Latest / Success Story with Scott Clary / Lessons - What Global Supply Chains Don't Want You to Know | Paul Rice - Fair Trade USA CEO

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Lessons - What Global Supply Chains Don't Want You to Know | Paul Rice - Fair Trade USA CEO · Success Story with Scott Clary

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  In this lessons episode, discover the dark reality behind most chocolate production,
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  and why child labor remains widespread in West Africa.
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  Learn how fair trade practices can build schools and lift entire communities.
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  Learn why everyday consumer choices have a global impact,
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  and learn how ethical sourcing isn't charity, but simply doing business right.
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  What would be one of the most jarring facts that if somebody knew about non fair trade products,
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  they would never buy them ever again?
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  Because I think that's part of it as well.
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  The company, yes, they're focused on the bottom line, but who represents the bottom line,
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  the consumer? And if the consumer knew X about non fair trade product,
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  they would never get it. What would that thing be?
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  Well, there's been a lot of research and media coverage of child labor
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  in the cocoa industry in West Africa.
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  So about 60% of the global production of cocoa, which is the key ingredient for chocolate,
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  comes from Ivory Coast and Ghana, 60% of the world's production comes from those two countries.
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  And sadly, child labor is rampant.
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  And it's not because parents are evil.
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  It's because they're poor, right?
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  The poverty levels are so great there that people feel compelled, in some cases,
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  to bring their kids to the fields.
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  In other cases, there aren't local schools.
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  And so if you're headed to the fields, what are you going to do with your six-year-old?
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  There's no local school. You're going to leave your six-year-old at home alone all day.
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  No, you bring them to the field and then they end up helping out.
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  So child labor is a real problem and it's rooted in poverty. It's rooted in lack of schools.
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  One of the areas where we've focused a lot of time and attention and other
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  certification labels have as well is in how do we lift those farmers in West Africa out of poverty?
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  And how do we help them get access to education for their kids so that we can overcome
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  the child labor issue? And so one of the things we started working with Hershey a number of years
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  ago and they sourced from that region of Africa. Hershey has a small fair trade program.
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  They're not a hundred percent fair trade. They do other things as well. They work with other
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  certifiers and they're trying to do the right thing. But with the Hershey fair trade program,
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  the first thing that the farmers did with the extra income they got
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  was they started building their own schools in the first country and these countries.
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  Yeah, in Ivory Coast, in the first year, the communities where Hershey was sourcing built 13 schools.
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  Now I'm talking about simple small two-room schoolhouses.
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  But still better than what they had before, which is nothing, I'm assuming.
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  Which is nothing?
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  Yes, exactly, exactly. And so then and the community negotiated with the government and basically
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  said, we'll build the school. You provide the teachers and the government said, okay,
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  we can do that. And so we ended up putting hundreds and hundreds of kids into schools just in
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  the first couple of years. And so, you know, it was a real impact in terms of eliminating the
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  incidents of child labor in those communities. I'm so proud of that. And I'm so proud of the
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  consumer because at the end of the day, the consumer by buying those products was making that possible.
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  I don't know. Have you seen a chocolate product called Bark Thins?
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  I think so. Bark Thins is one of Hershey's brands. That's the brand that we worked with.
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  And, you know, everyone I knew, I mean, that brand was on fire. Everyone I knew was buying
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  Bark Thins. This was like, you know, 10 years ago. And it really made a difference. It made a
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  difference. It kept kids in school.
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  It's so crazy to me. I've had this conversation. I had Scott Harrison from charity water
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  on the show. And obviously, very different business, but same idea. Like the amount of money
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  required to make such an insanely, an insane difference in someone's life overseas is so small.
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  It's such a small amount of money. You incorporate this program, all of a sudden,
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  getting rid of child labor. Now you have access to education. Like overnight,
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  like the whole community is lifted up. And it's not actually like your like to your point. It's not
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  it's not even charity. It's just doing business ethically. That's that's the that's what it's
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  it's not funny. It's actually quite sad that if you just did business away business was supposed to
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  be done, they'd have all these opportunities too. So you're not even fundraising. You're not asking
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  anybody for money just to do business the way that you do business here. Exactly. Yeah. That's
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  exactly right. Yeah. And if you think about it, if you think about it from the perspective of a
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  consumer, you know, there's so much going on in the world right now that has people worried.
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  You know, when when we think about the problems that that we face as a human species right now,
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  in terms of climate change and global poverty and deforestation and the immigration issue and
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  all these issues, I think a lot of us feel like we're powerless. Like these problems are too big
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  and we're too small. And what are we going to do? How can we help? And you know, a lot of people
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  are are really unhappy with politics, you know, whatever side they're on, they're they're unhappy
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  with politics. And so for me, the story of bark thins and the schools that it helped build
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  in West Africa to keep kids out of the fields, that's like the most powerful story of your power
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  in mind as a consumer to make every purchase matter, right? Every time we go to the store, we have
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  a chance, think of it this way, we have a chance to vote with our dollars for a better world,
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  right? By choosing sustainable products, by choosing clear trade products, by choosing
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  reinforced alliance certified products, there's so many products out there that have some kind
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  of environmental impact or social impact on the on the people. And so we really do have a chance
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  to make a difference in the world in in small ways, right? But every time we go to the store and in
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  our listen, companies, they're listening, right? Like that's one of the beauties of capitalism,
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  right? Companies listen to their customers and they respond quickly. And so we go to the store
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  and we buy a certain kind of product, right? Because it makes us feel good because we're having
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  an impact on the world. Companies start doing more of that. And we've seen it. We've seen it over
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  the last now 26 years since I've been, you know, leading Fair Trade USA, we've seen companies
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  that previously didn't really get it or didn't really believe in it. Look at this phenomenon of,
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  you know, what you might call conscious consumerism and go, wow, we don't want to get left behind,
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  we need to get in on that. The one thing that I think feel free to go into this as much as you want.
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  But I think it's an interesting idea. When a company only incorporates Fair Trader, any of these
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  certifications were like a fraction of their total product line. Do people get upset? Do people
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  consider that greenwashing? Like you're trying to ride the wave, but you're not fully committing?
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  What are your thoughts on that? Yeah, it's a great question. And you know, the reality is,
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  perfect is the enemy of the good. I would love to see every company implement some form of ethical
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  sourcing in 100% of their supply chain without a doubt, right? Whether it's Fair Trade or something
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  like it, I would love to see every company embrace that approach and go deep, go all the way.
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  And, you know, in the case of Fair Trade, we are blessed to get to work with amazing companies.
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  You know, we started with Ben and Jerry's ice cream. They went 100% Fair Trade.
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  In our apparel certification program, we, you know, we work with Patagonia. Patagonia is almost
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  100% Fair Trade. I didn't even realize. Every time I think Fair Trade, I think food.
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  I think food product. The Patagonia is. We're working with Apparel. We're working with Furniture.
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  We just started certifying a company called Vagia for tennis shoes.
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  Yeah. So yeah, we've started to expand beyond food and that's really exciting.
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  But you know, my point is there are definitely what we think of as lighthouse brands,
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  like Ben and Jerry's, like Patagonia and so on, that decide they want to go all the way and
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  really make Fair Trade like the foundation of how they do business, the foundation of how they
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  source products for us. And that obviously is the gold standard, in my view, and what we aspire
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  for all the companies we work with. However, back to your question about what's the business case?
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  If a large company, especially a publicly traded company, and it's kind of beholden to Wall Street,
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  you know, if they want to dip their toe in the water with Fair Trade and experiment and see if
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  it works, of course, we want them to try it. Of course, we want to give them a chance to prove to
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  themselves that Fair Trade is going to be good, not just for the farmers and workers, but also
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  for their business. And so, you know, that does in some sense raise the risk that we might be
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  perceived as, you know, somehow greenwashing those companies. I'll tell you what though,
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  we sign certification agreements with every company that we work with. And today we work with
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  about 2,000 companies in the U.S. from everyone from Whole Foods and Walmart to Costco and Safeway and
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  Trader Joe's and Kroger, all the major retailers. And then great brands, again, like Patagonia and
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  PepsiCo and General Mills and all these cool brands. So in our certification agreement,
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  they agree to run all advertising copy and packaging copy by us before it's approved, right? We
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  get the right to approval. So if a company submitted something to us that looked like it was over
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  representing, like saying, hey, we're a Fair Trade company, when in fact they're only doing a little bit,
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  then, you know, we obviously wouldn't accept that. And so for me, greenwashing is about
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  overclaiming relative to what you're actually doing, right? And we don't see examples of that.
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  Actually, companies are pretty shy about, you know, overclaiming precisely because they don't
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  want to be accused of like not walking the talk. And so here in that sense, for me, the bigger issue is
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  how do we galvanize consumer support to support companies that are launching Fair Trade
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  products so that they can test it. And based on the results of the test, say, hey, this is good for
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  the people. It's good for the planet. It's good for our company. Let's do more. Let me give you
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  one example. We're working with Walmart right now on tomatoes. And Walmart initially launched
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  tomato program. I want to say three years ago. And it was a pilot. And even though it was a small
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  percentage of their total volume, immediately Walmart was the largest purchaser of Fair Trade
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  Tomatoes in the world, right? Of course. And the tomatoes were coming from farms in Mexico.
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  And, you know, Walmart sourced these tomatoes. The farms got certified. Walmart sourced the
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  tomatoes on Fair Trade terms. They paid the premium back to those farm workers. The farm workers
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  invested in really cool community outcomes, health and education. And the label went on the product.
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  And here's the punchline. Sales went up. At Walmart. That's why I'll talk here to a whole foods.
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  I'm talking about Walmart. Sales of Fair Trade products went up over the non-Fair Trade Tomatoes.
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  And so Walmart, seeing the results in on both the farms in terms of the well-being of the workers
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  and then also in terms of the sales, Walmart said, well, this pilot is a success. We're going to do
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  more. And now they're rolling out into other products. They're doing more Fair Trade products.
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  And so, you know, you could come back with the greenwashing question and say, well, why did you let
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  Walmart in with just a small volume? Well, the answer is obvious. You know, they deserved to test
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  the model for themselves and see if it worked. And guess what? It worked and now they're doing more.
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  Thanks for tuning in. If you found this valuable, don't forget to hit that subscribe button so you
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  never miss an episode. And if you want to dive deeper into this conversation, check out the links
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  in the description to watch the full episode. See you in the next one.