food safety, crisis management
DESCRIPTION
TRANSCRIPT
FOOD SAFETY,
CRISIS MANAGEMENT &
CONSUMER COMMUNICATION
Cemlyn Martin,
General Manager,
Corporate Accounts, Asia-Pacific
PDF created with pdfFactory trial version www.pdffactory.com
Has a crisis of confidencehit our industry?
Each of our Companies?Absolutely.
Has a crisis of confidencehit our industry?
Each of our Companies?Absolutely.
PDF created with pdfFactory trial version www.pdffactory.com
China CrisisChina Crisis
Melamine contamination
300,000 people developed kidney problems6 infants died
Melamine contamination
300,000 people developed kidney problems6 infants died
PDF created with pdfFactory trial version www.pdffactory.com
China Melamine CrisisChina Melamine CrisisChina Melamine Crisis
•Two condemned to death•Sanlu Chairwoman life in prison•Director of AQSIQ resigned•8 officials resigned or disciplined
•Two condemned to death•Sanlu Chairwoman life in prison•Director of AQSIQ resigned•8 officials resigned or disciplined
PDF created with pdfFactory trial version www.pdffactory.com
CHINA MARCH 2009
SWINE, GUANDONG PROVINCE
• 15 arrested in Guandong Province for selling swine fed
banned additives – ractopamine and clenbuterol
• Chemicals harmful or fatal to humans
• 70 people poisoned
PDF created with pdfFactory trial version www.pdffactory.com
CHINA 2008
• 437 (reported) food poisoning incidents
• 13,095 illnesses
• 154 deathsSource: Ministry of Health
PDF created with pdfFactory trial version www.pdffactory.com
• Sudan Red II dye added to laying duck feed to increase red
colour of yolk.
• Sudan Red is a phenolic, carcinogenic chemical.
• Hong Kong authorities detected Sudan Red in salted duck egg
and table eggs from China.
CHINA 2006 SALTED DUCK EGGS, SUDAN II DYE
PDF created with pdfFactory trial version www.pdffactory.com
•Random testing of swine at slaughterhouse detected high
levels of lead in livers.
•80 farms identified as involved.
•Contamination traced to zinc oxide used in feed either as feed
additive (source of zinc) or growth promoter (gut health modification).
• Feed removed from sale.
•Pork meat - safe for consumption
- livers and kidneys condemned
• Zinc oxide from Chinese supplier. Cross-contamination or faulty
separation suspected.
AUSTRALIA MAY 2008
SWINE, LEAD SCARE
PDF created with pdfFactory trial version www.pdffactory.com
EUROPE• Beef – Mad Cow Disease
• Dairy – Dioxin
• Animal Feed - Sludge
PDF created with pdfFactory trial version www.pdffactory.com
A Dioxin scare in Ireland……all pork meat destroyed
Beef – cattle on 6 farms destroyed
IRELAND 2008
PDF created with pdfFactory trial version www.pdffactory.com
CAUSES FOR CONCERN
• Antibiotic residues
• Growth promoters
• Heavy metals in feed trace
minerals
• Bacterial contamination
• Industrial chemicals
• Mycotoxins
• Pesticides
• Animal diseasesPDF created with pdfFactory trial version www.pdffactory.com
THE COMMON LINK?
ANIMAL FEED
- Raw materials
- Feed additives
- ContaminantsPDF created with pdfFactory trial version www.pdffactory.com
THE CHALLENGE – TO INCREASE TRUST IN FOOD AND FEED
THE CHALLENGE THE CHALLENGE –– TO INCREASE TRUST TO INCREASE TRUST IN FOOD AND FEEDIN FOOD AND FEED
PDF created with pdfFactory trial version www.pdffactory.com
FOOD SECURITY
• Safety
• Quantity
• Sustainability (Economic, Social, Environmental)
• Traceability & Transparency
• Social acceptability (Animal Welfare)
• Consumer Confidence (Trust)
• Human Nutrition
• Ethics
PDF created with pdfFactory trial version www.pdffactory.com
FOOD SECURITY: Our Job is to Feed the WorldA world in which food production has to double by 2050 to
meet demand.
FOOD SECURITY: Our Job is to Feed the WorldA world in which food production has to double by 2050 to
meet demand.
PDF created with pdfFactory trial version www.pdffactory.com
Charles DarwinCharles Darwin
• It’s not necessarily the strongest or fittest that survive – but those most adaptable to change
• It’s not necessarily the strongest or fittest that survive – but those most adaptable to change
PDF created with pdfFactory trial version www.pdffactory.com
Crisis Management or
Reputation Enhancement?
Crisis Management or
Reputation Enhancement?– In The Eyes of the Beholder
PDF created with pdfFactory trial version www.pdffactory.com
There are three types of companiesThere are three types of companies
• Those who do not have a crisis plan in place
• Those that say they do
• Those that have, and work to it
PDF created with pdfFactory trial version www.pdffactory.com
When is a Crisis a Crisis?When is a Crisis a Crisis?
Consumer Risk? Business Risk? Brand Risk?
• Risk to life
• Risk of injury
• Serious product contamination
• Financial
• Legal action
•Extortion
• Media coverage
• Negative positionversus competition
RECALL ??????
PDF created with pdfFactory trial version www.pdffactory.com
Basic Crisis Management Model - Product
Preparation& Planning- Avoidance
Early WarningSystem
- Identify the issue- Quantify the extent
Learning& communication
- Communicate control & confidence- Prevent recurrence
Crisis Response- Inform relevant people
- Control exposure- Limit risk
- Quarantine product
Crisis Closure- Replace supply chain
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
Basic Crisis Management Model - Product
Preparation& Planning- Avoidance
Early WarningSystem
- Identify the issue- Quantify the extent
Learning& communication
- Communicate control & confidence- Prevent recurrence
Crisis Response- Inform relevant people
- Control exposure- Limit risk
- Quarantine product
Crisis Closure- Replace supply chain
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
RISK ANALYSIS – FOUNDATION OF FOOD SAFETY POLICY
• Risk Assessment
• Risk Management
• Risk Communication
PDF created with pdfFactory trial version www.pdffactory.com
RISK ASSESSMENT
• Founded on good science
• Easy to understand & communicate
• Easily implemented
PDF created with pdfFactory trial version www.pdffactory.com
What poses the greatest risk and how to:
What poses the greatest risk and how to:
• Avoid• Identify• React• Respond• Assure• Prevent…..Risk assessment
PDF created with pdfFactory trial version www.pdffactory.com
Catastrophic8064483216Severe403224168
Major20161284Appreciable108642
Minor54321
VeryLikelyLikelyPossibleUnlikely
VeryUnlikely
LIKELIHOOD
Threat Assessment and Threat RatingThreat Rating Matrix
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
Basic Crisis Management Model - ProductPreparation& Planning- Avoidance
Early WarningSystem
- Identify the issue- Quantify the extent
Learning& communication
- Communicate control & confidence- Prevent recurrence
Crisis Response- Inform relevant people
- Control exposure- Limit risk
- Quarantine product
Crisis Closure- Replace supply chain
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
To Manage a CrisisTo Manage a Crisis
• Identify key decision makers• Gather facts quickly to act• Keep target audiences in focus• Understand the media• Control information flow• Develop third party allies• Constantly monitor• Establish a crisis centre
PDF created with pdfFactory trial version www.pdffactory.com
In the Event of a Crisis:In the Event of a Crisis:
Act Now!
Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789
Group LeaderFinanceQualityMarketing/PRProductionResearchSalesLegalOperations
PDF created with pdfFactory trial version www.pdffactory.com
ResponseResponse
• Who is involved?• What happened?• When, date/time?• Where, location? Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789Phone # 123456789
Group LeaderFinanceQualityMarketing/PRProductionResearchSales
LegalOperations
PDF created with pdfFactory trial version www.pdffactory.com
Basic Crisis Management Model - ProductPreparation& Planning- Avoidance
Early WarningSystem
- Identify the issue- Quantify the extent
Learning& communication
- Communicate control & confidence- Prevent recurrence
Crisis Response- Inform relevant people
- Control exposure- Limit risk
- Quarantine product
Crisis Closure- Replace supply chain
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
Crisis Management or Reputation Management
Crisis Management or Reputation Management
Confidence and Trust
Be prepared
Be available
Be credible
PDF created with pdfFactory trial version www.pdffactory.com
• Traceable forwards, backwards (+1/-1)• Comprehensive system encompassing
all materials/ingredients• Speed of response• Link traceability to management systems• Staff training – how to increase safety standards• Quality improvement teams work proactively on
continuous improvement• Ability to successfully recall
When is a Crisis a Crisis?When is a Crisis a Crisis?What standards should traceability systems adhere to?
PDF created with pdfFactory trial version www.pdffactory.com
Basic Crisis Management Model - ProductPreparation& Planning- Avoidance
Early WarningSystem
- Identify the issue- Quantify the extent
Learning& communication
- Communicate control & confidence- Prevent recurrence
Crisis Response- Inform relevant people
- Control exposure- Limit risk
- Quarantine product
Crisis Closure- Replace supply chain
When is a Crisis a Crisis?When is a Crisis a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
Communicate ConfidenceCommunicate Confidence
• At all times• To all people• In control• Trust• Prevention better than cure…
• At all times• To all people• In control• Trust• Prevention better than cure…
“If you tell the truth you don’t have to remember anything”
- Mark Twain
PDF created with pdfFactory trial version www.pdffactory.com
All three elements are related
Communication
External InterfaceInvestors, Customers, Suppliers, Communities, Government Bodies,Regulatory Groups, Legal Entities, Insurance Groups,Competitors
MediaPublic communication
Internal ResponseBusiness Recovery,Employee Communications
Your problem will not improve with age
Communication in a Crisis?Communication in a Crisis?
PDF created with pdfFactory trial version www.pdffactory.com
Communication in a Crisis?Communication in a Crisis?
Get it right, Get it quick, Get it out and Get it over
Communication• Consumer information is vital, don’t let the media become the
crisis- Prepare a holding statement, clear and simple- Wording is crucial – could cause/avoid panic- Target to the audience- Message must be true
• Don’t forget internal communication- Regular briefings to employees- They may be worried about their future- Ensure all are aware of your media communications policy
PDF created with pdfFactory trial version www.pdffactory.com
In a CrisisIn a Crisis
So?Be prepared!
• Events happen fast• Decisions made quickly• Media scrutiny intense• Media processes, rarely report• Victims drive story• Information not always accurate• Your message does not get out
PDF created with pdfFactory trial version www.pdffactory.com
Reputation Managementat Corporate level
Reputation Managementat Corporate level
Management used to shaping events, not events shaping management
PDF created with pdfFactory trial version www.pdffactory.com
Can you continue to run your business in a crisis?
Can you continue to run your business in a crisis?
• Ensure you develop a business continuity plan
• Ensure you can keep vital operations running
• Allow the crisis team to control the crisis
• Regular status communications from the team
PDF created with pdfFactory trial version www.pdffactory.com
RISK MANAGEMENT AND CONSUMER CONFIDENCE
PDF created with pdfFactory trial version www.pdffactory.com
RISK COMMUNICATION
• Transparency is a fundamental
requirement
• Consumer confidence requires
information to the public
• Clear relationship with media
• Managing the perception of risk
PDF created with pdfFactory trial version www.pdffactory.com
TRACEABILITY LABELLING
MANDATORY RECALL• Traceability must be established
at all stages of production,
processing and distribution
• It must link a unique batch of feed
with information
• Full labelling to facilitate
traceability
• Mandatory recall essential to
safety based on traceability and
labelling
PDF created with pdfFactory trial version www.pdffactory.com
‘MADE IN CHINA’WE CAN TRUST
GENE SCAN®
PDF created with pdfFactory trial version www.pdffactory.com
• Sustainable Supply System
• VP of Corporate Social Responsibility
• 3 E’s of Responsibility
- Ethical
- Environment
- Economics
PDF created with pdfFactory trial version www.pdffactory.com
• Launched 2000 in United Kingdom
• 78,000 farmers and growers members of the scheme
• Commitment to food safety and hygiene, animal
welfare and environmental protection
• Auditing of members by independent organisation
Assured Food Standards (AFS)
• Farmers, processors and packers are licensed to use logo
• Annual inspection and review covering animal health &
welfare, farm procedures and safety, salmonella, movement
and transport.
• Logo on thousands of products – beef, lamb, pork, chicken,
turkey, milk, cheese, cream, cereals, vegetables, sugar,
flour, fruits and salads in shops and supermarkets
• Swine – covered by Assured British Pigs (ABPigs)
The Red Tractor Scheme
PDF created with pdfFactory trial version www.pdffactory.com
Thank YouThank You
British Lion Code
PDF created with pdfFactory trial version www.pdffactory.com
• Standardized, comprehensive traceability framework covering farm production, processing, packaging, logistics, marketing.
• Star Farm quality security system combined with HACCP and Global Gap enhances production safety and product quality, strengthens brand image and provides the end consumer with safe and traceable food products.
• Collect and record specific information along supply chain.
• Customer log-in to website allowing search for product information, producer details – all of which are also on product label.
STAR FARM (METRO), CHINA
PDF created with pdfFactory trial version www.pdffactory.com
Where are we going?Where are we going?
PDF created with pdfFactory trial version www.pdffactory.com
CRISIS “The Chinese use two characters to write the word 'crisis.'
One stands for danger;the other for opportunity.
PDF created with pdfFactory trial version www.pdffactory.com
What can we do?
What can we do?
“The world we have created today has
problems which cannot be solved by thinking the way we thought
when we created them.”
-Albert Einstein
“The world we have created today has
problems which cannot be solved by thinking the way we thought
when we created them.”
-Albert Einstein
PDF created with pdfFactory trial version www.pdffactory.com
What are the pillars upon which we can rebuild our
industry?
What are the pillars upon which we can rebuild our
industry?
PDF created with pdfFactory trial version www.pdffactory.com
The 5 pillarsThe 5 pillars•Crisis management• Education• Innovation• Branding• Cause and Fun• Trust and Integrity
•Crisis management• Education• Innovation• Branding• Cause and Fun• Trust and Integrity
PDF created with pdfFactory trial version www.pdffactory.com
“Next week there can’t be any crisis, my
schedule is already full”
Henry Kissinger
PDF created with pdfFactory trial version www.pdffactory.com
David ByrneDavid ByrneFormer European Commissioner for
Health and Consumer Protection
PDF created with pdfFactory trial version www.pdffactory.com
Two types of organizationsTwo types of organizations
Those that have had a crisis
Those that will
PDF created with pdfFactory trial version www.pdffactory.com
We need a systemCrisis Management
We need a systemCrisis Management
PDF created with pdfFactory trial version www.pdffactory.com
“Someone is in charge, there is a plan, the plan is working”
-David Byrne, Former European Commissioner for Health and Consumer Protection
“Someone is in charge, there is a plan, the plan is working”
-David Byrne, Former European Commissioner for Health and Consumer Protection
The Key to Crisis Management
PDF created with pdfFactory trial version www.pdffactory.com
QuestionQuestion
Do you have a totally traceable quality control
system?
Do you audit your
suppliers?
PDF created with pdfFactory trial version www.pdffactory.com
PDF created with pdfFactory trial version www.pdffactory.com
“Every company, every institution, every industry needs a Crisis Management System”-David Byrne, Former European Commissioner for Health and Consumer Protection
“Every company, every institution, every industry needs a Crisis Management System”-David Byrne, Former European Commissioner for Health and Consumer Protection
PDF created with pdfFactory trial version www.pdffactory.com
The 5 pillarsThe 5 pillars• Crisis management•Education• Innovation• Branding• Trust and Integrity
• Crisis management•Education• Innovation• Branding• Trust and Integrity
PDF created with pdfFactory trial version www.pdffactory.com
We have to educate them or someone else will
PDF created with pdfFactory trial version www.pdffactory.com
The 5 pillarsThe 5 pillars• Crisis Management• Education
• Innovation• Branding• Trust and Integrity
• Crisis Management• Education
• Innovation• Branding• Trust and Integrity
PDF created with pdfFactory trial version www.pdffactory.com
Embracing InnovationEmbracing Innovation
PDF created with pdfFactory trial version www.pdffactory.com
Greenhouse gases
Carbon dioxide: 72%
Carbon dioxide: 72%
Methane: 18%
Methane: 18%
Nitrous oxide:
9%Nitrous oxide:
9%
PDF created with pdfFactory trial version www.pdffactory.com
Agriculture contributes emissions
of all three
PDF created with pdfFactory trial version www.pdffactory.com
Innovation: NutrigenomicsInnovation: Nutrigenomics
The gene chip never lies
The gene chip never lies
PDF created with pdfFactory trial version www.pdffactory.com
The 5 pillarsThe 5 pillars• Crisis Management• Education• Innovation
•Branding• Trust and Integrity
• Crisis Management• Education• Innovation
•Branding• Trust and Integrity
PDF created with pdfFactory trial version www.pdffactory.com
An agricultural brand that people:
- Recognize- Respect- Trust- Has core values- Endures- Stands out
PDF created with pdfFactory trial version www.pdffactory.com
The 5 pillars• Crisis Management• Education• Innovation• Branding• Trust and Integrity
PDF created with pdfFactory trial version www.pdffactory.com
Trust & Integrity: Partnerships
Trust & Integrity: Partnerships
We need true and meaningful
relationships along the food chain
PDF created with pdfFactory trial version www.pdffactory.com
The running of the pigs
The running of the pigs
PDF created with pdfFactory trial version www.pdffactory.com
So, do we have a future?
So, do we have a future?
PDF created with pdfFactory trial version www.pdffactory.com
CRISIS
Rahm Emanuel, Obama's new head of staff
"One should never waste the opportunity of a good crisis!"
"One should never waste the opportunity of a good crisis!"
PDF created with pdfFactory trial version www.pdffactory.com
Thailand • Dr. Yukol Limlamthong, Director-General of
the Department of Livestock Development at the Ministry of Agriculture and Cooperatives
“Apart from the effect of the economic downturn, the biggest change in demand patterns has to be that Thai people nowadays are more health conscious than in the past and they understand more about food safety. Consumer purchasing behaviour has changed from being based largely on price or quantity to a level where quality is also taken into consideration. They are especially willing to pay more for foods that are considered to be safer.”
Pig International magazine, March/April 2009, p.24
THAILAND
PDF created with pdfFactory trial version www.pdffactory.com
SAFETY AND QUALITY ARE THE PRIMARY DECISION MAKING DRIVERS FOR CHINESE CONSUMERS
80%
85%
83%
89%
92%
81%
8%
14%
6%
14%
7%
1%
6%
13%
6%
9%
3%
4%
7%
13%
79%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Packaged products
Fresh Produce
Fresh Meat & Fish
Toys
Electronics
Medications
Personal Care
Safety and Quality Environmental friendliness Source of product/product ingredients
Source: 2008 Chinese Consumer Survey, Institute for Business Value, China
n: 300 {60 from Beijing, Shanghai, Guangzhou, Wuhan, Chongqing}
What is your primary concern when purchasing the following consumer products: personal care,
medications, electronics, toys, fresh meat & fish, fresh produce, and packaged goods?
PDF created with pdfFactory trial version www.pdffactory.com
CONSUMERS ARE READY TO PAY MORE
65%
62%
26%
33%
29%
3%
2%
9%
71%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
W illingness to pay more fornon-food consumer products
that are safe
Willingness to pay more forenvironmentally sustainable
food
W illingness to pay more fornon-food consumer products
that are environmentallyfriendly
Increased Stayed the same Decreased
Source: 2008 Chinese Consumer Survey, Institute for Business Value, China
n: 300 {60 from Beijing, Shanghai, Guangzhou, Wuhan, Chongqing}
For each of the following statements, please tell us how you think each has changed over the last two
years.
PDF created with pdfFactory trial version www.pdffactory.com
PROVIDING CONSUMERS WITH DESIRED INFORMATION IS AN OPPORTUNITY
65%
60%
66%
57%
58%
59%
60%
61%
62%
63%
64%
65%
66%
67%
I would like more information aboutthe ingredients of the food
products I buy
I would like more information aboutthe source of the food product I
buy
I would like more information abouthow the food is processed and
manufactured
Source: 2008 Chinese Consumer Survey, Institute for Business Value, China
n: 300 {60 from Beijing, Shanghai, Guangzhou, Wuhan, Chongqing}. The chart shows the sum percentage of people who selected “strongly agree” and “very strongly agree”.
Please indicate your level of agreement with each of the statements about:
PDF created with pdfFactory trial version www.pdffactory.com
BENEFITS FOR THE PUBLIC
•• Confidence Confidence and certaintyand certainty
•• SafetySafety•• Good quality, safe, acceptably Good quality, safe, acceptably
priced, nutritious food available in priced, nutritious food available in the quantity desiredthe quantity desired
PDF created with pdfFactory trial version www.pdffactory.com
BENEFITS FOR INDUSTRY
Opportunity to capture economic advantage:Opportunity to capture economic advantage:–– premium pricingpremium pricing-- export market accessexport market access-- steady revenue and profit growthsteady revenue and profit growth-- consumer and brand loyalty and trustconsumer and brand loyalty and trust
PDF created with pdfFactory trial version www.pdffactory.com
“Food companies should reduce safety risks by better monitoring of the whole production and distribution
process from raw material to sales.
Although it requires a huge investment to establish an entire monitoring chain, it is good for a company in the long run.”
Mr. Liu Yonghao, Chairman, New Hope Group
Reported in Beijing Sci-Tech Report
PDF created with pdfFactory trial version www.pdffactory.com
International TradeInternational Trade
•• Safety and traceability is now central to the global trade inSafety and traceability is now central to the global trade in food.food.•• Importing countries demand and expect traceability.Importing countries demand and expect traceability.•• National incomes will be negatively affected by distrust in foNational incomes will be negatively affected by distrust in food safety.od safety.•• Governments play an important role in setting the right legal Governments play an important role in setting the right legal framework framework
for ensuring food safety, with appropriate penalties for nonfor ensuring food safety, with appropriate penalties for non--conformance.conformance.
PDF created with pdfFactory trial version www.pdffactory.com
Thank YouThank You
PDF created with pdfFactory trial version www.pdffactory.com