Co-op group cites increasing competition for being unable to sustain support for fairtrade products
The troubled Co-op group and supermarket is to drop its commitment to fairtrade saying fierce competition is making it economically unviable.
In its upcoming AGM a motion will be tabled supporting fairtrade in principle but the organisation's bosses have said its commitment to fairtrade can’t be maintained due to “austere” financial conditions.
"The group's board supports the motion in terms of leading the way on fairtrade", the board has told members in response, "but won't be able to sustain its commitment to the brand in future.
“It should be recognised that some of the specific points highlighted in the motion cannot be supported due to the current financial position of the group, the austere market climate we continue to face and the strategic direction of the business into convenience shops, which naturally increases pressure on space and range."
The motion, and several other subjects, has been sent to more than 2.5 million people who are eligible to vote at the annual meeting.
It should be recognised that some of the specific points highlighted in the motion cannot be supported due to the current financial position of the group
The Co-op group was highly praised for becoming the country’s first fairtrade retailer.
It has previously taken the strategy that if a "Co-operative product can be fairtrade, it will be fairtrade".
But the group is still reeling from the 2013 banking scandal, which saw its director Paul Flowers’ drug habit revealed, and exposed a £1.5-billion hole in its finances.
Fairtrade commercial director Euan Venters said: “As one of our longest standing and most valued commercial partners, we thank the Co-operative’s management team for its ongoing commitment to fairtrade.
“We also express our gratitude to the active Co-operative members, whose tireless campaigning has been instrumental in driving local and regional awareness and fuelling demand for product.”
He added: “We look forward to taking the next steps towards supporting fairtrade communities together, through the principles outlined in the Co-operative’s draft new fairtrade policy,” he added.
