Fairphone is a bold new social enterprise which aims to challenge producers in the mobile phone market by producing a smartphone that’s not only free of some conflict minerals but also has the usability and quality of any of the big name brands.
Tim Hunt caught up with Tessa Wernink, a director of Fairphone, at their launch event in September 2013 in Soho, London.
Give us a run down of what you’ve been up to in the last year.
Three years ago we set up Fairphone as a campaign. In January 2013 we became a social enterprise, and we got our first lot of funding to produce the phone. In May we started a crowd-funding campaign to see if there was a market for what we were doing. In three weeks we sold 10,000 phones which was double our target.
We’ve now sold 15,000 online and the Dutch equivalent of BT has also bought 1,000 phones from us. We aim to sell 25,000 this year. We’ve now started production and hope to have the first phones by December.
Why did you choose to build a phone rather than campaign in the traditional way?
You can campaign and create awareness but phones aren’t going to go away. If people don’t have an alternative then campaigning doesn’t really make sense.
But also because to actually change the system you need to understand it and with a mobile you need to understand all the complexities of production. So Fairphone is a way to open up that system and show that you can use transparency and social goals in your decision making.
Can you tell us about finding conflict-free minerals?
Being active as a campaign group for three years and building relationships over that period has really helped. In that time we started working with NGOs like Action Aid and Somo and we built up many contacts.
For example we use conflict-free tin and tantalum in our phones and we have a relationship with Fairtrade, Max Havelaar and others.
We are working with other NGOs on sourcing cobalt, and have set up working groups to look at other elements.
However that is not to say that all the gold, tin and cobalt in the phone is ethical. We’ve become part of an existing supply chain rather than setting up a totally new one. We are trying to make interventions where we can with component manufacturers but it’s a challenge as we need to know about second tier suppliers. There are issues with suppliers maintaining secrecy for a competitive advantage but part of what we want is transparency: to know which materials go into what and to be able to trace them. It’s a long journey.
Was it difficult to find a factory to use?
It was quite a journey. At the time we were going to produce 20,000 phones and we didn’t have any funds. And we had all these requirements on transparency and social values. So we needed to find a company that was willing to listen and most didn’t have the time to talk to us!
But local experts selected a number of factories based on our criteria. For instance we wanted to look at a factory which didn’t use a large number of migrant workers. It’s also a state-owned company, so its motives are different from a purely commercial enterprise.
We also looked at using a factory in Europe. But we felt it was as important to stay in China, as it was to use minerals from the Congo. You can move out of areas where there are problems but that will create new problems and we want to shed a light on the supply chain in those areas and work to improve them.
What sort of auditing have you done?
We’ve done a social assessment and made it clear to the manufacturer we want to work with them on a long term project.
We’ve been crunching the data from this and will be publishing all the data in full on our website. This will be the first time that a phone manufacturer will have done this.
There are likely to be issues that need improvement and if we find problematic issues we want to work together to change them.
We are setting up a working group to look at workers’ rights. $2.50 from every phone goes into the workers’ welfare fund and is matched by the factory and we’ll use this to ensure people earn a living wage. The rest will be used to create a dialogue between workers and managers. We’ve been talking to unions and NGOs to help achieve this.
We’ll also make sure we aren’t doing what the big brands do, growing quickly, forcing fast production times and reducing the manufacturer’s margins.
What have been the biggest challenges?
There are four main ones I’d say:
- Working in volatile regions and with initiatives that are in war zones, such as the Congo, is obviously difficult. You need to monitor the situation and make sure your people are safe.
- To work on a global level is difficult, where you have cultural differences and language barriers.
- Also we’re all about transparency and so when you communicate mistakes and difficulties you lose people along the way, which is tough.
- And remaining true to values with commercial pressures is also difficult.
What’s been the most positive aspect of the project so far?
People are hungry for change. There is so much goodwill and people who want to help out.
People we have met from corporations are also working for change from the inside. There is so much greenwash around that there is also a lot of healthy scepticism and that’s good because it helps people to really engage with what we are doing.
The speed at which the word has spread has also been a surprise. It was a dormant thing and it’s been amazing to wake it. It’s not just us, we’ve just formulated something that people were thinking already and given it a means to take action. I’m also surprised by people calling us and the amount they are willing to do.
How are you looking to progress the project?
It’s not our intention to become a big brand. Our campaign was to raise awareness and now we’re creating an alternative for people who want to act. Making it and buying it is a political act, we are showing that there is a market for it.
The second thing is to work with people in the industry to share best practice. To influence the way the industry works and, because we come from a different fundamental principle of creating social impact rather than making profits, it’s easier for us to help make changes in the industry and to show that change is possible.
We need to grow as we are a company and we need a commercial strategy and to reinvest to take the next steps, but if we can take along the whole industry then that would be great.
Our next step in growth is to work with some networks but it’s hard because it’s not our intention to become a huge company in an untenable situation where you grow exponentially, strain the supply chain and end up with all the same problems as the mainstream producers.
It’s our intention to influence the industry and we’re trying to maintain our independence and to make a phone that proves you don’t need to sacrifice quality for ethics.
Do you think you’ll ever make a 100% fair phone?
It’s good to realise that ‘fair’ is a human concept and not a static thing. It changes depending on what angle you are viewing it from. Fairphone is a discussion and we want people to constantly have that discussion about how our actions influence other people. Fairphone will be a platform where people can talk about what constitutes fairness in the mobile market but we’ll never achieve the 100% fair phone – that’s not really the point.