While certainly not a new issue, there has been much renewed concern in food fraud over the past couple of years. High profile incidents in Europe and Asia, effecting major global brands has brought this topic into focus for retailers, manufacturers, regulators, and consumers. The full scale of food fraud is not easy to define, however some estimates put its impact on the global economy at nearly $50 billion, annually. The inherent complexity of our global food supply chain means that economically motivated food fraud perpetrated on one side of the globe could have significant impacts on consumers and brands on the other.
Food fraud is not only an economic issue, but a public health issue. Food agencies around the world are considering food fraud to be a significant risk to food safety. Intentionally adulterated products, whether done so for economic gain, or otherwise, can have dire effects on the health of consumers – as we’ve seen many times. Earlier this year, GFSI released a position paper on food fraud, indicating it “must be regarded as a significant risk to human health.” GFSI is now taking steps to include criteria into future versions of the Guidance Document which will require the topic to be addressed in all benchmarked certification schemes.
As the certification standards begin to add elements specifically relating to food fraud, there will be a raised awareness of the issue in tens of thousands of certified facilities around the world. Certified facilities will need to implement some minimum programs and controls to mitigate the risks of food fraud and take an official stance against it. However, food fraud is a complex issue, motivated by those after economic gain, often purposefully operating outside the law and directly disregarding their own policies. Their tactics are often very difficult to detect, sometimes hiding behind elaborate methods designed to obscure their efforts.There are several factors which contribute to the incidence of food fraud. They include:
• The growing length and complexity of today’s supply networks.
• The concentration of consolidated buying groups and organizations with immense buying power applying downward pressure on pricing.
• The advent of refrigerated transport and warehouse systems that allow long distance distribution and long-term storage of perishable products.
• The rapid development of technology, opening new channels and tools to criminals to covertly transact illegitimate deals.
These contributing factors, and many others, pose some very real challenges for the industry. Audits alone, even with additional measures, will not uncover most cases of food fraud. Preventing food fraud is a shared industry responsibility where all stakeholders have a role to play. Increased diligence from all links in the food supply chain is necessary if we are to take a comprehensive approach to reducing the risks of food fraud. Above all, strong leadership and enlightened corporate cultures around food safety and product integrity will be necessary from organizations throughout the food supply chain.
The Elliott Report, released last October, provided some in-depth evaluation of the issues, risks and contributing factors to food fraud. In response, NSF International released a white paper that discusses approaches it recommends to reduce the risk of food fraud. These include strategies of conducting more thorough traceability exercises such as using forensic accountants to conduct and validate mass-balance exercises. Predictive modeling approaches are also recommended as a means to identify and prioritize risks of food fraud in the supply chain. NSF developed a 7-step program featuring a holistic approach for businesses to minimize food fraud opportunities in their supply chain, as shown below.
At the 2015 CGF conference in Kuala Lumpur, Malaysia, NSF will hold a Special Session on Thursday morning, 5th March, entitled, "Food Fraud in the Seafood Sector: Current Perspectives and Tools for Upstream Prevention." It will focus on new methods of detecting and preventing food fraud, with different perspectives from various sectors of the industry. Mark your calendar to join this NSF session. For additional information on NSF’s Food Fraud services, visit www.nsf.org/info/foodfraud.
By Robert Prevendar, Global Managing Director – Supply Chain Food Safety