بررسی اثرات صدور گواهینامه نمایشگاه بازرگانی بر سرمایه اجتماعی : مورد تولید کنندگان قهوه از رواندا

Fair Trade certification may have important social effects on small-scale producers but empirical evidence is limited. We conducted logistic regressions using data from a 2009 survey of Rwandan coffee farmers to estimate the link between Fair Trade and social capital—measured as farmer trust and participation—while controlling for various other factors that could influence social capital, particularly membership in a cooperative organization. The results show a negative association between Fair Trade and farmer trust in cooperative leadership and a positive association with a perceived higher level of participation of women. Social capital is linked most significantly to farmers’ interaction with their neighbors.

Fair Trade certification is designed to ameliorate the social, as well as economic and environmental conditions of producers in the developing world through production and trade standards (Raynolds, Murray, & Heller, 2007). Certified Fair Trade products have moved from niche to mainstream market channels and are now sold by leading retailers like Wal-Mart, Costco, and McDonald’s (Kolk, 2011 and Raynolds, 2009). Certified Fair Trade retail sales total US$ 4.8 billion globally (FLO, 2010), averaging an annual growth rate of 30% (Potts et al., 2010). Fair Trade International (FLO) certifies 20 different products, including bananas, tea, sugar, cocoa, honey, cotton, cut flowers, and coffee. There are approximately 1.2 million producers participating in over 800 Fair Trade certified producer organizations in Latin America, Africa, and Asia that sell certified products across North America and Europe (FLO, 2010). Given the rapid growth of Fair Trade certified products, it is important to examine Fair Trade’s impact on these farmers and their families—an estimated five million people (FLO, 2010)—in order to understand the certification’s effectiveness as a market-based tool for improving the well-being of populations. Of the four main sustainable coffee standards (Fair Trade, Organic, Rainforest Alliance, and Utz Certified), FLO is the oldest, and supporting smallholders has been its starting point, while for Rainforest Alliance and Organic this has been environmental protection, and for Utz market-based mainstreaming of sustainability (Kolk, 2012). Fair Trade certification has the potential to increase farmer well-being not only through its economic standards, for which it is best known, but also through its social standards (Raynolds et al., 2007). Unlike other certification standards, Fair Trade standards require buyers to pay a guaranteed minimum price and a social premium to producers, and recommend that buyers provide pre-financing and long-term contracts. Fair Trade also includes specific environmental protection standards designed to ensure safe and sustainable agricultural and environmental practices and to protect and enhance biodiversity. Lesser known, however, is that in order for farmers to obtain Fair Trade certification they must also meet specific social standards of production. Fair Trade focuses on small coffee producers who rely on family members for farm work and do not hire permanent workers. While other standards certify individual and groups of farmers as well as contract farmers, Fair Trade only certifies small coffee producers that belong to a cooperative producer organization, of which the majority of members must be small producers. The cooperative organization must be set up in a transparent way and not discriminate against any particular member or social group, such as women (FLO, 2011). Research on the outcomes of Fair Trade certification for producers has focused on questions related to the economic impacts (see Bacon, 2005, Imhof and Lee, 2007, Levi and Linton, 2003, Lyon, 2007, Murray et al., 2003 and Sick, 2008). There has been less in-depth attention to the social impacts of Fair Trade’s cooperative and non-discrimination standards despite growing evidence that “social networks and the reciprocities that arise from them” (known as social capital) can improve a number of areas of human welfare (Schuller, Baron, & Field, 2000). Both theoretical arguments and empirical evidence have shown the positive effects of social capital in areas as diverse as health, markets, and government administration (Grootaert et al., 2004, Putnam, 2001 and Woolcock, 1998). This article focuses on Fair Trade’s impact on social capital in order to broaden understanding of the certification’s effectiveness at ameliorating the lives of small producers. We analyzed data from a 2009 survey of 175 Rwandan coffee farmers and informant interviews using logit regressions to estimate the link between Fair Trade certification and social capital—measured as farmer trust and participation—while controlling for various other factors that could have an influence on social capital, particularly membership in a cooperative organization. In the next section, we provide background on social capital and Fair Trade certification. Section 3 introduces the study setting and Section 4 explains the methods. Section 5 provides descriptive statistics from the survey and reports the results of the empirical analysis. Section 6 discusses the findings and reflects on general lessons from this case.

The literature on Fair Trade certification’s impacts indicates that the social capital effects of Fair Trade certification may be especially important for producer well-being, due mainly to the cooperative organization of producers. This study aims to improve understanding of whether changes in producer-level social capital are a result primarily of cooperative organization or of Fair Trade certification. The regression analyses provide limited evidence that cooperative organization and Fair Trade certification are both associated with dimensions of social capital, although not always in the ways expected. In addition, the analyses do provide some counter-evidence against the relationship. In particular, neither cooperative organization nor Fair Trade certification is associated with perceived trust among community members. Even more surprisingly, both cooperative organization and Fair Trade certification have a significant negative association with trust in cooperative board members. Findings regarding perceived increases in farmer participation in decision making are more consistent with the study hypotheses; cooperative membership, regardless of certification, is positively correlated with a perceived increase in farmer participation in decision making, and Fair Trade certification is associated with producers’ perceiving that, since they joined their cooperative, women have increased participation in cooperative decision making. This study is a first foray into quantitatively analyzing the relationship between Fair Trade certification and social capital. While the regression results do not provide the direction of the causal relationships between variables, knowing a relationship between two variables exists holding other factors constant, and the strength of that link, provides important insight into what factors, including Fair Trade and cooperative organization, may affect social capital. The coffee producers surveyed generally perceive that there is trust between their community members, but while they attribute this trust to the existence of cooperatives, the regression results show that whether farmers perceive general trust in the community relates to whether they themselves have frequent interaction with their neighbors and not whether they are a member of a cooperative. In other words, greater interactions related to the mode of coffee production and processing, not cooperatives per se, seem to be building trust. This result would support the promotion of collective coffee processing, such as coffee washing stations, even if private owned. In Rwanda, trust is understood broadly as what Govier and Verwoerd (2002) define as “an attitude of confident expectation” that the person or persons trusted will act in a decent, competent, and acceptable way that does not result in harm to the trusting person. Study respondents gave the following as specific examples of trust: the ability to depend on a person for help, whether in the form of advice or a loan; the knowledge that a person will not steal from you; and an understanding of the other person and their motivations. Farmers linked trust among community members to coffee cooperatives. As one coffee grower explained, “Community support has increased a lot because we have seen the benefits of working together. We didn’t know before about the benefits of joining together in a cooperative” (Producer IAA003, personal communication, November 2, 2009). Another cooperative member said, “Before the cooperative I spent the whole day at home after work. Now I meet people through the cooperative and meet them to share a bottle of beer and ideas” (Producer IAE001, personal communication, October 27, 2009). Yet another farmer elaborated: “We are able to discuss with others, share ideas, get ideas, learn from them, and don’t feel isolated” (Producer IAC003, personal communication, October 27, 2009). The regression results do not show a link between perceived trust among community members and cooperative organization though, and instead suggest that the greater the amount of time he/she has spent interacting with his/her neighbors, and to a small degree the older a farmer is and the larger his/her household is, the more likely he/she is to perceive trust among his/her community members. Interestingly, while cooperative farmers attribute their increased interaction with neighbors to being a member of a cooperative, producers selling to the privately owned coffee washing station attribute their increased interaction with their neighbors to the coffee washing station. A private farmer observed that “coffee lets us know other people in the area” and the coffee washing station “brings ideas from different people and gives you strength to stand together” (Producer IAB005, personal communication, October 26, 2009). In most cases, private producers seem to equate selling to the privately owned CWS with being a member of a cooperative, indicating that private coffee washing stations may play a role similar to the one expected of cooperatives in the lives of coffee farmers in Rwanda. As one producer said, “in general, people in the community have good relationships because people are brought together by coffee” (Producer IAD002, personal communication, October 29, 2009). We are unable to determine for certain the direction of the relationship between increased interaction and increased social capital based on the regression results alone, yet the interview data suggest the possibility that selling to a central processing location can increase interaction among neighbors, regardless of whether the coffee washing station is privately or cooperatively owned. If implemented in a way that increases social interaction, value added activities appear to have the potential to not only increase income but also to improve social capital. Cooperative organization and Fair Trade certification are not linked to perceived trust among community members, but cooperative organization, and Fair Trade certification especially, are negatively associated with trust in leaders while private coffee washing stations are not, likely because of leaders mismanaging their cooperatives. More than one member from two of the sampled cooperatives testified that their cooperatives had experienced embezzlement of cooperative funds and nepotism by their leaders. Both of these cooperatives had Fair Trade certification. A staff member of a Rwandan coffee company explained that “whether farmers benefit from joining in cooperatives depends largely on the management of the cooperative” (Representative 1, personal communication, December, 2009). It is likely that management also matters in the case of individual farmers selling to a private coffee washing station. This study only included one private CWS, which turned out to be well managed, but which is not necessarily representative of all private CWS in Rwanda. While the results of the cooperative to private CWS comparison need to be treated with some reservation, by including one private CWS we are able to give some indication of what can happen when there is a well managed private coffee washing station. There is a need for further research with larger sample sizes to further explore the question of management and leadership trust in Fair Trade cooperatives, non-Fair Trade cooperatives, and private coffee washing stations. The Director of another coffee company in Rwanda suggests that cooperative organization can make it easier for an individual to take advantage of members because they are organized and have a leadership structure they respond to (Representative 2, personal communication, December 7, 2009). In a study of social capital and the Rwandan genocide, Pinchotti and Verwimp (2007) differentiate between bonding and bridging forms of social capital to explain how in the 1990s vertical relationships between the state and the local level (bridging social capital) enabled government authorities to use political and manipulative powers to undermine the horizontal associations between farmers of different ethnic groups (bonding social capital) of the agricultural cooperatives. Similarly, a staff member of an NGO supporting coffee cooperatives in Rwanda explained how he believes the history of colonial rule and dictatorial governments in Rwanda has led to a culture of farmers doing what they are told by authorities without question for fear of the consequences, and that this makes it easy for cooperative managers to act in their own interest instead of the interest of the group. He maintains that capacity building of cooperative members is key to whether members benefit, more so than Fair Trade certification, so that farmers understand the concept of a cooperative and that they own and control the organization (Representative 3, personal communication, December 7, 2009). Indeed, the regression results indicate that farmers who receive training from their cooperative or CWS, who see gains in terms of coffee tree productivity, and who have increased interaction with their neighbors, are more likely to trust their leadership. Despite a lack of trust in cooperative board members, farmers that belong to cooperatives appear more likely to perceive an increase in farmer participation in decision making than private farmers. A technician working with coffee cooperatives in Rwanda contends that cooperative farmers are learning and capturing the value of democracy. Having experienced a variety of leadership styles over the years, including corrupt management, cooperative members are beginning to understand that by voting for their choice of board members they can affect the organization’s impact on their lives (Representative 3, personal communication, December 7, 2009). It is not surprising that the regressions show no link between private ownership and perceptions of increased farmer participation. There is no mechanism to include farmers in decisions; the entrepreneur who owns the station retains decision making power. Fair Trade certification does not seem to have an effect on perceptions of an increase in participation of farmers in decision making beyond cooperative membership, but it may increase participation of women. The perception that women have increased participation in decision making in Fair Trade cooperatives was true of both male and female respondents (i.e., perception of women’s participation was not determined to the gender of the respondent). This suggests that Fair Trade’s non-discrimination standard may have a positive effect on gender relations in Rwanda. Because interaction with neighbors is also significantly related to feelings that women have increased participation, it is likely that farmers are not just saying there is gender equity and that women actually do participate more when they belong to a cooperative with Fair Trade certification. A producer explained that “before women stayed at home and couldn’t go out and get ideas. Before they said the cooperative was only for men, but then said women can join and we’ll see how they can produce. Now women have their own association within the cooperative that produces the best coffee” (Producer IAF001, personal communication, October 28, 2009). Our findings provide new insight into previous research on the social impacts of Fair Trade certification, though the overall effect of Fair Trade on social capital is unclear. Like Pirotte et al., 2006 and Moberg, 2005, we observed that producers develop social networks and a sense of community through shared work and regular meetings, but we suggest that increased interaction with community members plays more of a role in achieving this than Fair Trade certification. While others claim that Fair Trade certification can promote broad producer participation in their cooperative and their community (see Taylor, 2005, Raynolds et al., 2004 and Utting, 2009), our analyses suggest that cooperative organization itself may be more responsible for farmer participation than Fair Trade certification. On the other hand, our findings corroborate Bassett, 2010 and Utting, 2009 reports that Fair Trade certification encourages women in particular to participate in producer cooperatives. Many developing nations face the question of whether to invest in product certification and what are the economic, environmental, and social effects of those investments. If our findings are held up by future research, they have important implications for policy and development programs. In the case of Rwanda, the move to processing coffee at coffee washing stations may be leading to social capital benefits for producers. In other words, whereas certification brings access to premium markets and requires formal cooperation processes that may be abused, quality improvement activities that increase interactions may bring access to specialty markets without similar risk of grievances over organizational capture. Pursuit of this question could contribute meaningfully to the debate (see Parrish et al., 2005, for example) over whether certification should be the focus of market-based efforts to improve the well-being of small-scale producers in the developing world.