FWD 2 HerbalGram: Ethical Trading and Fair Trade Certification: The Growing Market for Botanicals with Ecological and Social Certification

Issue: 88 Page: 46-57

Ethical Trading and Fair Trade Certification: The Growing Market for Botanicals with Ecological and Social Certification

by Josef Brinckmann, Kerry Hughes

HerbalGram. 2010; American Botanical Council


An estimated 3,000 botanical species that are used as medicinal and/or aromatic agents are traded globally, of which the majority of species are wild collected. These plants are destined for a wide range of commercial uses as components of foods, aromas and flavors, colorants and dyes, dietary supplements, and natural health products, medicines, and textiles.1 The American Herbal Products Association’s Herbs of Commerce 2nd Edition (2000) lists 2,048 separate species in trade.2 Surely, in the decade since this book was published, the total number of such commercially traded botanicals has risen.

The international trade of herbs and spices, their extractives, exudates, gums, resins, and oils has been well-established for many hundreds—in some cases, thousands—of years. It appears obvious that people in the “Global North”* have always placed high importance on market access to exotic or tropical botanical substances imported from afar. Indeed, monarchial empires have battled and even waged wars for access and control of the production and trade of certain medicinal and aromatic plants occurring in biodiverse regions of the world. Over time, seeds and cuttings of plants of economic importance were transported to other colonies, dominions, or overseas territories of the monarchies to establish plantations and competition. The herb and spice trade was not so transparent nor was it equitable for the colonized producing regions. That was then.

A deeper look at sourcing practices today, however, may reveal that the lack of transparency and unequal trading relationships still inherent in worldwide trading systems is the cause of a growing demand for eco-social certification. Today, there remains significant demand from Europe and North America to satisfy the inventory requirements for daily consumption of botanical drinks (such as coffees [Coffea spp., Rubiaceae], black and green teas [Camellia sinensis, Theaceae], and herbal and fruit teas), as well as exotic and tropical herbs and spices used in food, cosmetic, and medicinal products, most of which are imported from the warmer climates of Africa, Latin America, and southern and southeastern Asian countries. Due to this growing demand and increased concern about unequal and, in many cases, unsustainable trading relationships, new tools and opportunities to make trade more fair and sustainable are being created. Beyond the increased interest in eco-social trading practices, domestic consumption of medicinal plants within certain regions, such as China, the Himalayan countries, southern Africa, and southeast Asia remains very high, but with few means to monitor and measure this trade. However, the demand for botanicals with eco-social certifications in these regions is very low.

Historically, this herb and spice trade has been, and still is for the most part, extremely secretive and highly competitive. At the producer group level there remain some good reasons for secrecy. For example, when one’s main source of household income is dependent on access to a particular secluded wild-collection area or on cultivation practices that are a form of inherited traditional knowledge, it can be difficult for a family or tribal group to believe that it would not be detrimental to their livelihood to divulge the precise location and practices of their herb production and harvesting operation. With transparency, competitors may soon arrive and encroach on their source of income, possibly even depleting or eradicating the resource itself.

With botanicals—which normally change hands several times in their annual journey from communities in their country of origin to consumer health product markets—the relatively new initiatives for implementing conservation and sustainable resource management plans, chain of custody tracking (from the forest to the final product), transparency and traceability systems, and fair trade can appear daunting to all stakeholders in the supply chain.

A reasonable question for an herb harvester to ask is whether there are really enough conscious consumers to justify the costs and complexities of implementing sustainable fair trade management systems, undergoing audits, and becoming a certified operator. And will these conscious consumers in the rich North be willing to pay appropriate and fair prices for products composed of botanicals that are independently verified to have been produced according to rigorous ecological and social sustainability standards and criteria? This same question remains even if the certification is paid for by a “mandator” or other company in the supply chain that is willing to shoulder some or all of the costs. Certification and development programs are increasingly aiming to create ways in which to ensure sustainability and fairer trade relations while also producing a product that is affordable to the domestic market, regardless of whether the producer operates in the “Global North” or “Global South.”

The process of establishing a sustainable and/or fair trade management system is time-consuming, difficult to navigate, and may compromise elements of secrecy. So, does the benefit outweigh the inputs and risks? This is pioneer territory. Who knows for sure? This article highlights some of the emerging eco-social certifications and aims to identify who does care. Consumers care differently about different aspects of “sustainable” sourcing of botanicals. For some, sustainable agriculture and sustainable wild harvesting, as evidenced by organic certification, are enough. But for others, non-exploitation of harvesters and social sustainability, as evidenced by fair trade certification, are the most important aspects. However, the linking of ecological and social sustainability in a single standard and certification is a growing trend.

The Standards

Implementation of ecological and social sustainability standards at a botanical farm or wild-collection site is no trivial matter. This requires significant commitment of labor and resources necessary to eventually achieve sufficient levels of compliance for a successful audit leading to certification. Table 1 lists selected ecological and social sustainability standards presently being implemented in the botanical supply chain along with Internet addresses where these may be downloaded.

The addition of social and fairtrade modules to ecological sustainability standards finds its genesis in the organic agriculture movements of the 20th century. The Demeter Biodynamic® Farm Standard was introduced in Europe in 1928. Ecological, economic, and social responsibility are integral to biodynamic production systems.† By the early 1970s, farms cultivating medicinal and aromatic plants according to principles of sustainable agriculture were being established in North America. Organic inspection and certification bodies also emerged, such as California Certified Organic Farmers (CCOF) that was formed in 1973.

The international organic movements paved the way for greater awareness of sustainable production systems. But the implementation of sustainable agricultural systems does not necessarily ensure economical and social sustainability for herb harvesters and processers. Nor do these systems ensure sustainable wild collection of the vast majority of medicinal and aromatic plant species which are not farmed. To illustrate that point, there are certified organic herb and spice farms situated in totalitarian dictatorship countries (e.g., Burma, aka Myanmar) where no enforceable labor standards or human rights protections exist. Sustainable resource management systems interconnect elements of ecological, economical, and social sustainability. Therefore, it is difficult to evaluate ecological sustainability without also considering the economical and social needs of the producer communities. Conversely, it is difficult to assess social sustainability of producer groups that are dependent on wild collection for their income, unless ecological and economical sustainability efforts are incorporated into the assessment. Experience is showing that economical and social sustainability are prerequisite to ecological sustainability.3

In an effort to inform prospective buyers, the December 2009 edition of the Market News Service for Medicinal Plants & Extracts, a quarterly bulletin of the International Trade Centre (ITC), featured up-to-date information on the commercial availability of botanical ingredients in the global marketplace with value-adding certifications or verifications that demonstrate evidence of sustainable resource management and production (ecological, economical, and social sustainability practices throughout the supply chain). Additionally, contact details for the certified operators and/or distributors of the listed botanicals were provided.4

The following is a brief overview of some of the standards for measuring sustainability (economic, ecological, and social) that are becoming visible in the North American market.

FLO Fairtrade Standards for Herbs and Spices and Tea

Fairtrade Labelling Organizations International (FLO) is an organization based in Bonn, Germany that coordinates Fairtrade labeling at an international level by 1) setting international Fairtrade standards; 2) organizing support for producers around the world; 3) developing a global Fairtrade strategy; and 4) promoting trade justice internationally. According to FLO, “Fairtrade is an alternative approach to conventional trade and is based on a partnership between producers and consumers. Fairtrade offers producers a better deal and improved terms of trade. This allows them the opportunity to improve their lives and plan for their future. Fairtrade offers consumers a powerful way to reduce poverty through their every-day shopping. When a product carries the FAIRTRADE mark it means the producers and traders have met Fairtrade standards. The standards are designed to address the imbalance of power in trading relationships, unstable markets and the injustices of conventional trade.” Box 1 provides a summary of the principles underlying the FLO Standards.

The FLO standards for botanicals are species- and region-specific, and are limited to only certain types of producer groups in developing countries (e.g., small producers’ organizations). Botanicals that are farmed or wild collected in European countries, or in Canada and the United States, among other developed countries, fall outside the scope of the FLO standards.

Presently, the “Fairtrade Standard for Tea for Hired Labour”5 covers 6 botanicals (chamomile flower [Matricaria recutita, Asteraceae], hibiscus flower [Hibiscus sabdariffa, Malvaceae], peppermint leaf [Mentha × piperita, Lamiaceae], rooibos herb [Aspalathus linearis, Fabaceae], spearmint leaf [Mentha spicata, Lamiaceae], and tea leaf). The “Fairtrade Standards for Herbs and Spices for Small Producers’ Organisations”6 covers many more botanical species, produced by smallholders in 70 developing countries in the “Global South.” Annex 1 of the standard provides a non-exhaustive, indicative list of 127 different botanicals (but more than 150 different species) fitting the FLO “Herbs and Spices” definition.‡ For example, FLO’s Annex 1 includes medicinal plants such as asafetida oleo-gum-resin (Ferula assafoetida, Apiaceae), calamus rhizome (Acorus calamus, Acoraceae), dandelion herb and root (Taraxacum officinale, Asteraceae), eucalyptus leaf (Eucalyptus globulus, Myrtaceae), ginkgo leaf (Ginkgo biloba, Ginkgoaceae), licorice root (Glycyrrhiza glabra, Fabaceae), mugwort herb (Artemisia vulgaris, Asteraceae), psyllium husk (Plantago ovata, Plantaginaceae), and valerian root (Valeriana officinalis, Valerianaceae), among many other potentially certifiable species. This general list also allows for rapid inclusion of species newly introduced to the market such as guayusa (Ilex guayusa, Aquifoliaceae) from South America.

FLO publishes a periodically updated “Fairtrade Minimum Price and Fairtrade Premium Table,”7 which specifies the product, type, quality, form, characteristics, country/region, certification scope, price level, unit, quantity, currency, Fairtrade Minimum Price, Fairtrade Premium, and date of validity, where applicable. FLO provides the following price and premium definitions:

Fairtrade Minimum Price (where it exists) is the lowest possible price that may be paid by buyers to producers for a product to become certified against the Fairtrade standards.

Fairtrade Premium is an amount paid to producers in addition to the payment for their products. The Fairtrade Premium is intended for investment in the producers’ business and community (for small farmers’ organizations or contract production projects) or for the socio-economic development of the workers and their communities (for hired-labor situations).

Retro-certification occurs when a buyer buys tea (or another commodity) from a producer under ordinary conditions (non-Fairtrade) and at a later stage, converts it into a Fairtrade-certified product. Buyers current with their Flow of Goods reports may retro-certify provided that retro-certification transactions fall within the agreed upon limits, the transaction is properly documented, and Fairtrade premiums and any Fairtrade price adjustments are made in full on due date. Prior to commencing retro-certification, buyers must inform the certification body of the intent to do so. Abuse or misuse of retro-certification will likely result in buyers’ losing permission to retrocertify.

FWF FairWild Standard

Fair Wild Foundation (FWF) is an organization based in Weinfelden, Switzerland, with its Secretariat based at the World Wide Fund for Nature-Germany in Frankfurt, with a mission to provide a worldwide framework for implementing a sustainable, fair, and valueadded management and trading system for wild-collected, natural ingredients and products thereof. FWF does this by 1) encouraging sustainable and fair business practices, with a concentration on influencing consumer choice; 2) informing, advising, and assisting those involved in the wild plant trade; 3) providing advice on the application of the FairWild Standard and supply-chain certification; and 4) by providing advice on the application of standards for sustainable and fair management of trade in conservation, trade policy, and other regulations. Box 2 provides a summary of the principles underlying the FairWild Standard (FWS).

Unlike the FLO Fairtrade standards, the FairWild Standard places no restrictions on geographical scope or on the type of producer group. So long as the botanical ingredient is wild harvested, any type of operation in any country or region of the world can implement the standard and apply for certification if desired. The FairWild Standard is designed to be applicable to the wide array of geographic, ecological, cultural, economic, and trade conditions in which wild collection of plant resources (as well as fungi and lichens) occur. It primarily addresses the collection of wild plant materials for commercial purposes, rather than for subsistence or local, small-scale use.

So far, there are FairWild certified operators mainly in European countries (e.g., Bosnia, Herzegovina, Croatia, and Poland) and Asian countries (e.g., Kazakhstan) offering a good range of typical European species of medicinal plants under sustainable wild collection. A number of other operations are in process of implementation but not yet certified, including wild-collection operations situated in China, Georgia, Hungary, and Uzbekistan. Table 2 lists the botanicals presently commercially available with FairWild certification.

FWF provides the following price and premium definitions:8

The FairWild Price that is paid by the buyer to the wild-collection enterprise is based on cost calculations but it is always above the normal market prices for conventional wild crops. In general, the FairWild price is at least 5% to 10% higher than prices paid for same product collected conventionally in the region.

The FairWild Premium Fund amount is negotiated between seller and buyer on a case-by-case basis appropriate for the specific situation and scale. It is usually paid out by the final buyer (e.g., the finished-product manufacturer) to the wild-collection enterprise (even when there are other companies in between). If it is paid by an intermediate buyer (e.g., a wholesale distribution company) or by other value-adding companies in the supply chain (e.g., an extraction house), this amount will usually be charged upstream to the final buyer.

The FairWild Standard Version 2.0 (2010) now combines Version 1.0 (2006) of the original FairWild Standard, which deals with social aspects (the Social Module), and Version 1.0 (2007) of the International Standard for Sustainable Wild Collection of Medicinal and Aromatic Plants (ISSC-MAP), which deals with ecological aspects (the Ecological Module).

Fair for Life Social & FairTrade Program Certified by IMO

In 2006, The Swiss Bio-Foundation, in conjunction with IMO (Institute for Marketecology), introduced “Fair for Life,” a brandneutral, third-party certification program for Social Accountability and FairTrade to complement existing fair trade certification systems. The IMO Social & FairTrade Certification Program combines strict social and fair trade standards with adaptability to local conditions and a wide variety of products and botanicals. The program is based on several sets of key baseline standards such as the ILO conventions, FLO Fairtrade standards, SA8000, and IFOAM Social Criteria. It offers operators incentives for continuous improvement of social and trade conditions beyond minimum requirements and allows for meaningful certification of multi-ingredient products by using content rules that are modeled after those for organic products and by reviewing all critical steps in the value chain.

Currently, there are approximately 90 operators certified worldwide, and the standard has grown in acceptance quickly, especially in the North American Market, although it is an international standard with producers residing only in the “Global South” thus far. When the Fair for Life standard was drafted, it was with domestic production in mind, and IMO soon intends to begin pilot certifications for production in domestic projects, especially in North America and potentially other “Global North” countries as long as the operator has a genuine fair trade system and marginalized emphasis.

The following are some of the Key Features of Fair for Life FairTrade Certification:

Wide range of certifiable materials and products, including many niche market but nonetheless important raw materials, multiingredient products, and wild-crafted herbs and medicinal plants. There are separate criteria for sustainable wild harvesting of plants. Non-food products, including handicrafts, textiles, and toys can also be certified.

Any type of smallholder producer organization is certifiable. This includes smallholder cooperatives and small farmers under contract by traders (“contract production”), plantations, and processors. Program requirements apply to all critical steps in the value chain to ensure adequate and fair handling at all stages.

Physical audit of the ultimate buyer of FairTrade materials and products, usually a company in the developed world, for verification of their FairTrade practices.

Buyer and supplier cooperate closely and negotiate a fair price for all sales – not just a few FairTrade consignments. Farmers always receive a fair and sustainable price for their products that covers, at a minimum, cost of production and a reasonable premium for value-added organic production. Additionally, a FairTrade premium is paid either directly to the farmers as additional premium or into a premium fund for community projects. There is also no retro-payment of FairTrade premiums allowed in the Fair for Life system. For every order a FairTrade buyer makes with a FairTrade producer, there is an upfront payment of not only the FairTrade price, but also the FairTrade premium.

Transparent system of FairTrade premium payment and use. The importer agrees on a FairTrade premium with the FairTrade supplier. It may be paid directly to the farmers and/or used by a fund for community for local development projects, such as sanitary installations in the village, healthcare or education projects, and livestock programs to ensure nutritional and ecological balance. IMO audits payment and use of the premium to ensure that this extra premium money is fully paid to the farmers (as premium in addition to fair price) or used for intended social community projects. The buyer may be involved in the decision on how the FairTrade premium is spent. FairTrade premium use and certifications are published on the www.fairforlife.net website.

Rigorous chain of custody requirements throughout the whole system ensure traceability, transparency, and greater control.

No license fee is leveraged on participants in the supply chain. Certified entities incur only the actual costs of inspection and certification. For efficiency, FairTrade inspections may be combined with audits for organic or other ecological standards (organic textiles, FSC, GlobalGAP, bird-friendly, etc.). The IMO “fair for life – Social & FairTrade Certified by IMO” and “for life – Social Responsibility Certified by IMO” seal may be used on certified products.

Certification provides maximum transparency for buyers and consumers through annual audits by qualified inspectors. Each operation will be measured against a list of published criteria. The performance rating of all certified operations are published on the IMO website, together with an assessment of their social impact in their host communities.

Good environmental performance is assessed in detail, and additional good agricultural practices (GAP) criteria must be met if an operation is not certified according to organic or GAP standards.

Requirements for physical audit of brandholder companies to help keep the focus of the supply chain on producers, transparency, and brandholders' own commitment to social responsibility within the company and a FairTrade sourcing policy.

Rainforest Alliance Certification Standard

Under the auspices of the Sustainable Agriculture Network (SAN), the Rainforest Alliance works with farmers to ensure compliance with the SAN standards for protecting wildlife, wild lands, workers’ rights, and local communities. Farms that meet these standards are eligible to trade goods with the Rainforest Alliance Certified seal. Rainforest Alliance Certified botanical ingredients that have become commercially available include açai fruit (Euterpe oleracea, Arecaceae), cupuaçu fruit (Theobroma grandiflorum, Sterculiaceae), tea leaf, and vanilla fruit (Vanilla planifolia, Orchidaceae). Box 3 provides a summary of the principles underlying the SAN Standards.

Other Fair Trade Organizations/Labels

Beyond ecological and social standards that are emerging on the botanical market, there are other initiatives, membership/trade organizations, and labels that are worth mentioning, such as the Fair Trade Federation (FTF). The FTF is a trade association made up of companies with commitments to fair trade. Although FTF is largely made up of handicraft companies, it is also open to companies that sell other products, such as botanicals. To become a member there is a lengthy application and interview process to assess each applicant’s commitment to fair trade. The FTF is worth mentioning herein, as members are allowed to use their logo on the products they sell, and it has become recognized as a fair trade label by some consumers. Other such associations or membership organizations have also emerged with the increase in awareness of eco-social issues, such as the World Fair Trade Organization (WFTO, formerly IFAT) and B-Lab or “B-Corp Certified.”

UNCTAD BioTrade Principles and Criteria

The BioTrade Initiative of the United Nations Conference on Trade and Development (UNCTAD) was launched in 1996 to promote sustainable biotrade in support of the objectives of the Convention on Biological Diversity (CBD). In the meantime, the Initiative has developed a unique portfolio of regional and countrywide programs. Since 2003, the BioTrade Initiative has also hosted the BioTrade Facilitation Programme (BTFP), which focuses on enhancing sustainable bio-resources management, product development, and valueadding processing and marketing. In 2007, UNCTAD published the “BioTrade Principles and Criteria”9 and Draft 3 of the “BioTrade Verification Framework for Native Natural Ingredients.”10 Box 4 provides a summary of the principles underlying the BioTrade Initiative.

Currently, there are BioTrade country programs operating in more than 15 countries in Africa, Asia, and Latin America, including Bolivia, Brazil, Colombia, Ecuador, Peru, Botswana, Malawi, Mozambique, Namibia, South Africa, Swaziland, Uganda, Zambia, and Zimbabwe (www.biotrade.org). New BioTrade country programs are under development in Costa Rica, Indonesia, Paraguay, and Vietnam. In addition to the country programs, other BTFP partners include PhytoTrade Africa – the Southern African Natural Products Trade Association (www.phytotradeafrica.com), Bolsa Amazonia Programme (www.bolsaamazonia.com), Dutch Centre for the Promotion of Imports from developing countries (CBI, www.cbi.nl), and the Swiss Import Promotion Programme (SIPPO, www.sippo.ch). Priority product groups include edible plant products (e.g., fruits and nuts), food ingredients (e.g., coloring and flavoring materials), cosmetic and pharmaceutical ingredients (e.g., medicinal plants, essential fatty and aromatic oils), fibers, latex, resins, gums, and gum byproducts. According to Lorena Jaramillo Castro, economic affairs officer of the BioTrade Initiative,11 “Within the BioTrade Network, methodologies, tools, guidelines, and standards are developed to enhance the implementation of the seven BioTrade Principles. The Verification Framework for Native Natural Ingredients, guidelines to implement management plans for wild-collected species and to strengthen value chains of BioTrade products, are a few examples.” The most recent BioTrade guidance document, available at the homepage of the BioTrade Initiative website, is titled “Guidelines for the Development and Implementation of Management Plans for Wildcollected Plant Species used by Organizations Working with Natural Ingredients.”12

Who Cares?

Market indicators show that a steadily increasing number of stakeholders in the botanical supply chain are indeed deeply concerned. This is evidenced by the fact that several new sustainability standards have emerged over the past decade, often developed and test-implemented with the active participation and/or financial and technical support of governmental organizations (GOs), international governmental organizations (IGOs), and/or non-governmental organizations (NGOs), along with various stakeholders, including the variety of producers involved in a supply chain. Correspondingly, the number of independent inspection and certification agencies for ecological, social, and fair trade botanicals and natural products is increasing, presumably in order to meet the market demand for more certified organic and fair trade products.

The Consumers

The TransFair USA Almanac 2009 report shows that US imports of Fair Trade Certified (FTC) “herbs” from Egypt (e.g., chamomile flower, hibiscus flower, and mint leaf) grew by 73% over 2008 and imports of FTC “spices” (e.g., cardamom seed [Elettaria cardamomum, Zingiberaceae], cinnamon bark [Cinnamomum verum, Lauraceae], clove flower bud [Syzygium aromaticum, Myrtaceae], ginger rhizome [Zingiber officinale, Zingiberaceae], mace aril [Myristica fragrans, Myristicaceae], pepper fruit [Piper nigrum, Piperaceae], turmeric rhizome [Curcuma longa, Zingiberaceae], and vanilla fruit) grew by 240%.13 Consumers are the driving force behind fair trade demand and some companies find that the powerful producer stories behind their botanical ingredients are also excellent marketing messages. According to Rob Cameron, CEO of FLO, “As 2009 began in the midst of the worst recession in 70 years, we worried that Fairtrade producers could lose sales. Instead, consumers across the globe bucked the trend and proved their deep commitment to giving producers a fair deal. Fairtrade sales grew in all countries.”14

According to the Fairtrade Labelling Organizations International Annual Report 2009-2010, there are now 827 FLO-certified producer organizations in 60 countries; an 11% increase over 2008; and consumers spent an estimated €3.4 billion§ on Fairtrade products in 2009—a 15% increase over 2008. An estimated 27,000 Fair Trade Certified products are now sold in over 70 countries. Box 5, excerpted from the FLO Annual Report, compares the 2008 and 2009 total value (in euros, €) of Fairtrade Certified sales in developed countries. The top 5 sellers of Fairtrade Certified goods in 2009, in terms of estimated value, were the United Kingdom, the United States, France, Germany, and Canada. The FLO report also shows that the highest percentage growth category was “Herbs and Spices” with a 266% growth rate, in terms of volume (in metric tons), over 2008.15 This audited data encompasses only those Fairtrade products that are certified, documented, and transacted through the FLO System. As of yet, there are no known comprehensive data that combine all fair trade sales inclusive of all products traded under all certification schemes. On the regional and class-of-trade level, different inclusion criteria may be used in a way that could capture a larger percentage of fair trade retail sales inclusive of products certified under different programs. For example, SPINSscan Natural is a comprehensive source of information on all UPC-coded retail products selling through the Natural Products Supermarket Channel in the United States. SPINS collects scanner-based sales data with coding parameters for 16 label-based attributes including fair trade. Thus it would be possible to purchase specialized US-specific reports on fair trade retail sales in the natural products channel. Annual sales data for Fair Trade Certified products are also made available through the annual reports of country-specific bodies. For example, Table 3 shows the estimated UK retail sales of Fairtrade products by value 1998-2009 (£ million).||


Although most businesses wait to see an increasing trend in demand for such products that are ethical or fair trade certified, some find there are commercial benefits and reasons to reach and maintain the certification beyond altruism and philanthropy, such as reducing the risks that would otherwise come from a supply chain with less management, and creating a more secure supply stream. Currently, there are several initiatives worldwide that are changing the food-safety landscape, and now that there have also been several problems reported from products manufactured outside the United States, notably in China, there is increasing consumer demand as well for such initiatives or assurances to take place. Businesses are realizing that they may not have much control or understanding of their supply chains and are coming to realize that production abroad may come with considerable risk to food safety and therefore a more secure supply chain is invaluable. The implementation of any of the above-mentioned ethical and fair trade standards increases the amount of management in the supply chain, thereby naturally also increasing some aspects of control and safety of foods and herbal medicines.

Governmental and Non-Governmental Organizations

Governmental and non-governmental organizations are also calling for more transparency and traceability at the very least in supply chains in order to help manage this risk. For example, in 2009 a food traceability bill (S.425) was introduced into the US Senate intended to establish a national traceability system for all food under the US Food and Drug Administration’s (FDA) jurisdiction. It is just one of several major food safety bills that have been proposed recently in the US Congress. The FDA also called a public meeting near the end of 2009 in order to provide an opportunity for the agency to collaborate more closely with the Food Safety and Inspection Service (FSIS), as well as with members of the food industry. The FDA and FSIS noted that “changes in consumer preferences, changes in industry practices and the rising volume of imports continue to pose significant challenges” to food scrutiny.16 One natural advantage to a good chain of custody-focused certification, such as organic and most fair trade standards, is a high level of traceability, forward and backward, through the supply chain.


The benefits to producers are the one clear advantage in social and fair trade certification systems. As trade relations become more equitable and transparent, they progress toward becoming partnerships. While fair prices are key goals of such certifications, the producer should also receive clear and transparent premiums and benefits from their participation in such programs. Whether the cost of their certification, and time and management of such a system is worth the benefits should be noticeable in the first several years of certification as producers would not opt to continue such a system if the benefits were not apparent. Moreover, since the premium is ensured at the farmer or wild-harvester level, it could be more of a lasting incentive to small producers who may not normally benefit from premiums of other labels that are focused on the final product. Lastly, the standards described in this article were developed through an active multi-stakeholder process that included the voices of the producers in the development and test implementation of the standards. Feedback from all stakeholders based on practical application informs subsequent improvements and revisions to the standards.

Future Prospects for the Fairtrade Botanicals Market

Fair trade is more than just a consumer trend. It is a partial solution to the many converging problems with the current trading system and globalized economy and environment. A movement that began taking shape in the 1940s when Mennonites started selling goods from poor regions through their church network,17 fair trade has since blossomed into a transparent global trading system. While up to this point a major focus of the various social and fair trade standards has been on food ingredients and products, the standard-setting bodies are beginning to prioritize standards for herbs and spices.

Many people compare the fair trade certification arena today with the early organic food movement: There are many approaches, certifying bodies, standard setters, and labels. Although this may be confusing for consumers, it is also a time of high integrity, meaningful discussion, and application of standards, often performed by the very pioneering companies that make up this emerging niche demographic. As the fair trade movement progresses, hopefully this “integrity race” will not devolve into a set of watered-down standards, so it can continue to improve living conditions for workers, promote environmental standards, and earn consumer confidence. As few things motivate producers like the prospect of fair and reliable trade partners, this fast-growing market niche has the potential to inspire more and more harvesters and suppliers of botanical ingredients to realize the social and environmental benefits of the eco-social movement.

Josef Brinckmann is the vice president of Research & Development at Traditional Medicinals, Inc., in Sebastopol, California, a member of the Board of Trustees of the FairWild Foundation (FWF), a member of the Product Advisory Council (PAC) for Herbal Teas of the FairTrade Labelling Organizations International (FLO), a consultant on Market Intelligence for Medicinal Plants & Extracts to the International Trade Centre (ITC) of the United Nations, and a member of the Advisory Board of the American Botanical Council. He is also co-editor and translator of Herbal Drugs and Phytopharmaceuticals, 3rd. ed. (MedPharm, 2004).

Kerry Hughes, M.Sc., is founder and president of EthnoPharm Consulting, is a consultant to the International Trade Centre (ITC) of the United Nations, produces Market News Service (MNS) reports for Essential Oils and Organics, and is the US Representative for the Institute for Marketecology (IMO), an international agency for inspection, certification, and quality assurance of eco-friendly products including Fair for Life Social & Fairtrade certification, FairWild® certification, and National Organic Program (NOP) certification.

* “Global North” means the socio-political and economic region which is more developed than the “Global South.” Wealthier “developed countries” are collectively referred to as the “Global North” while poorer “developing countries” and “least-developed countries” are collectively referred to as the “Global South.” The term is not strictly geographical: Most but not all "Global South" countries are in the Southern Hemisphere and most but not all "Global North" countries are in the Northern Hemisphere.

† The Demeter Association Inc. defines biodynamic farming as “a holistic and regenerative farming system that is focused on soil health, the integration of plants and animals, and biodiversity. It seeks to create a farm system that is minimally dependant on imported materials, and instead meets its needs from the living dynamics of the farm itself. It is the biodiversity of the farm, organized so that the waste of one part of the farm becomes the energy for another, that results in an increase in the farm’s capacity for self-renewal and ultimately makes the farm sustainable.” http:// demeter-usa.org/about-biodynamic-agriculture

‡ The list of botanicals of Annex 1 of the FLO Standard can be found on pages 6 through 8 of the document at www.fairtrade.net/fileadmin/user_ upload/content/2009/standards/documents/July09_EN_Herbs_and_Spices_standard_SPO.pdf

§ 1.00 EUR (€) = about 1.28 USD ($) as of Aug 15, 2010. || 1.00 GBP (£) = about 1.56 USD ($) as of Aug 15, 2010.


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