Frequently Asked Questions (FAQ)
about ethical sourcing...
- Is ethical sourcing a result of consumer pressure?
- Does ethical sourcing mean higher prices?
- Is ethical sourcing the same as fair-trade?
- What does ethical sourcing tell me about the environment?
about the Ethical Trading Initiative...
- see About ETI
Is ethical sourcing a result of consumer pressure?
The ETI was originally very much a response to the concerns of ordinary people who want to see the dream of ethical sourcing turned into reality. Now the driving forces behind ethical sourcing are more complex. Many people, from consumers and investors to trades unions in the North and South, and managers within major companies, want to see improvements made to the lives of many of the people who work hard making the goods we all consume. The ETI complements initiatives by individual companies, by the ethical and socially responsible investment movements, by civil society and by governments to meet this demand by providing mechanisms for bringing about real and lasting change.
Does ethical sourcing mean higher prices?
The simple answer is that we don't know what impact ethical sourcing will have on retail prices. Researchers are studying the cost implications of meeting international standards, but there is still much we do not know. Suppliers of the big retailers are worried that ethical sourcing will squeeze their profit margins, but again there isn't any hard evidence. Even if we look at the experiences of other similar initiatives such as forest certification, fair-trade and organic certification it is hard to draw conclusions.
Is ethical sourcing the same as fair-trade?
ETI's members include organisations from the fair-trade movement (see List of ETI Members). But ethical sourcing and fair-trade are different.
Ethical sourcing tries to ensure that decent minimum labour standards are met in the production of the whole range of a company's products. By contrast fair-trade is primarily concerned with the trading relationship, especially those involving small producers in the South. Fair-trade ensures that producers are paid a decent price that at least covers the true costs of production, despite often serious fluctuations in world commodity prices.
Many consumers will always be prepared to buy special fair-trade products, while expecting that mainstream products are safely and decently produced.
For more please see:
- Ethical trade and Fairtrade: complementary approaches - ETI media briefing (Feb 2008)
- Fairtrade and ethical trade – complementary approaches; a joint statement by the Ethical Trading Initiative and the Fairtrade Foundation (May 2007)
What does ethical sourcing tell me about the environment?
Ethical sourcing is about labour and human rights conditions. Although it may be part of a company's wider corporate responsibility strategy, by itself it says nothing about a company's environmental performance, governance or community engagement.
See also:
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