Fair Trade Organization (FLO) And Alliance For Responsible Mining (ARM) Do Not Renew Contract, Splitting The Fairtrade/Fairmined Label
Introductory Comment: Last year, we worked hard to raise our opposition to ARM’s proposal to mass balance fairtrade gold. Over 140 companies and individuals signed our petition.
We were most concerned about the fairtrade gold brand. We wanted the fairtrade gold label when shown on a piece of jewelry to remain a real assurance of 100% pure fairtrade gold. We opposed mass balancing or dilution of the fairtrade gold with other gold in the production of fairtrade gold certified jewelry. Some jewelers also questioned the notion of the duel label: fairmined and fairtrade. From a marketing point of view, it was difficult to explain to the customer.
Yet, we learned that ARM was concerned, on behalf of small scale miners, that the current channel of distribution mainly through small jewelers was not creating enough demand for fairtrade fairmined gold. More fairtrade gold was being produced by the miners than could be purchased. The miners wanted to open the market as wide as possible. Plus, it is difficult to bring new mines into the system if the demand is not there.
Actually, everyone involved has wanted to find ways to bring more of this gold into the broader market. But there have been challenges along the way because components within this virtuous economic circle– the production, marketing, jeweler support, consumer awareness– have been developing independently.
One solution we at Fair Jewelry Action and many of our allies advocated was the splitting of the label. Potentially, ARM would then be able to use the fairmined label to promote an ethical mass balanced large volume product. In other words, ethically sourced gold could be mixed with other gold. FLO could protect the purity and image of the consumer facing fairtrade gold label, supporting the emerging ethical jewelry market. Those pioneer jewelers who had already invested so much in the promotion and marketing of the fairtrade gold wanted the purity maintained.
The split of FLO from ARM allows ARM to use the fairmined label for the best advantage for small scale miners, without having to be concerned about the impact of mass balancing on the fairtrade gold label. It is a win/win solution to an issue which was causing a tremendous amount of consternation in the broader ethical jewelry community.
Marc Choyt, FJA USA
Below is the stakeholder letter to from ARM:
We are writing with an important update regarding the Fairtrade and Fairmined gold partnership between Fairtrade International (FLO) and the Alliance for Responsible Mining (ARM), which is in operation to 21 April 2013. As a result of a partnership review process and taking into account feedback received from both market and mining partners, we have decided, instead of renewing the existing formal partnership, to bring this to an end, in favour of a more flexible model of co-operation for the future.
ARM and Fairtrade International have been working together since 2006 to implement a shared vision of better conditions for Artisanal and Small-scale miners (ASM). The partnership was formalized in 2009 through the joint Fairtrade and Fairmined Standards and dual label on certified products. We are proud of our achievements to date: empowerment of miner´s organisations, raising awareness of issues in the ASM sector and providing businesses with a traceable source of responsibly mined and fairly traded gold. However, we believe that by working more independently, yet cooperating wherever possible, we can make greater progress towards further improved terms of trade in the sector in the future. We will phase out the Fairtrade and Fairmined dual label, but continue to offer our respective labels and certification programmes separately. This will simplify labelling options and allow us to offer more tailored sourcing programmes for the industry and greater market access for miners and businesses.
As the current partnership agreement comes to an end, there will be a transition period through 2013 to allow phasing out of the dual label in the market and to minimise any impact to miners and businesses currently working with Fairtrade and Fairmined certified gold.
The current standards consultation will be continued independently by Fairtrade International and ARM resulting in a renewed Fairtrade standard and a renewed Fairmined standard as legitimate sources of supply to the market. Fairtrade and ARM will do their utmost to avoid duplication of work for the miners. The ending of the formal partnership will mean changes to the way certified gold appears in the market, however the fundamental goals of the Alliance for Responsible Mining and Fairtrade International remains focused on continuing to improve working conditions, environmental standards and terms of trade for Artisanal and Small-scale mining organizations and providing a sustainable source of responsibly mined gold for businesses.
Fairtrade and ARM will provide detailed information on the transition period by mid-April. Additionally, each organization will begin sharing full details of their new tools for businesses. Please liaise with your contacts at ARM and Fairtrade on any immediate concerns and we look forward to updating you further on next steps of this exciting new phase.
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Marc Choyt is Director of Fair Jewelry Action, USA. He is also President of Reflective Images, Reflective Jewelry, the first Fairtrade Gold jeweler in the USA. Reflective jewelry sells Fairtrade gold wedding rings and Fairtrade gold engagement rings
