ABSTRACT

Introduction This chapter explores the role the World Fair Trade Organization1 (WFTO) plays in the fair trade movement and how it contributes to international development by regulating the ‘ethical’ production and consumption of handicrafts and food. The international fair trade movement as a whole is distinctive among global social movements in that it straddles the for-profit and the not-for-profit worlds, and encompasses a wide range of organizational forms from small cooperatives, small businesses and village associations, to Public Listed Companies controlled by non-governmental organizations (NGOs), such as Cafédirect and Divine Chocolate in the United Kingdom (UK), with annual sales in the millions. Fair trade combines elements of business with the characteristics of campaigning NGOs (Unerman and O’Dwyer 2004), international development NGOs (Ebrahim 2003) and social welfare NGOs; it is both a ‘business and campaign’ (Zadek and Tiffen 1996). There is a growing academic literature exploring the fair trade movement, the majority focusing on the fast growing, lucrative market for tropical food commodities, such as coffee,2 tea (Besky 2008; Dolan 2008) and chocolate (Berlan 2009). As a result, discussion about governance within the fair trade movement tends to focus on the certification system for fair trade food products overseen by Fair Trade Labelling Organization International (FLO) (see Chapter 22 in this volume). Conversely, there has been very limited academic discussion of fair trade handicrafts (an exception is Littrell and Dickson 1999) and small volume food production (see Le Mare 2008), which are the primary domains of WFTO’s roughly 350 members. This limited focus on non-certified products, particularly handicrafts, is a gap that this chapter seeks to fill. Many of the fair trade retailing and wholesaling operations worldwide are either members of the WFTO directly, or are part of its growing country and regional networks, both South and North. These include the Cooperation for Fair Trade in Africa (COFTA), Asian Fair Trade Forum spanning Asia, the WFTO Latin American body, WFTO-Europe and WFTO-CAJUNZ,3 covering North America, Oceania and Japan. The stated goal of WFTO is ‘to enable small producers to improve their livelihoods and communities through sustainable Fair Trade . . . by delivering market

access through policy, advocacy, campaigning, marketing and monitoring’ (WFTO 2011a). This chapter casts the development of the complex web of internal and external governance mechanisms deployed by WFTO to meet that goal within the framework of non-state regulation, specifically as an alternative regulatory initiative controlled by civil society groups with no corporate participation. We characterize the changing regulation of fair trade under WFTO as a shift from informal trust-based relationships to more formal systems that encompass elements of voluntary codes of conduct. Most recently, WFTO has been developing an organization-(rather than product-) based approach to third party audited certification.4