Building Futures with Fair Trade Community Development: How Workers are Taking Action

Community Development Funds and the Fair Trade Impact

Fair Trade Community Development Funds are a key part of our model, empowering farmers, workers, and fishers to invest in projects that strengthen their communities and improve their living and working conditions. All Fair Trade USA industry and brand partners pay an additional sum of money, known as a Fair Trade Premium, which is incorporated into the product’s selling price. These funds go into a worker-controlled Community Development Fund at origin. With Community Development Funds supporting many diverse projects, Fair Trade USA sought to better understand how communities were choosing to spend their funds—and what that impact looks like around the globe.  

Workers at a certified factory in India vote on how to utilize Community Development Funds

Fair Trade Community Development Funds Impact Study 

Over three years, our team conducted research among 3,857 small holder farmers, fishers, and other workers to better understand the impact of Fair Trade Community Development Funds. Surveys and interviews were implemented in nine countries and across seven industries.

Fair Trade USA field managers employed surveys and focus groups in local languages to collect worker perspectives on the use of Community Development Funds. Study participants reflected on what they found to be the most meaningful projects. In order to minimize bias, a third-party researcher analyzed the transcribed survey responses. 

The study focused on four key questions: 

1. Are participants satisfied with how Fair Trade Community Development Funds are spent?

2. Were participants involved in the decision-making process?

3. Did participants feel their opinions were considered when allocating funds? 

4. Has the Fair Trade Certified program created a positive, neutral, or negative change in participants’ lives?

In surveying, talking to workers, and analyzing our data, we were able to draw some clear conclusions that help improve our work.  

Children at an elementary school in Sonora, Mexico show off their mid-morning snack of apples with oatmeal flakes and honey, supported by Community Development Funds.

Here’s What We Learned:

1. Across all countries, genders, and labor types, there was not a single most-preferred way to spend Community Development Funds.  

Workers allocated the Community Development Funds to projects, in-kind goods, or cash payouts. They can also choose more than one category and use the dollars to match individual community needs. We found that regardless of where it was spent, empowered choice means that impact is being made where it is needed the most. A farmer in the Ivory Coast shared the power of collective decision making:  

“It’s not a one-man decision, but everybody’s decision. So we like that. We vote. If the cooperative president wants to do something, he will first check with all of us if we agree. Therefore we are all aligned.”    

Those who voted on and participated in the spending process also tended to be more satisfied with the outcomes: 71% said that they were satisfied with how the funds were spent and 68% said participating in Fair Trade led to a positive change in their lives.   

2. Overwhelmingly, the most significant impact of Community Development Funds is economic empowerment.  

Recipients expressed that however they are spent, funds help meet basic needs, prepare communities for emergencies, and generally boost individual, workplace, and community well-being. Participants reported that more children go to school, healthcare is more accessible, and farm workers are provided with more support. A Cocoa farmer shared that the funds helped him buy food for his family and allow his eight children to attend school. Another worker shared:  

“These projects do not only benefit and help me but also my relatives and community members. It does not stop only with me as an individual member.”  

An additional economic benefit is increased efficiency. Some recipients opt to use funds for new tools or other job supplies. This was widely cited among smallholder producers as increasing production efficiency.  

“For me, the most significant change, because I’m a farmer, it’s receiving the boots, the machetes, or the files,” one Ivory Coast farmer said. Similarly, coconut farmers in the Philippines, who also received farm tools, expressed that they helped make harvesting easier.   

Locals play soccer at their community center in Heredia, Costa Rica. The center was created with Community Development Funds, and provides soccer matches, math courses, adult school classes, computer courses, technical workshops, and more.

3. Community Development Funds and cooperatives build community.  

Because spending decisions are made democratically, Fair Trade Premiums naturally foster engagement, shared learning, and social connection. These funds not only improve working conditions but also create stronger networks of support among workers and cooperative groups. 

“Through Fair Trade, I acquired new friends and new acquaintances… Knowing new coconut farmers gave me new knowledge. It is like an exchange of learning experiences. We share everything about coconuts, our methods of working on the farm, and many others. It gives me an idea to apply this new knowledge on my farm and continue with what works best for me.”  

Participants shared that they go to the Fair Trade Committee to seek emergency funds, ask for support in personal matters such as sending a family member to college, and to gain more education through trainings or knowledge sharing. Workers reported gaining financial literacy, more job expertise, and a common bond. One farmer shared:  

“The most prominent is our moments of togetherness. Because before Fair Trade, we tended to mind our own business, but now, not anymore. So, what stands out is the togetherness.”  

Our work 

Our research indicates that Fair Trade Community Development Funds significantly enhance the ability of farmers, workers, and fishers to meet essential needs and withstand unexpected challenges, such as the global COVID pandemic.  

As communities continue to invest these funds, Fair Trade USA remains committed to monitoring their impact and amplifying worker voices to improve our program.  

To learn more about Fair Trade Premiums and how you can support this work, explore more stories from our community.

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