Fair Trade Certification

What Is Fair Trade Certification?

Fair trade certification is the confirmation from an official organization that a product was produced and sold according to fair trade principles: mainly, fair compensation to farmers for their labor.

Additional goals of fair trade networks include environmental sustainability and women’s empowerment.

The term “fair trade” also refers to any kind of ethical exchange, usually commercial. Even data collection can be described this way.

Why Is It Important to Have Fair Trade Certification Data?

This data measures the impact of this certification as well as market interest in fairly traded products.

Both consumers and companies find this information invaluable. Consumers make purchasing decisions based on this information; meanwhile, companies use it to make decisions on product purchases, business partnerships, and more.

What Internal Data Should I Have for a Good Fair Trade Certification Data Model?

If your business has become a partner to a fair trade network or purchases products from an affiliated organization, you can use this information to draw comparisons with past revenues or sales of other products you offer.

If not, however, there is little internal data available.

What External Data Is Essential for a Good Model?

Fair trade certification organizations provide a plethora of data: number of certifications issued per year, number of affiliated countries,  type of product sold, revenue generated sales, and so on. Naturally, there is also data about the individual producers: the farm-holders and contractors for whom their fair compensation is the main priority of these certifications. This includes the number of workers, their gender, and what they report they invest in after receiving their wages.

What External Data May Prove Useful for a Good Model?

Additional external data for a fair trade certification dataset includes market data for the products or regions that the official organizations report on. This information is especially useful to make comparisons between fair trade certified products and other products.

Businesses also find great use of consumer interest and sentiment data toward products or companies that use this certification.

What Are the Main Challenges of this Use Case?

Fair trade certification—and the organizations issuing them—are not without criticism. However, this page restricts itself to the realm of data. To that end, the main challenge of this topic concerns incomplete or inaccurate data. In essence, since these certifications are issued by the same organizations that provide most of the data, many have expressed concern that the data is not reported accurately or in full.

Interesting Case Studies and Blogs to Look Into

Fairtrade Foundation UK: Facts and Figures about Fairtrade
Fairtrade International: Monitoring the Scope and Benefits of Fairtrade: Monitoring Report 11th Edition

Tangible Examples of Impact

Nestlé UK and Ireland sparked controversy in June this year with its decision to stop sourcing Fairtrade cocoa and sugar for its popular chocolate bar KitKat, currently sold in 16 countries. The corporation announced it would instead use Rainforest Alliance certification under its own Nestlé Cocoa Plan from October, with the ultimate aim to shift all their products to this scheme.

Pioneers Post: KitKats in question: Nestlé’s ethical alternative fails to convince Fairtrade fans