Skip to main content
Log in

Ethical Objections to Fairtrade

  • Published:
Journal of Business Ethics Aims and scope Submit manuscript


The Fairtrade movement is a group of businesses claiming to trade ethically. The claims are evaluated, under a range of criteria derived from the Utilitarian ethic. Firstly, if aid or charity money is diverted from the very poorest people to the quite poor, or the rich, there is an increase in death and destitution. It is shown that little of the extra paid by consumers for Fairtrade reaches farmers, sometimes none. It cannot be shown that it has a positive impact on Fairtrade farmers in general, but evidence suggesting it harms others is presented. Many of the weaknesses are due to an attempt to impose political views on farmers and others. Secondly, the unfair trading criteria require that sellers do not lie about their product, nor withhold information that might alter the decisions of a substantial proportion of buyers. It is argued that the system only can exist because of the failure of the Fairtrade industry to give the facts on what happens to the money and what it can be proved it achieves. This unfair trading compromises the reputation of charities in general. Much of the trading may constitute the criminal offence of Unfair Trading in the EU.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others


  1. One UK Sainsbury superstore, in November 2010, had 76 product lines for coffee and 53 product lines for Fairtrade coffee. The most expensive coffee was nearly four times the price of the cheapest, £21.20 per kg, compared with £5.36. Many of the more expensive lines were Fairtrade. Some of the objective characteristics were stated, such as organic, Arabica, produced in Costa Rica, but there was no indication of most of them. Most of them would have been blends of at least half a dozen different qualities and different growths, produced by different suppliers.

  2. One web page says that farmers ‘are often forced to sell to middlemen who pay them half the market price, generally between 30-50c per pound. Fairtrade coffee sells for a minimum of $1.26 per pound.’ (Organic Consumers Association 2007) This comparison is flagrantly dishonest. The Fairtrade price quoted here is the New York price. The other price is the price paid in a village in the middle of Africa. Both the independent middlemen and the Fairtrade middlemen have to pay the costs of assembly, processing, marketing and transport, as well as the export tax, so both pay the farmer much less than the New York price.

  3. e.g. Lyon (2009, p. 230), Garza and Cervantes (2002, p. 15), Cabañas (2002, pp. 3, 19, 22, 24, 29), Aranda and Morales (2002, p. 15), Boersma (2002, pp. 6, 8, 20), Lyon (2002, pp. 4, 21, 23, 31), Escalante (2001), Mendez (2002, p. 20), Taylor (2002, p. 2), Milford (2004, pp. 49, 52, 55, 58), Ruben et al. (2009), Murray et al. (2003, p. 7), Johannesen (2008, pp. 108, 110, 115).

  4. Murray et al. (2003), Valkila (2009, p. 3024), Utting (2009, p. 141), Ronchi (2002), Luetchford (2006).

  5. International Coffee Organization statistics. There is an urban myth that this overproduction was caused by funding from the Asian Development Bank, and, in particular, the World Bank. In fact, the US veto on multinational loans to Vietnam meant that Vietnam was excluded from World Bank and ADB lending until 1993 (ADB 2010) (US Department of State 2010). The World Bank only began lending again in the rural sector in Vietnam after 1996 (World Bank 2010). It would normally take 4 years from planting of coffee to harvest, 6 years to full harvest.

  6. Fairtrade is at pains to distance itself from other ‘ethical trading’ organisations which may not have the same problems and which could be far more effective: ‘The most high-profile examples included the Rain Forest Alliance, Utz Kapeh (at Ahold supermarkets), and the Common Code for Coffee. However, it is important that consumers realize that these labels are not analogous with Fairtrade and that the latter is the only market-driven mechanism that offers real positive impacts for disenfranchised producers’ (Nicholls 2008).


  • ADB. (2010). Asian Development Bank and Vietnam: Fact Sheet. Retrieved June 14, 2010, from

  • Aranda, J., & Morales, C. (2002) Poverty alleviation through participation in Fair Trade Coffee: The case of CEPCO, Oaxaca, Mexico. Retrieved from

  • Audebrand, L., & Pauchant, T. (2009). Can the fair trade movement enrich traditional business ethics? an historical study of its founders in Mexico. Journal of Business Ethics, 87, 343–353.

    Article  Google Scholar 

  • Bahra, P. (2009a, January 2). Fairtrade is struggling to change practices on tea estates and tackle abuses. The Times.

  • Bahra, P. (2009b, January 7). Tea workers still waiting to reap Fairtrade benefits. The Times.

  • Bassett, T. (2009). Slim pickings: Fairtrade cotton in West Africa. Geoforum, 41(1), 44–55.

    Article  Google Scholar 

  • Berndt, C. E. (2007) Is fair trade in coffee production fair and useful? Evidence from Costa Rica and Guatemala and implications for policy (Mercatus 65 Policy Series, Policy Comment 11). Washington DC: Mercatus Centre, George Mason University.

  • Boersma, F. V. (2002). Poverty alleviation through participation in Fair Trade Coffee Networks: The case of UCIRI, Oaxaca, Mexico. Retrieved from

  • Boersma, F. (2009). The urgency and necessity of a different type of market: The perspective of producers organized within the Fair Trade market. Journal of Business Ethics, 86, 51–61.

    Article  Google Scholar 

  • Bowbrick, P. (1988). Are price reporting systems of any use? British Food Journal, 90(2), 65–69.

    Article  Google Scholar 

  • Bowbrick, P. (1992). The economics of quality, grades and brands. London: Routledge.

    Google Scholar 

  • Cabañas, A. A. (2002). Evaluation of the current and potential poverty alleviation benefits of participation in the fair trade market: The case of Unión La Selva, Chiapas, Mexico. San Cristóbal de las Casas, Chiapas, Mexico: Union of Societies of La Selva, Federation of Social Solidarity Societies.

    Google Scholar 

  • Doussin, J.-P. (2007, October). Max Havelaar reply. Le Monde Diplomatique, p. 2.

  • Escalante, M. Y. (2001). Transcription of the workshop on alternative markets, Tacuba, July 18. San Salvador, El Salvador: Shade, Livelihoods and Conservation Project—UCSC/PROCAFE/CFHF.

  • European Commission. (2005). Directive 2005/29/EC “Unfair Commercial Practices Directive”. Retrieved May 27, 2011, from

  • Fairtrade UK. (2009). Annual Report. Retrieved May 5, 2010, from

  • Fairtrade Foundation. (2008, Feb 23). Response to Adam Smith Institute Report. Fairtrade Foundation Press Release.

  • Fairtrade Foundation. (2011). Are consumers getting a fair deal from Fairtrade products? Retrieved May 22, 2011, from

  • Fairtrade Labelling Organizations International. (2010). Annual Report 20092010. Retrieved May 27, 2011, from

  • Garza, V. P., & Cervantes, E. (2002). Poverty alleviation through participation in Fair Trade Coffee Networks: The case of Unión Majomut, Chiapas, Mexico. Retrieved from

  • Gendron, C. V. B., & Rance, A. (2009). The institutionalization of fair trade: More than just a degraded form of social action. Journal of Business Ethics, 86, 63–79.

    Article  Google Scholar 

  • Griffiths, P. (2003). The economist’s tale: A consultant encounters hunger and the World Bank. London and New York: Zed Books.

    Google Scholar 

  • Griffiths, P. (2008, August). Why Fairtrade isn’t fair. Prospect.

  • Griffiths, P. (2010). Refutation: Does fair trade deliver on its core value proposition? Retrieved June 26, 2011, from

  • Hamel, I. (2006). Fairtrade firm accused of foul play. Swiss Info., 23/12/2009.

  • Hill, M. (2009). European coffee symposium, October 9. Retrieved from

  • Jacquiau, C. (2006). Les Coulisees du Commerce Équitable. Paris: Mille et Une Nuits.

  • Jacquiau, C. (2007). Max Havelaar ou les ambiguïtés du commerce équitable: Pourquoi le Sud rue dans les brancards. Monde Diplomatique, September.

  • Johannesen, S. (2008). Producing and consuming narratives for Fairtrade. Masters thesis, Norwegian University.

  • Jones, S., & Bayley, B. (2000). Fair Trade: Overview, impact, challenges study to inform DFID’s support to fair trade. Oxford: Oxford Policy Management.

    Google Scholar 

  • Kilian, B., Jones, C., Pratt, L., & Villalobos, A. (2006). Is sustainable agriculture a viable strategy to improve farm income in Central America? A case study on coffee. Journal of Business Research, 59(3), 322–330.

    Article  Google Scholar 

  • Lamb, H. (2008, September). Fairtrade is fair (Reply to Peter Griffiths, Fairtrade isn’t Fair, Prospect Aug 2008). Prospect.

  • Lamb, H. (2008b). Fighting the Banana Wars and other Fairtrade battles. London: Rider Books.

    Google Scholar 

  • Lamb, H. S. (2006). Trade audits do detect sales of non-certified coffee [REPLY]. Financial Times, September 13.

  • Luetchford, P. (2006). Relations between coffee cooperatives and alternative trade organizations—A view from Costa Rica. In D. Lewis & D. Mosse (Eds.), Development brokers and translators: The ethnography of aid and agencies (pp. 127–148). Bloomfield, CT: Kumarian Press.

    Google Scholar 

  • Lyon, S. (2002). Evaluation of the actual and potential benefits for the alleviation of poverty through the participation in Fair Trade Coffee Networks: Guatemalan case study. Retrieved from

  • Lyon, S. (2009). What good will two more trees do? The political economy of sustainable coffee certification, local livelihoods and identities. Landscape Research, 34(2), 223–240.

    Article  Google Scholar 

  • McMurtry, J. (2009). Ethical value-added: Fair Trade and the case of Cafe Fenenino. Journal of Business Ethics, 86, 27–49.

    Article  Google Scholar 

  • Mendez V. E. (2002). Fair Trade networks in two coffee cooperatives of Western El Salvador: An analysis of insertion through a second level organization. Retrieved from Sociology/FairTradeResearchGroup.

  • Mendoza, R. (2002). La paradoja del café, el gran negocio mundial y la peor crisis campesina, Managua, Nitlapán-Universidad Centroamericana, Oxfam UK, CAFOD and Christian Aid. (Cited in Mendoza, R., & Bastiaensen, J. 2003).

  • Mendoza, R., & Bastiaensen, J. (2003). Fair trade and the coffee crisis in the Nicaraguan Segovias. Small Enterprise Development, 14(2), 36–46.

    Google Scholar 

  • Milford, A. (2004). Coffee, co-operatives and competition: The impact of fair trade. Postterminalen, Norway: Chr. Michelsen Institute Development Studies and Human Rights.

    Google Scholar 

  • Moberg, M. (2005). Fairtrade and eastern Caribbean banana farmers: Rhetoric and reality in the anti-globalization movement. Human Organization, 64, 4–16. (Cited in Nelson & Pound 2009, p. 10).

    Google Scholar 

  • Moore, G., Gibbon, J., & Slack, R. (2006). The mainstreaming of Fair Trade: A macromarketing perspective. Journal of Strategic Marketing, 14, 329–352.

    Article  Google Scholar 

  • Murray, D., Raynolds, L., & Taylor, P. (2003). One cup at a time: Poverty alleviation and Fair Trade Coffee in Latin America. Fort Collins: Colorado State University.

    Google Scholar 

  • Nelson, V., Pound, B. (2009). The last ten years: A comprehensive review of the literature on the impact of Fairtrade. Retrieved from

  • Newman, P. (2006, September 23). How the Fairtrade ethos seeks to protect the growers. Financial Times.

  • Nicholls, A. (2008). Thriving in a hostile environment: Fairtrade’s role as a positive market mechanism for disadvantaged producers. Retrieved from

  • Organic Consumers Association.: n.d., Starbucks campaign. Retrieved May 22, 2007, from

  • Proctor, R. N. (2008). Agnotology: a missing term to describe the cultural production of ignorance and its study. In R. N. Proctor & L. Shiebinger (Eds.), Agnotology: The making and unmaking of ignorance (pp. 1–36). Stanford: Stanford University Press.

  • Raynolds, L. T. (2009). Mainstreaming Fair Trade Coffee: From partnership to traceability. World Development, 37(6), 1083–1093.

    Article  Google Scholar 

  • Reed, D. (2009). What do corporations have to do with Fair Trade? Positive and normative analysis from a value chain perspective. Journal of Business Ethics, 86, 3–26.

    Article  Google Scholar 

  • Ronchi, L. (2002). The impact of fairtrade on producers and their organisations. A case study with COOCAFE in Costa Rica.

  • Ruben, R., Fort, R., & Zuniga-Arias, G. (2009). Measuring the impact of fair trade. Development in Practice, 19(6), 777–788.

    Google Scholar 

  • Taylor, P. (2002). Poverty alleviation through participation in Fair Trade Coffee Networks: Synthesis of case research question findings. Fort Collins: Colorado State University.

    Google Scholar 

  • Utting-Chamorro, K. (2005). Does fairtrade make a difference? The case of small coffee producers in Nicaragua. Development in Practice, 15(3, 4).

    Google Scholar 

  • Utting, K. (2009). Assessing the impact of Fair Trade Coffee: Towards an integrative framework. Journal of Business Ethics, 86, 127–149.

    Article  Google Scholar 

  • Valkila, J. (2009). Fair trade organic coffee production in Nicaragua—Sustainable development or a poverty trap? Ecological Economics, 68, 3018–3025.

    Article  Google Scholar 

  • Valkila, J., Haaparanta, P., & Niemi, N. (2010). Empowering coffee traders? The coffee value chain from Nicaraguan fair trade farmers to Finnish consumers. Journal of Business Ethics, 97, 257–270.

    Article  Google Scholar 

  • Valkila, J., & Nygren, A. (2010). Impacts of fair trade certification on coffee farmers, cooperatives, and laborers in Nicaragua. Agriculture and Human Values, 27, 321–333.

    Google Scholar 

  • Weitzman, H. (2006a, August 9). ‘Fair’ coffee workers paid below minimum wage. Financial Times.

  • Weitzman, H. (2006b, September 9). ‘Ethical-coffee’ workers paid below legal minimum. Financial Times.

  • Weitzman, H. (2006c, September 8). The bitter cost of Fair Trade coffee. Financial Times.

  • Wilson, B. R. (2009). Indebted to Fair Trade? Coffee and crisis in Nicaragua. Geoforum, 41(1), 84–92.

    Article  Google Scholar 

  • World Bank. (2010). FAQs. Retrieved June 14, 2010, from,,contentMDK:20263941~menuPK:534295~pagePK:98400~piPK:98424~theSitePK:95474,00.html.

Download references

Author information

Authors and Affiliations


Corresponding author

Correspondence to Peter Griffiths.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Griffiths, P. Ethical Objections to Fairtrade. J Bus Ethics 105, 357–373 (2012).

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: