World Fair Trade Day

By Laura Duncan on 05/14/2011 @ 02:53 PM

Today is World Fair Trade Day!

Terms like “social responsibility of corporations” and “corporate responsibility” have been widely used, but there is little consensus on what these terms actually mean. For some, it means that companies use their own funds for projects that benefit society, such as building parks and libraries. The idea that corporations should invest their money in projects that do not benefit them directly has in the past decades come under sharp criticism. In 1970, the economist Milton Friedman emphatically argued against such an idea, stating that “the social responsibility of business is to increase its profits.” To the extent that a company’s funds belong to its shareholders, this is a poignant argument.

Others define corporate responsibility as a way of doing business. Through innovative strategies, business men and women have found ways of combining the interests of shareholders with the interests of those affected by the company’s actions, such as farmers who provide raw materials and the company’s own employees.

Fair Trade is one example of a business strategy that improves communities while still making a profit. Fair Trade is not a new concept, but it has come into sharp relief in the past decades as society becomes more and more aware of the negative consequences of the global economy. Take Fair Trade coffee, for example: coffee producers in Latin America often live in remote regions and are dependent on middlemen to buy and transport their coffee to the city. Many of these middlemen offer prices that are far below the market price for coffee, and that is where Fair Trade comes in. By demanding that farmers and others in the chain of production be paid a fair amount, a corporation can enable small farmers and producers to improve their quality of life by participating in the free market.

An essential part of the success of Fair Trade is the conscious consumer. This consumer knows that she doesn’t have to go very far to make the world a better place. Just by purchasing Fair Trade products, she knows that she will improve the quality of life of people around the globe.

If you would like more information on Fair Trade, please visit http://www.transfairusa.org/

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