The WFTO Guarantee System’s External Verification: A Member’s Story


Women producers of Ayni Bolivia, first WFTO guaranteed Bolivian Fair Trade Organisation.  Photo: lobOlmo

 

Women producers of Ayni Bolivia, first WFTO guaranteed Bolivian Fair Trade Organisation.            Photo: lobOlmo

Amidst the complexity of current verification systems, WFTO introduces a clear system that can be understood and used effectively by small enterprises. The interest of small producers and their organisations was on top of the list when the WFTO Guarantee System (GS) was developed. To give our readers a good grasp how the WFTO system works, we asked our Bolivian member to share their GS experience, particularly on the external verifications part. Below is the story of Ayni Bolivia.   

Ayni Bolivia, is a small producer organisation working with 26 craft producer groups and a member of WFTO since 2010. The La Paz-based organisation aims to improve the lives of handicrafts workers by following the Fair Trade Principles in all their activities. They were selected as one of pilots in 2013 based on their size and capacity. 

The GS is based on best practices of Producer Group Internal Control System (ICS), Organic Participatory Guarantee Systems (PGS) and WFTO membership system experience.  It has five components: the new membership application system, self-assessment reporting, monitoring audit, peer visit and the Fair Trade Accountability Watch (FTAW). The last three components are the external verification part. 

To be externally verified, Ayni Bolivia must fulfil the first two components. A WFTO trading member is obliged to submit a self-assessment report (SAR) every two years. The SAR is the framework for the monitoring audit and peer visit. Read another member’s experience with the self-assessment process here.

Peer Visit
The Peer Visit is a best practice procedure involving a peer organisation in the monitoring mechanism. The emphasis of the peer visit is different from a Monitoring Audit. The peer visitor comes not to inspect but rather to help a member achieve and improve the compliance with the Principles. The peer can highlight good practices of a member and raise issues of concern. It is seen as a mutual learning experience.  When Ayni Bolivia filled out the SAR, they were asked to propose two to four peer visitors. WFTO decides as to who will become the peer visitor.  

Ayni’s founder and current president Vania Rivero Martinez said that they were fortunate to be visited by Barbosa do Brasil, a Dutch member of the WFTO and one of Ayni’s major European clients. Vania told WFTO in an interview that Ayni learned many things from the peer visit stressing the fact that Barbosa has set high standards, and the experience worked to the advantage of Ayni. 

Barbosa provided a recommendation on an issue that Ayni Bolivia had overlooked. Based on that recommendation, the two FTOs worked together to follow the appropriate steps to resolve the issue. When the external audit took place, this very subject was extensively looked into, and if the peer had not picked up on it, this would have put Ayni Bolivia in a difficult position potentially causing them to fail the audit. Based on her experience, Vania believes that “the peer visit is the best thing about the GS as it allows you to explain your difficulties to someone who has been in a similar situation, and work together to look for solutions.”

The atmosphere of the visit, according to Vania, was open and motivating. She said the visit enabled them to openly discuss how the organisation functions to a non-judging listener who works within similar circumstances. They felt motivated and inspired when listening to the stories, experiences and troubles that their peer organisation had lived through. 

Monitoring Audit
After the peer visit, it is time for the monitoring audit. The audit is a formal and extensive process, which requires preparation and securing good and complete documentation of the ins and outs of the Fair Trade organisation. It is essential that everything mentioned or explained in the SAR has back up documents or proof to present to the auditor. However, the idea is that after the Peer Visit the FTO should be feeling well-equipped and ready for the external audit. 

WFTO trains and approves a pool of WFTO Guarantee System auditors in all membership regions. If suitable, WFTO may collaborate with an auditing organisation to coordinate Monitoring audits in certain regions. 

WFTO members are diverse. From medium-sized importing organisations down to small family run artisan groups, from spice producers to eco-coffins through to Fair Trade tourism services, WFTO members come in all shapes and sizes. Therefore, it is required that the auditor is trained and familiar with the different types of organisations.

What happens in the audit? 
An important part of the audit is completeness and thoroughness of the documentation such as financial reports, payment schedule of producers and workers, organisational policies, among others. In the case of Ayni Bolivia, they were required to prove their fair price payment based on a current analysis of the producer groups’ cost of living. They were also made to demonstrate sourcing and payment process and their policies because of the variety of products they are producing and selling. 

Vania said two artisan groups were selected randomly for on-site inspection. During the producer evaluation, the auditor conducted independent random interviews with individual artisans. “We took the auditor to the workshops of the selected producer groups as they are located in areas that are difficult to access. The auditor conducted the interviews alone, and we were only called in from time to time to help explain certain processes.”

Vania noted that the audit was “long and in-depth” but as they had all the relevant information prepared, and assistance form Barbosa, they successfully passed. Ayni Bolivia now holds the status as WFTO Guaranteed member and is entitled to use the WFTO product label.  

Continuous improvement
The GS is a continuous cycle of compliance monitoring. Ayni Bolivia has just finished the first cycle. Areas that needed attention are identified on the improvement plan they prepared. Depending on their risk category, which influences the depths and monitoring frequency, Ayni Bolivia will follow a schedule of alternating peer visits and external audits in the future.

Note to readers: We continue to inform the public about the WFTO Guarantee System. Kindly see the list of Guaranteed Members here. If you have any questions, please contact us.

Michael Sarcauga and Katie Ramsbottom