The “Better Cotton Initiative” (BCI), “Cotton Made in Africa” (CmiA), “GOTS” and “Fairtrade” seals promise consumers of cotton textiles that the cotton used has been produced under strict ecological and social criteria. Is this promise kept? Are the labels comparable? In which areas do they need to improve? Roger Peltzer’s article, which appeared in the online magazine epo.de, deals with these questions.
From the point of view of textile consumers, there are 4 sustainable cotton standards that guarantee a minimum level of compliance with ecological and social criteria in cotton production. These standards are the Better Cotton Initiative (BCI), Cotton Made in Africa (CmiA), organic cotton mainly certified according to GOTS and Fairtrade cotton. At least the first three standards now play a significant role in the global market for cotton textiles . Around 22% of the 25 million tons of cotton produced worldwide is BCI-certified and 50% of this is sold on as certified goods to companies such as IKEA, H&M, etc.
There are 2.2 million Better Cotton Farmers worldwide, including 900,000 CMIA farmers in Africa. 30% of African cotton production (500,000 tons) is certified according to CmiA, of which around 50% is sold as certified goods to Tchibo, Otto, Rewe and others. And organic cotton accounts for around 1.3% (350,000 tons) of global cotton production. In contrast, Faitrade only produces 17,000 tons of cotton (according to ICAC) in 2023. In the German textile market, at least 30% of the cotton textiles sold here are now likely to be certified according to one of the standards mentioned, and the trend is rising. However, not all textile retailers indicate the use of sustainable cotton on their products.
The impact of sustainable cotton standards
All 4 standards claim to improve the ecological and social conditions of cotton production and to “enable cotton farmers to lead a better life”. Is this the case? What is the impact of these standards beyond compliance with minimum environmental and social criteria?
An independent study with comparison groups shows that BCI farmers in India, Pakistan and Kyrgyzstan, among others, were able to increase their productivity by 9-15% and their income by 18-35%. Cotton Made in Africa also recently commissioned an independent study with comparison groups, which shows that female cotton farmers in the CMIA-certified regions receive significantly better support than their colleagues in the comparison region. And BCI can use its own statistics (without a comparison group) to show that BCI-certified farmers in India have been able to reduce their consumption of synthetic pesticides by 50 percent in recent years. The latter is also due to the widespread use of genetically modified cotton in India. In 2023, CmiA invested EUR 780,000 in school classes, wells and women’s cooperatives in the cotton regions. The local CmiA partners have substantially increased this amount again.
In this respect, it can be said that consumers who buy products with these seals are doing something good. All 4 seals are not greenwashing.
On the other hand, it is still the case that all 4 standards mentioned (including Faitrade) are still a long way from guaranteeing “their” farmers a living income. Depending on the country, the real income earned by cotton farmers in Africa is likely to be between 40 and 60 percent of the income that farmers would have to earn in order to lead a decent life. A recent study by BCI in two Indian states found a “living income gap” of 50% in one state. In the other state, the relatively low income from cotton is offset by state income subsidies.
With the exception of organic cotton (GOTS), synthetic pesticides are still used on a large scale in the other three standards mentioned, some of which are classified as highly hazardous by the Pesticide Action Network (PAN). However, it should be noted that around 80% of Fairtrade cotton is certified organic.
How do the BCI, CmiA, GOTS and Fairtrade Cotton standards compare?
With regard to the social and ecological production criteria, BCI, CmiA and Fairtrade Cotton are largely comparable, also in terms of the independent and transparent verification of compliance with these criteria. BCI places a stronger emphasis on compliance with minimum social conditions for farm workers (decent work), whereas paid farm labor in Africa (CmiA) does not play such a major role because a large part of the work is done in family and village networks. In contrast to BCI, CMIA does not allow genetically modified cotton or cotton from irrigated cultivation. However, unlike in other parts of the world, neither of these are practiced or produced in sub-Saharan Africa. And CmiA also includes working conditions in the ginning plants in accordance with ILO standards, which is not the case with BCI.
Fairtrade should theoretically pay cotton farmers higher prices than the world market price. In fact, however, this is not the case. For many years, the fair cotton price determined by Faitrade has been below the world market price. Fairtrade therefore pays its farmers the same world market prices as BCI and CmiA. However, Fairtrade also pays “its” farmers a Faitrade premium of 0.5 cents per kg. According to Faitrade Germany, this amounted to around 1 million euros in 2023. In contrast, BCI supported smallholder projects with a volume of around USD 13 million via the Innovation and Growth Fund in 2022/23. CmiA spent around 3.5 million in 2023 to promote the productivity and living conditions of smallholder farmers in Africa. The bottom line is that BCI and CMIA achieve significantly more for smallholders worldwide than Fairtrade due to the larger volumes traded. This is another reason to consider including BCI and CmiA in the Fairtrade label. With the Fairtrade label, BCI and CmiA could presumably enforce significantly higher license fees in the difficult and highly competitive textile markets and thus generate more funds to improve the standard of living of small cotton farmers.
Organic cotton farmers (GOTS) receive higher than world market prices for their cotton.
However, they also need this to compensate for the generally lower productivity.
As far as can be seen, social criteria do not play a role in cotton production in the GOTS standard.
As far as can be seen from the website, GOTS also does not support any projects for small farmers in the growing regions.
What remains to be done?
The central issue is the living income for cotton farmers. While BCI makes it clear in its publications that it is striving for such a “living income” and is also spending money to determine the “living income” gap in the cotton areas it certifies, CmiA, GOTS and Fairtrade are not addressing this issue in a recognizable and public manner. All those involved are aware that such a “living income” can only be achieved gradually and over a period of years. However, if the goal is not set in the first place, little will happen in this direction.
The goal of the UN Biodiversity Conference to reduce the use of chemical pesticides by 50% by 2030 is adopted by BCI, albeit without a target date. CmiA has not made any public commitments in this regard. For Fairtrade Cotton, this target is not so important, as around 80 percent of Fairtrade cotton is certified organic anyway.
In connection with the discussion on the Supply Chain Act and the debate on reducing bureaucracy, there are plans to exempt companies that sell goods that are certified according to credible sustainability standards from reporting obligations. This is provided for in Article 52 of the corresponding EU Directive. However, the implementation of such proposals requires that the relevant standards comply with the due diligence obligations in the risk areas specified by law. This is largely the case with the four sustainable cotton standards. However, only BCI and GOTS have installed transparent complaints mechanisms that allow farmers or workers, for example, to lodge complaints anonymously if, for example, defined standards are grossly disregarded in reality. CMIA and Fairtrade lack this, although Faitrade may argue that the producers’ representatives are organically integrated into the system. But even on Fairtrade farms, there are farm workers who are not represented on Fairtrade committees.
It is also important for consumers and producers that the existing standards are largely comparable and compatible with each other. Organic Fairtrade cotton or CmiA Organic (the cotton is GOTS and CmiA certified) are steps in this direction. With regard to the mass of sustainable cotton, it is more important that CmiA cotton continues to be recognized as BCI cotton. This was the case until recently, and has allowed CmiA to sell CmiA certified cotton through BCI channels. However, this benchmarking agreement was initially terminated by both sides at the end of 2023 for reasons that are difficult for outsiders to understand. The consequences are significantly higher bureaucracy and additional costs for partner cotton companies in Africa and the cotton traders. And the consequences are also – as can be read in CmiA’s annual report for 2023 – significantly lower license income for CmiA. This means there is a lack of money that could be invested in improving the living conditions of farmers in Africa.
Last but not least, there are deficits in the transparency of the reporting of all 4 standards. In addition to a profit and loss account, all standards should also publish a balance sheet. This is the only way for the reader to get an idea of how much of the license income is spent on promoting smallholders and how much money is “hoarded”. You will look in vain for such a balance sheet at CmiA. All standards should clearly state how much certified cotton they produce and how much of it they sell.
Standards have costs to ensure the implementation of their standards on the ground. This includes certification, reporting, organizing the farmer groups in a way that makes them eligible for certification in the first place, etc. CmiA and BCI should make it clearer in their annual reports which expenses are caused locally in the project areas by the implementation of the standard and to what extent expenses are used to promote the improvement of the production and living conditions of small farmers. In reality, this cannot always be clearly distinguished, but the attempt should nevertheless be made. Transparency would be served by this.
Cover image from Freepik.com
Dear Roger, just a remark about a ‘living income’ from cotton. It must be realised that most smallholder cotton farmers in Africa are first of all maize farmers, who also happen to grow cotton, and often are engaged in other crops or activities as well. Expecting a living income from only cotton is not realistic. For their own reasons, hundreds of thousands or even millions of smallholder farmers continue to grow cotton because they see a benefit from doing so. All these farmers cannot be wrong.
Kind regards,
Rudy
Dear Rudy,
thank you for your comment. If I talk on the living income of a cotton farmer family, I´talk on the whole income of such a family, i.e. from cotton, other crops, vergetables gardens, small husbandary, small trade, handicraft etc. So my statement, that smallholder farmers in Africa earn at present in average only 40 – 60 percent of what they need for a decent life refers to their total income.
As however cotton is for almost all of these farmers the anchor crop, cotton companies and cottons sustainibility standards behind are specifically challenged to take action to improve the income of theses cotton farmers. Theses actions however don`t necesseraily have only to concentrate on cotton. In West Africa cotton companies could for ex. also faciliate access of their farmers to fertilizers for maize growing, That would also susbtantially help to increase the overall income of theses farmers. And their have been some tests in the past in this direction.