It’s not a very merry Christmas for Fairtrade chocolate

At a time when children are waking up every day to a chocolate from their advent calendar, the Fairtrade scheme for cocoa farmers is facing a fraught run-up to Christmas. Cadbury’s has announced it will drop out of the benchmark certification system in a move that will undermine the good progress that has been made.

The Fairtrade logo will no longer appear on the front of Cadbury’s chocolate packs and will be replaced by their own Cocoa Life scheme branding. In a puzzling announcement, the UK Fairtrade Foundation told campaigners this was an exciting development. It claimed the move represented a “new global partnership” between the Cocoa Life programme and Fairtrade. The new arrangement will see Fairtrade help Cadbury’s owner, Mondelez, to deliver the Cocoa Life sustainability program, and a “partnering” message will go onto the back of Cadbury’s packs.

But this is hard to accept as good news, particularly for campaigners who have spent decades promoting the Fairtrade Mark and its certification system. When Cadbury’s first converted their leading Cadbury’s Dairy Milk product to Fairtrade back in 2009 it was a moment to celebrate. It was arguably one of the defining moments in the mainstreaming and growth of Fairtrade in the UK and internationally. Cadbury’s CEO Todd Stitzer stated that “our goal is ultimately to have all of our chocolate bars be Fairtrade”. In reality, however, only Cadbury’s chocolate buttons and Cadbury’s drinking chocolate have switched since.

Fairtrade is both a trading system and a movement that people can get behind and support. As it grows, it ensures farmers are paid sustainably and empowered by the relationship. It builds robust and long-lasting partnerships between consumers, companies and producers to better cope in a world trading system prone to shocks and threats. Following Cadbury’s in 2009, both Nestle and Mars made commitments to Fairtrade and products proudly displaying the Fairtrade logo were bought by millions of customers.

Free radicals

In an article co-authored with Dr Iain Davies of the Bath Management School, I cautiously welcomed the announcements that big names had come on board. But it came with a warning. There has always been the potential for mainstream partners to co-opt the more convenient elements of broader fair trade at the expense of the more radical edges. We also predicted that some of the core fundamental principles and standards upon which Fairtrade is based may be watered down to ensure mainstream engagement with the initiative.

It is therefore disappointing, but perhaps not surprising, to hear that Cadbury’s has chosen to opt out of this international social movement for fairer trade and shift entirely to a private scheme. We are concerned for the reputational damage it could do to the Fairtrade system – and its impact on smaller players.

The policies of big players have an effect on 100% fair trade pioneers such as Traidcraft, Divine Chocolate and others. They suffered a slowdown in their fair trade chocolate sales when Cadbury’s announced their switch to the Fairtrade programme in 2009 and their message is compromised by strategic corporate manoeuvring in the ethical chocolate marketplace.

The raison d’etre of these pioneers is their social mission. They go way beyond the minimum Fairtrade standards. In the case of Divine, cocoa farmers are made shareholders in the company, all products are certified fair trade, and all other ingredients are fair trade sourced where possible.

The announcement by Cadbury’s has led to headlines suggesting that the Fairtrade scheme might be finished, which does little to support the work of other fair trade pioneers. Consumers may lose faith.

Reality cheque

Despite the upbeat rhetoric from both sides, the Cadbury’s withdrawal has been a major blow for the UK Fairtrade Foundation. Remember that one of the foundation’s aims since it was set up in 1992 has been to promote and raise awareness of the Fairtrade Mark – its highly visible stamp of approval.

They have made the most of a difficult situation to ensure via Cocoa Life that Mondelez continues to invest in working with farmers in Ghana and that Fairtrade will report in some way on the Cocoa Life scheme’s progress. But it is slim pickings for the optimists.

The hope must be that the continued association with Fairtrade means that Mondelez will continue to support smallholder farmers. One of the biggest benefits of the Fairtrade project has been the requirement for smallholder farmers to come together in democratic organisations to decide how to spend the premiums, build their businesses and invest in their communities. According to Fairtrade, Cocoa Life must deliver at least equivalent value to the Cadbury farmers as they would have received under Fairtrade, including direct cash loyalty payments to farmers.

Finally, as Cadbury’s moves to its own company private cocoa scheme, it is unclear whether there will be any kind of full and trusted third party verification monitoring of how much money is invested and where. Studies have shown this independent monitoring is crucial to scheme credibility. It is also unclear what role farmers will have in running this programme, and whether, as it is their future that is being decided, they have appropriate influence over the price they get for their cocoa and how the money is spent.

The real danger lies in the fact that other major players are also building their own private schemes. This clearly opens up the possibility that they too will opt out of the independent certification scheme. If this does come to pass, consumers will be left unable to properly assess and compare the benefits to farmers being offered by the different chocolate brands. And that favours the big companies far more than it does those growing the cocoa.

Bob Doherty, Professor of Marketing , University of York.

This article first appeared on The Conversation.