Fair trade certification and social premium fund

June 12, 2017

Ecuador Placeholder
Ecuador

Fair Trade Certification and Social Premium Fund

About the Implementing organization

Name: Runa Foundation

Country: Ecuador

Year of establishment: 2011

Type of organization: Legally recognized non-profit status

Description

Over the last five years, Runa Foundation has worked with 3000 indigenous farming families to create 13 indigenous-led Fair Trade certified farmers’ associations. Part of Runa’s mission is to strengthen the ability of producer associations to make sustainable financial decisions that address the needs of farmers, and to responsibly invest their Fair Trade Social Premium Fund in a way that will generate tangible benefits for all guayusa producers and their communities. The Social Premium Fund is an additional payment of 15% of guayusa sales that is paid to the associations to support community development and strengthen organisational capacity. The associations have made various investment choices based on the needs of their producers. They have invested in agricultural inputs, such as equipment, tools, and materials, organisation and administrative expenses including the legalisation of their association and the purchase of office materials, and the creation of rotating community funds to administer microloans to their producers. Runa Foundation has created special spaces for women and youth to have a voice in the investment and spending decision-making processes. One of Runa Foundation’s strength over the past year has been working with the associations to create adaptive investment strategies that benefit all stakeholders and that promote the transparency of the Fair Trade process and the investment of the Social Premium Fund.

Nature Element

Forests

Type of Action

Protection / Restoration / Sustainable use / Access and benefit sharing / Awareness and education

Sustainable Development Element

Jobs and livelihoods / Food security / Health / Climate action

Related Sustainable Development Goal(s)

      

Environmental Impacts

Runa provides producers with an alternative to timber production, deforestation, and land-degrading agricultural practices. Instead, farmers and communities are encouraged to leverage their knowledge of the land and traditional agricultural practices for more financially stable production. Runa hosts workshops to promote sustainable agriculture practices and agroforestry management, further encouraging sustainable biodiverse practices and has also launched a wildlife monitoring program, with the Universidad San Francisco de Quito and the Yale School of Forestry. This program aims to better understand how indigenous agroforestry systems contribute to wider forest conservation.Runa works with farmers in an important ecological buffer zone surrounding Napo-Galeras, Sumaco, and Colonso-Chaulupas National Parks in the Ecuadorian Amazon. Our monitoring program uses camera traps and trains citizen biologists to identify wildlife as we continue to measure the environmental impact of our work.

Sustainable Development Impacts

In the past year, nearly 3,000 indigenous Kichwa farmers from 15 indigenous community organisations participated in over 80 capacity building workshops ranging from learning the fundamentals of the Fair Trade Certification process to more advanced accounting workshops on how to administer community run banks. Runa Foundation has provided a framework to improve the livelihoods of all members of participating communities. By establishing community banks and micro-loan programs, other local enterprises have a chance to thrive, further diversifying income for an individual or a community. Since 2011, $136,000.00 has been generated in the Social Premium Fund was invested, serving 3000 beneficiaries. At the household level, the increased demand and value for guayusa has established an additional source of income that fits within pre-existing agricultural systems.

Scalability

The expansion of Runa’s activities has expanded from a small group of local producers to include nearly 3000 producers in three provinces of the Ecuadorian Amazon. We expect growth to continue, as guayusa sales are projected to continue growth, as well as through expansion of Runa Foundation activities to include other non-timber forest products that can increase impacts for farmers utilising the same certification platform already created for guayusa. Runa has worked with the Ecuadorian National Bank to create a line of financing for guayusa production at competitive interest rates. We are also working to develop new value chains that can achieve the same social and environmental impact as the guayusa value chain. This last year, we began working to research and develop value chains of wild heirloom peanuts, wild Amazonian cinnamon, and Andean agave. By 2020, we expect to reach 5000 indigenous households in Ecuador.

Replicability

Runa Foundation’s model includes a process of identification of potential commercial products, creation of a sustainable Fair Trade value chain, and the connection of farmers to national and international markets.These new value chains utilise traditional knowledge and production systems, as well as existing governance structures to organise indigenous producers for sustainable social and ecological impacts.Our methodology for providing workshops, holding forums, and supporting the organisation of producer associations has the potential for replication across these value chains and adds to the positive impact of the certification on local communities.In 2016, Runa Foundation established itself in Peru with a project financed by the Inter-American Development Bank to develop a new value chain of guayusa and other Amazonian products in the region of San Martin.This is the first stage of our expansion to other countries.We hope to begin working in other countries in South America by 2020.

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