I've decided to do some posting in
English, for a change. The great thing in my blogging engine is that
it should cater for any language. The blog itself is in UTF-8, and all
the posts should (barring any coding mistakes I've made) be tagged
with the right language codes.
If you are an activist, you have
no doubt noticed that Nestlé, widely quoted by the blogosphere as being the most boycotted
company in the UK, has launched a new Fairtrade certified coffee,
Nestlé Partners' Blend.
It will be interesting as to where this
will lead. Fairtrade, of the
[tm] variety, has
been tremendously successful in securing mindshare from customers. Before the
Fairtrade[tm], 'fairly traded' did not have a set of specific
criteria, but the system was run mainly by worldshops and
different ATOs.
All the respect to them - most ATOs now have the [tm] on their products, and still do fair trade in the non-certifiable (mainly non-food) items. However, if you'd ask from a random guy on the street back then whether they knew of Fair Trade, you would have probably got
blank stares. Nowadays, four-fifths of Finnish customers recognise the
brand - and this would not have been possible without FLO, the
labelling organisation behind the [tm].
Previously, large companies have launched Fairtrade[tm] products,
examples being Procter & Gamble and Starbucks. However, activist
criticism has been nowhere as harsh as with the Nestlé case. Nestlé
has a special place in every activist's heart - the first consumer boycott I heard
about was that against Nestlé.
Many activists
feel betrayed and say that the brand has been tarnished by Fairtrade
Foundation (the UK controller of the Fairtrade trade mark).
But this was inevitable, if we really want Fair Trade ([tm] or not) to go properly mainstream. Or not really, actually. Nestlé
did have an alternative, but did for some reason decide not to pursue that path
for now.
In November 2004, a Guardian article tells us an interesting tidbit:
'Nestlé, which makes the Nescafé brand, believes the fair-trade model exacerbates this problem [of supply rising faster than demand, -ed.] - in the long term, it draws farmers back into the market, attracted by a high artificial price, which will increase world production and force prices down further. Nestlé chief executive Peter Brabeck-Letmathe prefers a demand-led solution: "Present low coffee prices are the result of a global excess supply," he says. "The primary and most direct responsibility of companies like Nestlé lies on the demand side, with the promotion of coffee consumption."'
Now, there is an alternative certification system for coffee and other
foodstuffs and that opportunity has been seized by many other
companies: that of
Rainforest Alliance. Chiquita's bananas are
notoriously Rainforest Alliance certified (and many farms also have SA 8000, which is good). Both systems are based on
many of the same good principles of ILO and UN agreements. The main
differences are that Fairtrade[tm] has a concept of the
Fair Trade
premium, extra money that is directly channeled to the producer
organisation to be used for social development. Some producer
organisations are using this for schooling their children, some others
for pension funds. The use is determined democratically by the
producer organisation members (which often are co-operatives).
Another difference is that Fairtrade[tm] has a floor price, which will
never be undercut even if the market price would fall below that line.
This aims to guarantee that the farmers won't go bellyup if the market
crashes and they cannot repay their loans - and also ensures they have
no incentive to cut corners in environmental issues and workers' well-being, which
often are first casualties of financial instability.
Now, many companies feel that this kind of social responsibility
stuff reeks of a Commie plot and is not their cup of tea. Which is the
niche where Fairtrade[tm]'s competitor Rainforest Alliance comes into
picture. Don't get me wrong: I think Rainforest Alliance do a great
job. It just seems to me that they are being selected over Fairtrade partly because of the lack of social premium and floor price.
But what I am trying to point out that in the light of past comments by
Nestlé representatives, having them choose Fairtrade[tm] over a competing
coffee certification must have some meaning.
The Fairtrade[tm] mark is only awarded to certified products, not companies. (For companies, there is a different, less-known, non-end-customer-visible certification by IFAT.) Now, if the certification is product specific, in a rational world one would think that this is just what ought to happen: you fulfill the criteria, and you get the Mark. However, a recurring theme in Nestlé Fairtrade criticism in the blogosphere
is that if a company is somehow evil, then none of its products should enjoy this certification - the main point seemingly being that the Mark will turn into some kind of holy water that will greenwash the company from all past and future wrongdoings in the minds of customers.
Well, no. Let's first investigate how large a dent has been made in Nestlé's sales by the boycotts that have been running for two decades. Not much. Some studies claim that the 'naturally ethical consumers' make up about 3 to 5 per cent of consumer base. These are the ones that probably join the boycotts. The next 20 per cent are defined as 'strongly ethical', meaning that they can be educated into making the right buying decision. And the rest, essentially, don't care. The holy water effect would only strike the 20 per cent in between the Naturals and the Dontcares, because the Naturals 'know better' and the Dontcares don't care. Given that the Fairtrade[tm] logo guidelines actually are rather strict in how you can use it, and given Nestlé's notoriety in consumer activism circles, I would very much doubt that any greenwashing - if they properly tried - would have any lasting effect.
It is true that Nestlé would probably be making more good in the
world by putting some more Fairneß in their old sourcing chains, like
many critics have said. But let's face it: in a megalithic corporation
like Nestlé, there are different forces brewing in different parts of
the company. How would you explain the change from the tone in the abovementioned
Guardian article into this in less than a year? Contrary to what many people
believe, when a company is large enough, it gets less and less centrally (and coherently)
managed.
I hope that what we
see here are some cracks in the façade, the Forces of Good staging a
small victory over the Dark Side within the company. Now that Nestlé have a certified
product, this will further invigorate the watchdogs, and actually
serve as a platform for further criticism (without this certification
hoo-hah, I would probably have missed the news about the assassinated
Nestlé union leader in the Philippines which did not rise above the
mainstream media noise floor). Also, one should not forget that Nestlé's marketing money
also boosts the general recognition of the Fairtrade[tm] Mark with the 75 per cent of Dontcares of the population.
I think that Fairtrade Foundation and
FLO have made the right decision, and that the risk of
cross-pollination of fairness to other Nestlé products is minimal, and that
this is a real victory for Fairtrade[tm] over other competing
certification systems. I also wish Nestlé's social responsibility people
success in their continuing battle, which I believe is being fought.
And who in their right mind would drink instant coffee anyway?
In other news,
if you happen to read this in a country where Starbucks has successfully
built its stronghold already, have a look at Starbucks Challenge - a type of café campaign not entirely unlike the one we run locally here in Finland (with no Starbucks in sight).
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