cc
Entrepreneurship in Society. >> Jeanan Yasiri: This is
through the University of ItWisconsin School of Humaned
Ecology.
As we begin today, I'd like to I'm Jeanan Yasiri.
supporting this course, the UW extend thanks to our partners in
the UW College of Engineering for their technical support, and
financial support that is provided through the Ewing
Marion Kauffman Foundation which
academic education in is centrepreneurship.cing
Additionally, we'd like to thank
Public Television and their University Place crew for taping
today's lecture.
special guest to our class I'm very pleased to introduce a
CEO of Fair Trade USA, the today, Paul Rice, president and
products in the United States. leading certifier of Fair Trade
1998, Fair Trade USA has Since launching their label in
the fastest growing segments of esthe US food industry, and toof
date, they have developed business partnerships with over
800 US companies. Since 1999, low income
family farmers and partners in
over $250 million in additional tincome selling in theed
US fair trade market. Prior to launching the
organization, Paul worked for 11
specialist in the mountains of years as a rural development
That experience has led to 30 years of award winning service
in the fair trade movement, earning him accolades from
Ashoka, the Skoll Foundation, and the World Economic Forum
Award for Social
He holds degrees from Yale Entrepreneurship.
UC Berkeley. University as well as from
join us from the San Francisco We are delighted to have him
Please join me in welcoming BayPaul Rice.y.
[APPLAUSE]
Paul Rice: Can you hear me
So how you all doing? >> Good.
No, how are you really doing? >> Great.
Tired.
>> Great.
Especially the tired people. Who here drinks coffee?
Alright. Who here drinks coffee?
who eats chocolate? Of course, all the girls raise
their hands.
Who eats bananas? [LOkay.ER]
Now, who here has visited either
farm? a coffKeep those hands up.anana
I'm surprised.
So most of us haven't, right? I think most of us when we're
drinking that morning cup of
enjoying that chocolate bar, Joe, trying to wake up, or
about the farmer or where it was we're probably not thinking
environment or what the life of grownthat family was like.n the
So, I want to take you on that
I want to take you back to the journey today.
begins and help you get some farm where all of that stuff
that we eat comes from and what life is like for folks on those
farms and how hard things are,
who grow the things that we eat every day and take for granted.
The title of this presentation
the World, and what I tried to is Market Approaches to Changing
kind of evoke the intersection do with that title is really
between movements for social that I see happening today
save the world, make the planet cbetter, help people, save theto
environment on the one hand and the business community on the
other and how those two are increasingly intersecting in
finding a space where anyone
entrepreneurship can find a who's iplace.ted in
So, let's go on a journey.
cocoa beans from chocolate or Mosbananas comes from smallor
communities like this one way up
Farmers often only have one or in the mountains somewhere.
Often they don't have electricity so they don't have
Internet connection.
world market prices. They don't really know about
markets. They're really isolated from
vehicles, and so the way they Oget their coffee to market ore
their products to market is on
this one. mule bacSo very remote.ges like
Very poor.
harvest in raw form to the Typically, they deliver their
price, and you kind of take the nearprice that you can get.ates
So, as you might imagine, that
lot of farmers are locked into leads to a situation in which a
They struggle to put food on the poverty.
They struggle to just keep their table.
High school in the developing world is a luxury.
Stuff that we take for granted. Clean water in the developing
world is a luxury.
my second semester of freshman And so, for me, that reality in
heavy burden. And so my own personal journey
was one of awakening to this
something about it. And so I want to share a littleo
bit of that journey because it
and the story about markets and relates tsocial change.de story
So I got interested in
this reality of hardship and agriculture, I got interested in
international development, and decided to study economics and
wanted to go work with farmers. And so a month after graduation,
in the summer of 1983, I bought a one-way ticket to Nicaragua,
and I went off to join the
My goal was to work with revolution.
organizing co-ops and helping really small farmers get
together and try and improve
And I thought, okay, this is their production.
I'll stay for a year, maybe two, pretty cool.
something sensible. aI stayed for 11 years.
I was 22 when I went overseas.
And it was an amazing journey. I was 33 when I came home.
And for many years I worked on It was an incredible journey.
another which is kind of the one development project after
that we've had since World War classic model that we have and
poverty. II for alleviating Third World
sitting in these very Swell-intentioned organizations
in Washington and London and
projects and sending lots of around the world, developing
well-intentioned, to solve money off, also very
And that top down agriculture aid model, in my experience,
doesn't work. I would say that the projects
that I worked on, more often
dependency on aid. than not, simply recreated
They just want a decent price And for all their hard work.id.
So I had a chance to shift gears
Nicaragua and, kind of by chance, heard about these crazy
people in Europe that called
And their whole thing was they themselves fair traders.
dramatically higher price for coffee, I was working with
coffee farmers at the time, for coffee if we could just get
organized and sell direct.
started organizing. AndI pulled together some oldwe
friends that had also worked in the communities, and we went out
and we started telling people about how we could get so much
more money, not by trying to
selling smarter. produce more, but just by
No one believed it. No one believed that they could
be more than a coffee farmer, that they could also wear the
hat of trucker and miller and exporter.
No one imagined it possible, I'm
really small growers, no talking about one-acre farmers,
own an export company and go imagined that they, too, could
companies and really claim their toe to toe with transnational
Save 24 brave souls who stepped oup that year and delivered 10.
sacks of coffee each, 150-pound sacks of coffee, on consignment
because we had no cash. So they just delivered the
coffee and we filled the
We shipped it to a buyer in Holland, and three months later
they paid for the coffee. And so in a schoolhouse in Santo
Domingo, very much like that
previous slide, we got everyone ctogether to give them theire
money.
husbands and wives, the kids And so the farmers came,
dogs, everyone had a machete on their belt because they wanted
to know what Paulito had done with their coffee, and so I got
up on the chalkboard and went through the numbers.
Here's what we got, and the fair
paying $1.20 per pound trade buyers at the time were
The local market price at that for our coffee.
So I walked them through the time was 10 cents a pound.
We got $1.20 a pound, and here's numbers.
cost and the milling and how much the transportation
this and that, and that priced the sacks and export license,
So after all the costs, we had a dollar.
families. So just to put this in context,
these guys were growing like
So, at 10 cents a pound, they would have received 200 bucks.
Instead, we had roughly $2,000. And I had a tackle box full of
cash and a clipboard, and I invited every family to come up
one by one and sign their name
Two grand each. These people had never seen that
much money at one time ever.
a prairie fire. And it wasOver night,rk that lit
I became "Pablo un dolar."
Because we were getting one dollar per pound,
and we went from 24 families to 3,000 families over the next
three years, who all came together to process their coffee
as a group, to truck it, to export it, and a lot of that
went to the fair trade market at
So with that money, what did this dramatically higher price.
They paved the floors of dirt floor homes.
They bought mules, in many
down from the mountainside on mule back rather than on their
own backs.
Many communities formed high They kept their kids in school.
High school cost, roughly, school scholarship funds.
Uniform money, book money, 200 bucks a year.
But $200 a year for many rural bus money.
is like a wall locking a whole families in the developing world
future. So they set up scholarship funds
to give kids 200 bucks a year to
We dug wells and brought clean go to high school.
the first time. drinkInstead of waiting fors for
government to come and solve our
going to happen, we did it problem for us, which wasn't
Farmers got trained. ourselves.
They went organic. They invested in quality.
investment and improvement in Iliving standards and in social
services and in production and
charity. none of it thanks to anybody's
It was all made possible thanks to the money that was generated
through this direct sale. It was all made possible thanks
to people's hard work.
around this whole journey, what you couldn't see but you could
feel every time you talked to a farmer, was hope and pride and
dignity.
well, that well providing clean drinking water didn't come from
some agency.
made growing and selling coffee. It came from the money that I
It totally transformed that region, totally transformed me.
I think at the start of that
markets and business. jI thought business was really,
frankly, more the problem than
But out of this experience I the solution.
partnership with business and connections to consumers was,
perhaps, the most powerful way
that we could hope to have. to lift So I came back. poverty
Me and the farmer.
a classic coffee kid. So her dad, Santiago, the guy
looking stiff as a board
[LAUGHTER] next to her...
coffee farmer. He's a fourth generation
And he was able to study through He has two acres of land.
parents had to put him in the fields because they couldn't
afford to keep him in school. So he's like the coffee
every man.
grow our daily cup of Joe. He represents the people who
'90s that got fair trade But he joined a co-op in the
Then he started this journey and certified.
harvest. started getting more for his
able to continue on through high And as a result, Yolanda was
was created by fair trade school witpremiums.arship that
She went on to college. First girl in the entire village
to go to high school. First kid to go to high school.
First kid to graduate from
the health clinic in that same college, and now she's back in
For me, there's no better way coto describe the fair trade.
journey than to tell Santiago and Yolanda's stories because
that's really what it's all about.
It's us through our daily purchasing decisions through the
cup of coffee that we choose
way across the world to realize being ablher dreams.a kid half
So, wrong slide.
the fair trade world, and I Odecided, okay, if it's big ino
Europe and there's not really a whole lot going on in the US,
then I've got to see if I can help.
So I moved back, took a detour
MBA, got some tools, and through business school, got an
So we've been around launched Fair Trade USA in 1998.
And so our role in the fair trade world is not to buy and
sell product. We're a nonprofit.
We don't buy or sell coffee or
Rather, we're the matchmaker. We help the growers connect with
the market. We help those farmers find
buyers that will buy direct and pay a better price.
And we also perform a really
auditing and certifying those importantproducts. which is
So we have a label, a fair trade
see that on a package of coffee, certified label, and when you
chocolate, you know that the a bunch of bananas, a bar of
that there was an independent third party body that actually
audited that to make sure.
word of the company for it. So You know that there's anhe
independent verification. We also have farmer training
programs and we have consumer engagement programs to get
consumers on board to help
So, here are a few numbers for educate people about fair trade.
In 14 years, we've signed up you.
the US, from small mom and pop more than 800 companies here in
giants, like Starbucks and companies to big corporate
Sam's Club, Whole Foods, Green Dunkin' Donuts, Costco,
Ben & Jerry's Ice Cream. Mountain Coffee Roasters,
in that sense, spans the entire range of possible companies,
that you can imagine. Those companies last year sold
over $1.5 billion worth of fair trade products in the US alone,
and we're part of a $6 billion
So increasingly fair trade is globalmainstreaming.rket.
It's available in mainstream
People are waking up to it, and all of that is driven a pretty
significant impact. Last year we crossed the $250
million threshold in cumulative premiums back to fair trade
farmers.
of money over and above what So what that means is the amount
locally, we call that the fair farmers would have got selling
return on investment. When we think about why do we do
fair trade? It's for that extra money that
farmers are getting as a result of participating in fair trade.
So $250 million, again not in money that was given to farmers
but rather money that farmers earned and captured through that
direct transaction. And so that means not one but
hundreds of thousands of kids that are going to high school
and college as a result of this.
so much is happening now in over Wells, schools, health clinics,
and Latin America as a result of 70 countries in Africa, Asia,
Now, on the consumer side, we haven't done as well.
Consume awareness of fair trade in Europe where fair trade has
been around a lot longer is 80%.
you asked them what does fair Strade mean or show them a fair
trade label, they can give you a
that means. Here in the US, we're at 34%.t
So, 34% of 200 million adults,
the US today can tell you what so roughly 70 million adults in
And that's pretty good but it's fnot good enough.
What we discovered through the
learn about fair trade and research is that when consumers
what it's all about and when become aware of what it is and
store, then they want it. it's avaiWe want it.eir local
Who doesn't want to be a part of
So that kind of speaks to the big challenge that we face today
which is how can we raise awareness, how can we grow the
model, or more generally
model that has worked well for speaking, how can we take a
their family members around the rworld and take it to scale?nd
And so if you are thinking about
of the classic question that all entrepreneurship, this is kind
another, if they stay in entrepreneurs at one point or
with. bHow do I take my business from
small and successful to bigger
How do I take it to scale? and successful?
who started and runs And I can tell you, as someone
nonprofit, trying to impact the purchasing behavior of 200
million Americans is not easy.
challenges of consumer In particular venture, the
raising capital as a nonprofit awareness, the challenges of
And the challenges of engaging are huge.
we found is that fair trade will the business community, and what
Yolanda if it also works for the only work for Santiago and
It has to be a partnership. We can't expect businesses to be
socially responsible or environmentally responsible if
that comes at the expense of
I think that was the old way of thinking, that the business
community thought that
were kind of at odds with each profitability and sustainability
be sustainable, you had to take other, anlower profits.wanted to
And if you wanted to be profitable, then you couldn't
afford to care about the
workers. environment or Third World
The leading thinkers in the business community actually
understand that you can do both together.
You can be profitable and sustainable, and, in fact,
sustainability can be a driver
of growth, of profitability, and of reputational differentiation,
And so that was my comment of success, in business terms.
now that we're seeing of social bemovements and the businessn
community where it's no longer
separate phenomenon. two separate cultures or two
There's definitely a convergence The two are coming together.
So, I just want to make a couple going on.
in our venture and in fair trade more remarks about where we are
open it up and hear what you in American, and then I want to
So we have just launched, by the want to know.
of course now I can't remember way, there's a great book, and
It's something like What Got You the title.
is about how the formulas that Here Won't Get You There, which
starting something aren't necessarily the right formulas
at a different stage of that
take something to scale, you venture and how if you want to
That's where the fair trade movement finds itself today.
So we're thinking about if there
world that live on two bucks a are two billion people in the
million, how can we take this model and make it more relevant
in the pail of global poverty?
So we have just launched How can we have a bigger impact?
Fair Trade For All, which seeks anto do just that.ed
It seeks to take fair trade to
dramatically higher impact on farmers around the world.
In fact, specifically, our first
our impact in terms of milestone is we want to double
dollars back to those ccommunities, we want to doublef
our impact by 2015. And we're seeking to do that
through three core strategies.
strengthening communities. The first one is focused on
different expressions. And that kind of has a couple of
the community enterprise because The first one is strengthening
we're helping farmers form we're an enterprise model where
That's a business. viable co-ops.
Well, access to capital, helping So how do we strengthen co-ops?
so that they can produce and them get access to bank credit
training, technical assistance, entrepreneurial support, market
linkage.
them be really good partners to Suthe likes of Whole Foods oring
Starbucks or Just Coffee or whoever, that's critical for
their success.
is once they have fair trade But then the flip side of that
water project or an education preproject, are there greato a
organizations out there that can
do that effectively. partner with them to help them
partnership with Kiva.org, So we've just entered into a
with Lutheran World Relief, with with Heifer International,
are all taking similar a bunch of different NGOs that
sustainable development and who eare great partners for us in
this strategy of going deeper with fair trade, strengthening
the community.
Strategy two is all about So thatinclusion.y one.
It's about expanding fair trade in order to include more people.
Right now, fair trade really
in most of our product focuses on small farmer co-ops
In a few other categories we categories.
the standard there is about the also workfarm worker.rms, and
Three-dollar a day, four-dollar a day farm worker who works in
terrible working conditions with
So we also want to reach out to the farm worker community as
well as the small independent farmer.
We want to serve both communities.
And often it's the same family. So, by expanding the scope, if
you will, of fair trade certification we're going to
reach more people, but we're
more attractive to the business community because guess what?
Great coffee comes from small farms and large.
So if I'm a coffee company and
for high quality coffee, I want to have the freedom to buy fromg
farms of any size and to be able
halo, if you will. to do that within the fair trade
right now. So that's what we're onto
my world, but outside of the And it's a controversial move in
treat it like a no-brainer. So, the third and final strategy
within the fair trade for all vision is about us.
Through my time in Nicaragua
kind of thought about fair trade working with farmers, I really
empowering farmers. two dimenEnd of story. model for
That's it.
empowering farmers. And since I moved back to the
states, I've kind of developed a
Actually, I'd love to hear your thoughts on this in a minute.
I think people in this country
plight of the poor. I don't think there's a person
in this room that would enjoy eating a chocolate bar if you
thought that there might be child slavery in the cocoa
production of the cocoa.
in this room that would want to eat a banana if you thought that
the person that was picking the banana was crop dusted with
toxic pesticides. We all have basic values, basic
human values, and I think the problem isn't that we're
indifferent as a nation but that
involved. Who knows how to help a cocoa
farmer or banana farmer living
Most people have no idea. And, furthermore, we're all
caught up in our own lives and
has time to even educate our own struggles, and so who
less then figure out, oh my god, ourselves about the issues, much
It's almost paralyzing just a solthinking about it.erty?
I think that's the problem. And if you look at levels of
civic action in this nation,
If you look at how many people they've gone down.
the nation votes. vSo, for me, this whole thingf
about using markets to change the world, a lot of it is the
psychology of us. How do we make it easy for us to
be a part of something positive and powerful that really changes
things? Well, guess what?
We may not all vote but we all eat.
And we all wear clothes,
in Berkeley. except for some of my neighbors
So if you can turn the act [LAUGHTER]
the act of eating and clothing of consumption, if you can turn
a better world, then your onto yourself into a way to vote for
going to do it. Everyone's, potentially, going
to do it. And I think that's why fair
trade, like so many other things, like buy local and
organics and all these things, I
successful to the extent that it think that's why it has been
Because with a cup of fair trade has.
that simple, easy, every day coffee you can feel like, with
half way across the world and hahelp Yolanda go to school.h
That's pretty cool. And then you think about all the
stuff that we buy and the implications and the
possibilities are limitless.
consumer involvement is all So, that'about. igniting
It's about raising awareness and
involved. gGiving us all the realizationet
and the opportunity to vote with
better world because every our purchasing decisions for a
So, in my mind that kind of ptakes two levels
or two dimensions.
So, this is a picture of a woman The first one is buy the stuff.
you go into Whole Foods, you'll bfind a big ol' fair trade sign
over the fair trade bananas.
and buy fair trade products if So, at the very least, go out
And if it's not in your store or you can.
to see that the cafe out here where I just bought a cup of Joe
has Johnson Brothers fair trade coffee, yes.
[LAUGHTER]
ask for it. People don't get pissed off if
you ask for it. Do you all have fair trade?
Oh, you don't have it?
could get it. Guess how many times it takes of
someone asking that for the store owner to actually do it?
Not very many.
to their customers and respond. BusiSo buy it when you can.sten
Ask for it when it's not there. That's really easy stuff.
We can all do that. And for those who want to go
above and beyond, there are other ways to get involved.
So, we have a growing movement
Towns Movement, and kind of alongside that is the Fair Trade
Universities Movement, and the
to see how many universities and two are kind of in competition
Madison, guess what, is a fair towns they can capture.
Cool. And the university isn't yet a
fair trade university but we'll get there, right?
So, the whole idea of the fair
universities campaigns is, for trade towns and the fair trade
for those who want to go out and those who want to get involved,
the word and find the tconnections with other issuesad
like buy local, there's a framework there for getting
involved, for promoting it, for educating others, for getting
products onto shelves and so on.
and then we can open it up. So fair trade products, coffee
and tea mostly, are available now on about 600 college
campuses nationwide.
Y'all did that. The only reason why there's fair
trade coffee right out here is
of students and/or professors becand staff said to whoeverroup
manages that facility, hey, can we get fair trade in here?
And they responded. So that's happened in hundreds
of campuses nationwide. When we first got started, a lot
of the big companies did not
trade. want to get involved in fair
cared. They didn't think that consumers
cost them more money. They didn't want to have the
audit.
were like, oh, fair trade, not Lots of reasons why companies
I'm talking about in the early so sure.
Now it's much more common. years.
companies at that time was a One of the biggest coffee
We've all probably enjoyed company called Sara Lee.
They also served coffee, and Sara Lee pies.
campuses. theAnd UCLA, University oflege
California in Los Angeles, is a huge campus.
It's probably as big as this
So they drink a lot of coffee on one, probably 40,000 kids too.
by Sara Lee. UCLA campus, and it was served
hip to fair trade. And so students on campus got
committee. They put together a little
other kids were interested in They kind of wit. out to see if
They got a petition, just a bunch of signatures on a piece
of paper. So they went into dining hall
administration and said, you
trade coffee in our dining know what, we really want fair
And dining hall went to Sara halls.
but they went back and forth, back and forth, and finally Sara
Lee did it. And they converted that account.
And so several containers a year
trade which meant the farmers that produced that got a much
better deal.
about this story than that is that the business community sees
y'all as trend setters. You are their current and future
customers.
the norm in the future. WAnd so Sara Lee, which is kinde
of this crusty, conservative
better get on this fair trade company, dthing., whoa, we
And so they didn't just convert the UCLA account, they auto
shipped free fair trade samples to all of their university
accounts and actively encouraged
they wanted to get involved kind accounts to try it to see if
phenomenon called fair trade. And furthermore, they put it out
there in all their food service channels.
So basically a handful of kids
the behavior of a corporate on one campusgiant. up changing
That's power. That's consumer power.
And that's what Fair Trade
It's like using that voice of consumers, leveraging that voice
not just to change the products that are sold here on campus but
to have a much bigger impact on those companies.
So, that's my story.
Thank [APPLAUSE]ng me.
So I want to hear questions,
I also want to hear tother points of view.t
If anyone's skeptical or if anyone wants to share a story.
Those of you who raised your
farms, whatever you want to talk hands who've actually visited
Who wants to go first? about I'm up for it.
to go up and I'll hand the mic >> I'm just looking for a hand
My name is Matthew Rust. off.
Thank you for being here, I'm a consMr. Rice.irs major.
To go along with advertising and
maybe you could talk a little bit about what was successful in
the European market with fair trade, and maybe, I know with
being a nonprofit advertising is
I didn't know about fair trade difficult.
university, personally. I don't know if it was being in
Madison or being at the university that educated me to
it but talking about colleges starting it, I think, is a
really good point.
Thanks. >> So, why is Europe so far
ahead?
There's a long tradition in Europe dating back to, like, the
1950s of international
Oxfam getting involved in trading and seeing trade as an
alternative to aid. And so that evolved into
something called the world
How many of you all know of a local company called Serve?
Oh, man.
Street. >> It's down on Monroe Street.
Go check it out.
and Serve is a real pioneer here So it's 100% fair trade shop,
that's telling because if we had in the US market, but actually
Oxford today and I had asked the been Rotterdam or Berlin or
heard of Oxfam's little store down the street, everyone would
have raised their hand. There's this tradition of shops
that sell fair trade products across Europe and have helped
raise awareness over decades. And here in the US we also have
organizations but the profile has been lower and awareness has
not been as high. So that's one reason.
I think another reason, you know
heard it from several European what, this may be crazy but I've
They believe that their colonial friends.
all study history in school has hled to what many call just ay
collective colonial guilt in
Feeling like Europe was developed through the
exploitation of Africa and Latin
So there's a feeling that it's America.
I don't know whether that's true right to give something back.
We obviously have a different history.
We obviously have different consumers.
I think US consumers maybe are
history of Latin America and our not as aware often of the
around the world. So those are different thoughts
about why.
a mainstream phenomenon Ththroughout Europe Also, the is
market structure is different in
If you go to Switzerland, so Europe.
is the size of Wisconsin, and they have two retail chains, two
grocer chains there that control
So if you're in both retail chains, and fair trade products
are, basically everyone's buying.
So, in smaller markets where
distribution, I think it's going there's concentration of retail
trade gets in there, everyone's togoing to learn about it.ir
So, the US is culturally
We have a different history. different.
It's a bigger challenge here in We're mucthe US.dispersed.
It's as far from San Francisco
Manchester to Moscow. So we've got a huge task before
us. But it's doable.
And it's doable, I think, at its
that the core values of our nation, this is going to sound
cliche, we love to root for the underdog, we believe in honest
pay for a hard day's work.
We all learned the fair, what, We believe in fairness.
It's a core value. in kindergarten.
Play fair. Be fair.
I'm not just talking about fair trade now, but corporate social
responsibility and values based business and products I think
resonate with Americans in a
So, for me, the challenge isn't how do I change American's
values. No.
Our values, in that regard, fundamentally are right.
It's how do we raise awareness
with a cup of coffee I can keep so thata kid in school?t, wow,
That's cool.
Who knew? I probably didn't answer a damn
thing you asked, did I? [LAUGHTER]
You get me on a roll, man,
Sorry. and I'm just like, whew!
off to one of our other students, I'm just curious how
many of you felt you were familiar with fair trade before
reviewing materials in advance
class today? of Paul's talk and coming to
So just a fair number but not necessarily the whole group.
Hi. My name's Alex Diamond.
Hey.
here today. >> And thank>> Sure.in for being
My question refers to the video stream on our UW, which is
your coworker, Rob Behnke, and
industry and where that's going. his work with the apparel
He's a gentleman who's >> Who is this?
Oh, right. cofounder of Fair Indigo.
Thank you. Of course.
Are you guys working together with moving the fair trade
market towards retail production
kind of stuff? and where is that going and that
that I know of. >I actually haven't met Rob, so
that is why I did the double
Fair trade, historically, has been more about food than
anything else.
focused all these years of work is really on helping farmers,
but the model and the theory of change that lies at the heart of
fair trade certainly, at least
applicable to other industries, including manufacturing.
The theory of change being that you can align the interest of
producers, businesses, and
and that consumers will step up cand buy the product and buyin
into that if you give them a
So, a few years ago, we started looking at the plight of cotton
farmers.
If you're a one-acre, two-acre And it's tough.
Faso in west Africa or in India or in Peru, price is like this.a
You have no stability and no
to local middle men and you lose market access, so you're selling
and you might make a little bit yback the fourth year and thenw
you're back on that roller
So we were thinking about, okay, coaster.
cotton farmers? And what we realized was if we
were to bring fair trade cotton to America and put fair trade
cotton in garments without any
situation, so the hypothetical knowledge of the factory
sweatshop, made into a garment of fair trade cotton made in a
That's doesn't work. in a sweatshop?
whole supply chain. It's not like coffee where ite
just comes off a farm and gets
Cotton, made into clothes, goes through a factory, and, in fact,
the activist community for 30 years has been scrutinizing the
issue of the sweatshops.
live and work in difficult And those apparel workers that
wages. conditions and make really low
cotton until we could develop a standard for factory labor.
So we developed a standard. We consulted with the industry.
We consulted with the factory owners.
We consulted with the workers.
and last year, a year and a half We developed a pilot standard,
Apparel made with fair trade ago, we launched Certified
paying significantly higher cewages and providing betters
working conditions to workers,
that is certified as well. and the product coming out of
I don't know if it will work or It's an not.riment.
Like Levi's, Gap, none of the big brands have signed up yet.
So we've got Fair Indigo and
small, mission-driven, really cool brands that are doing it
because they believe in it, but we're waiting and hoping that we
can take it from there to the next level.
And I can't tell you how many times I've been to Minneapolis
to visit with Target to talk
They want to do it but they really don't believe that you
will pay a dollar more for a
label on it. t-shirt that has the fair trade
for nine bucks and they'd like They want to sell that t-shirt
it for nine bucks. to add the fair trade label on
Because of the way the apparel And guess what?
can't do it for nine bucks. supply It's got to be 10.ed, we
That's the only that the workers
cotton farmers can get their can get their benefit, the
same margin. benefit, and Target can make the
dollar hit on it, then they Ncould sell it for nine bucks.a
But I don't want that either. I don't want fair trade to be
something that erodes companies'
I want them to want to do it out profits.
Do you know what I'm saying? of enlightened self-interest.
take the dollar hit. Besides, they're not going to
How do I convince a big company to make the leap or even just to
experiment? And that's, frankly, where the
conversation is today.
y'all have Targets out here, Can we run a test in Targets,
Sure. >> Okay.
So, how can we run a test in
t-shirts and see how they sell? And if they don't sell, I'll go
home. But I think they'll sell.
Tell me the truth, now that you know what fair trade is, would
you pay an extra buck for a fair
You talking to me? trade t-shirt?
you. >> Hell yeah, I'm talking to
It was your question, right? [LAUGHTER]
but yeah. >> >> You better say yeah.was,
[LAUGHTER]
No, I don't mean to put you on the spot.
I'm just playing around.
if this is going to work in But thattheir industry.ne knows
They've seen it work in coffee, they've seen it work in other
product categories, but everyone
So, this is all step by step, it's an iterative process but
I'm hopefully, actually I'm confident that fair trade can be
relevant, not just for the
manufacturing as well. agricultural sector, but for
here, and then I'll come down to >> We've got a question back
Yes, sir. >> Hi, my name is David, and
basically I'm wondering how you go about researching and
reaching out to new producers and farmers in developing
countries.
them? So>> So, in most cases, theing
farmers come to us because they have heard about fair trade in
their countries, maybe the
gotten involved in fair trade, community down the road has
In Nicaragua, you recall in my and so they see that difference.
the first year. sAfter that first year, afters
word got out that Pablo un dolar
for coffee when the price was 10 cents with the middle men,
people came to us.
co-op. Everyone wanted to join the
And so that's kind of a similar So it grpath.ke that.
I don't have a team that goes out looking for farmers to
certify.
Fair trade is big in a lot of It's these countries.outh.
In every coffee producing country in Latin American, fair
trade is on the industry's radar
people are getting trained, and I think the challenge has been,
in the case of some of these
and sugar, that we haven't been willing to work with everyone.
We've only worked with you if you're in a co-op.
That's been the requirement in
So that's why we've launched the some of our product categories.
kind of open the fair trade facertification up to any and to
every producer that feels like
and sustainably and give them a tchance to participate as well.y
And we're communicating that
We go to all the trade shows and broadly.
industry, and the industry in turn tells their suppliers, hey,
fair trade is expanding the model, you should apply.
And applying means they're going
to get audited. So there is an on-site audit of
every farmer once they say, okay, I want in.
They can't just get in without
And it's 200-point checklist of different social, labor, and
environmental criteria that farmers have to meet.
It's very rigorous. The audit is very detailed.
It takes many days and it costs.
year, sometimes more for bigger The co-ops, in order to get00 a
certified.
certified, that unlocks this But, of course, once they get
significant premium price that whole market and this
Hi, I'm Ellie Feldman, gets paid back to them.
You were saying in other and I just have a question.
bigger because there's just a few grocery stores and they all
have fair trade.
seems like there's Starbucks on every corner so have you guys
tried to leverage with Starbucks
It seems like that would be a pretty big way of getting a lot
of knowledge in the US about
I'm working on it. fair trade.
Swear to god, I'm working on it. [LAUGHTER]
a fair trade coffee early on, So,like 2000-2001.ched
So Starbucks has been a partner for, like, 10 years.
But most years they've only had one or maybe two different fair
trade coffees out there, and if you go into Starbucks you might
not even notice that they have
Unless you know the fair trade it.
it, you might not know. It's served as coffee of the day
on a fairly regular basis.
Starbucks and say, hey, I want a So sometimes if you go into a
fair trade coffee even though cup ofyou don't know it.tting
But even with that kind of
Starbucks has become one of the largest importers of fair trade
coffee in the world, and it's impacted the lives of hundreds
of thousands of families. So it's a good thing.
But to your point, what if we could leverage the whole company
behind fair trade?
Obviously, that's where we want What if they to go.d the walls?
So I think if you look at the fair trade market and think
about it as all markets that
stage to a mainstreaming stage evolve from kind of a pioneer
we're just now kind of at a tpoint in mainstreaming wherek
companies are starting to think about fair trade not just as a
flavor. I've got my Italian roast,
my decaf, and my fair trade.
Companies are starting to think about fair trade as their brand
halo. As what they stand for.
And I say companies are starting
Actually, Just Coffee, right to.
pioneers, have been doing fair here in town, and a lot of
day one. trade and only fair trade since
pioneers who believe in the cause with all their heart and
soul, I'll say that for them
every done from the very fair trade has been all they've
But for a big company that came late to the game, they want to
dip their toe in the water, they
they got to a certain level, and want to see if it will sell, and
just kind of left it at that. Now we're seeing those companies
take it up. So point in case, Ben & Jerry's.
I've been working with Ben &
A couple of their ice cream flavors were fair trade.
Last year they announced they're
their ice creams. In the next two years, you'll
see my label on every Ben & Jerry's sold in the land.
That's pretty cool. So that's going from the flavor
approach, which is a
here's what we're all about. differentiation approach, to a
business. Ben & Jerry's, Honest Tea,
y'all know Honest Tea?
Honest Tea. So Honest Tea converted all
their tea last year to fair trade, 100%.
So it's not just on one bottle, it's on all the bottles, that
have tea in them anyway.
So a bunch of mainstream Green & Black Chocolate.
who we are. cWe're going to go all the way,s
and guess what? When you go all the way, you
tell everyone.
so much advertising and cool So Ben & Jerry's has been doing
Did y'all see Ben & Jerry's on stuff.
Someone's got to nod. Please, someone nod.
[LAUGHTER]
Y'all don't watch TV? So, [LAUGHTER]on?
So, Jimmy Fallon has now
Late Night Snack. a It's ice cream with littled
potato chips in it. It's pretty good.
Yeah, I know, sounds gnarly but it's actually pretty good.
It's fair trade so they've got
show about fair trade. Jimmy Fallon now talking on his
once a company says, okay, I'm So that's the kind of stuff,
is who I am, then they have a strong interest in advertising
and promoting and awakening consumers with far more dollars
than I'll ever have because I run a small nonprofit.
So the way I awaken consumers is
getting them to raise awareness. by leveraging partnerships and
way all y'all can help is Sowhether it's Starbucks orhe
Dunkin' Donuts or Subway or whoever it is, wherever you
shop, just ask. Do y'all have fair trade?
Oh, you don't?
next time I come in. Okay, well maybe you'll have it
like you. Not like in yNo. face, I don't
Okay, well next time I come in
because guess what? If enough people do that,
they'll do it.
a final one down front. >> We've got>> Okay.ion here and
Hi. My name is Becky Hall, and I
know that you talked earlier
company as you guys grew because about how you had to change your
things you started out with. you can't stick with the same
started working with other As your company has grown, you
What have you done to stay cost effective and make sure that
everything is still fair trade? How do you oversee all of that?
Run that by me again. >> As you guys grow, how do you
stay cost effective and make
trade, that all of the farmers sure everything is still fair
Nicaragua, how do you oversee all of that as you're working
with so many more people? >> I'll answer what I think
you're after, but if I don't hit
In terms of the farmer the mark, ask again.
certification, we have a network inspections and farmer
that are, essentially there to of inspectors all over the world
are complying with the standard. inspect and verify that farmers
in, so that work load grows And every every year.armers come
So every year we have to hire to
Fair trade has been growing kind of slow and steady
for the last 10-15 years. Last year we grew by 25%, so
that was pretty good coming out of the recession.
But suffice it to say, with Fair Trade For All, there is
going to be a significant expansion of the work load at
the farm inspection level.
certification agency called And Scientific Certificationth a
Systems, SCS, California-based, global, and they do an amazing
job.
They've been certifying sustainable forestry and
organics against other standards
So we're really confident that for 25 years.
expands the movement and expands as Fair Trade For All really
to new farming communities, that the availability of fair trade
infrastructure, if you will, to we'accommodate that.ctor
Is that what you were getting at
Yeah. or was i>> Thanks.g else?
Hi. My name is Darian.
So, I'm going to go back to kind
So how did you choose Nicaragua of all the places to go, and
once you were there, how did you
they're up a hill, across a bridge, and what obstacles did
you have during your travels and
yourself? was itThat's my question.ent by
[LAUGHTER]
obstacles, and safety. So, Nicaragua, communities,
safe, and that's why I went to >> So, it definitely wasn't
I'm kidding. Nicaragua.
somewhat unique in that it was Nicaragua, at the time, was
political and social change, going through pretty dramatic
farming cooperatives and the cooperative movement,
Everyone was organizing farming co-ops, and that was, in school,
what I had studied, thinking
them come together into co-ops. aboAnd we have a tradition ofing
co-op, farming co-ops, here in
Like Sunkist Oranges, Ocean Spray Cranberries, those are
farmer owned co-ops.
that, theoretically. So, I was really interested in
Nicaragua was doing it. I It was like this liveand
experiment. So I thought, okay, cool, I'll
go there. But once I got there, I realized
that I was, to your question
middle of a war zone. There was a lot going down in
the '80s in Nicaragua, and it wasn't safe.
But I stayed because I just felt
by the struggle of people to really drawn to it and compelled
better life. organize and to strive for a
gorgeous Nicaraguan woman And it and got married.t this
[LAUGHTER]
I ate rice and beans every day So, yeah, I kind of went native.
days and that was my life. and rode a horse to work most
home at some point. But, really, it was kind ofg
random how I got there. What was the other point?
How did you find communities
Oh, yeah. Well, so I worked on these
different projects. So I worked with Oxfam for a
while, and I worked with another
the government of France had a agency called Christian Aid, and
over a year. project that I worked on for
different development agencies So I connected with these
signed on to their projects and then got sent to this community
or that community and ended up
farmers in hundreds of little metiny villages throughout theof
northern part of Nicaragua which
And so after doing that for seven years, then I kind of got.
out of that model, and I started
had all those relationships. the coffee co-op, but I still
I went back to all the coffee communities where I had already
worked, and I looked up Santiago
we've got to do this. anAnd he's like, no way, dude,n,
it's not going to happen. He didn't sign up the first
year. He signed up the third year
because he didn't believe, you
cowboy hat on. got to see Santiago with his
He doesn't see himself as an He's a little cowboy.
Now he does but at the time he exporter.
That's a big company. waWe can't export.?
So I worked for months going
communities where I had already worked to try and find people
who would step up.
first year then it took off. Of course, once we proved it the
are interested in thinking about There is a, for those of you who
graduate, there's, of course, Peace Corps, but there's also a
great book and you can Google it
An organization called and buy it.
and it's called Alternatives Food First puts it out,
And it's about really cool NGOs all over the world that are
doing sustainable development and food security
and cool projects.
all the time by kids who want to Because we get calls and emails
there are lots of great organizations doing great work
that you can connect with.
if you don't stay for 11 years. So I highl[LAUGHTER]d it, even
I want to thank the students
questions, and I know that they all join me in thanking you
for an inspired presentation. Thanks, Paul Rice.
They did good, thank you. [APPLAUSE]