Fairtrade International governance

Abstract

Fairtrade labeling stakeholders have a long history of disagreeing about many aspects of fair trade labeling. But since they (generally) feel a harmonized, worldwide label is more effective than a multitude of unique systems, stakeholders seek to develop unified strategies despite their disparate preferences. Particularly contentious issues have included: whether or not to certify hired labor groups; who should pay for third-party auditing; and what percentage of composite products must be Fairtrade certified for the product to bear the seal. Because stakeholders hold very different – and very strong – beliefs about these issues, the institutional rules that balance how each stakeholder is able to influence policy-making are extremely important. The question of how to weigh producers’ opinions against the positions of the national labeling initiatives has been a particularly difficult struggle for Fairtrade International.1 Some fair trade scholars and activists have argued that producers have been largely marginalized by the organization’s highest governance bodies and that this arrangement has compromised Fairtrade labeling’s ability to deliver on its promises. But in 2011 the organization announced that it would give producers equal ownership over the label. This chapter compares this new iteration of Fairtrade governance with previous arrangements. It answers the questions: How does Fairtrade International include producers of Fairtrade certified products in its governance bodies? And when producers are included, to what extent do they reflect and represent the broader producer population?2 It argues that today’s governance structure is the most democratic and representative in the organization’s history, even more so than the original Max Havelaar Netherlands label. The chapter proceeds as follows. First a background section positions this analysis in relation to relevant fair trade studies. Next the data and methods section describes the collection and synthesis of over 17000 archival documents and more than 100 interviews with Fairtrade leaders and participants. Then an empirical section describes producers’ participation in Fairtrade International governance from 1988 to 2014. It is presented in five time periods: label creation (1988–1995); label proliferation (1992–1997); label unification and development (1997–2005); producers as members (2005–2011); and producers as equal owners (2011–2014).3 The discussion argues that the new structure could be pivotal in shifting Fairtrade outcomes, and it identifies key variables that shape the policy-making process. Some of the policy-making challenges were generated by Fairtrade International’s extended period of excluding producers, while others are broadly experienced, enduring problems in governance. The chapter closes with suggestions for future research and by emphasizing the value of including marginalized voices in private regulatory regimes.