In the book, The Blue Sweater: Bridging the Gap Between Rich and Poor in an Interconnected World Jacqueline Novagratz chronicles her experience in establishing a financial institution that served as a venture capital fund for the poor.
I was most impressed with the decision that led her to starting this venture.
Her first option was to work for a wealthy company in the “dot.com” boom worth $100 million to start a philanthropic organization for clients. The pay would be seven times greater than her current salary and there would be a sense of security. Her other option was to start something from scratch, with freedom and her own vision. Although the latter was more risky, she followed her gut and the chance to pursue her own vision.
I am also intrigued by the business model she followed and the approach she took in starting the project.
This venture capital fund for the poor would raise charity money and then invest in equity, loans, and grants in organizations committed to helping the poor. Novagratz made it clear that this is not microfinance. There is no investment in individuals but instead there is an investment in organizations that reach millions. The idea behind this was her “…passion [to use] business models to create effective, sustainable systems where government or charity alone had failed poor people.” In this sense, private entities were a solution to global poverty.
This last sentiment connects back nicely to the concept of fair trade. Purchasing fair trade goods is a private investment that affects a wide range of individuals. Whether it be a large coffee plantation cooperative, or a group of women making artisan goods to avoid prostitution, traditional private investment is put towards an untraditional goal of helping others.
What I found most intriguing about Colonial Pasts and Fair Trade Futures is that this is the first time our class has been exposed to the downsides of pursuing the Fair Trade framework within an industry.
Discussing the Darjeeling Tea industry of West Bengal, Sarah Besky identifies that perhaps it is better for this industry to stick to the infrastructure left by its British colonizers. This to me was surprising, as I have never heard that colonial infrastructure is in the best interest of freed colonies.
Upon reading Besky’s explanation however, this structure would make sense for the Bengali tea industry. Colonial institutions set up a framework for the tea industry and it was maintained after freedom. Colonial labor policies adapted into the Plantation Labor Act (PLA) which “guarantees plantation worker’s social welfare, insisting that owners provide workers housing, health care, food rations, and schooling for children.” Besky describes the colonial institution as a “positive legacy of an otherwise exploitative colonial regime,” and I agree.
What I found a little disappointing after having spent weeks discussing the benefits and good work that comes from a Fair Trade business framework, is to hear that in this industry it has failed its purpose to promote social justice.
In this area, Fair Trade was adopted because it was a way for plantation owners to get around their obligations to provide social benefits to their employees according to PLA. Fair Trade standards are far more flexible than the laws adopted from the colonial system. Additionally, it seems that there is little Fair Trade education among the workers. For example a Joint Body, a group elected group of representatives from the industry and community to manage, investigate and uphold fair trade values, was implemented in the region. However, in this case the Joint Body was selected the owners. The Joint Body did not represent the whole group and some people did not even know what it was. Additionally, some community members did not know the concept of fair trade.
I think that this is an indication that some aspects of the Fair Trade framework should be reworked. In this case, the original system ensured the best interests of the workers in mind more strictly than Fair Trade standards. Perhaps there can be an amendment made that Fair Trade guidelines will be implemented in places that do not have an existing framework for worker’s interests. In areas that have laws already in place to protect workers, the standards held should be the stricter guidelines to ensure worker’s are truly being treated in all fairness.
In the first chapter of Anna Hutchens book, Changing Big Business, she highlights an important underlying psychological concept that is found in all types of businesses- power. While it is to broad and stereotypical to say that business is all about domination, Hutchinson identifies different types of power starting with the traditional concept of power as an instrument of domination characterized by ‘coercion,’ ‘struggle,’ and ‘force.’ In modern times, a different form of power emerged- empowerment.
I found the structure Hutchens used to be an interesting model to describe power. This chapter reads as a textbook to me, which is why I was able to react to each definition of power she presented and connect it to Fair Trade businesses.
In describing the concept of “power over” which is the power of one to get someone else to do something, I thought the sub-definition of “invisible power” relates closely to our own classes Fair Trade business endeavors. Invisible power is described as one person who is given power because others think of themselves as subordinate. I believe that when there are too many leaders in one room, some choose to take a back seat and let others take over if the other is more passionate about the topic. I believe that each Entrepreneuship and Fair Trade student is a leader in some way. Our topics were chosen because of what we are passionate about and while we do work as a collective group, we are all subtly in control of the subunits of the mission of the overall course.
Continuing in the power over section of the chapter, Hutchens cites Foucault’s thought that power and resistance makes the other possible. He states that first, where there is power there is resistance; and second, power relations refer to how people try to control others thus there is not complete dominance. He then leads into how this relationship can turn into a situation of repression. I can correlate repression as power to the places in the world which are controlled by small groups of dominant people which inflicts pain and limitations on others for profit. This is exactly exemplified in the Dark Side and Chocolate and Blood Coltan.
While the previous paragraphed focused on the power aspect of the relationship, the next definitions Hutchens presents relates to resistance, which is the driver of Fair Trade businesses in my opinion.
Hutchens defines “power to” and “power with.” Here comes the concept of empowerment. The power to do something correlates to the back story behind many Fair Trade businesses. In some examples, products are made by women who want a different life and a less detrimental source of income, such as moving from prostitution to creating beautiful goods and developing a skill. The power with others relates to individuals who formed Fair Trade cooperatives to find success in numbers.
As a final thought to this chapter, her discussion of “Pushing the Empowerment Agenda” gave me a different insight to the true power behind Fair Trade. She writes that entrepreneurship disrupts the typical model of economic power. I believe that entrepreneurship in itself does not disrupt the typical balance; rather I believe that entrepreneurship is just the start of the business cycle. All businesses started somewhere. I do believe however, that the Fair Trade is a different type of entrepreneurship which does not so much disrupt the typical balance of power, but rather places it in the hands of a different person. Entrepreneurs in Fair Trade return the economic power to the person who earns it, the producer.
In the first chapter of John Bowes book, A Fair Trade Revolution, Bowes details the evolution of the Fair Trade movement. While this chapter provides background details on the history of Fair Trade, it also makes a connection, intentional or not, that Fair Trade is perpetuated by the harmony of western and non-western ideals.
I was interested to learn of that the development of the Fairtrade mark was vital to the growth of the Fair Trade movement. The chapter reports that 70% of the adult UK population is able to recognize this label. Consumers also understand that this label is a legitimate accreditation which indicates that the product has met Fair Trade standards and is priced fairly.
This label opened up distribution options for Fair Trade products and also led to a consumer demand for the good. However, I feel that this relates back to consumers’ love of labels. Often people make purchases because of what it says on the tag and not necessarily because of quality. For example, people purchase Coach Handbags because it’s Coach and not because it is the exact product they are looking for. The western emphasis on the “name” or “label” of a product is seen in the success Fair Trade to a certain degree. Now that Fair Trade is becoming a more mainstream consumer trend it is gaining popularity and customers.
However, while Fair Trade might be supported by western consumers, it did not evolve as a result of western development programs or ideals.
The last page of the chapter indicates that the success of Fair Trade model is not from a western person giving the developing world a solution. Rather, it is people in that region who wanted a change their lives and they constructed a way to do that so they can stand on their own and support themselves independently.
This is our first exposure to literature on the Fair Trade movement. What I was first interested to learn is the history pre-dating free trade and the evolution of the movement.
I never made the connection between the artisans from ancient civilizations that fueled the regions economies as a precursor to the Free Trade movement. However, looking at the evolution of industries and the state of certain developing countries, these artisans are still producing goods whether it is through factories for large corporations, or their own smaller jobs to support themselves. Regardless of the situation, many people who have craft and manufacturing jobs work in poor conditions, are underpaid and have little stability. Starting in the 1940s, different people noticed these issues and by 1988 the Netherlands began Fair Trade Certification. The Fair Trade movement is significant as it is a way for individuals with the skills for craft jobs to be given a fair wage for their work.
I was also impressed with the Fair Trade business examples and stories which are presented in the article.
I thought the model of the Action Bag company located in Saidpur was a good set up for a fair trade business. Employees are given a salary as well as money entered into a savings account. At a certain monetary level, employees are able to access the savings account and use that money to start their own business. This allows for employees to make a fair wage while also having the security to continue on an independent economic path. Sacred Mark, another fair trade company, also had an impressive element to their enterprise. All of the soap products are sealed with a wax fingerprint of the artistan who created the product to indicate the individuality behind the product. I think this is an excellent way.
While I am aware of many goods that are a cause of outrageous social injustices, I am disappointed in my lack of knowledge about the materials that go into objects I use every day, my laptop and my iPhone. In the documentary Blood Coltan, journalists bring to light the source of the mineral coltan. This mineral is used in electronic products such as cell phones. It is sourced in African countries, namely the Democratic Republic of the Congo.
What first struck me is the danger associated with mining coltan in the Congo. What I was most interested to learn regards the portion of the video which identifies the guerilla and militia groups which control the mines. These groups come from neighboring Rwanda. After the Rwandan Genocide in the 1990s, the targeted group fled to the Congo and then became dominating militias. It is shocking to see that people would inflict pain and enslavement upon others as a demonstration of power and a desire for money and their own group of people experienced painful atrocities.
The second component of the documentary which struck me is the connection it makes to consumerism and large technology corporations. During one scene the journalists ask the coltan distributors who set the prices for coltan. The distributor responds that it’s the world market that sets the price. Consumer demand for goods causes the mining and distribution of coltan. Businesses respond to these demands and produce and sell their goods. This makes me wonder where corporate social responsibility comes into play. In the documentary coltan distributors identify that the supply chain of coltan is so long and diluted because of the nature of production, making it difficult to identity the source. I asked myself why the production of this is not standardized or better controlled, but the political climate of the Congo makes it difficult to implement fair laws and protectionist policy. To follow my initial thought, I asked myself why companies do not make better decisions regarding the materials they use. However, it is sadly economics and the way consumerism operates.
If some products can be certified as fair trade, could technological goods be certified as fair trade? Bandi Mbubi asks this question during the presentation of his TED talk, “Demand a Fair Trade Cell Phone.” He points out that technology is vital to the improvement of our society, but it also participates in its destruction. He demands a fair trade cell phone. I think this is possible if both consumers and producers make that commitment.
My name is Ani Esenyan and I am a student in Professor Combellick's Entrepreneurship and Fair Trade class at Fordham University.
This is the second time I have seen the documentary, The Dark Side of Chocolate. I first saw this film for my Development and Globalization class in which we were to respond to the film in terms of how this, and other, commodity affects the economic and social development of the region. Although I primarily noticed the economic impact of this industry from my first viewing, upon watching the film again, I noticed two particular aspects of child labor in the cocoa industry which correlates to the social injustice that perpetuates in the region.
First, I was intrigued by how these children were involved in this labor industry.
It was unsurprising that children were tricked into the industry. The film indicates that children were mislead as to what their future would be like if they left their homes. Additionally, children were blindly taken from villages. What did initially surprise me however, was that parents encouraged their children to work in the fields in hopes of an income. In the scene of Mariam, a little girl who was sent by her parents to work and make money for her family, she stated that her parents would be upset if she returned with nothing. I say that I was initially surprised by this because it shocks me that parents would send their children away and commit them to a laborious and potentially dangerous job. But, when a family is in a desperate economic state, any source of income helps.
Second, I was confused by the reaction of large chocolate corporations and the Ivory Coast government to child labor in the region.
The film indicates that these corporations have no knowledge of where their cocoa comes from, as seen in the chocolate convention scene. How is it possible that these multi-million dollar organizations are either completely ignorant or able to bury the truth? In the scene with the CEO of Saf-Cocoa he also seemed shocked to learn of the use of child labor. At first, he was completely appalled at the accusations but once he was shown the video of proof he began to accept the reality. To me this also seems strange that he was blind to this possibility. The most shocking response however was from the Ivory Coast government officials. One official stated that "child labor is not a problem anymore because they are aware of it and are taking measures to stop it." I still see this as a problem however as it is still continuing.
Tue Nov 12, 2013 4:05 am
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