do not have clear-cut grievance mechanisms for workers who need to communicate about problems.