That you can not simply buy fair trade products but also invest in fair trade producers is down to the life and work of Mark Hayes, who passed away just before Christmas 2019.
Mark was the founder of the fair trade financial co-operative Shared Interest, which provides trade credit and finance to producer co-operatives overseas. A distinguished economist, he was also a noted commentator on the work of John Maynard Keynes, completing a book on the work of Keynes which was launched at Robinson College in Cambridge on December 5th 2019.
Starting work in 1978 with the Industrial and Commercial Finance Corporation (renamed as 3i in 1984), Mark developed his skills as a banker. In 1987, together with Robert Oakeshott, the father of the Employee Ownership Association, he visited the Mondragón network of co-operatives in Basque Spain, a trip that helped to point him towards alternative economic options.
A few years later, Mark and family made the move up to Newcastle to start a new partnership with Traidcraft, looking to establish a finance arm for the fair trade pioneer. The direct link with Traidcraft fell through but Mark could see a way to move ahead with a new entity, what became Shared Interest. As he would tell the story to me, “it came to me that what we needed was not a bank but a financial co-operative, bringing people into an ongoing relationship based on values.”
Starting in 1990, Shared Interest was run out of a spare bedroom in the house of Mark and Andrea, his wife, both working to make it more than a dream. What made the difference was a stroke of luck, although it could also be called providence – Mark was a man of faith throughout his life (and latterly holding the St Hilda Chair in Catholic Social Thought and Practice at Durham University, from 2014-2016).
Mark had undergone the exams required to become an authorised investment adviser under the financial regulations of the time, with his certification, under Nimloth Corporate Finance, covering his work for Shared Interest. He happened to sit in on a meeting in Edinburgh of the Scottish Churches Action for World Development, which highlighted that the way that the churches were raising funds for their own overseas investment activity was not lawful under those same regulations. What they needed was an authorised adviser and the solution was Shared Interest.
Registered as a society in March 1990, Shared Interest went on to attract £750,000 in share capital from 600 members in the first year. In 1991, Mark oversaw the first loans to fair trade businesses, channelling these in subsequent years through the allied networks overseas of the Ecumenical Development Co-operative Society, Oikocredit.
The vision wasn’t necessarily limited to fair trade – there was a wider vision at the start of the scope for finance to play a role in global justice. But fair trade has proved an effective market in which to make a difference.
The need for finance in fair trade starts with the needs of producer co-ops for working capital. To grow the beans that will become the chocolate bars or coffee packs sold in the UK takes time. To process and transport the produce takes time. Finance from lenders such as Shared Interest can cover the costs of all of this, repaid once the revenues come in from sales.
In simple terms then, what Shared Interest typically offers is advance payments on sales for fair trade co-operatives overseas. This is small scale, high risk lending and rarely available from mainstream banks, here or abroad. But as Shared Interest showed over the nine years Mark was Managing Director, it can pay its way.
Today, there are 11,700 members of Shared Interest, typically investing with patience, with average share holdings of around fourteen years. You can join online. In 2019, the society helped to make a positive impact on the lives of around 400,000 people across 55 countries.
An example is Azucena Quispe Rodas, a member of Cecanor, a coffee co-op based on the northern coast of Peru. The co-operative is playing a key role in promoting the role and voice of women in the coffee sector through its partnership Café Feminino.
Shared Interest has provided finance for Rodas and her fellow members at Cecanor for over six years, providing regular payments for their crops and enabling investments to help the farmers improve their yield on a sustainable basis. What she says is that the finance from Shared Interest “helps us to improve our farms, improve our food and also improve our homes.”
Mark set out his approach to co-operative finance in a 2013 discussion paper for Co-operatives UK. He argued that “the co-operative principle of limited return on capital needs to be asserted clearly but also understood more imaginatively.”
This is an appreciation of a life that I feel deeply. I am writing this on my way to represent Co-operatives UK at Mark’s funeral.
We first met in the early 1990s and I last saw him in November, courtesy of Patricia Alexander and the team at Shared Interest. Having finished his new book on Keynes, I was looking forward to talk with him on the growing agenda for and articulation of a green new deal, such as in the excellent recent book by Ann Pettifor.
There is a saying that I learned from a farmer co-operative last year that seems appropriate. When someone dies who has given so much to society, it is for society and not just the person that we grieve.