The Challenges Of Ethically Sourcing Cut Flowers

Published Date: 02 Nov 2017

J M Worth April 2013

The Kenyan Flower industry in the early 1990’s was socially unregulated. By the late 1990’s) voluntary agreements were being used. The situation in 2013 is that most of its exporting farms have Fairtrade certifications. In this essay I will try to explain why the key changes occurred and why it has been a mixture of Push and Pull (Kenyan Society and Final Consumers from 2003 to 2007) to get the Producers to implement the changes. Also discussed will be why the needs of the final customer in terms of Ethical assurance took over four years to be addressed. Another aspect I will highlight is the learning’s taken from these Ethical challenges. As hopefully handling of a similar situation would be completely different now therefore avoiding the Panic of 2004 (Homer S 2008). Kenya has the most successful flower industry in Africa. Cut flower production is now a major part of the Kenyan economy and represents approximately 0.2 % of the GDP (KFC) over the last thirty years the industry has created new employment opportunities in both harvesting and processing. Throughout the industry the majority of workers are women. Women account for between 65-75 % of the 60,000-90,000 workers employed in the industry. These 60,000 to 90,000 support up to 500,000 dependents indirectly (ETI 2005).

In the 1990’s Good Agricultural Practice standards (GAP) were introduced to Kenya mainly by the UK retailers. The standards had been written to comply with the Due Diligence requirements of the 1990 Food Safety Act (H.M. Government). Compliance to the standard meant the producers had to show control of all aspects of the production especially Agrochemicals and the associated Personal Protective Equipment (PPE). For the Kenyan flower industry it was the first time clear training requirements had been given to the producers. Although social standards did not attract such scrutiny and the UK retailers relied on the Kenya Standard on Social Accountability (KESSA).

KESSA was a Voluntary Private Initiative (VPI) in the horticultural industry. This initiative was led by Kenya Flower Council (KFC), Fresh Produce Exporters Association (FPEAK), and Agricultural Ethics Association (AEA), who feared that the reputation of Kenyan flowers was under threat from the unethical business practices on certain flower farms. This was set up after a number of media reports in the late 1990s, highlighted the "exploitative" nature of the flower industry, and its adverse impact on workers (Wolf 1996).

However, the retailer’s reliance on KESSA was seen as inadequate after the launch of the ‘Blue Rose’ campaign in January 2002 "how public demand for a symbol of love can have devastating implications for workers, involving long hours of forced overtime" (Hale and Opondo, 2005: 308).

From a supermarkets perspective flowers are seen as the ultimate discretionary / impulse purchase. The sales of Kenyan flowers in the United Kingdom last year were 121,891 tonnes (Kenya Flowers Council). The flowers from Kenya have shown on average a 20% year on year growth (tonnage) for the last 8 years (Kenya Flower Council 2013).

However this is an industry that was once in crisis as reports from Women Working Worldwide (WWW) to the Ethical Trade Institute (ETI) in 2002 highlighted worker labour abuses. Although the Kenya Women Workers Organisation (KEWWO) report did not contain some of the information required by the alleged code violations procedure and in fact that procedure was not followed in the subsequent actions. (ETI 2005) As a direct result of this and subsequent actions by some of the stakeholders the allegations built up a less controlled momentum. The report by KEWWO highlighted a number of abuses that had been found on the Flower farms.

Employment insecurity;

• Overtime work;

• Sexual harassment;

• Low wages;

• Lack of access to maternity leave;

• Minimal union membership among the workers;

• Poor communication between workers, supervisors and management;

• Poor transport facilities;

• Frequent exposure to chemicals;

• Lack of opportunities for promotions;

• Lack of a proper complaints procedure; and

• Lack of awareness of codes among the workers (Dolan, et al 2003).

Following the publication of the reports there was a strong reaction from within East Africa where a coalition of non-governmental organisations led by the Kenya Human Rights Commission (KHRC) announced plans to conduct national and international campaigns that would highlight what it says are exploitive labour conditions of workers in Kenya's cut flower industry.

Steve Ouma (June 2002), KHRC's programme officer for advocacy stated that activities in Kenya would include: a national boycott of up to 20% or more of Kenya's flower companies that are deemed the worst offenders of workers' rights; public rallies to increase the public's awareness of the situation in the flower farms; a presentation by the KHRC to the Parliamentary Committee on Labour, Health, and Safety; and cooperation with the Kenya Medical Association (KMA) to examine workers who have developed health problems as a result of being exposed to dangerous chemicals and working conditions on the job.

Failure to do so meant they would mount an international campaign reminiscent of the Cirio Delmonte (Dolan and Opondo, 2005; Hale and Opondo, 2005). The successful campaign against Cirio Delmonte was stated in 1999 after the Workers’ Rights Alert (WRA) highlighted workers’ rights violation in Cirio Delmonte (one of the largest and oldest pineapple companies in Kenya). Knowing the effects Cirio Delmonte campaign the flower industry in Kenyan was extremely concerned. Leading to a misunderstanding that the ETI would call for a boycott of Kenyan flowers, thereby causing disruption to the flower industry. There was widespread confusion among Kenyan stakeholders about the aims and purpose of ETI. (ETI 2005)

Another aspect that was highlighted was the effectiveness of the codes of practice that were in operation during that time. Some of the farms had already had social audits (see table below). A total of eleven codes of practice were in operation during the time of the workers abuses. Nine industry standards plus two Retailer (M&S and Safeway) (Dolan et al 2003). The table below demonstrate clearly the plethora of standards and the subsequent confusion within the industry at the time.

Table 1

(Dolan, C et al 2003)

One farm was trying to follow a total of seven codes whilst another chose not to implement any even though they were a member of the Lake Naivashia Growers Group (LNGG). This was also highlighted in an internal Safeway report ‘There are a number of standards in operation however the growers seem to select which is the most suitable for them rather than the customer’ (Worth 2002)

Public awareness had also been raised due to lobbying by a number of Non-Governmental Organisation’s (NGO’s) including KHRC, WWW and the ETI highlighting the abuses within the flower farms to consumer groups which increased the pressure on both the retailers and the producers.

During a meeting with all the key stakeholders in Nairobi in 2002 there was a realisation that whilst these campaigns considerably raised public awareness, there was not a standard that could fully addresses all of the needs to the various stakeholders.

Therefore an agreed code had to be written to satisfy the needs of all of the stakeholders.

There are plenty of people in the modern world who know what is best for everyone else. Self appointed experts and pressure groups abound, all with their own good causes and all trying to convince states, corporations, and individuals how much better off they would be, if only they would follow certain specific rules of behaviour.... Brunsson, N. and Jacobsson, B. (2000)

This led directly to the formation of Horticultural Ethical Business Initiative (HEBI) in 2003.

The relationship of HEBI to the rest of the organisations is shown best in the chart below

Table 2

(Omosa M.et al 2006)

HEBI was almost seen as a panacea to all the problems when it was first set up. This was a tripartite group (Unions, Producers, ETI) led by Kenyan’s who would resolve the various needs to all of the stakeholders. The Panic of 2004 (Homer 2008) refers to the initial set up of HEBI where the different timeline needs of all of the stakeholders became apparent. This could almost be split by hemisphere.

The Northern Stakeholders needed a relatively quick resolution that would satisfy their consumers and EU based NGO’s.

Whilst the Southern hemisphere based stakeholders had a completely different agenda. Their view that the review of Ethical standards within Kenya was a long term project.

A survey in 2004, found that nearly half of the 145 exporting growers who employed approx. 75% of cut flower industry workers were signed up to at least one code, with several belonging to more than one. The most frequent membership was of the KFC (47) followed by FPEAK (26), MPS (17), Max Havelar (10) and FLP (8).

In March 2004 a strategy and associated actions was developed for the development of HEBI. Although progress with these actions in 2004 was slow. This was partly due to the Steering Committee members all holding full time jobs in their own organisations. (P18 ETI). However the needs to the Retailers and more importantly their Ethical Customers and Shareholders were not being addressed.

The campaign by WWW & WRA had raised considerable awareness especially within the UK based Trade Unions. Two retailers in particular were targeted by both Trade Unionist and Ethical shareholders and were challenged to resolve the situation.

We almost had to prove to the various stakeholders that we were not sourcing sites that had considerable Ethical abuses. The attitude of the main board was we need this fixed today so go and do it (Pearson 2013)

Faced with the challenges both M&S and the Co-op decided to go immediately for the imposition of an additional standard which was the Max Haavelaar / Fairtrade standard. This enabled both of the retailers to use the Fairtrade logo on their Kenyan flowers.

Retailer members also worked extensively with their Kenyan flower supplier and the Fairtrade Foundation to introduce certified fair trade flowers from a large Kenyan farm under the Fairtrade Labelling Organisation's hired labour standard. These went on sale in March 2004 (ETI P18).

We worked closely with both our Kenyan supply base, the Co-op and the ETI to find an appropriate fix. On reflection whether the imposition of another standard (Fairtrade) was the correct route is extremely debateable although from an M&S perspective Fairtrade ticked all the required boxes. All of the UK based stakeholders seemed satisfied by this resolution. (Pearson S 2013).

The decision of Marks and Spencer and the Co-op not to follow the HEBI route signalled the start of Retailers taking different routes. This could be viewed as diluting the HEBI process Whilst ASDA, Safeway and Tesco remained supportive of the HEBI project and were prepared to wait for the finished standard. ‘Senior Tesco management were clear. We wanted to be seen to supporting not disrupting the HEBI process (May D 2013)

By the end of 2005 the process had moved considerably forward and participatory audits had already started. Five key recommendations were made by the HEBI steering committee.

Harmonization of the codes operating in the cut flower industry into a single comprehensive national code with international recognition.

Participatory auditing. HEBI has significantly advanced the introduction of more participatory social audits.

Export licenses conditional on code membership.

Worker awareness. Given the limited worker awareness of their rights.

Complementary strengthening of government organisations responsible for enforcing national labour laws.

These recommendations were generally welcomed by the industry. Although the producers did have considerable reservations about points three and five (which have still not been fully adopted).

These recommendations in general have worked well and have been praised by journalist Felicity Lawrence (Guardian 2011)

However, in May 2008 the situation changed again when Andy Bond, then CEO of ASDA, pledged to source an additional £30 million worth of fresh produce from African farmers over the next five years. This was part of the company’s commitment to the Millennium Development Goals. ASDA, the UK subsidiary of Wal-Mart, wanted products with a unique selling point and preferably Rainforest Alliance (RA) certification. They wanted a good development story but with products that would fit within their existing buying model. However Wal-Mart was looking to work with smaller suppliers who had not necessarily been included in previously exporting growers.

This also led to the development of ‘Ethical Agents’ within East Africa. An Ethical agent was defined as, ‘Actors play a mediation role facilitating the process of chain collaboration to get a product or service to market. ‘Agents possess the skills, knowledge and/or relationships necessary to play this role. They are usually industry experts who understand the particular market idiosyncrasies of the sector they are operating in. Agents utilise their networks within the sector to garner information, establish trust and build new links between stakeholders in the industry – strong relationships with key contacts is crucial. Ethical agents also have a strong motivation to ensure a positive development impact within these new market relationships. Although agents do not handle the product they are likely to add value and assume some risk. Threats to the agent are likely to be too reputational or relationship-based, given the risks involved in getting a competitive product to market. (Homer 2011)

This led to the development of the Wal-Mart African push pull model.

Table 3

(Buxton A. et al 2011)

The bouquets were designed to sell mainly in the United States and Canada (countries where the Rainforest Alliance has high recognition) with the UK taking a relatively low volume. However the model proved inflexible as one of the main problems was the lack of flowers certified to the Rainforest alliance standard. For a bouquet to be able to display a sticker highlighting RA certification there would normally need to be 70% of the stems from audited farms .This was reduced to 40% certified stems for the purposes of this trial . Although initially popular this lack of flexibly proved to be the downfall of the project and after ten weeks the project was quietly closed.

Conclusion

Over the last ten years the Ethical agenda within East Africa has completely changed. Ethics has now become a pre-requisite for all produce production. However I believe the observation of the Food Ethics Council accurately reflects the current situation. Is competition in the ‘ethical’ foods sector creating too many different levels and types of ‘ethical’ standard, damaging consumer trust in the movement? (Food Ethics Council 2013).

The UK supermarkets now regard an Ethical Audit as a base requirement in the same way as a Good Agricultural Practice standard.

However there has not been the harmonising of Ethical standards as there have been with GAP standards. Sometimes this is due to the preferred standards within the NGO’s of recipient countries. This is still leading to confusion within the market for example M&S, Waitrose, Sainsbury, and Co-op all insist on Fairtrade flowers. ASDA Wal-Mart accepts Fairtrade but prefer Rainforest Alliance. Interestingly Tesco Kenyan flowers are all 100% Fairtrade certified however a Fairtrade sticker is not applied to the bouquets. ‘

‘When we had the Fairtrade sticker on the bouquets Tesco were often challenged by NGO’s and customers who did not support the Fairtrade agenda. Their preference was often another Ethical standard. By removing the Fairtrade stickers and only telling customers when asked has considerably reduced adverse comments’ (Knowles L 2013).