When I heard that Sainsbury’s was set to drop some of its ties to Fairtrade Foundation, I was reminded of one of my favourite comedies: Yes Minister.

The shrewd permanent secretary Sir Humphrey Appleby would often indicate that a policy suggestion by Jim Hacker represented a risk of election loss by employing the phrase ‘a most courageous decision’.   If the policy would merely lose the government votes, it was described in more measured terms as ‘brave’.

A communications advisor might have used similar euphemisms upon hearing that senior managers in the supermarket chain were planning to take on one of the best known charitable organisations in the world.

In deciding to set up its own foundation, effectively in competition with Fairtrade, Sainsbury’s is taking a risk.  Its in-house ‘fairly traded’ plan to help tea growers in developing countries may well turn into a success over time, but people’s natural inclination will probably be sceptical.

That’s because the Fairtrade Foundation isn’t just a popular and recognisable brand.  It isn’t just well known for helping the world’s poorest either.  It is acknowledged as being extremely successful at what it does and boasts a handsome track record of delivery.

Sainsbury’s argues that independent auditors will ensure it is hitting sustainability targets.  But consumers may ask why a leading organisation wants to take even more control and why the company would move away from an initiative – Fairtrade – that has garnered near universal praise.  Arguably the supermarket seems to have forgotten a key reputational rule: the value of a respected external, independently verified endorsement from an organisation that is clearly delivering for the world’s poorest can never be matched by an internal scheme, however robust and whatever the auditors say.

Sainsbury’s has defended itself by arguing that the traditional Fairtrade model is out of date; the response to this so far has been mixed.  There have been accusations that the company is misleading customers, disempowering some of the world’s poorest farmers and even precipitating the end of the entire Fairtrade movement.  A cross-party group of 45 MPs has called for the company to reverse its decision and NGOs, including Oxfam, have also criticised the supermarket. 

In reality, the long-term impact on farmers in the developing world and the impact on the Sainsbury’s brand is as yet unknown.  Only time will tell whether its decision is ‘courageous’, ‘brave’ or perhaps something else altogether.

Max Wilkinson headshot

Max Wilkinson is an account manager at Camargue

destroy