Workers at a flower farm in Oserian, Naivasha, Kenya. Questions have
been raised about the management of an important Fairtrade Africa
project after an audit by a Nairobi-based firm. PHOTO FILE | NATION
Questions have been raised about the management of an important
Fairtrade Africa project in Kenya after an audit by a Nairobi-based
firm.
The issue was highlighted in the British newspaper Guardian,
which said it had received a copy of the secret audit on the project by
Clyde & Associates who were commissioned by the flower company
Oserian to investigate possible misappropriation of funds.
The
investigators are reported to have looked into a raft of concerns,
including poor or non-existent record keeping and lax controls.
According to the Guardian,
the audit found “a host of financial irregularities and
misappropriation of funds, which have raised fears about the
effectiveness of the controls in place at Fairtrade projects.”
But
a spokesman for Fairtrade Africa said there were “no findings that
bribes had been paid in the report by Clyde & Associates or
elsewhere, and no criminal procedures were taken.
“Fairtrade believes these issues are isolated incidents,” he said.
Oserian,
Kenya’s leading flower producer, supplies a number of UK supermarkets,
including Sainsbury’s, Morrisons, the Co-op and Aldi, with cut flowers
from Kenya.
It had ordered a forensic audit into the
way $1 million of Fairtrade funds were distributed by community
representatives “amid allegations bribes had been paid for bursaries,”
according to the Guardian.
A spokesman for Sainsbury’s said it was “aware of this report” and ... of course concerned by the issues raised.”
Oserian is Africa’s largest producer of roses and carnations, producing a million stems a day.
The
Fairtrade scheme sets aside a portion of cash from the sale of the
products to improve the social, economic and environmental conditions of
workers.
Oserian executives do not play any part in
the allocation of these funds, but are reported to have been actively
trying to encourage Fairtrade to improve governance in its flagship
projects.
Seven-figure sum
Neil
Hellings, managing director of Oserian, said: “The premium has a
seven-figure sum. It is effectively the size of a small business in its
own right and it has some of the lowest [least qualified] people in the
organisation running it.
(Our) management were
increasingly concerned at the way in which the premium was being
allocated (and) the scope for abuse within that use.
“The
forensic audit was carried out — at my instigation but with the full
support of Fairtrade Africa. There were anecdotal tales of
misappropriation before the forensic audit but these were not proven,
only that administrative procedures needed to be strengthened.”
Fairtrade
Africa insisted that people should still “be confident in their trust
in Fairtrade and, though we work in challenging areas with some of the
poorest farmers and workers we learn and adapt in order to improve, as
the steps taken in this matter show.”
New reforms have been undertaken and a financial consultant has been brought in.
The
UK’s Fairtrade Foundation and Fairtrade Africa are part of a global
network of Fairtrade bodies. They license the use of the Fairtrade mark
on items sold and around 2.55p ($0.3) in every pound ($1.3) goes towards
the premium, administration and the implementation of controls to
ensure suppliers adhere to agreed standards, and suppliers also get a
minimum price guarantee for products.
The Guardian points
out that before Fairtrade was founded in 1992, Oserian was already
offering workers free, stone-built housing with running water,
sanitation, and security.
A hospital, pharmacy,
schools, and creches were provided free-of-charge by the business. In
the mid 1990s, people on the estate were also provided with free
electricity.
No comments :
Post a Comment