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Marler Blog Providing Commentary on Food Poisoning Outbreaks & Litigation

Theno’s Idea – A Sarbanes–Oxley for Food Safety

I have been thinking about Dave Theno a lot today.  I recall that several time before I wrote the below, Dave an I shared a few glasses of good wine.  I am not sure what I’m going to do without Dave.

Food Safety is the crazy uncle of corporate food production – everyone has one, but no one really wants to talk about it.

Corporate management on average is far more interested in sales and profits and would just as soon ignore those people who talk incessantly about a “culture of food safety,” or “food safety from farm to fork.”

Management is most interested in getting food from the farm to your grocery cart in exchange for as much cash as possible and for as little corporate cost as necessary.  Food safety is overhead, as are the audits that slow the chain of distribution from revealing bad food safety behavior.

True, safe food becomes important when a foodborne illness outbreak happens and the corporate brand is put at risk.  However, on a day-to-day basis, food safety is at best, and most often, simply ignored.

That is why food – most produced here in the U.S. – sickens 48,000,000, hospitalizes 125,000 and kills 3,000 of us yearly.

What if the corporate management of a food manufacturer or retailer was required to personally certify to the public that he or she had established “internal controls” over food safety, and in fact the food produced and sold was safe?

What if an auditor was required to “issue an opinion” as to the accuracy of those controls over food safety, and that in fact the audit was truthful?

Stunning ideas?  Not really!

There is a somewhat recent and apt model for increasing corporate and auditing responsibility that would work quite well to focus attention on good food safety behavior.

Fact – good food safety behavior in the long run protects consumers, which protects the corporate brand.  Not poisoning your customers is actually good for business.

The Sarbanes–Oxley Act known as the “Corporate and Auditing Accountability and Responsibility Act” has set increased standards for all corporate management and auditing firms.  The bill was enacted in 2002 in reaction to corporate and auditing scandals in the 1990’s, which cost investors billions of dollars when share prices of public companies collapsed.

As a result of Sarbanes–Oxley, top corporate management must now personally certify the accuracy of financial information. Management must certify that they are “responsible for establishing and maintaining internal controls” and “have designed such internal controls to ensure that material information relating to the company” is made known.

Sarbanes–Oxley has also increased the responsibility of outside auditors who review the accuracy of corporate financial data. External auditors are now required to issue an opinion on whether management maintained effective internal control over financial reporting and that the financial statements are in fact accurate.

How can the Sarbanes–Oxley Act relate to safer food?

Can you imagine if the president of a food company was actually required to sign off yearly on the company’s food safety “internal controls?’  If that were the case, perhaps food safety would have a direct line of communications to corporate leadership instead of lagging behind marketing and short-term profits.

It would be truly revolutionary to have a food company focused on producing and selling safe food as its core mission.  That would be a “culture of food safety.”

And, what about audits?  What if an auditor had to sign his or her name that the audit was in fact truthful and was not simply a mechanism to move product speedily, not necessarily safely, along the chain of distribution?

An honest audit would be “food safety from farm to fork.”

Does it not seem at least equally important that the food manufacturers or retailers ask our children to put in their bodies have some of the safeguards that investors have in the same corporation?

Thanks Dave