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Fraud Vulnerability in the Supply Chain Dan Kastor Sr. Director, Regulatory Affairs May 11, 2018
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The Canadian Food Inspection Agency …a study by Queen’s University Belfast in (CFIA) has beefed up its inspection of the United Kingdom warns that fraud in spices sold in Canada to detect products the global food supply chain is becoming that have been adulterated by other increasingly common due to the huge ingredients… profits associated with this type of criminal activity. Several experts say the best way to reduce the risk of buying spiked ground spices (and get much better flavour) is to buy the spices in their whole form and then grind them at home By Levon Sevunts-Radio Canada International 4 Thursday 12 April, 2018
Queen’s University-Belfast in UK (Prof. Chris Elliott) • 3 year PhD funded by UK retailers and key Herbs and Spice industry companies • Aimed at researching the adequacy of techniques (FTIR and NIR) to detect EMA in our product category as well as exploring the extent of EMA generally. • The consortium project will likely run into 2019 Output so far (tons of press) has been the creation of validated chemometric models on which to reliably screen samples of herbs and spices for the presence of adulterants added for financial gain. OREGANO - Queens are now looking to move to get this method accredited. Queens continue to test many hundreds of samples of oregano globally via this screening technique. SAGE - The sage model shows a good fit, similar to the oregano results. This model was able to clearly identify different sage species. PAPRIKA – more samples are needed to build this model, The NIR fit was better than the FTIR fit in the case of paprika. GARLIC – The model is in its very early stages. 5
• Background and Landscape Today’s • Protecting Against Food Fraud at McCormick Presentation • Forward-Looking Strategy and Actions
McCormick: the Tas aste te y you T ou Trus ust ™ A 129-year commitment to leadership in food safety and quality 1889 2018 “We view food safety and superior “Make the best, someone will buy it” quality as a key differentiator for Willoughby McCormick McCormick” Lawrence Kurzius 7
In 2018, McCormick Delivers the Taste You Trust™ on a Global Scale McCormick manufactures, markets and distributes flavor products including spices, seasoning mixes and condiments to the entire food industry – retail outlets, food manufacturers and foodservice businesses $4.8 Billion in sales 66% Americas 21% >150 EMEA 13% APZ 10,500 Employees brands in more than 150 Worldwide COUNTRIES AND 50 Facilities in 26 TERRITORIES Countries 60% Consumer 40% Industrial Every day, no matter where or what you eat, you can enjoy food flavored by McCormick. 8
McCormick Quality & Regulatory Programs and Expertise Cover an Extensive Range of Competencies, Ingredients and Source Countries Wet, Dry, Frozen, Ready-to-eat etc. competencies ~ 2,800 suppliers 15,000+ raw materials/ingredients ~ 100 raw material/ingredient source countries ( 39 for spices and herbs) 9
Translating Food Safety Into Quality and Quality Into Premium Will be a Winning Proposition More than Ever Across the globe, today’s educated consumer, especially millennials, is watching. Transparency rules! Consumers want to know what’s in their food, where it came from and its journey to them. Premium packaging today is clean and clear as one response. 10
Millennial Preferences and Values Those Savvy Canadian Millennials… Surrounding Food Projected Population by Generation (1000s) Canada Source: Millennial Marketing • Eighty per cent of Millennials want to know more about how the food they buy was grown or processed. • Millennials are interested in the story behind their food and are looking to learn more about what’s in it and how it’s made . Transparency in business operations is important to Millennials . • In the food industry it is important that companies can trace the source of ingredients used in their products to ensure they are safe, produced sustainably, and with the highest quality standards. 11 Source: Food PackagingLabels.net. How Are Millennials Changing the Food Scene?
Executive Summary • Interest in Food Integrity continues to dominate global food safety, quality and regulatory forums, with herbs and spices together with meat, fish and alcohol being the most discussed. • Food authenticity is a growing concern with increasing public awareness. • Still no clear legal definitions of integrity, authenticity or food fraud. • On the traceability and auditing side, schemes have been amended to include specific aspects of vulnerability assessment. • We remain at the forefront, influencing these shaping events. 12
How does Authenticity Differ from Food Safety & Quality ? 13
In Scope 14
Our 6 Principles of Food Integrity At McCormick we consistently address the 6 principles of Food Integrity via a number of well established overarching programs: 1. The food we produce is safe – via GFSI 2. The food we produce is authentic – via GFSI 3. The food we produce is nutritious – via MSI 4. The systems we use to produce our food are sustainable – via PLP (Purpose Led Performance) 5. Our food is produced to the highest ethical standards – via PLP 6. We respect the environment and those who work in our food industry – via PLP 15
GFSI SI Food Fraud Preventio ion Co Compli liance Requir irements • GFSI clearly defines the scope of Food Fraud to include all types of fraud (e.g., not just adulterant-substances but also to include theft, tampering, counterfeiting, etc.) and all products (e.g., incoming goods such as raw materials and outgoing goods v.8 including finished products destined for retail shelves.) • GSFI only requires that a Food Fraud Vulnerability Assessment be completed and documented and then that a Food Fraud Prevention Strategy be completed and documented. • There are no further published requirements or guidance on the method, process, details, length, depth, etc. 16
GFSI SI Food Fraud Prevention Audit Requirements 1. Conduct a Food Fraud Vulnerability Assessment (Y/N)? 2. Written (Y/N)? 3. Implement a Food Fraud Prevention Strategy (Y/N)? 4. Written (Y/N)? 5. Minimally conduct an annual Food Fraud Incident Review (Y/N)? 6. Confirm these meet the “GFSI scope” of all types of Food Fraud (Y/N)? 7. Confirm these meet the “GFSI scope” of all products from both incoming goods (e.g., ingredients) and outgoing goods (e.g., finished goods) through to the consumer.” (Y/N )? MSU Food Fraud Initiative, Food Fraud Audit Guide MOOC (Massive Open Online 17 Course), July 2017 (see http://foodfraud.msu.edu/mooc/)
Highest Vulnerabilities Mislabelling – fake credence certification, Natural Flavouring Substances – synthetic vanilla sold as natural Dilution – Oregano containing other foreign leaves Unapproved enhancements – chilli powder containing illegal dyes 18
Where are we vulnerable ?
Raw Material Focus Consider materials that are in low supply, have highest demand, and challenging to obtain… 20
Supply Integrity Strategy Industry Vulnerability Supply Chain Spice & Herb Influence Assessment Supply Chain RM Exposure Integrity Integrity and Tools Intelligence List Program Assessment Emerging VACCP/BRC 7 Technology 21
Vulnerability Assessment Tools • Numerous IT tools for vulnerability assessments emerging. Vulnerability assessments involve the review of controllable factors, uncontrollable factors and mitigating factors in a systematic way to establish the potential for fraud or adulteration to occur on the products within that group • Extensive review undertaken of current vulnerability tools • Procedure developed – Vulnerability and Horizon Scanning directive • Based upon USP methodology (www.foodfraud.org) 22
Vulnerability Assessment Systems TESTING PERFORMED New Origin/New Vendor Program ✓ Microscopy + ✓ Volatile Oil and Geography Scan ✓ Chemical Screen ✓ Illegal Dye Screen ✓ Heavy Metals (Cd, Hg, As, Pb) ✓ Pulsed Photo- stimulated Luminescence (PSL) ✓ DNA Fingerprinting 23
Vulnerability Assessment Systems • McCormick completes its assessment at a global level • The assessment is based on supply chain knowledge, our internal verification processes, and the history of occurrence of food fraud by material category • The final vulnerability assessment is documented in the Unapproved Additives tab of the Global Raw Material Exposure List (GRMEL) 24
GRMEL – Unapproved Additives - example 25
• Consumers trust the McCormick Brand and food safety and quality are critical to that trust. Protection of • Business Survival – Our brands are most important the Brand assets. and the • Industry Responsibility – We are committed to food safety across the supply chain more than Consumer is ever. Our First • We have top level commitment to invest in trade associations to raise the bar for all of the spice Priority industry. • Safe food starts with safe ingredients.
Supply Chain Controls , Long Term Alliances and Global Standards Drive Prevention… Chain of Custody Controls to Prevent Adulteration Manufacturing Strategic Vendor Source Material Process Alliances Control Control Field McCormick 27
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