Many organisations are doing well on environmental issues, but there’s often a gap when it comes to people. Fair Change Co (Scottish Fair Trade’s trading subsidiary) brought on Maëlle Tholomé as a volunteer to help us understand that gap better and identify where we can support change. Read on to hear Maëlle’s summary of her research below.
In recent years, we have seen an increase in net zero pledges and broader corporate a climate strategy among businesses. Companies are increasingly mindful of their products’ environmental impact, attempting to navigate this through initiatives such as reducing packaging. Although this is extremely important, perhaps we have overlooked the true meaning of sustainability, which is beyond an environmental project.
The UN Sustainable Development Goals embrace our commitment to the planet as equal to our commitment to its people. This involves reducing inequality, promoting peace, securing human rights, and much more. In practice, abundant research, such as that by Gugkang and Hendry, highlights that the social dimensions of sustainability, such as labour practices and community welfare, are often neglected. Indeed, throughout the past 8 weeks, I have investigated this exact gap.
Why does this matter? According to the International Labor Organization (ILO), an estimated 3.3 billion people employed in 2018 had a lack of economic security, material well-being, or equal opportunities. In the same year, approximately 700 million workers lived in extreme or moderate poverty despite having a job. Furthermore, forced labour, a violation of human rights, still affects 27.6 million people across the globe, a reflection of this lack of protection.
While this may feel abstract, 63% of forced labour happens within the private economy, the very economy striving to reduce its environmental impact with net zero pledges. A company can score well on emissions and packaging while still failing to support the people in its supply chain. This disconnect is what motivated my research.
I first consulted Ethical Consumer, a website that researches the social, ethical, and environmental dimensions of companies and assigns them a representative score. Interested in the social dimension, I focused on the “Workers Score,” which looks specifically at how companies treat their workers and supply chains. After understanding how this scoring worked, I broke down the scores of over 100 companies across different sectors, from butter to clothing brands, to analyse patterns between sectors and practices.
The results offered crucial insights. Coffee and chocolate were the strongest-performing categories, with an average Workers Score of 80.8 and 90, while milk, butter & spreads were the weakest, averaging 22.5 and 46.3. These lower scores could be attributed to a large focus on animal welfare in the latter categories, and likely reflect differences in supply chain structure, which would need to be researched further.
High Workers Scores are driven by in-house production, Fair Trade certification, supply chain monitoring, and deep supplier relationships. In general, companies with a comprehensive supply chain policy averaged a Workers Score of 87.2, compared to roughly 50 for those with a weak, basic, or absent policy.
The same divide showed up around monitoring workers’ rights (83.8 vs. 53.3 for companies that don’t monitor) and supplier relationships (71.4 vs. 52.7 for long-term vs. no-evidence relationships). However, the failure to provide living wages and publish supplier lists was the largest contributor to lowering Workers Scores. Most companies did not publish a full supplier list, and a focus on living wages was a major gap across all sectors.
With this in mind, I conducted a deeper dive into companies that achieved high overall ethics scores but low Workers Scores, as well as those reaching the top Workers Score, in hopes of understanding the limitations and drivers of high performance.
This initial look at companies with the lowest Workers Score but highest company ethics score highlighted the paradox mentioned above: these companies were highly committed to environmental sustainability but lacked the supply chain policies or worker welfare information needed for a high Workers Score.
True sustainability (and therefore a high overall ethics score) cannot be achieved without attention to the social dimension, which is just as important as the environmental one.
This attention to both dimensions is what made some companies stand out. Among them is Hodmedod’s, a British food business I interviewed. There, workers’ rights are treated as a structural commitment. The company is Living Wage and Living Hours accredited, and as Kate, who works there, explained, freelancers are held to the same standard as employees, stating that “anyone who works for us on a regular freelance basis… (is) legally required to be on the same living wage and living hour policy.”
She expressed the difficulty of finding ethical suppliers for some ingredients, like salt and oil, and the care taken before bringing on new partners: “we work with companies we know are likeminded, we look into them before approving working with them.”
Similarly, Postcard Teas, a small tea merchant, also achieves a perfect Workers Score. The founder, Timothy, highlighted how small-scale farming means “more democracy, less concentration of power, more money going back into the community, kept in the local economy.” For Postcard Teas, natural farming and fair wages go together, partly because it’s the small farmers themselves who bear the health costs of destructive practices like insecticide use.
By sourcing directly from small-scale farms (e.g. the farms they work with in Asia are all under 15 acres) and focusing on natural farming, they ensure fair wages and safe conditions that support the local community.
My research over these past two months indicates that to improve social sustainability, businesses need to put workers’ rights at the center of their business. More practically, my research points toward three main initiatives that improve Workers Score: paying a certified living wage, publishing clear supplier lists for full transparency, and building direct, long-term relationships with suppliers.
By taking these first steps, companies can finally bridge the gap between environmental initiatives and fair treatment for the people behind their products. I am immensely grateful to Scottish Fair Trade, who gave me the support and tools to carry out this research. Organisations like Scottish Fair Trade are well placed to support this shift, offering businesses the guidance to close this gap.
If you want to learn more about how Scottish Fair Trade can support your business on your mission to deliver products and services that do good for both people and planet, take a look at the Fair Change Co. website, or get in touch with our Ethical Business Manager, Kiera.
