Sector de la construcción

As explained in the global trends section and value op- tions of the Strategy, there is increasing global consumer demand for handicraft products produced without ex- ploiting workers, children or the environment. This cor- responds to the principles of fair trade and implies : first, knowing about the supply chain from the collection of the raw material through the workshop up to the retail stores ;

and second, trusting that production methods meet ethi- cal standards. Ethical consumers place a value on these labels and in most cases are prepared to pay a premium price for the ethical assurance given.

There are several initiatives that give varying degrees of independent third-party assurance about sustainable, fair trade and other ethical product dimensions. Among these are BSCI, ETI and WFTO, who focus on ethical trade. The FSC mission is to promote environmentally sound, social- ly beneficial and economically prosperous management of the world’s forests.

Fair trade labels are being used as marketing tools. Fair trade organizations have been found to : protect small producers from being forced to accept low prices ; ensure minimum prices for their products ; and create markets. Additionally, the sale of fair trade handicrafts online has been of particular importance in aiding the development of female artisans in other regions of the world, especially in Latin America. It is important to mention that recently some criticisms have arisen about fair trade systems due to failure to enforce the fair trade standards with sector stakeholders and limited benefits for producers.

In the handicraft sector, WFTO is the most dominant certification and labelling organization in the world. The WFTO Guarantee System is an assurance mechanism that Fair Trade is implemented in the supply chain and practices of an organization. It is an accountability and development tool for organizations. Members that pass the Guarantee System process attain ‘Guaranteed Fair Trade Organization’ status and may use the WFTO la- bel on their products. It is not a product certification sys- tem. The WFTO Fair Trade Standard is the heart of the Guarantee System, focusing on the management and operation of fair trade organizations in relation to their fair trade practices.

The WFTO Standard comprises a set of compliance crite- ria based on the 10 Fair Trade Principles and International Labour Organization conventions. Many of these criteria

87 THE WAY FORWARD

are mandatory requirements to join WFTO. There are also other non-mandatory requirements, where WFTO members must show continuous improvement over time. Compliance with this Standard will be assessed by vari- ous means, including a self-assessment report, a peer visit and a monitoring audit. Trading members are called Fair Trade Organizations. They must be engaged with Fair Trade as a producer, trader or supportive organiza- tion. WFTO Guaranteed members can apply the WFTO label on products which they sell. The label assures that the product is ‘made by a guaranteed Fair Trade organiza- tion’. The organization is certified ; not the product. Fairtrade International is an independent NGO which is part of WFTO and counts 19 national organizations, called Fairtrade Labelling Initiatives, to promote the mar- keting of Fair Trade Products in 24 countries in Europe, North and Central America, Australia and New Zealand. One organization – FLOCert – is responsible for auditing and certification compliance against the Fairtrade stand- ards. The FLOCert office responsible for Nepal is based in Bangalore in India.

FSC is an organization that provides a system for volun- tary accreditation and independent third party certifica- tion. This system allows certificate holders to market their products and services as the result of environmentally appropriate, socially beneficial and economically viable forest management. FSC principles and criteria require,

for example, that forest management is compliant with national legislation, respects local use rights and indig- enous peoples’ rights, maintains ecological functions of the forest and its biodiversity, enhances economic viabil- ity, and carries out adequate management planning and monitoring of operations. The FSC principles and criteria apply to natural forests, plants and also some types of non-forest vegetation.

The FSC standard is adapted to different conditions of forests around the world through the development of na- tional and subnational indicators. FSC standards have a specific geographical scope, such as a political des- ignation ( country, region or province ) or an ecological designation ( forest type, ecologically delimited area ). In countries where no specific standards have yet been de- veloped, certification bodies adapt the generic standards to local conditions. FSC is a third-party certification sys- tem, meaning that compliance with FSC requirements is verified by an independent certification body. FSC prod- ucts can contain parts or proportions which are not fully FSC certified. The ‘FSC Mixed Sources’ label allows man- ufacturing companies to mix FSC certified material with non-certified material.

Figure 19 below shows the number of requirements ap- plied by the certification body for each pillar that defines sustainability and also their relative degree of obligation vis-à-vis the implementation time frame.

Figure 19 : Comparison of BSCI, ETI, WFTO and FSC certification areas and degree of obligation ( number of requirements )

Source : International Trade Centre Standards Map ( 2016 ) ( b ).

125 100 75 50 25 0 250 200 150 100 50 0

BSCI ETI WFTO GS FSC FM

BSCI ETI WFTO GS FSC FM

Social Management Quality Ethics Environmental Within 1 years Within 3 years Within 5 years

For immediate action Recommendation

88 NEPAL NATIONAL SECTOR EXPORT STRATEGY – HANDMADE PAPER AND PAPER PRODUCTS • 2017 – 2021

As previously explained, the Strategy recommends com- pliance with and certification in sustainability standards across the value chain. HANDPASS, in close collabora- tion with Fair Trade Certified companies, needs to restart implementation of the Nepalokta CoC and establish a partnership with other private sustainable standards organizations to further integrate sustainability prin- ciples in the value chain.

POTENTIAL OFFERED BY THE