How does fair trade certifications work?
The process of and principles in fair trade certification are rather similar through Fair Trade USA and FLO. Overall getting fair trade certified means that producers can put a label on their product, meaning that the product is produced under circumstances living up to the standards that a certification organ, like FLO or Fair Trade USA, has established. When carrying this label, the certification organ ensures that the producer is paid at least the minimum market price for it's produce plus it receives a fair trade premium - a sort of a financial bonus pr. lb. sold, earmarked to be spend on establishing social improvements on the production site.
The process of becoming certified
Becoming fair trade certified either starts with a producer wanting to get his or her products certified, or by bi-lateral agreements between producers and fair trade certification organs. In the first case, producers must contact a certification body themselves and in the latter, which is the case in our controversy with Ipanema Coffees, the certification is negotiated through an agreement with Fair Trade USA and it's third party certification organ. Both FLO and Fair Trade USA use third party auditing organs in an attempt to ensure that the certification happens in a reliable manner by a independent actor. While FLO uses FLO-Cert, an organ solely certifying FLO products, Fair Trade USA uses CSC Global Services, an organisation operating with certifying products from all over the world. However, both of these are operating in the slightly same way:
1) The producer's application is received and an audit is planned by the auditing organ.
2) The auditing organ goes into the field and check if the producer comply with the standards of the certification body. Both FLO-Cert and SCS Global Services has developed extensive schemes, which can be seen as a sort of a translation of the standards into a checklist, for this auditing process. During the auditing, which is performed by internal auditors of the certification bodies, both farmers, workers unions, managers and committees are interviewed in order to make a thorough check of compliance.
3) An analyses of the auditing results is performed by internal personnel in FLO or SCS Global Services respectively. Here it's concluded whether the producer comply with the standards or not.
4) If the analysis points out so called non-conformities, aspects in which the production site doesn't live up to the given standards, the producer has 30 days to change these non-conformities.
5) Certification is granted, and a Producer ID for the production site is sent to the certification body. Both for FLO-Cert and SCS Global Services, a re-audit has to take place every third year in order to make sure that the production site maintains the compliance with the standards.
1) The producer's application is received and an audit is planned by the auditing organ.
2) The auditing organ goes into the field and check if the producer comply with the standards of the certification body. Both FLO-Cert and SCS Global Services has developed extensive schemes, which can be seen as a sort of a translation of the standards into a checklist, for this auditing process. During the auditing, which is performed by internal auditors of the certification bodies, both farmers, workers unions, managers and committees are interviewed in order to make a thorough check of compliance.
3) An analyses of the auditing results is performed by internal personnel in FLO or SCS Global Services respectively. Here it's concluded whether the producer comply with the standards or not.
4) If the analysis points out so called non-conformities, aspects in which the production site doesn't live up to the given standards, the producer has 30 days to change these non-conformities.
5) Certification is granted, and a Producer ID for the production site is sent to the certification body. Both for FLO-Cert and SCS Global Services, a re-audit has to take place every third year in order to make sure that the production site maintains the compliance with the standards.
The principles in being fair trade certified
Being fair trade certified means that you, as a producer, legally can sell your product with your respective certifier's certificate. The certifier guarantees that the products of the producer will be bought at a special fair trade minimum market price. This means that if market prices drop below this minimum price, the fair trade price will act as a safety web, protecting farmers against major price drops. This is relevant to most farmers whose produce is heavily dependent on unsteady, ever changing climate conditions. At the same time, the producer receives a social premium, one that in 2011 doubled to 20 cents pr. lb, that has to be spend on social improvement on the production site. For larger production sites, like Ipanema Coffees, it is mandatory to have a workers committee, or a so called joint body, consisting of democratically elected workers to decide what the premium is to be spend on.
In turn of these advantages, the producer has to continuously comply with the social and environmental standards of the certification body.
In turn of these advantages, the producer has to continuously comply with the social and environmental standards of the certification body.