executive summary - The Fairtrade Foundation

key insigHts
1. A holistic view of
supply chains
The supply chains that connect smallholders
to mainstream consumer markets are often
a web of interdependent relationships and
there is an increasing need to take a holistic
view of their internal structures and to
understand the interdependencies. This
is especially important when retailers and
large brands use intermediaries to manage
their relationships with smallholder groups,
which can limit their understanding of
how their actions may affect smallholders,
and vice versa. While buying direct from
smallholders may not always be practical
in every supply chain, there is increasing
recognition of the need to have more direct
communication and sharing of information
among all the links of the chain, with the aim
of using greater transparency to strengthen
mutual accountability.
2. Aligning the aims and
objectives of all parties
While the different stakeholders in supply
chains may share many long-term
objectives, there are also significant
differences. For most businesses smallholder
farmers are little more than the first link in
their product supply chains, whereas farming
families view trade not only as a means of
generating income but also of sustaining and
developing the social and cultural fabric of
their communities. The earlier report
identified different smallholder strategies of
strengthening their existing market positions,
diversifying their production, transitioning to
new ways of income generation, describing
these, respectively, as ‘hanging on, stepping
up and stepping out’. If the differences as
well as the commonalities are not adequately
understood there is a risk that investments,
for example in increasing productivity or
quality, may not be aligned with the needs
and priorities of smallholder groups and their
wider communities. This can limit the
chances of their success or undermine
the efforts of smallholders to make their
own choices.
3. Beyond minimum
standards
The activities needed to address points
1 & 2 sit firmly in the area beyond
compliance with minimum requirements
of Fairtrade standards for traders and
licensees towards deeper commitment,
although they are very much in tune with
the development aims of the latest standards
for smallholder organisations. 4
As good practice in this area becomes
established, this could be reflected in a
raised minimum threshold for businesses,
provided the cost or complexity of
certification was not unduly increased; this
ensures a level playing field in which the
committed are not undercut by the merely
compliant. However, this is an ongoing
process and some companies will always
be piloting work beyond minimum standards
and would like to communicate this to
consumers. While the FAIRTRADE Mark
plays a vital role in providing a clear and
specific guarantee that helps consumers
identify products that meet its standards
from other products in the market, new ways
of differentiating the brands that ‘go further’
than the minimum would be welcome.