Green & Black's: setting the bar on ethical trading
A Fairtrade pioneer from the outset, Green & Black's has thrust what was a niche set of ethical principles into the core of today's mainstream chocolate market. Leigh Stringer finds out how this once tiny start-up led to one of the world's largest chocolate producers making the move to Fairtrade.
When Green & Black's opened up shop in 1991, Fairtrade and organic principles were low priority for most multinational companies. Green & Black's co-founders Jo Fairley and husband Chris Sams wanted to change that. The couple knew that getting the big players on board would be key to achieving large scale transformation.
By eliminating the stigma that's associated with sustainable, organic, environmentally-friendly products and leading by example, the couple were sure that consumers would take note and that industry would soon follow.
Savvy business people as well as activists, Fairley and Sams went about creating high-end chocolate products that encompassed Fairtrade and organic processes without overpowering consumers with ethical messaging. The products were Fairtrade but they didn't want this to be the main attraction - it had to be a quality product too.
Fairley says that through a marketing strategy that focused equally on the products qualities as the company's ethical foundations, and branding that matched luxury mainstream products, Green & Black's soon established itself as a market heavyweight.
"Branding has played a huge part in helping to raise awareness around organic and Fairtrade. Organic was a tiny, quirky niche when we started and in order to get it noticed and to attract the mainstream it had to throw off its cliché of the hippy earth shoes and lentils image which has dogged it for many, many years," says Fairley.
"Sustainable products have to work that little bit harder because people think that they're not going to taste as good or they're not going to look as good or they're not going to perform as well.
"And this is because it is thought that some kind of compromise must have been made in order to meet a sustainability goal, which isn't true".
This association is still present, she says, but Fairtrade, organic companies are now as focused on the success of their business as they are promoting ethical principles, which is seeing them slowly gain respect from the industry as well as consumers. Multinationals have taken note of this.
In 2005, Cadbury's bought Green &Black's for around £20m - a move that Fairley and Sams were heavily criticised for. Some thought it would be the end of ethical trading at the company, with its principles being immersed into a global portfolio of mainstream products.
However, Fairley says the decision was not made on a whim and that she was comfortable selling to Cadbury's because of their "long history for wanting to improve society and the environment", such as its Bourneville social housing for workers programme dating back to the mid-1800s.
More than eight years down the line and Fairley is still happy with the decision. In fact, she says the deal has acted as a catalyst, encouraging the industry to take note of ethical, fair trading. A few years after the agreement, Cadbury's went Fairtrade with one of its biggest brands, Dairy Milk.
An achievement that Cadbury's CEO at the time, Todd Stitzer, largely attributed to Fairley and Sams' efforts in showing the company the way to Fairtrade. Shortly afterwards, several other major chocolate brands went down the same route.
"The Fairtrade move from Cadbury's had this wonderful snowball effect within confectionary, which saw KitKat very rapidly going Fairtrade and Divine and Fair Deal, to global brands, such as Starbucks and Tesco, companies have stepped up and are now acknowledging the importance of Fairtrade chocolate - a legacy Fairley and Sams are most proud of.
Could Green & Black's have produced this kind of step-change in the confectionary industry had it not made the deal with Cadbury's? Fairley is quite adamant that scalability is best achieved when the multi-nationals get on board. "I'd love to think that we could make as much of an impact on developing world farmers as taking Cadbury's Fairtrade has but we're still a tiny player relatively compared with a Cadbury's", she says.
Looking at the figures, Cadbury's Dairy Milk sales from September 2012 to September 2013 reached almost £500m, while G&B's annual sales are approximately £60m-£70m. "If [Cadbury's Dairy Milk] chocolate is sourced through Fairtrade relationships then that is transformative on an absolutely massive scale".
"If a multinational wants to take your brand global and you've seen with your very own eyes that the knock-on effect of the deal is enabling more children to go to school in the developing world in the villages you trade with, who wouldn't agree? "Secondary education for the children of the cocoa-growing villages of Belize has risen from around 10% to roughly 80%. Who am I to say 'no, I want to keep this small and I don't want that to happen'" adds Fairley.
Though often met with cynicism, these deals have become an industry norm. Coca-Cola took a majority stake in ethical smoothie business Innocent early last year, while Fairley's "mentor and friend" Anita Roddick agreed to sell her ethical beauty chain, The Body Shop, to L'Oreal in 2006.
"Anita was a great believer in business karma. And I am too. When you build these principles into your business then you are rewarded many, many times over. And that's why there is no reason not to embed a sustainable, ethical model into your business these days".
Like Roddick's the Body Shop, Fairley says social and environmental awareness was never a bolt-on to Green & Black's strategy; it was the "foundations of what the business was built on". "When we launched Green & Black's we didn't need to sit down and work out what our ethics were going to be and what our CSR policy should include. Concerns like Fairtrade, organic and sustainability were just embedded in the brands DNA from the word go," she says.
"For us, it was right there from the start and so from an ethical point of view it meant that we never had to do a lot of soul searching about decisions on ethical aspects of our business, it all felt very natural."
"I think it's much easier to start from that point than to try and bolt it on. However, every company should have a CSR policy and I applaud the attempt of anyone doing it because it actually helps change the company even if they go into it cynically."
Fairley says that it doesn't matter how companies get involved, as long as they do. "I'm not the least bit cynical about why big brands take on a CSR sustainability programme because my observation is that they might start out disparagingly, thinking that they have to put something in the annual company report, but actually doing it changes the fabric of the organisation".
Fairley's optimistic about the future of corporate behaviour, and explains that by those incorporating this type of business model, not only will they change the mind-set of their workforce, it will become "strongly woven into the fabric of the company and gives people the feel good factor".
Jo Fairley will be taking to the keynote stage at this year's Sustainability Live at the NEC, Birmingham, on April 3. For more information visit www.sustainabilitylive.com