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Ethical investment: Are you green with your money

Ethical spending

The British people showed huge generosity of both pocket and spirit in giving generously after the Tsunami this year to help look after those who had lost everything in the disaster. It was the scale of the event that concentrated our minds on the devastation, but all over the world families are having to face similar problems. Bad harvests and fluctuating commodity prices can have the same effect but on a smaller scale but still catastrophic for the families concerned.

Disastrous troughs in world prices for agricultural goods, alongside the long-term downward price trend, are devastating the lives of families and rural communities as farmers struggle to make a living from their land. Farmers may find that the price they can sell their goods for may not even cover what it costs to produce their crop. The impact may be more gradual, but the spiralling effects of falling prices and loss of income can lead to under-employment, economic and physical hardship, homelessness, forced migration, and life-threatening poverty and disease.

“The catastrophic falls in the prices of major commodities – of coffee, tea, bananas, cotton, rice and sugar – are tearing apart lives across the developing world,” says Harriet Lamb, Executive Director of the Fairtrade Foundation. “People are forced to give up their farms, to become labourers or city slum dwellers, to take their children out of school. These economic disasters are all the more shocking because they are not unstoppable natural disasters; this is not the force of nature unleashed in all its fury. These are man-made disasters, entirely preventable and worse still, they carry on even though everyone knows what the effects will be.”

So how can you as an individual help? One very direct way is in how you spend your money - it can make a huge difference to farmers and producers. Over the years a number of schemes have been set up which aim at helping small producers to help themselves. The best know of these is Fairtrade which is a labelling scheme which guarantees a certain standards - an independent guarantee that farmers in developing countries are getting a fair deal and a decent price for their produce.

The history of Fairtrade

The first Fairtrade label was launched in 1988 in the Netherlands and applied only to coffee. Since then, labels have been launched in 16 other countries, in Europe, North America and Japan, and the products have gained between 1% and 14% market share. In the UK, the first Fairtrade Mark products appeared in 1994 (chocolate, coffee and tea) and, from a small base, sales are still expanding rapidly – by around 40% per year.

How does it work?

The Fairtrade scheme is a labelling scheme that applies to fairly traded goods, whoever is selling them, which guarantees a range of standards.

The guarantees behind the Fairtrade Mark are:
• Farmers receive a fair and stable price for their products
• Farmers and plantation workers have the opportunity to improve their lives
• Greater respect for the environment
• Small-scale farmers gain a stronger position in world markets
• A closer link between consumers and producers.

The problems experienced by poor producers and workers in developing countries differ greatly from product to product. The majority of coffee and cocoa, for example, is grown by independent small farmers working their own land and marketing their produce through a local co-operative. For these producers, receiving a fair price for their beans is more important than any other aspect of a fair
trade. Most tea, however, is grown on estates. The concerns for workers employed on tea plantations
are fair wages and decent working conditions.

To address this there are two sets of generic producer standards; one for small farmers and one for workers on plantations and in processing factories. The first set applies to smallholders organised in co-operatives or other organisations with a democratic, participative structure. The second set applies to organised workers, whose employers pay decent wages, guarantee the right to join trade unions and provide decent housing, where relevant. On plantations and in factories, minimum health and safety as well as environmental standards must be complied with, and no child or forced labour can occur.

How popular is it?

Fairtrade sales have grown by around 40% year on year, and sales for 2004 are were over £130million. More than 700 products carrying the Fairtrade Mark are now available across the retail and catering sectors.

Britain has overtaken Switzerland to become the biggest Fairtrade market in the world, with coffee, bananas, tea and chocolate still the most popular choices. Fairtrade wine and beer, roses and footballs were introduced last year, joining fruit juice, other fresh fruit, cocoa, sugar, snacks, honey and other products. All major UK supermarket chains now sell Fairtrade products.

Currently, more than 250 coffee, tea, fresh fruit, chocolate, cocoa, juice, sugar, honey and wine products carry the FAIRTRADE Mark. Fairtrade coffee, tea and other products are also offered by more than 25 catering suppliers nationwide. New products in 2004 include Fairtrade vegetables, roses and footballs.

Now more than 5 million people - farmers, workers and their families - across 49 developing countries benefit from the international Fairtrade system.

Further information on Fairtrade

Are there any other ways of helping?

One scheme that has been praised as an imaginative way of tackling on-going slavery and child labour has been the Rugmark initiative. The Rugmark scheme for India where people can buy a product from India on the assurance that child slave labour has not been used in making it".

Rugmark is a non-profit initiative working to end illegal and exploited child labour through monitoring production as well as improving conditions in carpet making communities through provision of free schools and other social programmes.

In 2004 alone the UK sold over a quarter of a million of rugs bearing the Rugmark label. Rugmark UK aims to double those sales within the coming two years, in partnership with its importing licensees and committed retailers. The importing company pays a levy for each rug it brings into the UK. This levy helps fund the Rugmark schools, education programmes and community welfare for the thousands of Indian and Nepalese children rescued from illegal, forced labour.

The problem of child labour is still rife so if you want to ensure that your rug hasn't been made by exploited children then check to see that the carpet or rug from India you are thinking of buying carries the Rugmark label and let your consciencel influence your buying decision.

In the UK you can find the Rugmark label on collections of rugs by: Asiatic Carpets, Gooch Oriental Carpets, Flair Flooring, Handmade Carpets, Oriental Weavers (UK), Selected Rug and Matting, Nawrozzadeh Trading Company, and Shenkin Rug Innovations. There are many retail outlets for these rugs including Co-op Department Stores, Allders, Allied Carpets, Makro, Costco The Pier, B&Q and independent retailers. For further information on where to buy Rugmark labelled rugs visit www.rugmark.net

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