Social Enterprise and Fair Trade: Strengths and Challenges.

by Olivia McLardie

Social Enterprise and Fair Trade: Strengths and Challenges.

On April 26th, Monash SEED partnered with VGen Monash (World Vision youth) for an event focused on trade solutions seeking to benefit social justice. With our respective trades of social enterprise and Fair Trade put into the spotlight, the triumphs and challenges of our respective systems became more apparent, and highlighted room for each to move forward.

Fair Trade is a system similar to social enterprise; while we have explained previously the social enterprise model, Fair Trade ensures that farmers of coffee, tea and chocolate products are of legal working age (to prevent child exploitation), and are receiving proper working rights (proper working hours and minimum wage). Like social enterprise, Fair Trade products can be found in local supermarkets and online (see the graphic below of recognised labels of Fair Trade products).

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Some of the main challenges of the social enterprise model included:

Labelling System:

Arguably the biggest problem for the system is that, unlike Fair Trade products, social enterprises do not have a labelling system. Apart from personal networks, people are unaware of the brands unless we publicise that they are social enterprises. This is part of the success of Monash SEED; we provide platforms for these businesses, and why as student club we’ve forged connections with many Melbourne-based social enterprises.

‘Trust’ in businesses:

In 2016 it was revealed that Shebeen, a Melbourne social enterprise bar that closed down last year, had not handed over cash to charities since 2013. It’s very frustrating and tarnishes the name of social enterprises when it’s not a very well known system can deter people from this business model. Why choose to place your business in a social enterprise when it’s not delivering what it promises?

Access:

Social enterprises are meant to make donating to charities easier. It can, however, be difficult to make these brands personable and interactive when they are not readily available; many sell their products wholly online, such as stationery brand Inspirationery. It can be difficult to donate money in this way when consumers need to go out of their way to purchases such products.

As Monash SEED is a champion of social enterprise, we also see it as necessary to constantly challenge the system in order to improve it. We do not want to be personal cheerleaders of brands whilst not critiquing them or holding them up to the standards we think they can achieve. Whilst we ask our members to support and value the work of SEED, we also ask you to be critical of the system so it can improve it its capacity, and shine as an example of other ethical trade systems.