Ethical Performance
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Food glorious food?

April 2014

So how much has food security improved since Romanian horse meat was found in beef ready meals, prompting financial and reputational damage across the food industry? Miranda Ingram reports


Mozzarella that is only 50% cheese, prawns that are 80% water and ham that is either poultry dyed pink or “meat emulsion”.

On the anniversary of the horse meat scandal, West Yorkshire trading standards, with their superior laboratory, tested 900 food samples and found that over a third were not what they purported to be.

“We are facing a food adultery crisis,” said Labour’s Baroness Crawley, President of the Trading Standards Institute, addressing the House of Lords last month. “Call me old fashioned but I want fruit juice to be just that and not laced with vegetable oil that is used in flame retardants.”

The Labour peer went on to criticise cutbacks in the Trading Standards budget, pointing out that since 2009 testing is down 26% while food fraud is up 66%.

So how much has food security improved since Romanian horse meat was found in our beef ready meals, prompting financial and reputational damage across the food industry? Not much, according to Adrian Chamberlain, ceo of the global supply chain risk management company, Achilles. He believes that we are sleepwalking our way into another horse meat scandal since a survey commissioned by Achilles and carried out by the independent consultancy IFF last November showed that 82% of food and drinks manufacturers said the horse meat scandal has not affected the way they manage information about their suppliers.

Forty percent have never ‘mapped out’ their entire supply chain to find out who all their suppliers are and only 24% said they were ‘very confident’ that suppliers in emerging markets would continue to adhere to health and safety responsibilities.

“We were very surprised to see that manufacturers had not made changes to the management of supplier information, given the loss of public trust caused by the horse meat scandal,” says Chamberlain.

“Supply chains are becoming increasingly complex and globalised, with manufacturers seeking suppliers from all over the world. What this research shows is that even by the second tier of the supply chain, buyers begin to get hazy about the operations and risk profile of their suppliers. This is particularly concerning, given that recent scandals have involved suppliers deep down within supply chains.

“We are likely to see another scandal because of complacency about risks within the supply chain,” he told Ethical Performance.

There are two issues at stake when talking about food security: safety and fraud. It doesn’t matter how clean the East European dairy is or how good the UK storage facilities if the haulier uses insufficiently refrigerated trucks, the product will be rendered unsafe for human consumption.

Food fraud = food crime
Food fraud, on the other hand, involves deliberately substituting one food for another so that the product being sold is not what it says on the label. This latter, food fraud – or, as he calls it, food crime – is the biggest risk facing Britain today, according to Chris Elliott, professor at the Queen’s Institute for Global Food Security in Belfast and who published his interim report on the horse meat scandal at the end of last year.

“I have been persuaded by the evidence I have collected that food crime already is or has the potential to become serious organised crime,” he says. Although there is nowhere near enough data to put a cost on food crime, with the UK food and drink industry worth an annual £188bn, the profits from criminal behaviour could be substantial, he adds.
Elliott’s final report will be published in June but he has already called for the creation of a food crime unit within the FSA. “Our focus now urgently needs to turn to tackling food crime.”

Both food safety and food crime depend on the security of the supply chain which is itself subject to myriad pressures. Do you know your suppliers? Your suppliers’ suppliers? Their suppliers? Set questions like these against a rapidly changing global market in which traditional suppliers, such as China and Asia, are becoming consumers and emerging countries are joining the supply chain and the enormity of the task of monitoring supply chains becomes clear.

On top of this, consumers are constantly demanding innovative products – a mind-boggling 8,000 new food and drink products are launched in Britain annually according to the Food and Drink Federation – which requires a constant stream of new suppliers.

Clearly sustainability has a big impact on security here. Knowing your suppliers, your suppliers’ suppliers etc., talking to them, investing in them and understanding their problems while explaining your needs, builds an atmosphere of trust. Sharing the risks and rewards that follow goes some way towards avoiding corner-cutting and fraud.
However, there are more steps that could be taken. Achillles’ Adrian Chamberlain is among those calling for retailers to work collaboratively and create some sort of accreditation system for suppliers.

The idea is that two or three leading food manufacturers set the ball rolling by getting together and mapping out their entire supply chains, right down to source, during which process they will probably find they have suppliers in common.

They could then work together towards introducing industry certified standards for suppliers worldwide, creating an accurate, centralised database which would allow retailers to check suppliers’ credentials in all operational areas.
This would save retailers time and money as they would not have to keep carrying out their own audits whilst also giving certified suppliers a shop window to promote their products as well as an incentive to maintain standards in order to retain their certification.

This approach, however, necessitates leading retailers being transparent about their existing supply chains which they are remarkably reluctant to do. When Oxfam was trying to collate information for its Behind the Brands sustainability scorecard last year the charity was frustrated by ‘a lack of transparency within the sector’.

“All ten firms examined were overly secretive about their agricultural supply chains, making their claims of sustainability and social responsibility difficult to verify”, said a statement which prompted industry investors including F&C Asset Management, BNP Paribas Investment Partners and Aviva Investors to join the call for more supply chain transparency.

This assessment of supply chain security makes it clear that Britain needs robust testing in place. So is this the case?
Testing food is the responsibility of local authorities and their trading standards departments but as their budgets have been cut many councils have reduced checks or stopped collecting samples altogether.

Department for Environment, Food and Rural Affairs Minister Lord de Mauley, responding to the Yorkshire findings, told the Lords that the testing carried out by West Yorkshire Trading Standards demonstrates the action being taken by local authorities across the United Kingdom to tackle known problem areas and added “ there were 86,000 food safety composition and authenticity tests during 2012-13” and the Food Standards Agency has increased the funding it provides to support testing to £2.2m this year.

Overall, however, the number of samples taken to test whether food being sold matched what was claimed fell nationally by nearly 7% between 2012 and 2013, and had fallen by over 18% in the year before that.
About 10% of local authorities did no compositional sampling at all last year, according to the consumer watchdog Which?

Huge risk potential
Worryingly, West Yorkshire’s public analyst, Dr Duncan Campbell, believes the problems uncovered in his area are representative of the picture in the country as a whole and adds: “We are routinely finding problems with more than a third of samples, which is disturbing at a time when the budget for food standards inspection and analysis is being cut.”
Horse meat report author Elliott also blames the fragmenting of the responsibilities of the FSA between different bodies. There are, indeed, a bewildering number of organisations concerned with food safety and Elliott is calling for closer working between government departments and a “more robust” FSA as well for a supra-national system of standardised laboratory testing.

“I believe criminal networks have begun to see the potential for huge profits and low risks in this area. The food industry and thus consumers are currently vulnerable. A food supply system which is much more difficult for criminals to operate in is urgently required,” he writes in his interim report, recalling an incident when a supplier told him that a retailer had asked for a “4oz gourmet burger” to be brought in at 30p, a feat that would only be possible, according to the supplier, by using non-EU approved meat, offal and mechanically-recovered meat. 

Europe | supply chain

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