FairPhone, a Dutch company which lists Vodafone and KPN among its supporters, is looking to create a “fair trade” smartphone, taking an ethical approach to everything from component sourcing to the working practices of the factories assembling the device.

According to the Financial Times, the company is supported by UK-based incubator Bethnal Green Ventures and €400,000 from a private backer, with seven staff on-board. It has already demonstrated a concept device and a commercial, Android-based product will be launched this year, priced at €325 before tax.

While most sales will be made direct to consumers, KPN has agreed to buy some of the first batch, and “other leading operators have expressed interest”.

The FT said that Bas van Abel, founder of the company, acknowledged that the complexity of the supply chain means the resulting device will not be “a 100 per cent ‘fair’ phone”, but that it will demonstrate that there is a market for such a product.

In a number of blog posts on its website, the company has addressed issues including its engagement with production partners, and the ethical sourcing of raw materials such as cobalt (used in batteries) and “conflict-free Tin”.

There has been a growing backdrop of concern about the conditions under which smartphones are manufactured, a process which is generally outsourced to specialist companies – usually located in China.

Much of the attention has been focused on Apple and its supplier Foxconn. A study early last year by the Fair Labor Association noted “significant issues” with the working conditions of staff.