Summary of Council decision:
Two issues were investigated, of which one was Upheld and one was Not upheld.
Claims on www.sainsburys.co.uk, seen on 18 October 2017, promoted tea. A search results page for ‘tea' displayed a number of products, and included images of the packaging. One product was “Sainsbury’s Fairly Traded Red Label x240 Tea Bags 750g”. The packaging included a "Fairly Traded" logo in a box. The same logo appeared underneath the product description, and linked through to a page which gave further information on the Sainsbury's Fairly Traded programme. A number of other products listed on the page were “Fairtrade” tea products, and the images showed that the packaging for those products included the Fairtrade logo.
Stella Creasy MP challenged whether the claim "Fairly Traded":
1. misleadingly suggested a connection to the Fairtrade scheme; and
2. was misleading as to the ethical standards that applied to the products.
1. J Sainsbury plc (Sainsbury’s) believed the claims were not misleading because they signified to their customers that the tea had been sourced using very high ethical standards that identified and built on existing internationally recognised standards and was beyond simply achieving compliance. They said they had never suggested their online content relating to the ‘Fairly Traded’ tea had been approved, endorsed or authorised by another body. Since launching the scheme they said they had clearly publicised what the pilot scheme covered and had marked the tea they sold with the relevant certification status of the product. They said they had always clearly distinguished between the different types of tea they had available to order by offering a full description of each tea product and had listed them in line with industry practice and consumer expectation.
Sainsbury’s said the name ‘Fairly Traded’ had been chosen to reflect that, firstly, through the sourcing relationship they always guaranteed a minimum fair price for the crops, and secondly, through the social premium associated with Fairly Traded products they supported projects that benefitted the relevant businesses and communities. They said their aim was to improve the livelihoods of their suppliers, farmers, growers, and workers and to develop their understanding of sustainable practices so that, together, they could offer customers a greater choice of quality products.
Sainsbury’s said the ad did not suggest a connection to the Fairtrade scheme, and that, since launching the scheme they had clearly marked the tea and had never claimed that it was linked to the Fairtrade Foundation or Fairtrade International, although they inevitably sold Fairtrade products as well as Fairly Traded products. They said, as with all product ranges, items that met the same needs would be listed together in line with customer expectation and industry practice; for example, all tea products would be listed in the same area.
Sainsbury’s said the ad demonstrated how clearly they had labelled Fairly Traded products using a distinctive red and black logo, and they did not see how they could have been clearer on that point. They said the Fairly Traded logo acted as a ‘find out more button’ which provided a direct link to an essential information page where consumers were able to find out more about the pilot scheme. They said that page made clear through the language used that they were introducing a new scheme.
Sainsbury’s said the ad also included a banner featuring Pukka tea which used the ‘fair for life - fair trade’ logo to communicate its certification programme for social accountability and fair trade in agricultural, manufacturing and trading operations. There, the words ‘fair trade’ were also used in a descriptive sense to describe the Fair For Life standard, which was an example of an alternative certification owned by the ECOCERT GROUP, that was part of the fair trade landscape while not being commercially or otherwise connected to the Fairtrade Foundation or Fairtrade International. They said ECOCERT also operated another Fair Trade programme, ‘Fair Trade by Ecocert’, that applied to goods they classed as being fair trade products, having met certain standards.
Sainsbury’s said they felt it was essential to add that ‘Fair Trade’ was generic wording that could be used to describe a trading partnership, based on dialogue, transparency and respect, that sought greater equity in international trade. It was for that reason that there were numerous registered marks in active use with a combination of the words ‘fair’ and ‘trade’, and the Sainsbury’s Fairly Traded mark had been successfully registered.
2. Sainsbury’s said they were committed to establishing long-term, open and fair relationships with their suppliers, ensuring they had the skills and capacity to manage their workers responsibly. They said their Fairly Traded products were underpinned by their Supplier Policy on Ethical Trade and sourced from farmers and suppliers participating in the Sainsbury’s Sustainability Standards. That programme was essentially a new management framework to support farmers who produced their key crops and ingredients in meeting the highest sustainability standards.
Sainsbury’s said the Fairly Traded pilot included key lines of bySainsbury’s [sic] tea, and the participating tea farmers were working to the aforementioned Sainsbury’s Sustainability Standards. Through the pilot they sought to enable tea farmers in Africa to strengthen their businesses and communities as they tackled ever-growing challenges, such as the impact of climate change and associated droughts, soil erosion, and crop diseases. The pilot provided tea farmers with financial security through a guaranteed minimum price for their crop along with a ‘Social Premium’ for investment. It also gave farmers the additional opportunity to build long-term relationships with Sainsbury’s and receive tailored advice, data and practical support to help them respond to their specific challenges. They said practical support programmes would be led by producers and workers and funded through the social premium, as well as any additional funding that could be leveraged. In order to build their plans, producers would have access to country-specific information linked to the UN Sustainable Development Goals, Sustainability Standard action plans and support from locally-based experts.
Sainsbury’s said they did not accept that the claim ‘Fairly Traded’ was misleading as to the ethical standards that were applied to the products because those products bearing the label would have been developed under the pilot scheme which had at the heart of it Sainsbury’s Sustainability Standards. They said those standards built on and recognised existing certifications and had been co-authored with specialist advisors and peer-reviewed by 50 independent experts, and would be independently audited. They said, unlike many existing forms of accreditation which focused on one aspect of sustainability, the Sainsbury’s Sustainability Standards addressed the full breadth of environmental, economic and social challenges that impacted their farmers and workers. They said their standards went beyond achieving compliance, to deliver meaningful data and insights to farmers so they could identify their strengths and weaknesses which would inform their future action plans. Those standards provided farmers with information about how their farm was performing in relation to their peer group, helping them to see and learn from best practice. They said each key crop and ingredient would have a bespoke Standard to ensure it was relevant to those farmers and delivered them greatest value and support. The programme recognised and gave credit to over 70 accreditations recognised by Sainsbury’s, and the Standards were working towards meeting the requirements of full ISEAL (the global membership association for sustainability standards) membership.
Sainsbury’s said the pilot was being overseen by a new expert advisory board, made up of independent leading charities, academic institutions and NGOs, set up and run by senior Sainsbury’s leaders. The Social Premium funds would be regularly audited.
Sainsbury’s said their suppliers were required to adhere to their Supplier Policy on Ethical Trade. That outlined the employment practices and standards they expected from their suppliers, wherever in the world they might be. The policy was based on the Ethical Trading Initiative’s Base Code, the International Labour Organisation core conventions and the Universal Declaration of Human Rights. Their aim was for the policy to be adopted as a minimum standard and to see suppliers’ performance continuously improving. They said they were committed to respecting human rights by providing training, sharing their knowledge, and engaging in collaborative industry initiatives.
Building on the above they had also chosen to fulfil within the Sainsbury’s Fairly Traded scheme the ten principles of Fair Trade set out by the World Fair Trade Organisation.
The first principle was ‘Creating Opportunities for Economically Disadvantaged Producers’. Sainsbury’s said they had a public commitment to grow the sales of Fairly Traded products in line with the sales of their business and to invest in the sustainability and resilience of their suppliers, farmers and growers. They and their communities would be supported in building knowledge, skills and capacity through their investment plans within the Sainsbury’s Foundation programmes. In parallel, they would be supported in working with their Sustainability Standards.
They said the second principle was ‘Transparency and Accountability’, and that Sainsbury’s Sustainability Standards, Sainsbury’s Foundation Investments and Sainsbury’s Fairly Traded contracts would all be subject to independent audit and they would report transparently on all aspects and their progress. The Sainsbury’s Foundation Advisory Board would have independent expert membership and an independent chair. Producer investment plans would be created and owned by farmers and workers all the way through the process. Farmers and workers would be supported in the production of their plans, and there would also be a tripartite memorandum of understanding between Sainsbury’s, the Sainsbury’s supplier and the farmer/producer organisations that included volume commitments. Third party independent grievance procedures were also established with the Sainsbury’s Foundation/Fairly Traded model.
The third principle was ‘Fair Trading Practices’ and the fourth was ‘Payment of a Fair Price’. They said their approach to Sainsbury’s Fairly Traded included a minimum price guarantee; a Social Premium for investment; and the opportunity for longer term commitments reflecting the length of Sainsbury’s contracts with first tier supplier. They said Sainsbury’s followed UK Groceries Supply Code of Practice (GSCOP) legislation.
The fifth principle was ‘Ensuring No Child Labour and Forced Labour’. Sainsbury’s said they required all their suppliers to meet the Sainsbury’s Code of Conduct for Ethical Trade which was based on the Ethical Trading Initiative Base Code for ethical sourcing. Their code covered 12 key principles, including safe and hygienic working conditions, payment of a fair wage and freedom of association. Their Sustainability Standards were based on the premise of supporting suppliers and farmers across their key crops and ingredients on a journey of continuous improvement. Those standards built on their base technical and ethical trade requirements and existing standards, specifically addressing the complex area of families in farming.
Sainsbury’s said the sixth principle was ‘Commitment to Non Discrimination, Gender Equity and Women’s Economic Empowerment, and Freedom of Association’. Their suppliers were required to show compliance against the code and to provide evidence of continuous improvement in worker welfare. Suppliers must have in place their own code of conduct, policies and systems to manage ethical trade, and be able to report their progress to Sainsbury’s. Sainsbury’s said they risk assessed all of their suppliers and conducted regular, independent, third party ethical audits where required. Any issues identified by those audits must be resolved in an appropriate timeframe. They also worked to train suppliers on ethical trade and engaged with key suppliers on projects designed to improve worker welfare. They measured supplier performance against a number of key indicators for ethical trade and built that performance into their purchasing decisions.
The seventh principle was ‘Ensuring Good Working Conditions’. Sainsbury’s said they risk assessed all of their suppliers and conducted regular, independent, third party ethical audits where required. Any issues identified by those audits must be resolved in an appropriate timeframe. They measured supplier performance against a number of key indicators for ethical trade and built that performance into their purchasing decisions. Their commitment to ethical and responsible sourcing was ongoing and they worked with suppliers to ensure they continuously improved their performance in that area. They were a founding member of the Ethical Trading Initiative which required them to work collaboratively with trade unions, non-governmental organisations and other corporations on ethical trade programmes.
The eighth principle was ‘Providing Capacity Building’. They said Sainsbury’s Fair Development Fund and other activities showed ten years of project level activity on capacity building. Sainsbury’s invested in capacity building for its direct suppliers across ethical trading, technical capability and sustainability.
The ninth principle was ‘Promoting Fair Trade’. Sainsbury’s said that they were the world’s biggest retailer of Fairtrade and would remain so, and that they supported Fairtrade Fortnight.
The tenth principle was ‘Respect for the Environment’. Sainsbury’s said their Sustainability Standards were based on the premise of supporting suppliers and farmers across their key crops and ingredients on a journey of continuous improvement. Those standards built on their base technical and ethical trade requirements and existing standards – giving recognition and credit for all existing activity avoiding duplication, while ensuring they were fully addressing the full breadth of social, environmental and economic challenges collectively with their farmers and suppliers. Their standards were further driven through data capture to support anonymised benchmarking and continuous improvement activities. Their suppliers and farmers would be supported in working to address the issues they faced.
In addition, they had made a public commitment within their Sustainability Plan to work with their suppliers, farmers and growers to address the impact of their products. Taking into account the rigorous standards and processes that were applied to their tea labelled as Sainsbury’s Fairly Traded, they rejected the claim that it was misleading as to the actual ethical standards that applied to the products.
Sainsbury’s noted concerns that had been raised by the Fairtrade Foundation, that farmers could go from being in control of how the money they earned from selling their product as Fairtrade certified was spent on community and local projects, to having to apply to a board (under the Sainsbury’s Foundation Programme) in order to access the money they had rightfully earned, with no guarantee they would receive it. Sainsbury’s rejected that claim and were confident that their scheme was consistent with what consumers would expect from a fair trading partnership, based on dialogue, transparency and respect. Sainsbury’s said they were working with expert partners as part of the pilot to help them design an improved way of working more directly with both farmers and workers who supplied their products. Through that development process so far, they and their partners had visited the six producer organisations involved in Kenya, Malawi and Rwanda, to understand their priorities and needs. That had allowed them to discuss important issues such as current decision-making in relation to social premium spend within their organisations (mainly consisting of between 3,500 and 10,000 small-scale farmers) and what their ambitions and objectives were for the future – for their businesses and communities. Secondly, they said all of the organisations involved in the pilot would continue to receive an equivalent level of social premium (with the ambition of Sainsbury’s being able to leverage additional money through working with Funders who shared similar strategic aims) and at the same time would be able to continue to develop their own premium spending plans at an organisational level.
Through the initiative they said they were also intending to make the decision-making process more inclusive for all groups within the producer organisations and not just the larger bodies. In addition, organisations would receive information and data including results from their Sainsbury’s Sustainability Standard assessment, access to knowledge about sector-wide initiatives happening in their regions and technical and agricultural information. That would allow them to develop or enhance their plans which would be shared with the Sainsbury’s Foundation Advisory Board. The aim was to look at where more support might be offered or to help build projects which offered greater impact or value for money. They said the social premium was ring-fenced for each producer organisation according to how much tea they had sold to Sainsbury’s and those ring-fenced funds would remain available to them for two years following any decision to cease supply.
They said it was important to add that although Fairtrade had questioned the execution of the pilot scheme, Fairtrade was working with a number of different organisations in a number of different ways to set up bespoke schemes. While those bespoke schemes had been designed with the farmer and grower community interests as well as environmental sustainability in mind, the operations of such schemes nonetheless differed from those of a ‘traditional’ Fairtrade endorsed relationship. That included varying levels of adherence to the well-established principles and rule set of the Fairtrade social premium and a guaranteed minimum price, as well as the Fairtrade Producer Standards that sat beneath them.
Sainsbury’s said they believed that the independence of their scheme was crucial and fundamental to the scheme, and as a result they had put in place a number of robust measures to ensure that independence was maintained, including the existence of a Sainsbury’s Foundation Advisory Board, which would have an independent chair, and the terms of reference of which stated that the board would be made up of up to nine members, only three of whom would be Sainsbury’s employees. They said the scheme was being supported by experts to ensure it was comprehensive and proportionate. They also said the Social Premium funds would be managed as they would have been under FLOCERT, but with increased public transparency, with results of assurance being published. They were working with PricewaterhouseCoopers LLP (PwC) to ensure that they established a robust framework and process that would allow for independent assurance in accordance with ISAE 3000 (Revised) (the International Standard on Assurance Engagements). The first piece of assurance that PwC would carry out would be connected to the Sainsbury’s Supermarkets Ltd Fairly Traded social Premium tea funds. Sainsbury’s believed that the rigour of independent external assurance would help them to drive continuous improvement in the quality, integrity and credibility in the management and operation of their Social Premium tea funds. They said participation in Sainsbury’s Sustainability Standards programme would be audited by a UKAS recognised Audit Body, and that their approach to governance was stated on their website in their Sustainability Standards document. They said they were confident that their scheme was consistent with what consumers would expect from a ‘fair trading partnership’.
The ASA considered the Fairtrade brand and scheme run by the Fairtrade Foundation was the most well-known fair trade scheme, and consumers were likely to be aware of that scheme, whereas they might not know about the existence of other, similar schemes.
We noted the packaging for the Fairly Traded Red Label tea had a simple design and the ‘Fairly Traded’ logo consisted of simple black text in a black border against the red colour of the packaging, which was not obviously distinct from the style of the rest of the packaging. We noted the Fairtrade Ceylon tea was referred to as “Sainsbury’s Ceylon Tea”, in the same way that the Red Label tea was referred to in the ad as “Sainsbury’s Fairly Traded Red Label”. We considered the fact that their own brand products used two different fair trade schemes was likely to cause confusion for consumers, who might assume that the packaging was using ‘Fairly Traded’ as a descriptive term to convey that it was part of the official Fairtrade scheme rather than that ‘Fairly Traded’ was itself the name of a separate scheme run by Sainsbury’s.
We noted that, at the bottom of the section for the Red Label tea, there was a logo which was clickable, referred to by Sainsbury’s as a ‘find out more button’, and which led to a page on the Sainsbury’s website where the scheme was explained. If consumers followed that link, it would become clear the scheme was separate from the Fairtrade scheme. However, it was not obvious that the image was a clickable link and, as above, it would not be obvious that it was a logo for a particular scheme, rather than merely a description. That contrasted with the logo for the “fair for life fair trade” logo on the Pukka tea banner ad, with which Sainsbury’s had drawn a comparison, which we considered was clearly a logo. We considered consumers were not likely to scrutinise the page and were likely to make decisions to add products to their basket fairly quickly before moving onto their next product search. In that context, we considered consumers would not understand that the ‘Fairly Traded’ term specifically referred to a scheme run by Sainsbury’s themselves, and it would not be clear that the scheme was not related to Fairtrade.
Because we considered the ad did not make sufficiently clear that ‘Fairly Traded’ related to a separate scheme run by Sainsbury’s, we concluded that the ad was misleading.
On that point, the ad breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. and 3.3 (Misleading advertising), and 3.50 3.50 Marketing communications must not display a trust mark, quality mark or equivalent without the necessary authorisation. Marketing communications must not claim that the marketer (or any other entity referred to), the marketing communication or the advertised product has been approved, endorsed or authorised by any public or other body if it has not or without complying with the terms of the approval, endorsement or authorisation. (Endorsements and testimonials).
2. Not upheld
The ASA considered that consumers would understand from the claim that a product was ‘Fairly Traded’ that the tea was produced as part of a scheme that involved the principles of fair trade. We understood that such schemes could involve different elements, and considered that consumers were unlikely to have a detailed understanding of how those schemes worked. However, we considered that consumers were likely to assume broadly that they would involve measures to ensure that fair prices were paid to producers and to ensure the standards of working conditions.
We noted that Sainsbury’s scheme included such measures, among other elements of their pilot scheme. We noted that there were potential differences with the Fairtrade scheme, such as the level of independence in the way it operated, notwithstanding Sainsbury’s explanation that it would be audited independently. We noted that the complainant did not believe the scheme met the criteria of Fairtrade products, the products were not registered with any accredited scheme, and that there was no independent verification of the scheme. However, we considered that the measures around the payment of fair prices and the working conditions were likely to be consistent with consumers’ assumptions on what a ‘fairly traded’ product might be, and because we had seen evidence that the scheme had a system in place for ensuring those things, we concluded that the claim “Fairly Traded” was unlikely to materially mislead consumers as to the ethical standards applied to the products.
On that point, we investigated the ad under CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising) and 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), but did not find it in breach.
The ad must not appear again in its current form. We told J Sainsbury plc to ensure that future ads made sufficiently clear that ‘Fairly Traded’ products were part of a separate scheme run by Sainsbury’s.