I thought Jacqueline Novogratz's article, "The Education of a Patient Capitalist," was very interesting and extremely relevant to the concept of Entrepreneurship and Fair Trade. In the article, Jacqueline addressed the major obstacles a socially conscious entrepreneur must overcome in their efforts to make a difference in the world. After receiving a huge sum of capital funding, Jacqueline struggled to build a strong team of globally minded business people to create a successful alternative to charity, one of the central themes of the Fair Trade business model, while dealing with the difficulties of conducting business in a third world country and domestic tragedies, like the September 11 terrorist attacks.
The first concept that I found interesting was Jacqueline's definition of Patient Capital, "money invested over a long period of time with the acknowledgement that returns might be below market, but with a wide range of management support services to nurture the company to liftoff and beyond." Jacqueline spoke about the difficulty of finding venture capitalists to fund projects like Amani and Aravind because most Wall Street investors are looking to make returns of 25 to 40% in 5-7 years.
This is a very valid issue to consider, when discussing the difficulties that people in undeveloped nations, like our Amani business partners, face in building a sustainable business. Though Fair Trade businesses serve a niche market of socially minded consumers who are willing to pay a premium price for goods that were produced without harm to anyone along the supply chain, many of them will never be able to compete, directly, with full scale corporations in developed nations funded by venture capitalists. The capital required upfront by companies in undeveloped nations to begin production immediately prevents many potential business deals from ever coming to fruition. However, the Patient Capitalists Jacqueline described had a very interesting business model, rather than making tiny microfinance loans to particular people, they would invest hundreds of thousands of dollars in enterprises that could reach millions of people. While I believe there is great merit and a strong need for microfinance, the concept mentioned above is another great way of creating an alternative to charity by enabling people to help themselves.
I was also very interested, though not very surprised, to hear what Cate Muther had to say about the success of women in his kiosk business, Drishtee. He stated that women were his most successful franchisees, but many of them had no access to financing because they had never been issued birth certificates. He went on to explain that in many cases the women worked harder than men and that in many instances it is more beneficial for societies to have the woman making money because every penny earned goes directly back to the family.
I have always learned about the struggles that women face in other countries to get a job outside the home, let alone start their own business, but this was the first time I ever heard of a lack of documentation as an obstacle. It is hard to imagine living in a world where you are not even given a birth certificate, because from your birth it is assumed that you will not need it. It was also interesting to read that successful women are more beneficial to the community as a whole because every penny they earn goes home to help their families.
Sarah Besky's article, "Colonial Pasts and Fair Trade Futures" painted a very different portrait of fair trade than what we have been exposed to in previous readings. Much like the condition of the Congo, described in Black Gold and the cocoa bean plantations on the Ivory Cost, the plantation workers on Darjeeling's tea plantations have are suffering at the hands of corporate greed. However, in this case, their suffering has been intensified by the implementation of Fair Trade standards. It was very eye-opening to read about ways that the Fair Trade business model has been manipulated to benefit plantation owners rather than the plantation workers.
The article began by explaining the past colonization of India that built up the strong tea industry in existence today. It went on to describe how the British colonization framework required owners workers houses, medical facilities, firewood, and food rations to ensure they lived somewhat of a just life. However, owners began to obtain fair trade certification as a means of working around these regulations which has negatively affected the lives of employees. Because the requirements of a Fair Trade certified company are significantly more lenient, and less strictly enforced than the requirements of the Plantation Labor Act, which was previously enforced.
It was very upsetting to read about an instance in which Fair Trade certification has had a negative effect on workers' livelihoods. Unfortunately, I find it hard to believe that this is the only instance in the world in which fair trade certification has been detrimental to workers' lives, and there are likely similar situations throughout the world. The article stated that the FLO does not enforce the regulations very strongly, which allows plantation owners to abuse the system. It is very hard to hear that in certain industries, even after the change has been made to become Fair Trade certified, the lives of the workers can continue to deteriorate because the FLO is not enforcing the regulations that were required. This also means that the marketing and sales completed by people in developed countries to spread the work about Fair Trade could be in vain if the regulations are not enforced enough to improve the working conditions of manufacturers in impoverished countries.
Anna Hutchens’s article, “Game-Playing: Rethinking Power and Empowerment” provided an interesting perspective of how different forms of power have dictated social norms within the business world and everyday social interactions. After breaking down the different forms of power, Hutchens spoke about the emergence of defiant entrepreneurs who are breaking down the barriers previously established by how business has always been conducted to delve into new ways of empowering workers through unique business models.
It was very interesting to read about how power is immediately established in a relationship as a form of dominance over other people, referring to “power over”. I was also intrigued by the alternative forms of power in existence, such as “power with”, “power to”, and “power within”.
Before reading this article, if I was asked to define power would have said the ability to make other people do things. While I never considered it ethical to make other people do things for you, I sill considered power to have a positive connotation and I never really questioned how that could be. This article really opened my eyes to the concept that I have always been aware of, which is that true power involves empowering your teammates to create the strongest team possible, which will result in the most efficient means of accomplishing a task. I think it is imperative to conceptualize this idea from a business standpoint, to really grasp the idea that a strong business model should not consist of highly educated, well-compensated executives running the business from the top, with little input from the employees at the bottom who are physically running the business from day-to-day. To run an efficient business, rather than vesting the high-up executives with the power to dominate the workers, everyone involved in the running of the company should have communication with each other to run the business as efficiently as possible by incorporating the opinions of people looking at the company from different perspectives.
I was also very interested in the section titled “Defiance Groups: Social Connections for Collective Agency,” which spoke about ending social injustice by challenging the status quo. One quote from this section that is very relevant to fair trade is “Game-players have a worldview that sees the potential for power as residing in social connections between otherwise disconnected states…Young suggests that structural injustice persists because of an absence of questioning of the status quo.”
I believe that these two sentences perfectly sum up why fair trade companies have been so successful so far and why they have so much potential for success in the future. Without the option of buying fair trade goods, people went to the store and bought what they needed with little thought given to where the items came from or whether they were comfortable with supporting the company from which they were making a purchase. Basically, people fell in line with the status quo. However, when “game-players” like fair trade companies came in and found a new means of connecting the suppliers in third world countries with the buyers in developed countries, bypassing large, corrupt corporations, the workers became empowered to work towards a tangible goal of creating a better life for themselves.
I was really inspired by William Foote’s “Harnessing Entrepreneurial Energy” because it once again proved that there are people in the world willing to put the effort in to solve the systemic problems of the business world. It was very interesting to read how he was not only improving the lives of thousands of workers, but enabling them to offer the best possible versions of their products to have more of a fair shot at competing in the global marketplace.
The story in the beginning about Shiwahiade, who was forced to employ her own children, rather than sending them to school, and still was not making enough money to keep her family fed. However, after receiving a loan from Root Capital, she was enabled to purchase the machinery to depulp the coffee beans and provide a much higher quality product with less effort, time, and wasted water. The high quality coffee beans enabled her to make the enough money to expand into poultry sales and send her children to school.
It is very interesting to read about more ways to help the people in developing nations who have historically remained trapped in the cycle of poverty. In America, I do believe there are extremely generous people who are willing and able to help people in third world countries, but the only way they know to do that is through donations to charity. Through Fair Trade and companies like Root Capital, people are able to help others build a sustainable business and a constant means of income to provide themselves with a better life. Going back to the Universal Declaration of Human Rights, every human being has the right to an autonomous life where they do not have to depend on the charity of others to get by. The loans provided by Root Capital take charity completely out of the equation by giving people the opportunity to build a maintainable business to achieve financial stability on their own.
I was also very struck by the success rates of the loans. The article stated that 98% of the loans are prepaid in principle plus interest. This is just more proof to further support the argument that fair trade is a sustainable business model and has the potential to become more and more successful as greater number of people learn about it and get involved.
“A Brilliant Idea” really opened my eyes to how much Fair Trade as an idea has grown, but also proved that it has a long way to go to help all the people who need it.
During the Occupy Wall Street protests last year, wealth disparity in the United States became a very popular topic of debate. However, I was still shocked to read that the poorest forty percent of the world’s population is sharing just five percent of the world’s income. Meanwhile, the richest five percent of the world is sharing seventy-five percent of the world’s income.
It is very interesting to think about my past views on wealth disparity during the Occupy Movement, as opposed to now that I am looking at it from the viewpoint of people in impoverished third world countries. Many Americans rightfully grew enraged when they were informed that the richest people in the country had so much influence and wealth, they were practically running the country. However, many of us failed to realize that we were not the true victims of the income disparity. The true victims are the people in third world countries who are forced to manufacture the items we purchase and dispose of here in America everyday. An American is officially considered to be living below the poverty line if their household income is below $11,490 but I think most people would agree that incomes much higher than that could still be considered poverty. It is unbelievable that around the world 2.6 billion people are living on less than $2 a day. Obviously the cost of living is much lower outside of America, but it is still difficult to imagine.
It was also very interesting to read about the environmental issues associated with Fair Trade. In order to support the farmers and artisans, their products must be shipped and sold in countries where people can afford to pay a slightly higher price. However, shipping items around the world presents a huge problem in the eyes of environmentalists who are working to minimize the amount of carbon and other toxic gases in the air. On top of that, the damage done to the environment by fossil fuels is making it more and more difficult for famers to get the most of their land. It is difficult to say what the best answer is in this situation because both environmentalists and fair trade activists are doing such important work. I do not know the best way to strike a balance between getting FAIRTRADE certified products from producers to consumers, while doing as little damage to the earth as possible.
Fair Trade: A Human Journey gave a deeper description of the people in third world countries who are directly benefitting from the spread of Fair Trade. It gave me a more personal view of why it is so important to contribute to the success and sustainability of a fair trade business model.
In the article, a Bangledashi woman named Shilpi recounted the rape she endured as a child. She stated that she was working as a maid for a wealthy family, where her boss raped her. Because she was poor, and he was wealthy, she was unable to take him to court for what he did. Then, her father lost his job because his daughter had been raped. Shilpi turned to prostitution to keep food on the table, where she was regularly beaten and unpaid for her services.
It is hard to imagine what she has been through because in America very few people will ever experience this in their lifetime. However, after hearing her story and knowing that there are thousands of other women in the world experiencing the exact same treatment, it is easier to see why it is so important for fair trade to continue to become more well-known and more widely practiced. It is easy for financial analysts and business executives to look at the profit margins when deciding between a fair trade business model and a traditional business model and choose to continue business as usual as a means of creating higher revenue. However, I find it extremely hard to believe that any human being could look at the benefits of fair trade versus the cost of human lives to continue mass production and cheap labor and still refuse to give fair trade a chance.
It was also very interesting to read about how much the women’s lives were changed by what we, in America, consider to be small amounts of money. At the end of the year, MCC organizations divide their profits among the workers and each woman is given a bonus of roughly $300. It was stated that this bonus almost doubles their yearly income and allows them to build a home, educate their children, and feed their families. It is unbelievable that $300 is enough to completely change someone’s life. This goes on to prove that people in developed countries have the means to change millions of lives without inconveniencing themselves al all. By simply purchasing the items that need to be purchased anyways, but buying them from fair trade organizations, we can improve the lives of people around the world in addition to helping force larger corporations to move in the direction of fair trade in an effort to meet the demands of their consumers.
The documentary, "Blood Coltan," explained how the natural resource, coltan is being mined and stolen from the Congo and sold to large cell phone manufacturers. The documentary depicted the harsh conditions that miners (many of whom are children) are subjected to in the process of extracting the mineral from mines and quarries.
As several students mentioned before, the most horrifying part of the documentary was Christine’s description of the rapes that occur as a result of mining. She recounted several stories of the women who had been brutally raped and assaulted by the rebel militia running the mines. She went on to explain that everyone in the village is in danger of the gruesome rapes including men, boys, young girls, and even babies. Not only do the inhabitants of the Congo live in serious danger of rapes and murders, but Christine stated that many of the men in the village are kidnapped and forced to work the mines as slaves until they grow too tired to work, at which point they will be burnt alive, beat to death, or shot in the head.
After hearing Christine’s stories of the brutal attacks taking place in the Congo, I had to really consider the value of a cell phone. As Bandi Mbubi stated in his TED Talk, cell phones have changes the world, and enabled people to connect with loved ones in different countries on different continents. However, it is impossible to look at the condition of the Congo without realizing that changes need to be made in the production of cell phones. As with the chocolate industry, cell phone companies bring in millions and millions of dollars in profit every year. There is no reason for children to be slaving away in mines to keep the cost of coltan at an absolute minimum so that cell phone company executives can walk away with million dollar bonuses. The unnecessarily high salaries of company executives should be invested in helping the United Nations restore a stable government in the Congo and overthrow rebel warlords.
This documentary really made me think about the Universal Declaration of Human Rights, and what it means for US citizens versus what it means for the citizens of the Congo. Article 4 states that every human being has the freedom from slavery. In America, this seems so obvious that it is hard to imagine a place in today’s world where people are still being subjected to slave labor, but in the Congo there is a very real danger of slavery. Article 23, which touches on people’s right to work, however, rings very true in both the United States and the Congo, but for very different reasons. When I think about my right to work as an American citizen, I take it to mean that I have the right to choose my career and earn a fair wage, and as a child, child labor laws protected me. In the Congo, none of these basic human rights are being granted. It was stated in the documentary that any able-bodied person in the village is expected to work in the mines because it is the only source of income in the area. It is hard to imagine a young child being forced to do the same work as an adult because otherwise their family wouldn’t be able to afford to eat. It is also hard to imagine being forced to work for your entire life in one job because there is absolutely no other option. Then, on top of those issues, the militia responsible for guarding the mine extorts a portion of the miner’s income as soon as they leave. To make matters even worse, the Congolese people’s lives are being ruined to extract a mineral that they will never even benefit from, as very few of them own or have access of a cell phone.
I am also a student in the Fair Trade and Entrepreneurship class at Fordham. The documentary, The Dark Side of Chocolate, really opened my eyes to the ongoing struggle to end child trafficking and slave labor in the chocolate industry. Before viewing the documentary, I had read a few articles about human trafficking, but there is a huge difference between reading speculative articles about slave labor in third world countries and actually seeing a child being tricked into leaving their family to work on a plantation with no hope of a better future.
One of the most powerful scenes for me to watch was the interview with a child trafficker who spoke so casually about the practice of smuggling children across the border to work. First, he stated that one person could not be held completely accountable because different people are involved in taking the children to different places where they are passed on to the next trafficker. He then stated that anybody living on the coast that claims that they are not involved in human trafficking is a liar.
It was extremely hard to listen to him speak so casually about such a terrible action. When I first saw the interview, my gut reaction was that he has to be a sociopath because it would be impossible for any person with a conscience to be involved in any way with human trafficking, let alone the trafficking of children. However, after reflecting on the conversation, I was struck even more by the idea that there are people in the world today who are living in such severe poverty that human trafficking has become a reasonable career path. What is even harder to comprehend is how little the compensation is for such a terrible act. The traffickers living on the Ivory Coast are ruining children's lives to make just enough money to survive in severe poverty. However, the executives of the chocolate companies are making excessive amounts of money at the cost of children’s lives. I researched the CEO of Nestle and found that his yearly compensation is over six million dollars. It is hard to believe that any board of directors could be willing to employ child slaves to keep labor prices low but turn around and pay another employee such an unnecessary amount of money.
I was also struck and infuriated at the interview with Ali Lakiss, the owner and CEO of SAF-CACAO. Ali adamantly confirmed that there were absolutely no children working on plantations in the Ivory Coast. He went on to state that committees had performed investigations, which proved that no children were working on plantations. During the interview, the documentary switched to footage of children working on cocoa plantations carrying machetes.
It is hard to believe that the CEO of one of the world’s largest cocoa distributors has absolutely no idea that human trafficking is such a huge part of the cocoa industry. This being said, I am convinced that he has chosen to turn a blind eye to the practice in order to turn over large profits. The documentary stated that SAF-CACAO brings in one hundred thirty-five million dollars worth of profits every year. It is tremendously disheartening to know that greed and corruption is so rampant in society that people would be willing to put profits and revenues before another human’s life.