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Annex 4: IFAT Code of Practices

The International Federation for Alternative Trade (IFAT) aims to improve the livelihood of disadvantaged people in developing countries by linking and strengthening organizations that offer just alternatives to unfair trade structures and practices. IFAT members come together in solidarity and mutual cooperation to create an alternative and fairer way of doing business. IFAT is a federation to promote fair trade and a forum for the exchange of information to help members increase benefit to producers.

IFAT members share the following practices:

1.Commitment to Fair Trade - To trade with concern for the social, economic and environmental well being of marginalized producers in developing countries. This means equitable commercial terms, fair wages and fair prices. Unfair trade structures, mechanisms, practices and attitudes will be identified and avoided. To cooperate and not compete. To promote fair trade and social justice in the interest of the producer, and not to maximize profit at the producer's expense.

2.Transparency - To openly share financial information; management policies; business practices; product sources; production, marketing and development program plans on a regular basis. This enables both members and the public to assess IFAT's, and each organization's, social and financial effectiveness. This openness is tempered with respect to sensitive commercial or political information.

3.Ethical Issues - To reflect in their structures a commitment to justice, fair employment, public accountability and progressive work practices. To seek the greatest possible efficiency at the lowest cost while involving workers in decision-making and management as appropriate to each organization. To aim for adequate income for workers to meet their basic needs, including health care, education and the capacity to save.

4.Working Conditions - To ensure a safe working environment that satisfies at a minimum all local statutory regulations. To provide the opportunity for all individuals to grow and reach their potential. To ensure that work is carried out under humane working conditions, using appropriate materials and technologies, while following good production and work practices.

5.Equal Employment Opportunities - To oppose discrimination and ensure equality of employment opportunities for both men and women who suffer from the exploitation of their labor and the effects of poverty and racial, cultural or gender bias.

6.Concern for People - To promote development which improves the quality of life and which is sustainable for and responsible to both people and the natural world. There will be no exploitation of child labor. Trading activities should not violate indigenous peoples' claims on land or any resources of vital importance to their way of life.

7.Concern for the Environment - To encourage the trading of goods, which are environmentally friendly. To manage resources sustainably and to protect the environment.

8.Respect for Producers' Cultural Identity - To encourage production and development of products based on producers' cultural traditions and natural resources. To promote producers' artistic, technological and organizational knowledge as a way of helping preserve and develop their cultural identity.

9.Education and Advocacy - To promote fair trade by encouraging people to change consumption patterns based on issues of social justice and concern for the environment. To support campaigns or campaign for national and international policies that will improve the living conditions of the poor in developing countries. To increase public and corporate consciousness of alternative trade as an effective means to change unfair international trade structures and attitudes. To increase awareness of cultural and traditional values of the South in order to promote intercultural understanding and respect.

Working Relationships

Organizations participating in fair trade shall establish their relationships within a framework of solidarity, trust and mutual respect, avoiding prejudice or harm to their colleagues' images and reputations. These relationships are based on reciprocal benefits and fair exchanges and should be of a nature that extends beyond trading itself. IFAT members and observers agree to negotiate our differences through open and direct dialogue.

1.Relationships between Alternative Trading Organizations (ATOs) and Consumers - ATOs both provide consumers with high-quality, fairly priced products and educate and inform. ATOs recognize that good customer care--including respect for the customer, honest marketing techniques and provision of information is both an ethical issue and a means of benefiting all parties in the trading cycle. Through consumer feedback ATOs will receive market and product information.

2.Relationships between ATOs - As representatives of the producers, ATOs should make efforts to coordinate their activities and help each other achieve commercial efficiency at the least possible cost in order to open up markets to benefit the producers. Their cooperation and commercial transactions shall be based on a clear and efficient work division according to their different geographical locations and resources. ATOs cooperate with each other by exchanging information about products and market needs and ways of meeting them, including joint supply and marketing. They seek to avoid both duplication and exclusivity in agreements for marketing and representation. They also aim to cooperate by obtaining funding for themselves and producer organizations through credits, loans and working capital and optimising existing resources.

3.Relationships between ATOs and Producer Organizations - The function of the ATO is to buy and sell and the function of the producer organization is to produce and sell. Their commercial relationship should be complemented with other actions addressing the overall situation. Market information, product feedback, financial support and other relevant services are available according to members' and observers' capability. Taking into account the skills and resources of producers, ATOs and producer organizations seek to improve the quality, acceptability and range of their product offerings. Both ATOs and producer organizations agree to be responsible and professional in meeting their commitments in a timely manner.

4.Relationships between Producer Organizations - Cooperation between producer organizations should be frank, open and based on mutual respect to benefit their members. They avoid competition by not duplicating the designs or patterns of another group without permission. They exchange information, have joint training workshops, take collective action and will, where possible, meet to discuss common issues.

IFAT members include southern and northern alternative trading organizations (ATOs) and producer organizations, and also organisations, which support the objectives of IFAT but are not directly involved in trading.

Approved at the 1995 IFAT Conference, New Windsor, Maryland, USA 13 May 1995

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last updated: 24 october 2000
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