BBB National Programs Archive

NARB Recommends Fair Trade USA Modify Composite-Products Seal to Better Inform Consumers of ‘Fair-Trade’ Sourced Content

New York, NY – Sept. 17,  2012 – A National Advertising Review Board (NARB) panel has recommended that Fair Trade USA – formerly TransFair – require users of the organization’s “Fair Trade Certified” seal for composite products to provide additional information to consumers.

NARB is the appellate unit of the advertising industry’s system of self-regulation. It is administered by the Council of Better Business Bureaus.

By way of background, Dr. Bronner’s Magic Soaps, manufacturer of personal care and cosmetic products, challenged before the National Advertising Division (NAD) the truthfulness and accuracy of claims made with respect to “Fair Trade Certified” seals licensed by Fair Trade USA.

Dr. Bronner argued before NAD that the use of the Fair Trade USA “Fair Trade Certified” ingredient seal for composite products falsely implied that fair-trade sourced ingredients constituted a substantial part of the product.

NAD determined that use of the “Fair Trade Certified” ingredient seal on the front panel of product packaging – in a context that included a statement of fair trade sourced ingredients on the front panel and identification of fair trade sourced ingredients in the ingredients panel – accurately conveyed the degree to which fair trade sourced ingredients are included in the product.

Dr. Bronner appealed NAD’s determination to the NARB.

NARB, in its decision, said it “recognizes there are a number of organizations that provide fair trade certifications and applauds their work in promoting fair trade. While it is not the panel’s role to determine acceptable thresholds or standards used by certifying organizations, it is the panel’s role to recommend changes it believes are necessary to ensure that fair trade certification seals convey an accurate message to consumers. The fact that there are no generally accepted or legally required thresholds for the amount of fair trade sourced ingredients in composite products … makes it even more important that consumers receive an accurate message as to the fair trade content in products displaying the seal.”

Specifically, the panel found that the placement of the “Fair Trade Certified” ingredient seal on the front of a package conveyed a message of significance to consumers.

The “identification of fair trade sourced ingredients on the ingredients panel, which normally appears on the back or side of the packaging, is not enough to overcome or qualify the implied message of significance conveyed on the front of the package,” the panel stated.

“Putting an asterisk after each fair trade sourced ingredient does not show the relative proportion of fair trade sourced ingredients in the product and does not provide enough information for consumers to determine whether fair trade sourced ingredients represent a significant percentage of the product’s ingredients, which is the message reasonably conveyed by use of the ‘Fair Trade Certified’ ingredient seal on the front of the package.”

Further, the panel recommended that Fair Trade USA qualify the seal’s message by indicating the relative percentage by weight of ingredients that are fair trade sourced in order to convey an accurate message to consumers.

Fair Trade USA noted in its advertiser’s statement that it began, following NAD’s inquiry, last summer to implement a new policy that made “several important changes, including the creation of new and easier to distinguish seals, the requirement that certified products contain substantially higher minimum fair trade sourced ingredients … . Significantly, the new policy also retains the requirement that the product contain as many fair trade certified ingredients as are commercially available.”

The company stated that it “respects the decision of the panel and agrees that any implied messages must be determined in the context of the entire product packaging.  As part of its ongoing review process, Fair Trade USA intends to follow the recommendations of NARB in order to further strengthen the Fair Trade USA multiple ingredients product policy.”