Fairtrade America: Brands must 'make good' on sustainability and human rights claims
In its report, Fairtrade America found that more than a quarter of the 2,387 adult consumers surveyed said they always or usually base their purchases on sustainability, an increase of 11 percentage points over the last 14 years and up 4 points from 2019 (2021 GlobeScan).
“We are energized by how consumers are showing a readiness to advocate for people and the planet through their own everyday choices,” said Peg Willingham, executive director, Fairtrade America.
Fairtrade predicted that consumer attitude for sustainability will continue to increase in 2022 as more consumers become aware of the environmental threats to major food supplies such as tea and cocoa (which some climate studies have estimated will be severely diminished by 2050) and demand that brands "make good" on their pledges addressing these global issues, said the organization.
"As climate change continues to worsen, consumers are looking to brands to provide sustainably sourced and produced products they can feel good about purchasing," said Fairtrade America. Companies certified by Fairtrade International follow several global sustainability standard set in accordance with the ISEAL (International Social and Environmental Accreditation and Labeling) Code of Good Practice on Standard Setting, and about 30% of those Standards aim to minimize farmers’ impact on the planet (e.g. protecting natural resources and encouraging eco-friendly cultivate), while still taking into account geographic realities and business growth pressures.
Human rights advocacy
Beyond environmental concerns, consumers are becoming increasingly concerned for human rights and fair wages of workers on a global scale.
According to the report, in 2021, 73% of Fairtrade shoppers were willing to pay more for a product to ensure farmers and producers were paid a fair price; specifically, up to 35% more per pound for Fairtrade coffee and 30% more per bar for Fairtrade chocolate. About three quarters of consumers familiar with Fairtrade agree that when they buy certified products, they “feel part of a community standing up for fairness and justice.”
Large CPG companies such as Unilever have made pledges to meet these consumers demands for workers rights by announced its commitment to ensure that workers who directly supply its goods and services across 190 countries will receive a living wage by 2030.
As an organization, Fairtrade has set up The Fairtrade Minimum Price acts, which function as a safety net for farmers when prices fall below a sustainable level. Evaluated every five years, the Minimum Price covers the costs of sustainable production and is established in partnership with producers, businesses, and other stakeholders. Fairtrade’s model also includes a Premium fund that farming cooperatives earn on top of the price.
In 2020, Fairtrade Premium funds contributed more than $218M to farming communities.
Sustainable shopping online
While the world is slowly reopening amid the pandemic, COVID led more US consumers to make purchases online (e-commerce spend grew by 32.45% in 2020 to $791.70bn, according to Digital Commerce 360, a trend that will continue into 2022, predicts Fairtrade America.
"This digitalization makes it easier for shoppers to compare products and learn whether or not a company’s sourcing and manufacturing practices align with their values," said Fairtrade America, which is working with online retailers such as Amazon to assist online shoppers easily find Fairtrade certified products through Amazon's Climate Pledge Friendly program, which includes over 200,000 products from over 10,000 brands across beauty, wellness, apparel, electronics, household, and grocery categories.
Mission-focused and brand transparency
"There is a clear consumer desire to support brands that are not only taking care of their own teams and suppliers, but also contributing to making the world a better place," noted Fairtrade America.
A study by Zeno Group found that consumers are up to six times more likely to buy from companies with a strong purpose. Additionally, 71% of consumers indicated that traceability is very important to them and that they are willing to pay a premium for brands that provide it, according to IBM Research Insights.
"This means companies have an opportunity to attract new customers and drive loyalty with existing shoppers by authentically developing a transparent supply chain and by celebrating how they work to benefit people and the planet," said Fairtrade America.
Fairtrade logo recognition
Since 2019, recognition of the Fairtrade International logo mark has increased significantly, according to Fairtrade, which said that 41% of US consumers now recognize the international certification logo, putting it just behind Fairtrade America with 42% recognition.
More than 75% of consumers familiar with Fairtrade agree that the Fairtrade label makes it easy to decide if a product is ethically and responsibly produced.
