Understanding Fairtrade Gold Systems

Your friends say that it is a good thing to support, you see it as "added market value" for a wide range of products, and you are even willing to spend an extra dollar per pound for coffee because of it, but let's break down what Fair Trade is and specifically for us, how does it apply to metal?

Dear Reader: This essay was published on Aug. 9, 2012 in conjuction with Ethical Metalsmiths newsletter. It has raised some important questions requiring clarification. We used the title Understanding Fairtrade Gold Systems to represent BOTH a broad concept of Fair Trade AND the specific certified Fairtrade and Fairmined gold product with a limited number of words. Throughout the article you will see the term Fair Trade. It has been used to keep the conversation in the realm of general benefits of Fair Trade. Ethical Metalsmiths recognizes the need for accurate use of established terms because of their real world market applications and official trademarks. Please note that this article does aim to plainly explain the general benefits of Fair Trade in order to make room for more specific conversations about Fairtrade and Fairmined gold in the future. Please contact us with your questions and concerns.


By Christina Miller

Essentially, Fair Trade gives people charge and incentive to responsibly benefit from their own resources. It does this through trade agreements that keep the earnings from a resource (coffee, lumber, gold, etc.) within the community where the stuff grows or was extracted. Additionally, it sets rigorous standards for both the quality of life of workers as well as for the treatment of the land. Without these standards, the community would lose the economic support (buyership) of a growing niche consumer--the responsibility conscious consumer--you and your customers and patrons! This is not economic rocket science: the demand for a commodity is created by a consumer who increasingly is able to specify the terms of the product they want.

When it comes to mining, imagine two pictures: The first is the Conventional mine. One would think that a community benefitting from the resources in their own back yard is the foundation of economic trade, but this is rarely the case. Corporate power and influence enables multi-national conglomerates to seduce national governments, promise jobs to locals, and to literally dig deep to extract metals as quickly and aggressively as possible. It is a sweet deal for the mining company but it inevitably creates an environment of exploitation.

Time is money, and because of advanced technology, a large operation can get the metal out of the ground FAST! This kind of “hyper efficient” mining can make a great deal of money--the majority of the profits go to the international company while the community receives only a small percentage. Currently this method delivers the lion’s share of the metal used by jewelers, and at the lowest possible cost. It is likely that this is the system through which we have all procured our metal in the past. Of course, how were we supposed to know? When we look at an ounce of gold in our hands, there is currently no way to tell what havoc it has wrecked elsewhere.
Ok, now imagine the second picture. Artisanal and small-scale miners recognize that they have something to offer and that there are internationally accepted, positive structures in place to help them market their gold. Their product is special and part of a movement called Fair Trade. Participation in this movement means that their mining practices have to meet rigorous standards, but that the extra income that the system generates can pay for community development such as schools, clinics, and infrastructure.

text boxThis community recognizes that is has a lot of gold, but that its speedy removal is not good for the long run, so it choses to employ slow extraction practices to ensure that their mineral supply will support many generations. And perhaps of greatest importance, the people living on or near exploitable resources are now organized, both in an effort to further community mining as well as prepare future generations for livelihoods involving more sustainable economies. The Fairtrade and Fairmined standards they abide by and ultimately benefit from also hold them accountable to the environment that, if maintained, will continue to support the vitality of the community.

In examining these two pictures, cost is the word to watch. We believe that cost is like matter, in that it always exists and can’t be made or destroyed, only displaced. So, when the cost is low for the maker, it is high for both the mining community (in working conditions, low wages, and poor management), as well as the extraction environment (in acid mine drainage and ground contamination). Fair Trade works to better distribute costs and to unify everyone in benefit.

The Fair Trade alternative not only creates better social standards and environmental conditions, but ultimately it produces a better product. Remember that we can’t tell the history of a product by looking at it, but think of what you and your customers or patrons want. If it is food they put into their bodies, lumber with which they build their homes, or gold through which they signify their bonds and beliefs, shouldn’t the materials promote regenerative health, vitality, and community? Shouldn’t we be able to count on this somehow?

We think so, and that is why we’ve joined with Fair Jewelry Action and Fairtrade International to bring certified Fairtrade and Fairmined gold to the US. We understand that metals can hide their histories, and we can accept that even when the history is one that turns our stomachs. But what is not acceptable is to continue to support these destructive practices as if we never learned our lessons from the past. Please visit both the Ethical Metalmsiths blog and Fair Jewelry Action site for more information and get in touch if you are interested in participating.