Motion 13: Members motion - Fairtrade Commitment

Votes For 96.17% / Against 3.83% - Carried

This Annual General Meeting calls upon the Group Board to reconfirm its commitment towards leading the way on Fairtrade and the availability of “Fairtrade products” within our stores and to ensure we remain the UK’s leading supermarket supporter of Fairtrade.

Specifically, this Meeting calls on the Board and Executive:

  • To increase the existing range and availability of Fairtrade products in stores
  • To retain the long term strategic objective that “If a Co-operative product can be Fairtrade, it will be Fairtrade”
  • To have targets for the conversion of own brand products to Fairtrade
  • To ensure that stores carry at least one Fairtrade item within relevant categories once the True North range review has been completed
  • To actively promote Fairtrade and Fairtrade products through advertising and promotion in stores and a programme of membership activity.
  • To ensure that Fairtrade Fortnight is prioritised as part of Co-operative Food’s annual promotional activity
  • To maintain and develop our Beyond Fairtrade initiative which provides a unique point of difference from our competitors through additional investment in fairtrade producers and their communities.

This motion further asks that the Council specifically and actively monitor the Board and Executive’s performance against these objectives as part of the “holding to account” role.

Group Board Response The Group Board supports the general principles of this Motion in terms of leading the way on Fairtrade. However, it should be recognised that some of the specific points highlighted in the Motion cannot be supported due to the current financial position of the Group, the austere market climate we continue to face and the strategic direction of the business into convenience shops which naturally increases pressure on space and range.

The specific points raised within the motion will be addressed by the formulation of a new Fairtrade policy which will be shared with the Council.

In line with True North, the new Fairtrade policy will seek to reframe our long term leadership position to that of being the UK's largest convenience supporter of Fairtrade (measured by market share and range) and whilst maintaining both leadership and ambition, also recognises the ‘rebuild’ phase of Group which itself imposes certain limitations at least in the short to medium term.

The new Fairtrade policy will look to fundamentally shift Fairtrade from strategic ambition to ‘Business as Usual’ (BAU) policy and responsibility for delivery assumed across all functions including, buying, ranging, marketing and product development.

The Fairtrade Foundation supports our continued commitment to Fairtrade and how we continue to progress leadership;

“The Fairtrade Foundation is delighted to acknowledge the ongoing Fairtrade ambitions and leadership of The Co-operative despite the ongoing challenging trading climate and the fact that the business is recovering from an exceptionally difficult period in its history. As one of our longest standing and most valued commercial partners, we thank the Co-operative’s management team for its ongoing commitment to Fairtrade and we also express our gratitude to the active Co-operative members whose tireless campaigning has been instrumental in driving local and regional awareness and fuelling demand for product.

We look forward to taking the next steps towards supporting Fairtrade communities together, through the principles outlined in The Co-operative’s draft new Fairtrade Policy”

Euan Venters, Commercial Director, Fairtrade Foundation.

The Fairtrade policy will specifically address the points raised within the motion as follows:

1) To increase the existing range and availability of Fairtrade products in stores.

As we have been striving to get the optimum range in our convenience shops, this has led to a handful of Fairtrade delists by buyers. Going forward we don’t expect to cut any deeper and in some cases, where demand is sufficient, we will look to extend.

2) To retain the long term strategic objective that “If a Co-operative product can be Fairtrade, it will be Fairtrade”.

The strategic ambition to deliver this goal was agreed some years ago when the business was in a much stronger financial position and the market more attuned. At that time, the multi million pound annual investment to move products into Fairtrade was realistic and the customer generally less price conscious and open to such ambition. Given the prevailing financial position, the need to remain relevant in a market now experiencing deflation and low levels of customer disposable income, and mindful of our Group rebuild status, plans remain paused and will only be reconsidered as part of the ongoing Fairtrade policy review process in around 18 -24 months.

3) To have targets for the conversion of own brand products to Fairtrade.

As a retailer we have converted more categories of products to Fairtrade than any other and having delivered over the long term, remain in a very strong position here in terms of ‘core’ Fairtrade offer. The new Fairtrade policy will recommit us to maintaining a 100% Fairtrade own label offer where already established (bananas, chocolate bars, sugar, roses, hot drinks (tea, coffee and other hot beverages), winter blueberries and cotton wool). For reasons outlined in 2) there are no current plans to convert any further products or categories into Fairtrade.

4) To ensure that stores carry at least one Fairtrade item within relevant categories once the True North range review has been completed.

Along with wine, the above mentioned categories in 3) represent some 88% of total Fairtrade turnover and the Fairtrade policy will require that all of these categories have ‘meaningful representation in all stores’. The only exception here is that blueberries are not ranged in all stores, but where they are, they will be Fairtrade sourced when available during winter months.

5) To actively promote Fairtrade and Fairtrade products through advertising and promotion in stores and a programme of membership activity.

The new Fairtrade policy thinking recognises the importance of advertising and promotion and collaboration with membership. We will upscale communications to drive awareness of our commitment and there is a need to find appropriate space and presence of our Fairtrade position across all channels. For the past two years, Food has partnered with the Fairtrade Foundation to be ‘priority partners’ in their own autumn campaign activity. This year, we will be going further still with a dedicated campaign which, in further collaboration with membership, is designed to drive Fairtrade through our ‘community’ lens and reflect our own Group Purpose.

The new Fairtrade policy will continue to support membership, social goals and wider Group activity. The BAU FT policy will create messages of strength, support and commitment to underpin the wider business support and brand position as it always has.

6) To ensure that Fairtrade Fortnight is prioritised as part of Co-operative Food’s annual promotional activity.

It is acknowledged that Fairtrade Fortnight 2015 did not achieve the levels of visibility of previous campaigns. We did partner with the Fairtrade Foundation in a successful collaboration, and whilst delivery was stronger online and through social media, and the collaboration between Food and membership to deliver events, resources and new information was also a great success, the all-important in store promotional element was not as strong as previous years. Higher prioritisation of Fairtrade Fortnight within the Food trading plan will be ensured for future years.

7) To maintain and develop our Beyond Fairtrade initiative which provides a unique point of difference from our competitors through additional investment in Fairtrade producers and their communities.

Our ‘Beyond Fairtrade’ programme of additional funding to producers through dedicated projects is recognised as a key differentiator and leadership element of our wider Fairtrade work. This has also helped us to build direct relationships. Over the last 5 years we have invested some £2M in such projects. The funding for these projects was largely from members’ retained surpluses and the investment ‘paused’ as the business fell into ‘rescue’. The Executive would very much welcome further availability of funding to allow new project development with our producers, but realistically it is acknowledged that this is unlikely. It is recognised that through suppliers, we need to rebuild and create new more direct relationships and find ways of supporting producers in the absence of centrally available funds.

This motion further asks that the Council specifically and actively monitor the Board and Executive’s performance against these objectives as part of the “holding to account” role.

Members’ Council Response The Council recommends that members support Council motion 13.