By Erinch Sahan
Chief Executive, WFTO

With growing inequality, entrenched poverty and a pending ecological crisis, it is time to revisit the central design feature of business and explore the alternatives that exist the world over.

Business was invented by humans. In order to employ humans, trade products and services, facilitate investments and foster production, we as societies designed business to meet human needs. We have a choice about what business looks like – its purpose, priorities, and structure. So, we do not need to accept that business must have a one-track mind, focused only on growing profits for shareholders.

The business world is diverse, but in most countries, it is dominated by businesses that exist primarily to grow the capital of their investors. This is especially the case for larger companies. In the past few decades, corporations have gone to an extreme end of the spectrum, where only one stakeholder group matters – the shareholder. In the 1970s, a typical corporation in the U.S. would return about 33% of its profits to shareholders. Today, it is 70%. The trend of increasingly channeling growing profits to shareholders is happening everywhere. From the UK to the U.S. to India, shareholder capitalism has become supercharged. This is central to the global story of rising inequality.


Rising inequality destabilizes societies, democracies and economies, and it is hindering our fight to end global poverty (according to the World Bank). Since the turn of the century, the poorest half of the world’s population has received just 1% of the total increase in global wealth. Meanwhile, half of new wealth has gone to the richest 1%. By 2017, only eight men owned as much wealth as the world’s poorest 3.6 billion people combined. Inequality is rampant and has been getting worse. This is bad for all of us.

What does business have to do with this? Businesses populate our economies, channel investments and wages, and are pivotal to determining how the fruits of our economies are shared. For some time now, profits have grown, but real incomes have not. Economies are expanding, but farmers and workers are getting a decreasing share of the pie.  In the 1980s, a cocoa farmer would get about 18% of the value of a chocolate bar, while today that same farmer gets below 6%. Similar trends can be found across the board, as workers overall get a decreasing share of the global economy. In global supply chains, prices paid are failing to cover the costs of sustainable production in products from tea to t-shirts (as covered in the film, True Cost). These are the decisions of businesses to squeeze suppliers, grow margins and maximize profits. Most companies are doing what they are designed to do – extracting maximum returns for their shareholders. But this does not have to be the case.


Are not most people shareholders anyway, through their pension funds, for instance? And is it really so bad that corporations are increasingly obsessed with growing the wealth of their shareholders? Yes, this is a big problem. The majority of shares are owned by a small group of people. In the U.S., the richest 10% own 84% of shares. As so eloquently put by Mike Konczal in his article “The Shareholder Revolution Devours Its Children” in The Nation, “The economy has been rigged to channel wealth to a tiny elite” and “these shareholders are also probably not you.” Put another way, if we share the fruits of the economy based on the size of peoples’ wealth, we will make business obsessed with growing dividends, and the dividend checks to the richest will get exponentially larger and larger. If business is fixated on growing those dividend checks, they will squeeze their workers and suppliers, cut costs and think short-term. That is a scenario where we have designed business and the economy to drive up inequality. And that is exactly where we have ended up.

But there is hope. Businesses are emerging around the world that show it is possible to prioritize a broader range of stakeholders – and purposes – than just the wealth of shareholders. These range from employee and farmer ownership, to hybrid ownership structures and fair trade enterprises, to social enterprises and cooperatives.


Let us start by looking beyond the fair trade movement. In the U.S., initiatives like Working World are supporting conversion of traditional businesses to worker cooperative models, from Arizona to the Bronx. Meanwhile, the B Corporation initiative has helped businesses broaden their agenda from a pure focus on profit maximization, spreading to over 2,600 companies around the world and encompassing major brands from Ben & Jerry’s to Eileen Fisher. In the UK, the John Lewis Partnership has redefined retail through a model where 83,000 workers co-own the successful department store chain with annual sales of over £11 billion. Farmer-owned processing in agriculture (such as KTDA tea in Kenya) and worker-ownership in heavy industry (such as Mondragon in Spain) are also bucking the trend and channeling more of the value generated by the business to their farmers and workers. Meanwhile, mission-led businesses like Fairphone are demonstrating that business governance models can be shaped to prioritize a mission other than profit maximization.

These are not businesses making every decision based on the pursuit of forever-growing profits. Instead, they are businesses that focus on balancing a social mission with achieving commercial viability. They are not confining themselves to doing good only when it is the path to greatest shareholder wealth.

Diamanta Peru’s priority is to create economic opportunities for women. They reinvest their profit to pursue this mission. Photo: Diamanta


The fair trade movement is full of business models that are designed to prioritize the interests of workers, farmers, artisans and communities. The organization I lead is the verification body and the global community for these fair trade enterprises. These enterprises provide a fundamentally different kind of power relationship for workers, farmers and artisans who would otherwise have little power or priority within a typical business. Some of the models are cooperatives. Others are hybrid models that have combined collective ownership with a social mission.

Take, for example, CORR – The Jute Works in Bangladesh, structured to give their 5,000 artisans majority control on their board and ensure profits are used to benefit these artisans. Other examples are Township Patterns in South Africa and Global Mamas in Ghana – businesses that exist solely to support artisan-owned producer groups and reinvest profits for that purpose. In Ecuador, Maquita runs several social businesses, investing all profits to benefit their communities and ensure they are represented on their boards. In India, models like Creative Handicrafts and Last Forest demonstrate that worker and farmer ownership can compete with profit-hungry apparel factories and clothing outlets. And consider Mahaguthi in Nepal, which protects its social mission by requiring all profits be reinvested to benefit its workers and artisans.

The chief executives of such businesses are not pressured to drive down costs and squeeze their suppliers. On the contrary, the voices of workers and farmers dominate their board rooms, forcing management to run the business in their interests. There are now 330 such fair trade enterprises that span over seventy countries, remaining commercially viable by prioritizing a social mission. The experiment is indeed working.


I was captivated by this diversity of businesses that are bucking the mainstream business trend. So, I dug deep and analyzed all 330 World Fair Trade Organization (WFTO) members to find that they all share some common trends in the way that they are structured. They all had at least one of these four features to ensure that their business is mission-led:

  • a board that represents a diverse range of stakeholders,
  • a limit on the profits being extracted for shareholders,
  • an explicit mission in their governing documents, or
  • part ownership by a mission-led organization (such as a community organization).

In essence, such models all have liberated themselves from the need to maximize returns to shareholders. When this single-minded focus is removed, a broader mission is possible.

In her book Doughnut Economics, best-selling author Kate Raworth describes the need to “design to distribute” in ensuring that the business world and our economies create a society and planet that thrives. Since design thinking is now in vogue, I wonder if we can allow ourselves to apply it to business. But if we are to design businesses differently, we must look beyond the design of products, or even their models of generating income. It is about revisiting the design of the very core of business – its purpose. This means giving ourselves the liberty to rewire business in order to pursue what society needs from it. Fair trade enterprises show that this is possible, and movement’s audacious experiment may be ready to inspire something bigger.

Originally published on Fair World Project

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17th international


17-20 SEPT 2024 – CAPE TOWN 

We are thrilled to invite you to our upcoming International Fair Trade Summit, set to take place in the vibrant city of Cape Town, from the 17th to the 20th of September 2024.

The International Fair Trade Summit aims to bring together leaders, practitioners, and advocates from all corners of the globe to collaborate and promote Fair Trade practices. This edition promises to be a unique opportunity for participants to engage in enlightening discussions, exchange ideas, and forge partnerships that will shape the future of Fair Trade.

WFTO Membership & Associate Types

  • Fair Trade Organisations (FTO)

    All trading members of WFTO. This includes all organisations that have more than half of their income and/or more than €100,000 in income from trade.

  • Fair Trade Support Organisations (FTSO)

    An organisation whose primary mission is to support Fair Trade and/or provide services to organisations that are or want to become Fair Trade Organisations.

  • Fair Trade Networks (FTN)

    An organisation which is an association of organisations committed to Fair Trade.

  • Individual Associates (IA)

    Individual Associates are supporters of the Fair Trade movement with limited rights. The WFTO Guarantee System does not apply to them.

  • Associate Organisations (AO)

    Associate Organisations align with WFTO’s values but after their application. They do not undergo monitoring and also have limited rights.

WFTO Guarantee System Monitoring Statuses

  • Candidates

    Candidates have been conditionally approved for membership but have not completed their first monitoring cycle under the WFTO Guarantee System. They have limited rights within WFTO. They may not use the WFTO Member Mark and Product Label or claim that they are monitored by WFTO.

  • Guaranteed Members

    Guaranteed members have met the WFTO Membership requirements and are monitored under the WFTO Guarantee System.

  • Member

    Organisations that have no or little income from trade go through a reduced version of the WFTO Guarantee System that does not include criteria related to trade. These organisations may use the WFTO Member Mark but cannot use the Product Label for any products they may be trading to support their mission. This status only applies to Fair Trade Networks (FTN) and Support Organisations (FTSO).

  • Renewal in Progress

    Members who are in the process of renewing their guaranteed status and are overdue on some requirements retain full rights while they work to meet the demands of the Guarantee System on an administrative or compliance level.

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WFTO welcomes applications from established Fair Trade Organisations as well as organisations that support Fair Trade. Individuals in their capacity as researchers, writers, consultants and specialists in their field who can contribute solid skills, knowledge and expertise to WFTO and members are also welcome.

Add Your Heading Text Initial requirements for organisations:

  • Compliance with the WFTO 10 Principles of Fair Trade. Please have a look at the WFTO Fair Trade Standard for more specific information on compliance with these principles.

  • All applicant organisations must already be duly registered (as a legal entity) and active for at least one year.

Who can apply?

  • Fair Trade Organisations (FTO)

    All companies, partnerships, co-partnerships and other legal bodies – as determined by the legal provisions of the country of the member concerned – that are directly engaged in Fair Trade. They may be producers or northern or southern based trading FTOs for whom Fair Trade is the main activity. To qualify for FTO membership, income from sales (turnover) must account for 50% or more of the total income. Applications for FTO membership cannot be accepted from organisations with no prior sales history.

  • Fair Trade Networks (FTN)

    Legal entities whose primary function is to serve as national or international associations of Fair Trade producers and/or Fair Trade Organisations.

  • Fair Trade Support Organisations (FTSO)

    Fair Trade Organisations where trading is not the main activity (proportion of trade is less than 50% of total income). These organisations are engaged in Fair Trade indirectly, through activities that promote and support Fair Trade. These activities can include business counselling, finance, advocacy or networking.

  • Associate Organisations

    This is a special category for national or international organisations that are interested in supporting and promoting Fair Trade, including donor organisations. Organisations that do not meet the one-year legal existence requirement also fit in this group.

  • Individual Associates

    Individual researchers, writers, consultants and specialists in their field that can support WFTO. WFTO expects its individual associates to be active Fair Trade supporters whose experience and expertise in their own particular field can be of practical benefit to WFTO's members. To apply, please submit a curriculum vitae.

    While FTO, FTN and FTSO are entitled to full WFTO membership, organizational and individual associates have only limited rights.

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The WFTO Product Label is more than just a Fair Trade symbol. It signifies not only that the practices across the supply chain are checked against the WFTO Fair Trade Standard, but it also represents support to the battle against poverty and inequality. Products carrying the WFTO Label are made and traded by Guaranteed Fair Trade Organisations dedicated to the sustainable Fair Trade economy. Every purchase of products with the WFTO Label supports small producers and their communities.

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