The organic industry is looking to pounce on fraud.
In September, the Washington, D.C.-based Organic Trade Association completed a pilot project designed to prevent and detect fraud in the global organic system.
The project came about after the OTA’s 48-member Global Organic Supply Chain Integrity Task Force formed last year to develop a fraud prevention program designed specifically for the organic industry.
As the first step, the task force created a comprehensive “best practices” guide to facilitate the industrywide implementation of systems and measures to preserve the integrity of organic, inside and outside of the U.S., according to OTA.
The OTA estimates the global organic market at nearly $90 billion, with the U.S. accounting for nearly $50 billion.
Organic imports into the U.S. in 2017 totaled around $2.1 billion, up nearly 25% from the previous year. In the past year, however, investigations have revealed imported products fraudulently labeled as organic and gaps in the complex organic supply chain.
“The success of organic relies on consumer trust of the organic seal,” said Laura Batcha, OTA CEO and executive director.
“It is critical that every link in the organic chain has systems and measures in place to provide the organic food that people can trust. We want our fraud prevention program to become the industry standard for achieving integrity across complex organic supply chains. But, before we get to that point, certain steps have to happen. This pilot project is a key step, followed by industry training and a roll-out with enrollment by the industry into this proactive and beneficial program.”
The effort is worthwhile, said Stephen Paul, category director for stone fruit, fall fruit and blueberries with Porterville, Calif.-based Homegrown Organic Farms.
“We want that,” he said.
“We work hard to maintain that integrity of the product. Integrity is everything. You have to have that, no matter what business you’re in.”
“Organic now operates in a global market. Fraud is one of the biggest threats to that market, and it cannot be tolerated in the organic system,” Batcha said.
Thirteen members of the GOSCI Task Force participated in the project from June to September and represented the entire organic supply chain and a range of products, services and commodities, including fresh produce.
Participants focused on one product or ingredient, or a specific location to run through the pilot program. During the pilot, the participants created fraud mitigation measures based on the results of vulnerability and risk assessment and then shared feedback on their experience and provided recommendations on how to improve and strengthen the suggested strategies explained in the GOSCI Best Practices Guide.
“We’ve worked for a year to develop a fraud prevention program for organic,” said Gwendolyn Wyard, the OTA’s vice president of regulatory and technical affairs and staff coordinator for the GOSCI Task Force.
“Now we need to have companies put our recommendations to the test in their everyday business activities to find the elements that have to be further developed. This pilot project is key to advancing the adoption of an industry-wide systemic approach to preserving organic integrity from the farm to the plate and to ensuring the honesty of global control systems.”
Ultimately, the intention is to build a program for organic businesses that will allow them to create continuously improving internal programs and processes for achieving organic integrity throughout their associated supply chains.
Organic companies will have an opportunity to enroll in a program that will require registration, training, process verification and a commitment to an organic integrity policy. The more companies that join, the stronger the organic supply chain will become, Wyard said.
“We envision a program that will create an opportunity for organic companies to be recognized and to become GOSCI card-carrying members,” Wyard said.
“A typical screening question a buyer will ask a supplier is whether they have implemented the GOSCI Best Practices. This is a collective domino approach to getting everyone in the organic supply chain to take a closer look at their organic approval practices and increase buyer responsibility.”