January 2009 Big Grower

Fair Trade: An International Approach to Sustainability? By Visions Group

Are fair-trade products really more environmentally friendly? People are always equating the two concepts, but they are not always related. How can you be confident that a fair-trade item is also green?

The recent rise of the "ethical" consumer hasn't just created a potential market for greener products; it's also created a potential market for new labels meant to show that those products have been vetted on your behalf. But for the average shopper, the labels can get confusing pretty fast. It's tempting to assume that any product with a sticker including words such as "earth" or "fair" must be good for the environment and good for workers — and probably helps grandmothers cross the street, too.

But that may not be the case. In an attempt to make sense of all the various labels and claims, let's focus on items that are officially "fair-trade certified." Traditionally, the fair-trade designation has been associated more closely with labor standards than environmental standards, suggesting that workers in far-off places are enjoying better wages and conditions than they would for producing products under conventional labels. But any product that's certified as fair trade must also meet a set of environmental standards determined by a group called Fair-Trade Labeling Organizations International.

The Green of Fair Trade

In some respects, these restrictions are very straightforward: For example, the certification process usually bans a specific list of pesticides. The standards are more general in other respects, telling producers to leave buffer zones around conservation areas, minimize water use for irrigation and ensure that organic waste is "disposed of in a sustainable manner." Fair-trade advocates argue that the eco-benefits extend beyond these simple rules. By helping to promote smaller producers, the label helps those who are most likely to use sustainable, traditional growing methods that are better for the environment.

Keep in mind that fair trade does not equal organic: The international labeling group encourages, but does not require, producers to "work toward organic practices where socially and economically practical." According to Transfair USA, the group that implements these standards in the United States, more than 60 percent of fair-trade coffee is also organic. There is also substantial overlap between fair-trade coffees and "bird-friendly," shade-grown varieties, but one doesn't imply the other. Still, if you assume the certifiers are doing their job, fair trade appears likely to be greener than the conventional stuff you'd find in a supermarket.

Fair-Trade Criticism

Still, critics have raised some big concerns. The promise of higher wages through fair-trade arrangements may provide farmers with an incentive to overproduce. More broadly, fair-trade farmers may not receive any benefit from the higher prices paid by consumers. The trickle-down theory is not always practiced in the third-world countries that are the source of many of these "certified" products. Moreover, in theory, overproduction would keep the rest of the world's farmers poor and potentially result in more and more of the world's land being cleared for farming. But these concerns may be overstated: Fair-trade certification generally bans the use of virgin forest land, and there is little evidence that its small-scale adoption has caused any overproduction. Washington State University professor Daniel Jaffee actually found that the certification had a positive impact on land use among a group of Mexican coffee producers, while also encouraging better practices surrounding water protection and soil erosion.

A second worry is that fair-trade products, by definition, are produced outside the country, so they need to travel a fair distance to get to your home. If the items are shipped by sea, the impact may not be as bad, as the emissions impact of long ocean hauls may be less than the emissions impact of trucking a product within the United States. (Besides, if you crave a product like chocolate or coffee, domestic farms aren't going to do you much good, anyway.) A few types of perishable fruits and vegetables are more likely to be shipped by air, which raises more serious concerns. In Britain, a debate has resulted over whether it's better to increase trade with Africa or to reduce emissions from the air freighting of otherwise environmentally sound produce.

Here's the bottom line: If you care about both global poverty and climate change, you can't always have it both ways. Keep things in perspective: Boycotting bananas from the Dominican Republic may reduce your carbon footprint a tad, but you'll make a bigger dent by putting that hamburger meat back on the shelf once in a while — and you won't be cutting a poor grower out of the global economy.

SIDEBAR

Breakthrough or Gimmick?

Canada has set a new course for dealing with climate change. In an effort to assist the country's growing oil industry and encourage economic growth, Canada has become the first nation to adopt a policy that reduces the rate at which carbon dioxide and other greenhouse gases are produced rather than the total amount produced. This is markedly different from the Kyoto Protocol, which mandates cuts in the total produced.

This new policy means that Canada's oil, gas, power, steel, chemical, cement and other industries can increase production and their total emissions as long as the basic ratio of emissions to the unit of production (per barrel of oil, per kilowatt-hour) declines.

Pros and Cons

Proponents say the "emissions intensity" method is the best of both worlds: It addresses global warming without sacrificing economic growth. With other abstainers from the Kyoto Protocol (most notably the U.S. and China) discussing similar systems, plans like Canada's could become an acceptable compromise approach. Critics of the policy say it is too lax with the end results an increase in emissions. This new policy represents the country's new conservative government's reversal of the former administration's support of the Kyoto Protocol, which called for reduction of carbon emissions to below 1990 levels. The new emissions intensity policy will require industrial companies in 2010 to have reduced their ratios of emissions by 18 percent below 2006 levels — and an additional 2 percent per year through 2020. No reductions in overall emissions are required, but it is the government's hope that, coupled with other energy-efficiency initiatives and renewable fuel, the end result will be a one-fifth reduction of total emissions by 2020.

There is much support from the country's booming oil industry in the West. Although second in size only to the oil reserves of Saudi Arabia, Canada's treasure trove consists of mostly bitumen, a sludgy, raw material that is expensive to extract and requires considerable processing just to flow through a pipeline and even more to be refined into usable petroleum products. It is a dirty, emissions-intensive process that has resulted in a tripling of emissions from Canada's gas and oil sector since 1990.

Elsewhere in the WorldÉ

China, which could soon surpass the United States as the biggest source of greenhouse gases, is concentrating its climate changing efforts on emissions intensity and is launching programs to encourage efficiency gains. Mexico is also considering implementing intensity ratios. The whole argument for emissions intensity is that it doesn't set a cap and allows for economic expansions while reducing the amount of emissions on a unit-produced basis, which is attractive to most industrial producers.

Proponents argue that a program with support from its participants has a stronger chance of achieving real change. Opponents, such as staunch environmentalists, contend the targets are much too low and the end results not significant enough. Some compromise on what is realistic and achievable seems to be in the best interest of both sides.