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An end to premium prices for ethical coffee?

18th June, 2012 by Anonymous | 4 comments

The wellbeing of coffee growers makes business sense for big brands like Kenco, as well as niche ones.

Big brands tend to get a bad rap when it comes to sustainability. But a company with 50,000 metric tonnes of coffee beans passing through their doors and selling millions of jars of  coffee every year, is in a position to make a big difference, and quickly.

In 2005, Kraft Foods’ coffee brand, Kenco, decided to begin sourcing from Rainforest Alliance Certified farms, a certification programme that ensures land is farmed in an environmentally sustainable way while also protecting the rights of workers. Over five years, Kenco has transformed their entire range, and Kraft Foods is now one of the largest purchasers of Rainforest Alliance Certified coffee worldwide.

For Kenco, ensuring the wellbeing of their coffee growers made business sense, but brand manager Stephanie Okell says there was a further business case to be made: selling ethically sourced coffee could be used to “increase consumer and customer engagement.”

“We’ve had a lot of growth on the back of becoming certified and launching the Eco Refill (a lightweight reusable plastic alternative to coffee jars),” says Okell, pointing out that since 2008, there has been over one million additional consumers buying Kenco coffee. “Sustainability has been a key business driver” she says. Central to this success is brand owner Kraft Foods' ability to make more ethical coffee accessible for a mainstream audience. As a large company, it can absorb the extra cost of buying certified coffee in exchange for a larger market share. “We can make sure people don’t have to pay a premium to enjoy great quality coffee. There are more niche brands of ethical coffee out there, but we are bringing it to an everyday consumer.”

Kenco’s advertising strategy has also been important, Okell believes. Instead of lecturing about saving the world, they focused on how Rainforest Alliance Certified coffee brings direct benefits to real people. And the lighthearted adverts for the Eco Refill helped. “There was no preaching. We just made it easier to make a sustainable choice.” - Sarah Lewis-Hammond

Photos: Rainforest Alliance 

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Comments

Martin Wright (Editor in Chief, Green Futures) (not verified), 29 June 2012 - 10:39
  • reply

Thanks very much for your comments on this piece. The article is one of a number of case studies on the way in which food businesses, large and small, are endeavouring to adopt more sustainable practices. They're grouped together in our forthcoming special edition, Food for the Future, along with general features on the challenges facing the industry. You are absolutely right to highlight the tremendous achievements of Fairtrade, which we've highlighted at some length elsewhere in the edition

Rainforest Alliance (not verified), 29 June 2012 - 10:34
  • reply

We would like to take this opportunity to correct several inaccuracies regarding Rainforest Alliance certification, posted in the comments here.

Rainforest Alliance Certified™ farms meet the comprehensive standards set by the Sustainable Agriculture Network (SAN), a coalition of not –for-profit conservation organizations. These standards were developed and are managed by grassroots groups, the same countries where the crops are grown and are continually reviewed by independent environmental and social experts that are internationally respected in their fields. Certified farms and companies that source goods from certified farms are eligible to use the Rainforest Alliance Certified green frog seal, if they meet our guidelines.
(SEE: http://sanstandards.org/sitio/sections/display/2)

The SAN standards encompass the three pillars of sustainability - social, environmental and economic - and empower farmers with the knowledge and skills to negotiate for themselves in the global marketplace. Farmers engaged in the Rainforest Alliance Certified program learn to grow smart, increasing their bottom line and conserving the fertile soils and natural resources on which their children will depend. Farmers also learn to increase productivity and control costs, often producing higher quality crops that can earn a better market price.
(SEE http://sanstandards.org/sitio/subsections/display/9)

To achieve and maintain certification, farms must comply with at least 80% of the applicable criteria (there are over 100 in total) of the SAN Standard. In addition, the Standard contains 15 critical criteria which farms must completely comply with.

Companies using the Rainforest Alliance Certified seal with less than 90% certified content must agree to scale up this percentage over a set timescale with specific benchmarks. This enables large companies to build wider markets for certified, sustainably produced products. This compares favourably with the requirements of other certification systems, including Fairtrade, which also allow less than 100% of the overall product to be sourced from certified farms.

The Rainforest Alliance works hard to ensure transparency and guard again conflict of interest. The website TRAFFIK recently endorsed both the Rainforest Alliance and Fairtrade as a defence against child labour.
(SEE: http://www.rainforest-alliance.org/about/integrity)

Consumer Reports' Eco-Labels Center offers an independent assessment of a variety of product labels, including the Rainforest Alliance Certified seal and the Fairtrade Certified mark.
(SEE: http://www.greenerchoices.org/eco-labels/)

Fairtrade, the Rainforest Alliance and UTZ Certified (another certification system) share the goal of transforming the world's production systems and value chains to make them more sustainable and promote credible third party certification as a viable solution. With the majority of the global coffee supply not certified under any system, we recognize the need to work together, and with consumers, to transform this industry and many others. To this end we released a joint statement that publicly acknowledged our aligned goal and mutual respect for one another.
(SEE: http://www.isealalliance.org/online-community/news/historic-joint-statem...)

Rainforest Alliance, 28.6.12

Jenny Foster (not verified), 21 June 2012 - 12:11
  • reply

I would very much like to talk to you about including this article. It seems to take a snipe at Fairtrade and gives a false idea that Rainforest Alliance is just as ethical as Fairtrade which is not true. It angered me and other colleagues in Sustainability team at Bristol City Council. It seemed a simple promotion of Kenco/Kraft with no real analysis or balance.
Key points:
- Rainforest Alliance only covers 30% of beans, so other 70% can be as unsustainable as the producer chooses
- In 2002 Human Rights Watch found banana farms certified by Rainforest Alliance relied on child labour, violated basic workers rights and prevented the forming of worker unions
- Kraft could well have a vested interest, having donated $100,000-$999,999 in 2008 and their former executive sits on the board of directors
- Rainforest Alliance develop their own sustainability standards covering 30% of beans, so not independent vision of sustainability. Also to comply with their standards only critical factors need to be met, and these only need to cover 50% of the beans
I would like to request a follow-up article explaining the differences between RA and FT to keep true balance and facts. Do call me to discuss.

Jenny Foster
Bristol and South West Fairtrade Co-ordinator

Green Giant (not verified), 20 June 2012 - 10:56
  • reply

I'm sorry, but Kraft/Rainforest Alliance being ethical?!!

Considering Kraft donated somewhere between $100,000-$999,999 in 2008 to Rainforest Alliance and their former executive now sits on the board of directors for Rainforest Alliance I think there might be some vested interest. In fact, I'd bet on it.

This might not be a problem if Rainforest Alliance certification standards were independently set, but they're not - they are self chosen.

And what do these standards cover? There is no critical or non critical standard set by Rainforest Alliance on minimum pay, so I do wonder what is covered. Many of the criteria are not critical, and beans qualify for the standard if half of the critical factors are met. Oh, and coffee can be branded as Rainforest Alliance provided 30% of the beans meet these loose standards.

So when buying a bag of Rainforest Alliance coffee, 15% of beans are covered by some self-created standards. The other 85% can be as unethical as the coffee provider chooses.

I think I'll stick with the independently set Fairtrade standard which covers 100% of beans

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