What if the bottom line wasn’t shareholder profit - but social good?
At first glance, it might seem a little unusual to sponsor a business. After all, they are run for profit – and surely a good business model should create enough profit to sustain their activities?
But at Transform Trade we know that sometimes, it’s the best investment in change you can make. Run by people embedded in their communities, with strong knowledge of local context, and owned and led by people with a vested interest in their success, social enterprises, producer groups, and fair trade businesses can be catalysts for change in their communities – they invest in people and planet, and are run not just for profit, but for social good.
We’ve seen time and time again that when an ethical business, run on fair trade principles and focused on social good, has the right tools to succeed, the impact they have on a community is often far more sustainable than a short-term charitable project.
Producer businesses are ‘David to the Goliath’ of trade
Despite these obvious benefits, they often struggle to attract mainstream funding – whether that’s to grow, invest in staff, or gain licencing or certification that would secure their future. Access to new or larger markets is also a challenge. Commitment to ethics makes everything more expensive, and more time consuming. Most business investors, in a traditional sense, ask what can we get? How will you make me richer?
In contrast, most producer businesses are set up along co-operative structures – so that the profits are reinvested in the business or in social good, rather than going to shareholders. This makes them a less attractive option for investors wanting to make ready cash.
Investors in producer businesses - as we're asking you to become today - ask what can we give? How can my money be used for good?
Producer led businesses are often small, and may not be in a position to export internationally. They often make ‘non-commercial’ decisions – like employing only people from a marginalised group, or investing heavily in skills training or additional support with basic skills, or connecting workers with social security entitlements. Most provide additional benefits, like health insurance, or savings schemes, as a given.
“Tanzania Delicious Cashews helps us access health services easily, and if we have any personal issues, the managers are there to help us resolve them. My salary supports my entire family and contributes to the community as well. I can meet all my needs with the salary I earn here at Tanzania Delicious Cashews. We also have health insurance through Tanzania Delicious Cashews, which is very beneficial.”
Studies show that social enterprises account for around $2 trillion in annual revenues, creating over 200 million jobs globally. In Sub-Saharan Africa, social enterprises are estimated to have directly created between 28 and 41 million jobs. These businesses work – they just need the right support to grow.
Perhaps most importantly, they put the people who matter most – the producers, artisans and workers who run and own these businesses – in the driving seat. Once a business is thriving, it’s no longer at the mercy of decisions around funding or charitable giving.
In the cut-throat world of trade – where paying people fairly is somehow an ‘alternative’ practice – these businesses can all too easily die out. It’s a rigged system.
By supporting these small and ethical businesses through limited grants, we help to level the playing field – giving them the chance to thrive.
“People must support women’s collectives like Sadhna. Many people are dependent solely on Sadhna. I would like to meet more women and introduce them to Sadhna’s values. I want other women to grow like I did with Sadhna.”
The Producer Sponsorship scheme is designed to provide tailored grants, and intensive business support, right up until the point the individual businesses no longer need it. As a charitable donation, the grants we give bridge the ‘risk gap’ – allowing businesses to invest, grow, and look for new markets or develop new products. Unlike traditional investment, we don’t ask for repayment, and accompany businesses with tailored support – from help with certification, to links to new markets.
1000 businesses to change the world
We know that 1000 ethical businesses alone won’t change the entire trade system. But there’s an urgent need to show that the future of fair trade is not just about a limited number of products – but about a radical reshaping of the entire trade system. As we build a network of alternative, producer led businesses, we can use their example to influence mainstream trade – and challenge the entire system.
Join us on our journey to a fairer trade system today and sponsor a producer group.