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'We're not trying to subvert capitalism. We're trying to bring out the positive benefits of enterprise instead' Paul Chandler started his career at Barclays Bank and for the last decade he's been a leading figure in battling for a fairer approach to world trade. JOHN HILL finds out more about how Traidcraft's CEO hopes to change the world for the better.

Byline: JOHN HILL

T'S not just about the money.

ITraidcraft's chief executive Paul Chandler makes this point more than once on a warm weekday morning in Gateshead's Team Valley Trading Estate, perched not far from a bowl of the company's Fairtrade-labelled chocolates.

People know what that label means. Fairtrade sales shot up by 40% in 2010 to around pounds 1.17bn on the strength of a solemn promise - that by buying a product for a few pence more, customers were backing a system that helped producers around the world to get a fair price for their efforts.

However, Chandler says the promise goes beyond that.

"It's not just about providing extra money for poor people", he says. "That's a vital part of helping them to lift themselves out of the dire situation they're in. But it's also about how people are treated in work and how they're held in the community."

So how do you achieve a change like this in the world? When people talked about fair trade back in the 1960s, many looked upon it as a tool in the political backlash against a capitalist system peppered with aggressive corporations and a belief in the markets over people.

In the 21st Century, the fair trade movement in the UK draws many of its sales from its recent multinational converts.

Nestle's Kit Kat now carries the label, while some of Kraft's Cadbury Dairy Milk also made the switch. Last week, Mars announced Maltesers would also shift production to fair trade.

Effectively, while the UK was late to the party when it came to fair trade, it's become a leading international market due to its willingness to engage with large corporations while others may have been more hesitant.

Chandler says: "It's all very well keeping yourself pure and if you do that you can help hundreds of thousands of people. We want to help millions and you can only do that with the help of people like Tesco and Nestle."

Traidcraft is also an unusual mix of charity and business. It talks about sales and profits, while simultaneously carrying out projects to improve lives in the developing world. Tellingly, it's run by a former Barclays manager with links to both the church and the world of figures.

"In the '60s, fair trade was seen as part of a search for alternative marketplaces to the capitalist system", Chandler says. "We've come increasingly to the realisation that businesses aren't inherently, wicked or damaging. Business can have that impact if it's done badly, but we believe it also has the potential to do good.

"We want to use business skills to create better opportunities for poor people; to create more responsible business practices that will be more sustainable in the long term. We're not trying to subvert capitalism. We're trying to bring out the positive benefits of enterprise instead."

While the thousands of Traidcraft activists, buyers and employees often don't need to be told about why fair trade is important, the movement can now also talk a language that's more familiar to your average multinational.

"It's not always about converting businesses to the moral case for fair trade", Chandler says. "There are executives within many companies that share that belief, but companies like Tesco and Kraft wouldn't be doing it if it wasn't good for their bottom line as well. You can make a good return from Fairtrade now as you can charge a small premium.

"It's not a silly business decision, but we've got to provide them with the economic and business argument for it rather than just say it would be nice.

"For us, Fairtrade is a tool. It gets consumers to send messages to the market that ethics are important. And they know that they could lose the loyalty of their customers if they don't do it."

When Chandler joined Traidcraft as chief executive in 2001 from Christian book publisher SPCK, he says there were around 100 products with the Fairtrade mark, 60 of which were offered by Traidcraft. "Around 4,500 products carry the mark now", he says. "If this was a pure business, I suppose you could say we'd lost a lot of market share there. But our role is to be a catalyst for change and the success of that has been beyond our wildest dreams."

In its last AGM in mid-September, Traidcraft announced "utterly flat" sales of pounds 18.5m and post-tax profits up from pounds 60,000 to pounds 482,000 thanks in part to the sale of its 10% stake in Cafedirect. Chandler admits being a catalyst for change doesn't always make business straightforward.

"We've got a conundrum in that we're set up to get other big players to adopt fair trade", he says.

"That means that every time we have a big success in that respect, we've just created a major new competitor for ourselves.

"Having said that, we made a good level of profit last year and we're very well capitalised. We've just got to stress the strengths of what we can do that no other company can do."

One way Traidcraft separates itself is by ploughing new furrows for Fairtrade. It is trying to build the business case for Fairtrade rubber and is also offering co-branded Fairtrade charcoal in partnership with the Co-operative.

It does this in the hope other larger companies will follow suit, but also knows it'll have a little while by itself in that market before these firms get the necessary stamps.

Chandler says: "Having development expertise allows us to ensure the impact of our trading is as effective as possible when dealing with producers, while this trading element enables us to avoid getting stuck in an NGO ivory tower."

Chandler enjoys business and admits the Traidcraft job allows him to combine his passions for business and development work. At university he was keen to join the Foreign Office but decided at the last minute to take a different route. His nine years at Barclays gave him the business understanding that won him the SPCK chief executive job at the age of 30. The Christian publisher's work included providing books to students training for the ministry in areas such as Africa, Latin America and Asia. Chandler visited every continent in the world within a few years.

"It was the first time I'd travelled outside the developed world", he says.

"To see that situation and then come back to the affluence here, the injustice of it all can't fail to touch you."

Chandler used to sell Traidcraft products at a stall in his local church in London. He'd been doing that for three years before he noticed the Traidcraft CEO job advert in the church newsletter. Traidcraft's supporter base is still overwhelmingly Christian and Chandler says it is this support that gives it the stability and profile to lobby businesses and politicians.

Despite holding the top job for a decade, Chandler, who lives near Durham with his GP wife Sarah and their three daughters, still runs his own stall in his church in the city. This understanding of the grassroots is balanced by his influential role in organisations such as the European Fair Trade Association.

Traidcraft was one of the six founding organisations behind the Fairtrade foundation in 1992 and Chandler says its role is still to challenge from within if it feels other organisations within the foundation are "not doing things properly".

However, Traidcraft is also active in lobbying for changes outside the movement itself. It participated in a successful campaign to amend the 2006 Companies Act, requiring companies to reveal the social and environmental impact of their operations.

It hopes some of its concerns about the way major retailers "pass risks down the supply chain" will be addressed by the Government's creation of a "supermarket adjudicator", initially looking at domestic supply chains.

It is also pushing the USA to stop giving subsidies to its cotton farmers, an outlay of pounds 15bn over the last decade which hands its cotton farmers a trade advantage over producers in Africa and other developing countries.

The World Trade Organisation has said some of these subsidies are illegal, but the USA has still not ceased the practice. However, it remains frustrated about the lack of political leadership on climate change.

Chandler says: "We're talking to producers who are going through unseasonal droughts and floods, and temperatures that stop craft producers from making crafts because the wax is melting. We've always seen cases of natural disasters hitting producers, but that number has gone up. It leaves us in absolutely no doubt about the reality of climate change."

This brings us to a question that's weighed heavily on the minds of millions for decades, whether they've raised a placard against changes to the NHS or taken to the streets to challenge the avarice of City banks.

How do you convince those in power to change the world? "There are three main things", says Chandler. "You need to understand and analyse the situation and work out an alternative that will have the desired impact. You've got to have a convincing argument if you want to make change.

"Then you've got to model it yourself.

You should be able to tell people things should work a certain way and show them how it works by doing it yourself.

"But just making an argument and modelling it won't work unless you can build popular momentum. You can convince a business by showing them their customers feel a certain way and you can convince politicians by showing them they will gain votes from it. "Once you've done all that, you've got to keep pushing for the change persistently.

We've made some changes through Fairtrade, but unless we keep the popular pressure going it will all unravel." Traidcraft's targets for 2011 to 2014 include increasing products by 10% a year and attracting 10% more supporters a year. It also wants to directly work with 400,000 people in the developing world a year, rising to half a million by 2014. However, it is also refining how it measures the impact of what it does.

It has been working with Bath University for a couple of years on a measurement system which looks deeper at the effect of fair trade on producers.

Through an initiative to be piloted at the start of next year, it aims to examine impacts on a community's self-worth, local environment, social connections and physical and mental health.

It is encouraging farmers in developing countries to sell products to local markets as well as international buyers and pushing them to diversify their crops to avoid over-reliance on a certain product.

Traidcraft is also nudging countries to think about what they produce and export, through initiatives such as hooking up villages in Ghana with small-scale presses so they can make their own palm oil.

Chandler says: "The palm kernels fall from the trees in Ghana and rot on the ground while the country imports from Indonesia. If you have a press that can be shared between a couple of villages, it can allow them to serve their local markets and reduce the need for exports."

Traidcraft summarises this approach with the tagline: "From fair to flourishing".

And it's an idea that's about more than just money.

Chandler says: "A few years ago, I visited a project we were doing in Gujarat with Agrocel, helping farmers develop the first ever Fairtrade-certified cotton while developing organic cotton at the same time.

"We'd started five years earlier with about 30 farmers volunteering. By 2006, that had risen to about 3,000.

"Yields of cotton had gone down as they were organic rather than GM, but the total income was the same because of the extra premiums and the cost of production had more than halved. Net income was about 25% higher.

"Going organic also meant they'd had to go from cotton farming all year round to crop rotation. They'd gone from 95% cotton dependent to 65%, as they were also growing food to sell at local markets.

"The premiums they'd received helped them improve water management, drilling boreholes and adopting water irrigation techniques. They also used natural pesticides from neem trees, but after extracting the juices for the pesticides they were using the neem for soaps and animal feeds, and setting up little additional businesses.

"They also formed little credit unions to lend to each other rather than be ripped off by middlemen, so it's pulled the community together in different ways.

"There are also signs that some of the people who had fled the fields for the Mumbai slums are coming back. They saw no future there before but are deciding this way might work better, and they're more at peace with the world and in touch with their ancestors.

"That's why we say that fair trade is about more than just about the price."

CV AGE: 49 EDUCATION: Graduated from St John's College, Oxford, in 1983 in Modern History.

His first job was at Barclays Bank. Over the following nine years he held a variety of management positions specialising in strategic planning and retail sales and obtaining an MBA from Henley Management College.

In 1992 he was appointed general secretary of SPCK - the oldest Anglican mission agency, which ran a substantial publishing business, a chain of bookshops and an international grants programme. He joined Traidcraft in 2001.

He is also director of the William Leech Foundation, a Fellow of St Chad's College in Durham University, and a governor of the Choristers School, Durham.

Since 2008, he has been a member of the CBI's North East Regional Council. He is a lay canon of Durham Cathedral and has recently become chairman of the Cathedral Council.

Other previous roles include being a member of the Church of England's Board of Mission, a trustee of the Church of England Pension Fund, Chair of the European Fair Trade Association, an advisory board member of IPPR North and a trustee of the All Saints Educational Trust.

QUESTIONNAIRE What car do you drive? Skoda Octavia estate.

What's your favourite restaurant? The Fox and Rabbit at Lockton, North Yorkshire.

What's your favourite book? The Aubrey-Maturin series by Patrick O'Brian (Master & Commander etc).

What's your favourite film? Barry Lyndon.

What was the last album you bought? Chasing Light by folk singer Gareth Davies-Jones.

GUESTS Cranmer, John What's your ideal job, other than the one you've got? Writer and commentator.

If you had a talking parrot, what's the first thing you would teach it to say? "Keep it simple, stupid."

What's your greatest fear? A serious accident in the family.

What's the best piece of business advice you have ever received? Don't put off taking tough decisions.

And the worst? Most people will never feel comfortable buying over the internet.

What's your poison? Red wine.

What newspapers do you read, other than The Journal? Saturday's Times, The Economist, The Week.

How much was your first pay packet and what was it for? pounds 50 for three days' work at Arab Horse Society show.

How do you keep fit? Walking our dog.

What's your most irritating habit? Thomas top, and Repeating myself to emphasise a point.

Which historical or fictional character do you most identify with or admire? John Buchan - best known as a writer, but he had an amazing career of public service, ending up as Governor General of Canada.

Which four famous people would you most like to dine with? John Buchan, William Gladstone, Archbishop Thomas Cranmer, Duke of Wellington.

How would you like to be remembered? He helped make a difference.

CAPTION(S):

GUESTS Thomas Cranmer, top, and John Buchan ENTHUSIAST Chief executive of Traidcraft Paul Chandler hopes to make a difference
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Publication:The Journal (Newcastle, England)
Date:Oct 3, 2011
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