Risk Compliance – No Small Peanuts

The recent peanut butter scandal dominating headlines is simply
another example of how the food manufacturing supply chain is
becoming more complex while the compliance visibility of our IT
systems and our processes tend to be localized. As we have all
discovered for any implementation  in order to achieve its
objectives, the people, processes and technology must be aligned.
In the litany of food safety issues that have come to light in
recent years, there are generally IT-related technology concerns on
global product quality systems, as well as visibility and
compliance reporting across domestic and national
boundaries. 

However, there is also the matter of social responsibility, which
is a problem in many food safety scandals, as is the case with this
recent peanut butter situation. Sure, there is a risk associated
with non-compliance to a brand and to the actual health concerns of
the consumers that utilize the product. A recent AMR Research note
found that 57 percent of consumers reconsider buying the
affected product for at least a year after a recall.
Companies can look to quality management systems and better
tracking solutions all they want. Even supply chain solutions that
provide the proper visibility for ingredient tracking is not enough
when management looks at the risk vs. reward equation too
closely.

There is a social responsibility concern in this latest food safety
scandal that Governance, Risk and Compliance (GRC) processes and
technologies are attempting to address. They go beyond the
identification of risk metrics and the financial implications of
what is occurring in the manufacturing and supply chain. They spur
a call to action for true business ethics and social consciousness
of a corporation. There are many companies that drive behavior and
use its social responsibility to not only drive revenues and
differentiation in the market but also to support future
legislation.  

There will always be those organizations, with or without systems,
that will comply or turn the other way as they risk recalls and
non-compliance costs instead of the financial bottom line success.
Legislation typically lags bad behavior corrective actions. The
concern here is now on a global scale and is about how to react
quicker once incidents are identified across global food supply
chains and manufacturing processes.