Does the Fairtrade movement offer a viable model for a more ethical Essay

Does the Fairtrade movement offer a viable model for a more ethical trading system Choose one of the following sectors to explo - Essay Example Ethical trading is the umbrella term used to denote and describe all types of business processes or practices, which borders on promoting socially as well as environmentally responsible trade. This was stated by Narasaiah (2006, p.148), â€Å"Ethical trade is one dimension of corporate social responsibility, bringing social issues into the mainstream of commercial supply chain management through the use of codes of conduct.† Although, the term is also used to refer to the trade practices in an organization’s supply chain, instead of ethical trading, the term Fair Trade is being used to denote the ethical trade practices in the supply chain. Although, the words Ethical Trade and Fair Trade are synonymously used or sometimes interchangeably used, there is some clear distinction between the two words. â€Å"Ethical trade focuses on employment conditions of workers within global value chains, as distinct from Fair Trade which focuses primarily on producer prices and tradin g relationships. (Barrientos, Conroy and Jones, 2007, p.60). Thus, Fair Trade is a form of trading, where the well-being of weak actors or producers in the supply chain is taken care, through optimal trading practices. That is, the big players need to carry out ethical practices and indulge in ethical trading, so that the interests of the small players or traders are protected. What is more, the Fair trade movement also focus on reducing the poverty and improving the living standard of primary producers or farmers. Successful organization will try to incorporate a feasible model for a more ethical trading system and this is applicable to organizations in any sector, including the food and drink sector. So, in this article, the argument will be made and the reason will be given on why Fair trade has become a viable model for more ethical trading system. Role of Fair Trade Fair Trade had its origins way back in 19th century in the form of Cooperative movement among the traders. Howeve r, it evolved more in the mid part of the 20th century. That is, it began with the Mennonite Central Committee, U.S. based service entity, deciding to do trade with the poor communities in the South in the 1940s. From that beginning, it further expanded and become a "movement" in the 1960s and 1970s. (Moore 2004). Fair Trade is the term given to the trade that is authorised and overseen by certain unbiased organizational bodies, whose role is to see whether that trade happens fairly giving the due benefits to the producers in the supply chain. The four main organizational bodies which formulated the guidelines that constitute Fair Trade, and gives Fair Trade recognition to specific producers and buyers, thereby overseeing the Fair Trade practices are Fair Trade Labelling Organizations International (FLO), World Fair Trade Organization (or formerly International Fair Trade Association), Network of European Worldshops (NEWS!) and European Fair Trade Association. To further actualize a n omnipresent body, which can coordinate and oversee all the Fair Trade practices, these four bodies created together FINE (starting letters of the four) in 1998, an informal body â€Å"whose goal is to harmonize fair trade standards and guidelines, increase the quality and efficiency of fair trade monitoring systems, and advocate fair trade politically.† (articlesbase.com 2011). This FINE is also responsible for