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Fair Trade USA's CEO On Being A Better Social Entrepreneur

In innovating and evolving the Fair Trade model there are lessons for everyone trying to find solutions to global issues.

There is no guidebook for changing the world; there are no roadmaps. These are uncharted waters. Social entrepreneurs are making a bold statement that the status quo is simply not acceptable, and they do so without knowing if they will succeed or fail.

They called me crazy back in the '80s, when I was living in the mountains of Nicaragua with a small group of rural coffee farmers. "Pablo," they said, "no one in their right mind would ever pay a few cents more for our coffee." That first year, 24 brave souls took a leap of faith, entrusting me with their precious beans and their livelihood for the year to come. When I returned to the village, cash in hand and a smile on my face, they knew the benefits were real. They learned that this crazy group of people in Europe called "fair traders" would pay better prices for coffee that was grown with respect for farmers and the environment. When we sold our coffee as Fair Trade, we were able to get $1.00 per pound—at a time when local middlemen were paying only $ .10 per pound. We could actually make a decent living farming coffee.

That was the beginning of PRODECOOP, Nicaragua’s first Fair Trade coffee cooperative. Within three years, nearly 3,000 people had joined. Through the cooperative, these farmers had direct access to the market, they received a better price for their hard work, and the additional income enabled them to improve the lives of their entire community.

My experience in Nicaragua was life-changing, and from it I learned three things that I believe are common to all successful social entrepreneurs:

  • Have the courage of your convictions. In order to make dramatic change, you must believe strongly that your vision is right—it’s really more of a calling than a goal.
  • Enroll others. Many people fear change. Get ready for lots of criticism. You’ve got to ensure others—employees, business partners, customers, other stakeholders—feel as passionate about your vision as you do.
  • Try, learn, then try again. There’s no road map for innovation—you only learn by doing.

I became increasingly convinced that if this type of social business model could empower my friends in Nicaragua to fight poverty, it could do so much more. I returned to the U.S., and in 1998 we opened the doors of Fair Trade USA (formerly known as TransFair USA). We enrolled a handful of mission-driven companies who shared our conviction that the current system simply wasn’t working. Today, we work with about 750 businesses, certify 11,000 different products, and empower more than 8 million farmers, workers, and their family members through the annual sale of more than $1.5 billion in Fair Trade Certified products.

We’re deeply proud of all that has been accomplished. Yet there are still 2 billion people living on less than $2 a day. Fair Trade reaches less than 1% of them. This is simply unacceptable—a case of when "good enough" isn’t.

To make a meaningful dent in global poverty, Fair Trade must innovate. As part of the "courage of our convictions," we recently launched "Fair Trade for All", our innovation agenda for doubling impact by 2015. Fair Trade for All focuses on strengthening farming communities, including more people receiving the benefits of Fair Trade, and engaging consumers to grow demand for Fair Trade Certified products.

We’re already seeing results. In our first pilot—a 500-acre, family-owned, 100% organic coffee farm in Brazil—farm workers are experiencing the impact Fair Trade can have. The farm’s 110 workers democratically elected to invest their first Fair Trade community development premiums in eye and dental care. Jonatan Santos Silva, who has worked at this farm for 12 years, says, "I had never been to a dentist before because I could not afford it. I am happy and thankful because we are now receiving health services we did not have." We’ll apply the lessons from this pilot to other pilots—we’re going to try, learn, and try again.

And we continue to enroll others. Our model has received input from a diverse global network of farmers and farm workers, labor leaders, activists, NGOs, businesses, academics and conscious consumers. Most stakeholders firmly support the effort to broaden and strengthen our model to ensure that all farming families can access the opportunities of Fair Trade.

As is to be expected, some are challenging our innovations, some are calling us crazy. But as most entrepreneurs know, that just comes with the territory. Fair Trade—and the close, personal relationships I’ve built with individual farmers and their communities—are my life’s work. We simply must make Fair Trade better, more inclusive and more impactful for the farmers and workers whom we serve. When "good enough" is no longer good enough, it’s time to take action and make a change.

I may not be able to provide a complete road map for entrepreneurs just beginning their journey, but these three principles—having the courage of your convictions; enrolling others; and trying, learning, then trying again—have worked for me.