A Model for Improving Private Food Safety Audits
BY TIMOTHY D. LYTTON | MARCH 20, 2013 OPINION
There are more than ten thousand kosher-producing companies in the United States alone, making more than 135,000 kosher products for over twelve million American consumers who purchase kosher food because it is kosher. Only 8 percent of kosher consumers, however, are religious Jews. Most kosher consumers choose kosher for reasons related to health and food safety.
Many consumers view kosher certification as a proxy for strict food safety standards, a view that kosher certifiers and food companies have embraced. Rabbi Eliyahu Safran, Vice President of Communications and Marketing at the Orthodox Union (OU) explains that demand for kosher certification is driven by the 50 percent of kosher consumers who buy kosher food for its “general healthfulness” and the roughly one-third who “believe that kosher food safety standards are better.” Skeptics might ask: “Does kosher certification really provide greater assurance of food safety?”
Yes and no.
In some cases, kosher certification may serve as a useful proxy for food safety and purity. Regular unannounced kosher inspection of production facilities may increase vigilance in preventing pest infestation and be more likely to detect traces of non-kosher contaminants, like insects. Federal regulations allow for certain threshold amounts of contamination in foods, known as “maximum defect actions levels,” before they are considered unsafe—for example, fewer than two maggots per 500 grams of canned tomatoes and fewer than thirty insect fragments per 100 grams of peanut butter. By contrast, kosher certification has zero tolerance for such contaminants and is more likely to reduce or eliminate their presence in food. Moreover, in 2009, the OU partnered with SGS—a private inspection, verification, testing and certification company—to begin providing dual kosher and food safety certification.
Although kosher requirements may overlap with food safety standards—and even be stricter than federal and state regulations in some cases—kosher certification is not a substitute for rigorous government food safety oversight and enforcement or for reliable private food safety auditing. Kosher inspectors are professionally trained in Jewish dietary law, food chemistry, and food technology, and they are especially vigilant when it comes to bugs and other impurities that render food non-kosher. They do not, however, have any particular expertise in bacterial contamination or safe food handling practices. “Our [inspectors], although knowledgeable, are not trained health professionals who qualify as health inspectors,” explains Dr. Avrom Pollak who heads Star-K, a leading kosher certifier.
The most valuable contribution that kosher certification offers to food safety is a model of reliable private certification. While government efforts have made great progress in improving food safety over the course of the last century since passage of the Pure Food and Drug Act and the Federal Meat Inspection Act in 1906, regulatory outcomes have fallen short of public expectations. The Food Safety Modernization Act of 2011 promised ambitious reforms, but inadequate funding and administrative delay have blunted its impact. And this is where the Australian model differs significantly from the US model. The Australian government has invested heavily in establishing the infrastructure and imposing law and sanctions that have been tried and tested in the courts, and more importantly have yielded tangible results and raised food health and safety standards across the board. Australian foods, both raw and processed are well recognised for their consistent superior quality. And just as initial legislation to enforce the wearing of seat belts has created a mindset where it is now almost unheard of in Australia to drive without a seat belt, so too the mindset within food production has been swayed to accept safety and hygiene practices that are already second nature to even the people engaged in the most basic food handling.
In the US however, private food safety audits and certification have the potential to complement government efforts and enhance food safety. As a general matter, private certification transcends limits that hamper government regulation. Key to its success is market demand. Industries that resist government oversight are often willing to pay for private certification to enhance the value of their products and services. When government lacks resources to develop, implement, and enforce regulations, private certification can generate fees to cover these costs.
Unfortunately, the private food safety system has not performed well. Market competition among auditors sometimes leads them to lower their standards in order to reduce the cost of their services and ease the demands that they place on their clients. The result is a race to the bottom.
The key to reliable private certification is harnessing the market demand for certification without succumbing to competitive pressures to cut corners. And this is precisely what the kosher certification system has achieved.
Kosher certification was not always so reliable. One hundred years ago, the kosher food industry was rife with fraud and corruption. The New York City Department of Markets estimated in 1925 that 40 percent of the meat sold as kosher in the city was, in fact, not kosher. Consumer groups and industry associations estimated that that figure was somewhere between 50 to 65 percent. Kosher certification suffered from the same financial incentives to cut corners that characterize private food safety auditing.
Several features of the kosher certification system account for its success. First, sufficient consumer demand makes companies willing to open up their operations to kosher inspectors and to pay for reliable certification. Second, a core of vigilant and active consumers scrutinizes products for certification mistakes, such as items that are mislabeled pareve (indicating the absence of any milk products) but list dairy ingredients on the package, or items that bear counterfeit certification symbols. These consumers share information about the reliability of different certifications through extensive social networks and online.
Third, fierce brand competition based on reliability among kosher certifiers vying for food company clients counteracts incentives to cut corners. An agency caught lowering its standards risks damage to its reputation among consumers and the value of its brand.
Fourth, interdependence among certifiers creates incentives for interagency oversight. Within industrial food supply chains, the reputation of finished-product certifiers depends on the reliability of ingredient certifiers who, in turn, require the trust of finished-product certifiers for acceptance of their certification downstream in the product production. The result is that finished-product certifiers scrutinize the operations of ingredient certifiers, who are eager to satisfy any concerns they may have. Since all of the major agencies certify both ingredients and finished products, this creates a network of interagency oversight.
Fifth, concentration of market power in the hands of a few large certifiers makes it easier to coordinate the development and enforcement of industry standards. The profitability of certification has attracted more than 300 certifiers in the US (there are more than 1000 worldwide). The “Big Five,” who control more than 80 percent of the US market, organized a trade association as a forum for information sharing, deliberation, and standard setting for the industry. While the trade association has no formal enforcement powers, it provides a vehicle for building interagency relationships that facilitate the communication of reputational information, which puts pressure on agencies to conform to industry standards and openly identifies agencies and agency practices that fail to conform.
Finally, certification agency personnel are motivated by a shared sense of mission that counteracts conflicts of interest and promotes cooperation between competing certifiers, sometimes referred to as an industrial morality. There is no denying that kosher certification is a business. But it is not just a business. For the rabbis who staff certification agencies, it is also a sacred trust.
In the end, kosher certification is not so much the means to food safety reform as it is a model for it. Although private alternatives are not a replacement for government regulation, a well-developed system of private certification is likely to deliver marginal improvements in food safety regulation.