Social values in business

Putting social values first, Amsterdam smartphone manufacturer Fairphone has created a functional campaigning tool to bring consumer attention to conflict minerals and to improve the conditions of workers caught in the crossfire. “We started looking at conflict minerals, those related to the war in Congo. We felt that if we wanted to create awareness all the way to the consumer then we have to be part of that system. So we said, let’s make a phone,” says Bas van Abel, founder of Fairphone. “It is not by accident that more pragmatic approaches to activism pop up in Holland.” Fairphone’s approach, mixing innovation and social conscience, seems well fitted to Amsterdam, a city regularly listed as one of the greenest in the world, and in new research, one of the ten most innovative. And it’s international: “Amsterdam is a good base to have an international company because it’s very easy for people to come here. If you look at the team here, there’s Nigerian, Spanish, German, Canadian, Romanian and American people,” says Van Abel.

Fairphone, in short

Fairphone is a one-product company that hopes to redefine a whole supply chain. The product is a smartphone that the firm believes can ‘put social values first.’ Fairphone audits its materials to ensure they do not contain conflict minerals, and manages its supply chain in an effort to ensure fairness at every step of the process, from labour conditions at its Chinese factory to the conduct of its German distributor. The original idea was conceived by members of Waag Society, the Amsterdam institute that promotes innovation in the arts and technology. The society is part of the cluster of innovation organisations that sees Amsterdam regularly listed as one of the ten most innovative cities on Earth.

The first funding and advice came from a number of sources, including Google, the innovation charity Nesta and network operator Vodafone. With a business plan in place, Fairphone raised 7.5 million euros through crowdsourcing and by selling 25,000 handsets through their own channels, even though it didn’t yet exist. There are now more than 60,000 handsets either delivered or on their way.
Fairphone is a remarkably open organisation and, despite the name, makes few direct claims of fairness. What it does is create something as fairly as it thinks is possible, and then gives consumers the information they may need to decide for themselves.

The website contains detailed cost breakdowns of where the money goes, product designs are available to encourage people to replace broken parts themselves (so the phones last longer), and Fairphone keeps in regular digital contact with consumers. It is also open about the mines it uses: while they are free of conflict minerals, working conditions remain poor. But Fairphone, alongside Tata Steel and Philips, uses two Congolese mines that are certified as conflict free, are audited by governments and NGOs and generate an income for the local economy. The fairness of it all is left to the consumer to decide.

Read full testimonial here.