Ethics, Faith, and Profit

Cater, J. J., Collins, L. A., & Beal, B. D. [2016]. Ethics, faith, and profit: Exploring the motives of U.S. fair trade social entrepreneurs. Journal of Business Ethics, published online (DOI: 10.1007/s10551-015-2934-4), forthcoming in print. [PDF, journal, project]

Abstract:

Although fair trade has grown exponentially in the U.S. in recent years, we do not have a clear understanding of why small U.S. firms choose to participate in it. To answer this question, we use a qualitative case study approach and grounded theory analysis to explore the motivations of 35 small fair trade businesses. We find that shared values (ethical, religious, and business) and the desire to help others (altruism), triggered by a critical incident, lead social entrepreneurs to found fair trade businesses. The link between a triggering event and the founding of a fair trade business is strengthened by four motivating (or driving) factors: direct relationships with producers, support for social cause, the desire for the preservation of craftsmanship, and the desire to share esthetic products. This same link is also strengthened by four facilitating factors (which make fair trade engagement easier): the acquisition of business knowledge, family member involvement in the firm, assistance from faith communities, and assistance from the fair trade community. Additional analysis reveals three types of fair trade social entrepreneurs: “ethics first” (or ethical) entrepreneurs, primarily motivated by human rights and social justice concerns; “faith first” (or faithful) fair traders, motivated primarily by their religious faith; and “business first” (or benevolent) businesspeople, motivated by what they perceive to be an opportunity to build a successful business while simultaneously doing “good” and helping others.

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