Awards 2002 The Shell Award for Sustainable Development

The Shell Award for Sustainable Development

This award is given to a company whose commercial activity has actively fostered an environment that allows socially, economically and environmentally sustainable development to take place in a community.

The winner: The Co-op

Receiving the award

Fairtrade prices for bananas, paid by Co-op supermarkets, mean that growers can afford better housing - and rubber boots. These are an important safeguard in a tropical plantation frequented by snakes and scorpions. One grower, Arturo, says he and his fellow growers used to be the lowest form of Costa Rican life. He worked 14 hours a day and just about survived. Now he and the other 300 growers in a co-operative supplying the Co-op earn 60 per cent more than the minimum wage. They employ an agronomist who has helped them cut their use of dangerous pesticides. Arturo feels a new self-esteem. "I have become an international businessman," he says. Bananas are the biggest selling item in supermarkets in Britain. They require special and expensive transport and treatment if they are to reach ripeness at the moment when a shopper buys them. This puts them beyond the compass of most Fairtrade enterprises. But the Co-op was big enough to persuade one of its suppliers to handle Fairtrade bananas, initially from Costa Rica, then also from Ghana and Ecuador. Forty per cent of pre-packed bananas sold in Co-ops are now bought from growers at an enhanced price set by the Fairtrade Licensing Organisation, a Europe-wide body.

Part of a Fairtrade deal is that, besides the enhanced price, growers receive an extra social premium to help them improve community services - schools, clinics, water supplies. This may be the most important benefit when the number of growers is large and they have to sell much of their produce to commercial rather than Fairtrade buyers.

The Co-op is now the leading retailer of Fairtrade goods in Britain, selling 5.5million worth in a year, a higher proportion of sales than any other supermarket group. With the help of such organisations as the Fairtrade Foundation, Twin Trading and Traidcraft, it has overcome the difficulty faced by small suppliers in meeting supermarkets' need for high-standard, pre-packed goods in specified quantities at specified times.

Besides such Fairtrade staples as coffee and chocolate (a Co-op brand bar at a readily affordable 39p is specially made by The Day Chocolate Co), the Co-op has launched out into wines from a Chilean co-operative and mangoes from a plantation in Ecuador. It sells Fairtrade goods in all its 2,000 supermarkets, even though they take up shelf space which could otherwise go to branded products. Terry Hudghton, the Co-op's head of corporate marketing, spearheads the Fairtrade campaign. He sees it as trading, not charity, but at the same time expressing Co-op shoppers' concern for overseas suppliers.

"Fairtrade goods are, generally, dearer than their commercially traded competitors. It is therefore critical," says Terry Hudghton, that the quality is excellent. It is also critical that shoppers know what Fairtrade is about, and the Co-op has put money into advertisements, lorry graphics and even 60 million carrier bags with the Fairtrade message printed on them. "We have spent a great deal of effort educating and motivating our most active Co-op members. Their response has been amazing." Fairtrade by one retailer can benefit only a limited number of people, and some of those to only a limited extent. "What we really want from our Fairtrade actions," says Terry Hudghton, "is for others to follow the retail lead we have set and for this to stimulate much greater change. We have seen that we can encourage other retailers or manufacturers." The Co-op is now switching all its own-brand chocolate bars to Fairtrade. Terry Hudghton comments: "We have made chocolate our primary focus because of the obscene contrast between the pleasure derived from eating it and the suffering that can go into supplying it."

The judges say

The Co-op provides an excellent example of a commercial organisation fostering development and societal contribution alongside a strong business model. The success it is experiencing with its emphasis on fairly traded goods has been achieved through strong marketing and strong leadership. The Co-op model depends on goodwill and consumers' commitment, to guarantee a floor price above the market norm. We applaud the commercial bravery of the Co-op in its efforts to mainstream fair trade. The economic and social impacts for the growers are clear, allowing them the crucial stability to plan over the longer term, and improving the lives of those who are involved in a truly sustainable way. It is a model to follow.

The Co-operative Group, New Century House, Manchester. M60 4ES;
Tel: +44 161 827 5557: Fax 839 2616