THE ROLE OF FAIR TRADE IN THE DEVELOPMENT OF SOCIAL ENTERPRISES (LEARNING FROM THAILAND)

Abstract

The increasing complexity of problems in society requires the involvement of social entrepreneurs. A social
entrepreneur is someone who understands social problems and uses one’s entrepreneurial skills to solve the problems
(social changes) through establishing a social enterprise. A social enterprise is a business that implements a combination
of a social mission and a business mission. As is known, to be able to do social changes, funds are needed which can be
obtained if the business activities generate profit. Globalization causes an increase in intensity of competition, which
forces business organizations to find a way to reduce costs. This situation makes the various parties involved in
production activities have to reduce prices, in which the victims are often small actors who have no bargaining power
such as artisans, farmers, etc. Fair trade is a trading system that strives to help producers who are marginalized through
a system of fair pay, decent working conditions, technical assistance (such as designs and bookkeeping), social
programs, equality, transparency, mutual trust, and environmental protection. It is one of the efforts done to create a
sustainable economy and new markets among developing countries, while on the other hand, to maintain the values and
local traditions. By working through fair trade, efforts to reduce production costs can be avoided to a certain extent.
This paper intends to examine how fair trade is involved in the management of social enterprises. It takes the cases of
social enterprises in Thailand. The research issues to be examined are: (1) What are the characteristics of social
entrepreneurs? (2) How does fair trade support social enterprises? (3) What are the challenges faced by social
enterprises that engage in fair trade? This study is a qualitative research, based on 4 case studies in Thailand. A crosscase
analysis is used.

Keywords: social entrepreneurship, social enterprises, fair trade