In the world of fair, ethical, and eco-friendly product sales and production, there are a lot of terms thrown around. In fact, several of them are right there! These days, when you go shopping, you’re likely to see all sorts of labels on a product.
- Free Range
- Fair Trade
- Union Made
- Certified B Corporation
Some of these are little more than marketing terms, with very little actual enforcement behind them. In the same way that you might see a product labeled “Gluten-Free” when there aren’t any ingredients in the product that would ever contain gluten in any variation of the recipe, it’s just there to attract people who shop more based on badges and marketing than on reality.
On the other hand, some of these are very important, serious terms. Two of the strongest on that list are Fair Trade and Certified B Corporation. These two go hand-in-hand, working to solve the same sorts of problems throughout global commerce but coming at them from different angles. What do they mean, though? Let’s dig in.
All About Fair Trade
Fair Trade can mean two things. First, it’s an ethos: that the products labeled fair trade are produced using ingredients that were farmed ethically, harvested ethically, produced and refined ethically, and that everyone involved was paid a living wage. Moreover, it’s a statement that everyone in the chain of custody, from the initial farming to the final product, is also treating their workers fairly.
Second, Fair Trade means the product comes from a farm that was certified fair trade by Fairtrade International or one of their regional subsidiaries like Fairtrade America or Fairtrade Canada.
Whenever you see the Fairtrade badge on a product – usually food, but sometimes handicrafts and other items – it’s an indication that the product has real ethics and, more importantly, serious verification behind it.
A huge part of what makes Fairtrade International a powerhouse is its scope, breadth across and throughout the industry, and the thoroughness of its reviews. Seriously, check this out: Fairtrade International – How We Set Standards. This comprehensive set of documents goes over a wide range of different products, from cereal grains to chocolate to cotton to nuts, and digs deep into their production and the standards that need to be followed in order for a farm producing them to be considered fair trade.
Farms that want to be certified as fair trade need to meet some fairly high criteria for production and the ethical treatment of their workers. In order to make this feasible, Fairtrade International will provide those farms with financial assistance. That money comes from the fees paid by traders and vendors higher up the chain that want to be certified as Fair Trade. The farms need the support because using unethical labor and business practices is undeniably cheaper, using human life as the currency.
Another part of the equation is certification. Fairtrade performs annual audits on farms, vendors, producers, traders, and anyone who intends to hold and use their certification at any point in the chain from raw material to finished product. If, at any point, an entity fails the audit, it immediately loses its fair trade certification. Moreover, anyone who does business with them is obliged to cease immediately, regardless of other contracts (though goods produced before the failed audit are still fine to buy.)
All of this is done as a very serious way to enforce the validity and meaning of the Fairtrade Certified badge. After all, if a company or a farm could get Fairtrade Certification only to drop the policies that earned them the assistance and the certification later on, it would dilute the meaning behind the badge, and people would lose trust in it. That trust is what makes Fairtrade meaningful and valuable, so the auditing is taken very seriously.
Now, above, we mentioned that Fair Trade is an ethos; that’s because Fairtrade International is just one of – and the largest of – a bunch of different nonprofits working on similar initiatives all around the world. There are countries that Fairtrade International can’t reach. There are labor organizations and similar unions throughout the world that want to operate on their own rather than be brought under the Fairtrade banner. Whatever the case, being Fair Trade and being Fairtrade Certified are different, though similar.
If this section seems short and cursory, it’s because we’re doing a deeper dive into Fairtrade specifically, including how you can certify yourself as a Fairtrade Certified Trader, coming in a few weeks. Stay tuned for that!
What is a B Corp?
Fairtrade is a powerful organization with a solid label and a lot of trust behind it, but it has a pretty significant drawback: it’s very limited to farms and producers of food and other similar ingredients. While they touch on things like precious metals for small mining operations, they can only cover so much of certain other kinds of commerce.
B Corps are a solution to this issue. There are a lot of companies all around the world that don’t fall under the banner of anything Fairtrade International would cover. B Corps allow a company to earn a certification that shows they’re socially engaged, environmentally conscious, and ethical. To quote them directly:
“B Corp Certification is a designation that a business is meeting high standards of verified performance, accountability, and transparency on factors from employee benefits and charitable giving to supply chain practices and input materials. In order to achieve certification, a company must:
- Demonstrate high social and environmental performance by achieving a B Impact Assessment score of 80 or above and passing our risk review. Multinational corporations must also meet baseline requirement standards.
- Make a legal commitment by changing their corporate governance structure to be accountable to all stakeholders, not just shareholders, and achieve benefit corporation status if available in their jurisdiction.
- Exhibit transparency by allowing information about their performance measured against B Lab’s standards to be publicly available on their B Corp profile on B Lab’s website.
B Corp Certification is holistic, not exclusively focused on a single social or environmental issue. And the process to achieve and maintain certification is rigorous and requires engaging teams and departments across your company. Taking company size and profile into account, verification involves documentation of your company’s business model and information about your operations, structure, and various work processes, as well as a review of potential public complaints and possible site visits. Recertification confirms these standards continue to be met on an ongoing basis.” B Corporation.
The actual, specific standards that a company must meet will depend largely on the amount of revenue and the number of employees your company has. Small businesses have a little more flexibility, while larger enterprises have a different set of standards. All of that is also available from B Corporation at the link above.
The key here is in that first bullet point: the B Impact Assessment. This is a tool companies can use to assess their adherence to social and ethical concerns in business. You can find it here. It asks questions such as:
“Governance: What portion of your management is evaluated in writing on their performance with regard to corporate, social, and environmental targets?
Workers: What % of the company is owned by full-time workers (excluding founders/executives)?
Community: What % of management is from underrepresented populations? (This includes women, minority/previously excluded populations, people with disabilities, and/or people living in low-income communities.)”
If you meet the standards, you can apply for a more rigorous overview to earn the certification. If you don’t, you can use the questions as a guideline to help you bolster your performance in social, environmental, ethical, and other spheres.
All of this is governed and managed by B Lab, the nonprofit organization that develops the standards, performs the certifications, and more.
One prime example of a certified B Corp is TS Designs, the vendor for the Homegrown Tee. Their commitment to socially responsible, environmentally conscious, and ethical practices has earned them this prestigious certification. By choosing to wear the Homegrown Tee, not only are consumers supporting sustainable fashion, but they’re also endorsing a company that stands by the highest standards of global corporate responsibility. It’s vendors like TS Designs that truly demonstrate the potential and impact of the B Corp certification.
There aren’t actually very many limitations on the kinds of companies that can become B Corporations; companies of all sizes, from startups to massive enterprises, from a few employees to thousands, public and private, are all welcome to apply. It’s all about meeting the standards.
Fun fact: As of the time of this writing, there are 7,304 certified B Corps. You can view a full directory and search through it here.
Some of the oldest B Corps include Seventh Generation, King Arthur Bakery, and Caprock Capital Investments.
Much like Fairtrade, B Labs charges an annual fee to maintain certification, which goes towards their operations and activism. The whole organization is very transparent, so you can read their financial statements and much more on their website.
How Fair Trade and B Corps Work Together
Fair Trade is largely focused on human rights, living wages, and the ethical treatment of the people at the very foundations of the supply chain, usually in the global south in geographically oppressed areas.
Meanwhile, B Labs works with pretty much any kind of business, and many of the certified B Corps are businesses based in America and operating more or less solely in the country. Of course, others are in other countries or are global. B Corps are concerned with a broader, more holistic view of ethics and human rights, eco-friendly production, and more.
“B Lab’s social and environmental business standards define how businesses can be a force for good. Based on stakeholder input, research, and established best practices, these standards are the basis for B Corp Certification requirements as well as B Lab’s impact management tools.
The Fairtrade Standards are designed to support the sustainable development of small producer organizations and agricultural workers in low- and middle-income countries. These rigorous standards incorporate a holistic blend of social, economic, and environmental criteria.
By choosing both B Corp and Fairtrade International certifications, businesses demonstrate their commitment to sustainability and social impact. They’re also raising public awareness of the connection between our changing climate and people’s livelihoods, and how businesses can act on both global challenges.” – Fairtrade.
The two organizations frequently evaluate the same kinds of points, and there’s nothing stopping an eligible business from certifying as both Fair Trade and B Corp other than the potential expenses of doing so.
What Are the Benefits of Fair Trade or B Corp Certification?
The benefits are many and far-reaching.
For the company earning the certification, it’s all about two things: knowing that you’re doing good for the world around you and letting others know you’re doing good for the world around you. Since both Fairtrade and B Corps are held to very high standards, they’re very well-recognized and trusted by consumers, with that trust and recognition growing every year. More and more people, surveys show, are increasingly concerned with environmental impact, worker treatment, human rights, and general ethics in their consumption.
For consumers, of course, seeking out products with these certifications means knowing that the purchase you make isn’t going to a company that uses child labor, slave labor, a substandard wage, or things like environmentally destructive farming methods. It also goes beyond simply feeling good about yourself; since these organizations support advancement and activism all around the world, some portion of the price of any certified good or service goes towards fighting those evils in the world around us.
Are All Companies Missing Certification Bad?
The growing popularity of Fairtrade and B Corp certifications has led to one small misconception, which is that companies lacking these certifications are, by definition, unethical or immoral in some way. Well, we’re here to assure you that’s not the case.
Take us, for example. Since we aren’t a farm and we don’t produce food, we aren’t in a position to get Fairtrade certification. And, while we could potentially apply for it, we haven’t gotten B Corp status. However, that doesn’t mean we’re unethical – quite the opposite, in fact. We strive to be green, ethical, and beneficial in all of our products.
When you browse our store, you can see badges like “USA Made,” “Union Made,” and “Eco Friendly” on various products. Not only do we live up to our ethos, but we’re more than happy to discuss what it all means with you, should you desire.
Simply reach out, and we’ll talk about any product in as much detail as you’re willing to accept.
Daniel Cardozo, CEO of Ethix Merch, is a passionate advocate for ethical promotional products. With a mission to transform global supply chains, he serves on the Labor 411 Foundation and Advertising Specialty Institute’s Promo for the Planet Advisory Board. Daniel is dedicated to empowering socially and environmentally-conscious consumers.