Combating Child Labor through Fair Trade in West Africa
This entry has been selected as a finalist in the
Ending Global Slavery: Everyday Heroes Leading the Way competition.
TransFair USA prevents child slavery by enabling smallholder West African cocoa farmers to obtain higher prices for their products, and promoting greater supply chain transparency.
About You
Location
Project Street Address
Project City
Project Province/State
Project Postal/Zip Code
Project Country
Your idea
Sector Focus
Business
Year the initative began (yyyy)
2002
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Positioning of your initiative on the mosaic diagram
Which of these barriers is the primary focus of your work?
Invisibility of problem
Which of the principles is the primary focus of your work?
Expose slavery’s hidden role in commerce
If you believe some other barrier or principle should be included in the mosaic, please describe it and how it would affect the positioning of your initiative in the mosaic
This field has not been completed. (333 words or less)
Name Your Project
Combating Child Labor through Fair Trade in West Africa
Describe Your Idea
TransFair USA prevents child slavery by enabling smallholder West African cocoa farmers to obtain higher prices for their products, and promoting greater supply chain transparency.
Innovation
What is your signature innovation, your new idea, in one sentence?
TransFair USA prevents child slavery by enabling smallholder West African cocoa farmers to obtain higher prices for their products, and promoting greater supply chain transparency.
Describe your innovation. What makes your idea unique and different than others doing work in the field?
TransFair USA’s work with Fair Trade Certified cocoa is unique in that it combines internationally-respected regulation and regular inspection of cocoa farms with guaranteed financial resources and technical support for farmers to make compliance possible. Poverty and geographic isolation are the roots of many of the West African cocoa sector’s most serious social problems, including human trafficking and child slavery. Farmers faced with low market prices are often forced to expand the land they cultivate, exacerbating labor shortages and increasing the demand for child labor. Poverty also decreases educational opportunities available to cocoa farmers’ children. TransFair USA tackles these issues by guaranteeing farmers higher prices for their cocoa with Fair Trade.
Fair Trade gives farming cooperatives more direct links to their international clients, and allows them to earn higher prices. Through Fair Trade premiums, TransFair USA also provides cocoa cooperatives with resources to invest in education and local development. Finally, Fair Trade’s annual inspections of cocoa farms ensure that labor laws are met.
Delivery Model: How do you implement your innovation and apply it to the challenge/problem you are addressing?
TransFair USA brings the supply and demand ends of the cocoa supply chain together, forging direct linkages between farmers, industry leaders, and an international network of technical assistance providers. We provide supply-chain auditing to U.S. companies sourcing Fair Trade cocoa, to increase transparency and guarantee that Fair Trade criteria are met. Finally, by promoting Fair Trade Certified cocoa, we connect farmers and industry to a growing network of conscientious consumers and advocates eager to reward them for their commitment to ethical production.
How do you plan to grow your innovation?
More than 48,000 small cocoa farmers in West Africa currently take part in the Fair Trade system, but there is enormous room for growth. TransFair USA is working to develop new opportunities for West African cocoa farmers to sell their products on value-added markets, and to build their agronomic and business capacities. This will enable current farmers to sell more cocoa on Fair Trade terms, and create opportunities for farmers who are not currently participating in Fair Trade to join the system. We are also dedicated to working with U.S. industry leaders, consumers, and advocates to educate the public about the hidden challenges of the global cocoa industry, and the benefits guaranteed by the Fair Trade alternative.
Do you have any existing partnerships, and if so, how do you create them?
Our partners are found throughout the cocoa supply chain, among producers, industry representatives, consumers, and advocates. Unlike many traditional development organizations, we view farmers’ cooperatives not as passive beneficiaries but as active partners, and cooperative leaders in Côte d’Ivoire and Ghana play key roles in designing and guiding our efforts to develop the market for their products and provide technical assistance to their communities. Other key partnerships include conscientious consumers and Fair Trade movement leaders. A global network of advocates in the NGO community, on campuses, and in communities of faith has played a leading role in raising consumer awareness of the need for Fair Trade in cocoa, and we continue to be grateful for these partnerships. Industry partners such as importers, manufacturers and retailers who take part in the Fair Trade system play an equally central role. We also work with allies in the international development and technical assistance communities to provide direct capacity-building services to our producer partners on the ground.
Impact
Provide one sentence describing your impact/intended impact.
TransFair USA’s work makes cocoa farming in West Africa more profitable, and cocoa supply chains more transparent, eliminating the need for forced or child labor.
What are the main barriers to creating or achieving your impact?
Fair Trade’s impact in the cocoa sector has been restricted by low rates of consumer awareness—both of the problem and the Fair Trade solution—and in many cases, by producer capacity limitations. Many farmers struggle with quality control, limited financial and international business experience, and difficulties producing the quantities of the varieties their international customers demand. Each of these issues constrains the Fair Trade Certified cocoa market’s growth. TransFair USA’s Global Producer Services initiative provides capacity-building services to help overcome these barriers.
How many people have you served or plan to serve?
TransFair USA’s work directly serves cooperatives in Côte d’Ivoire and Ghana representing nearly 50,000 smallholder farmer families. Many of these organizations are eager to expand their membership, and all are looking to sell more of their cocoa on Fair Trade terms. In addition, cooperatives elsewhere in the region, in Cameroon, the Democratic Republic of Congo, and other neighboring countries, will be entering into the Fair Trade network in coming years.
Directly
Cooperatives serving more than 48,000 smallholder farming families, representing as many as 525,000 individual family members, are currently selling cocoa to U.S. buyers on Fair Trade terms. We expect the cooperatives we serve to be able to expand their membership as the market for Fair Trade Certified cocoa from West Africa continues to develop.
Farmers and their families are able to earn higher incomes from Fair Trade, sustaining their farms without resorting to expanding their fields or exploiting labor. This, together with Fair Trade premiums to support education, increases children’s opportunities to obtain an education. Fair Trade cooperatives around the world have contributed to the education of young people by providing schools, scholarships, and school supplies.
Indirectly
The social development projects that are implemented by Fair Trade farmers benefit both cooperative members and their neighbors. Fair Trade cooperatives around the world invest in infrastructural improvements that benefit entire regions. Many co-ops maintain health facilities open both to cooperative members and non-members. And a growing body of evidence suggests that effective cooperatives such as Fair Trade helps to build can have a beneficial impact on local economies more broadly, raising local market prices and increasing smallholder empowerment.
Please list any other measures of the impact of your innovation?
TransFair USA has provided additional income and new business opportunities for cocoa farmers since the beginning to Fair Trade Certification of cocoa on the U.S. market. Farmers have made more than $6.5 million worth of cocoa sales on Fair Trade terms to date, and earned more than $450,000 in funds specifically dedicated to development projects. In 2007, TransFair USA worked with 57 U.S. cocoa companies, nearly twice the number that participated just two years earlier. Each new partnership provides African farmers with additional opportunities.
Is there a policy intervention element to your innovation?
TransFair USA’s efforts are concentrated on building a more transparent market for cocoa that eliminates the root causes of child exploitation, rather than direct policy interventions. But we are very open to collaborating with government efforts locally and internationally to aid farmers in accessing higher value markets, retaining more of the value of their crops and building their capacities as farmers and businesses. We are eager to mobilize our network of colleagues and allies in the cocoa industry in support of domestic policymakers’ efforts to document and prevent labor abuses in cocoa sector. Internationally, TransFair USA seeks partnerships with government agencies in Ghana and Côte d’Ivoire that will support the development of a business environment in which the interests of smallholder farmers are represented.
Exactly who are the beneficiaries of your innovation?
The beneficiaries of Fair Trade in West Africa are farming communities, consumers and industry. Fair Trade helps farmers and farming communities become sustainable and increase their opportunities. Consumers can have confidence that the Fair Trade Certified chocolate they enjoy was produced responsibly, with a positive impact on the developing world. Our industry partners are key allies in developing market opportunities for the smallholder farming communities we serve, and we are proud to provide them with a credible means to ensure their social responsibility.
This Entry is about (Issues)
Sustainability
How is your initiative financed (or how do you expect your initiative will be financed)?
As much as 80% of TransFair USA’s income is earned from U.S. companies in exchange for our supply-chain auditing services. This earned revenue supports almost all of our core expenses. We rely on grants and contributions to support technical assistance to farmers and other investments in Fair Trade’s expansion and growth.
If known, provide information on your finances and organization
Annual Budget: $10,043,860
Annual Revenue Generated: $9,970,066
Staffing 2007-08
Full Time: 65 Part Time: 3-6 Volunteers: 2-6
What is the potential demand for your innovation?
The U.S Fair Trade coffee market demonstrates the growth potential if certified chocolate products are successful. The Fair Trade coffee market has grown an at average annual rate of 55% and Fair Trade Certified coffee has moved from niche, specialty markets into channels as mainstream as Wal-Mart stores. We are confident that similar mainstreaming of Fair Trade cocoa—and more importantly, dramatically expanded benefits for farming communities—is possible.
What are the main barriers to financial sustainability?
TransFair USA’s success in bringing Fair Trade into the mainstream has placed significant pressure on our operations—opportunities to expand Fair Trade are now growing faster than our revenue base. The potential impact of our work has increased exponentially, but so too have the expenses associated with bringing Fair Trade to scale on behalf of farmers. TransFair USA will initiate a growth capital fundraising campaign in 2009 to overcome these challenges and ensure that Fair Trade’s growth continues to bear fruit for farmers.
The Story
What is the origin of this innovation? Tell us your story.
Even though Americans spend $13 billion a year on cocoa products, many small-scale family cocoa farmers face tremendous instability. They are often forced to sell their harvest to local middlemen who use rigged scales or misrepresent world prices. Recent media reports of child slavery on West African cocoa estates show the stark contrast between the delicious treat we enjoy and the often difficult working conditions of the people who produce it.
By guaranteeing farmers a fair and sustainable price, Fair Trade allows cocoa farmers to invest in post-harvest techniques that bring out the individual flavors of the particular cocoa-growing region. Fair Trade cocoa beans aren't "faceless" cocoa beans bought on an international exchange, but beans that can be traced back to an individual cooperative and even an individual farmer.
TransFair began certifying Fair Trade chocolate and cocoa in 2002, and by 2007, 57 U.S. companies offered Fair Trade Certified chocolate products. Already, Fair Trade Certified hot cocoa and chocolate bars are offered in thousands of retail locations around the US, including a rapidly growing range of mainstream supermarkets and retail outlets such as Trader Joe’s and Costco stores.
Please provide a personal bio. Note this may be used in Changemakers marketing material
Paul Rice became TransFair USA’s founding President and CEO in 1998, following eleven years working with smallholder farmers in northern Nicaragua. TransFair USA has now enabled farmers to earn more than $113 million in additional income. Paul’s work with TransFair USA has been recognized by leaders including Ashoka: Innovators for the Public, the World Economic Forum, and the Skoll Foundation. Paul holds an Economics and Political Science degree from Yale University and an MBA from the Haas School of Business at UC Berkeley.
Emphasis of Work
TransFair USA enables sustainable development and community empowerment by cultivating a more equitable global trade model that benefits producers, consumers, industry, and the earth. We achieve our mission by certifying and promoting Fair Trade Certified products. Fair Trade Certified agricultural goods in the United States give 1.4 million farmers and farm workers in 60 of the poorest countries on the planet more direct access to the world’s most powerful consumer economy, together with tools and resources they need to succeed in it. Our market-based approach to ending poverty represents a dramatic departure from traditional models of economic development, which all too often promote a dependency on aid instead of greater self-sufficiency. Through direct, equitable trade, farming and working families are able to support their families, and achieve vibrant local economies, environmental sustainability, uniquely sustainable local development, and hope for the future. As many as six million direct and indirect beneficiaries share in these growing benefits.
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