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South Africa establishes single ethical trade standard

04 January 2013

According to Fruit South Africa (FSA), a body representing four growers’ associations as well as the Fresh Produce Exporters’ Forum, a South African ethical standard and audit process for the fruit industry has been established that is ‘aligned to South African law, is internationally recognised and has the benefit of promoting ONE standard and ONE audit’. The standard is called SIZA (Sustainability Initiative of South Africa), and has been pioneered by FSA with the aim of replacing numerous standards and audits with which producers variously comply. This initiative is claimed as ‘a world-first’ as regards ‘enabling mutual recognition of audits among international and local retailers’. The standard is the product of collaboration between FSA and the Global Social Compliance Programme (GSCP) which, while not a certification or accreditation body, encourages organisations to use its tools as the basis for their own programmes in order to ‘harmonise ethical requirements and avoid duplication of audits while ensuring global standards are adhered to’. The GSCP receives support from retailers including Tesco, Delhaize, Carrefour and Pick n Pay. FSA used GSCP’s own code as the basis for developing its own standard, aligning it to South African law. Although pioneered by the fruit industry, there is ambition for the initiative to cover all areas of ethical standards in agricultural trade: FSA notes that ‘SIZA membership is open to producers, exporters, and stakeholders across the supply chain.’

The need for such independent ethical labelling is underlined by the news reported on a New Zealand television channel website that the New Zealand Commerce Commission has warned Dole that its attempt to trademark its label, ‘ethical choice’, ‘could mislead consumers and, therefore, breach the Fair Trade Act’. Dole already produces the ‘ethical choice’ label itself, and no independent organisation is involved. The company’s move to trademark this label has led to concerns that there will be no verification of the ethical claims, and the Fairtrade Foundation has also lodged an objection to the application to trademark the label.

Fair and ethical trade branded agricultural goods are an increasingly important element of trade. Fair Trade USA has reported that imports of its certified fruit and vegetables in the first half of 2012 were higher than in the whole of 2010. It reported 40% growth in 2011, compared to 2010, and noted that a number of new products are now certified, ‘including watermelons, bell peppers, cantaloupes, [and] tomatoes’. Fair Trade USA reported that its data showed ‘strong growth across nearly every source country and product’. 

Editorial comment

ACP states should take advantage of the desire by a growing number of Western consumers to use their purchasing power ethically. But this is not always easy to achieve. The regulation by OECD governments of the ethical claims made by importers and retailers is patchy, and consumers are often ill-placed to compare the implications of buying an independently verified fair-trade-labelled item to one which is self-certified by the supplying company (as in the case of Dole bananas marketed under the ‘ethical choice’ label in New Zealand). Even in cases where there is independent certification, producers (especially small ones) may find that they fall low in the pecking order when it comes to distributing any premium price paid by the consumer.

By organising a single national ethical trade certification system, South Africa is shifting the power balance towards the producer. The next key step is the education of OECD consumers on the substantive attributes of particular ethical labels with regard to the sustainability of the production process and the specific price and premium related gains arising for producers.

There could be a role for EU governments to help in this process both through education and, in some cases, regulation (for example by prohibiting, as the New Zealand Commerce Commission appears to be doing, marketing claims that cannot be independently and objectively verified).


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