FOOD SAFETY 2018 GOOD GOVERNANCE GUIDE FOR DIRECTORS, EXECUTIVES AND BUSINESS OWNERS - MPI
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New Zealand Food Safety
Haumaru Kai Aotearoa
FOOD SAFETY
GOOD GOVERNANCE GUIDE FOR DIRECTORS,
EXECUTIVES AND BUSINESS OWNERS
2018Publisher New Zealand Food Safety Ministry for Primary Industries Pastoral House, 25 The Terrace PO Box 2526, Wellington 6140, New Zealand Tel: 0800 00 83 33 This publication is available on the Ministry for Primary Industries website at https://www.mpi.govt.nz/news-and-resources/publications/ Further copies may be requested from brand@mpi.govt.nz ISBN No. 978-1-98-857106-5 (online) ISBN No. 978-1-98-857107-2 (print) Disclaimer While every effort has been made to ensure the information in this publication is accurate, the Ministry for Primary Industries does not accept any responsibility or liability for error of fact, omission, interpretation or opinion that may be present, nor for the consequences of any decision based on this information.
FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS CONTENTS 01 Foreword 2 Introduction 3 PART I: Food safety – the board's role 4 Step 1: Commit to food safety governance 10 Step 2: Lead food safety culture 11 Step 3: Assure food safety risk is identified, assessed and effectively managed 12 Step 4: Monitor system design and company performance 13 Putting it all together 15 PART 2: Director’s briefcase 16 Director's checklist 16 The food safety legal environment 18 What are the key roles in food safety regulation? 20 What comprises a food safety system? 21 Culture – the essential element 23 Example food safety performance measures 24 Introduction to food safety risk 25 Food defence – defending against intentional harm – an emerging threat 30 Glossary of terms 31 References 33
NEW ZEALAND FOOD SAFETY
02 FOREWORD
The safety of our food is critical. It is critical to the health of New Zealanders and to the
viability of businesses dealing with food. New Zealand consumers, and consumers
overseas, expect New Zealand food to be safe at all times, and food companies must be
proactive in delivering on that expectation.
New Zealand has an enviable track record and reputation for food safety and food
quality built up over many years, and our prosperity is tightly bound to maintaining this
reputation.
A report into dairy industry capability (December 20151) recognised that industry food
safety capability is in good shape but that we must continue to work to ensure that our
food safety capability remains world class. The report identified two principal areas of
focus – developing food safety capability and capacity, and building food safety culture.
If New Zealand is to retain and enhance its reputation for food safety, board leadership
is essential. Boards of directors have a key role in leading food safety culture and
capability.
This holds true for the New Zealand food industry generally, encompassing other
primary products and broader food production, processing, retail, hospitality and food
service sectors. Food safety is of paramount importance where our production,
processing and export of food products are the basis of a productive, sustainable and
inclusive economy.
This publication Food Safety: Good Governance Guide for Directors, Executives and
Business Owners aims to provide foundation food safety material for directors and
boards, and inform the first stage on the journey to best practice food safety.
I commend this guidance to you with the personal challenge, "What can I do to support
excellence in food safety governance to ensure the safety of our consumers, and to
sustain and grow our reputation in this vital area?"
Bryan Wilson, Head of New Zealand Food Safety,
Deputy Director-General, Ministry for Primary Industries, Regulation and Assurance
"A thriving food industry underpins New Zealand's economy and our future prosperity.
Food safety is critical to trust and confidence in our products and services. Boards and
directors have a key role in driving excellence in food safety governance to ensure the
long term sustainability of their organisations and industries. I encourage directors to
make sure food safety is on the board agenda and to use this guide to help ensure we
raise food safety standards in New Zealand".
Liz Coutts ONZM, CFInstD, President, Institute of Directors
1 Dairy Capability Working Group (2015) It’s our future: building food safety capability in the dairy sector.
Dairy Capability Working Group, commissioned by the Director-General of the Ministry for Primary
Industries; Wellington. www.foodsafety.govt.nz/elibrary/industry/dairy-capability-working-group-report.
htm. Accessed 10 October 2018.FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
INTRODUCTION 03
Food safety has always been important for
New Zealand’s food producers, manufacturers and
The ground is shifting. Food safety
marketers. Our consumers have a legitimate
expectations continue to grow, food supply
expectation that our food is safe, and our local and
chains are becoming longer and more
international reputations depend upon excellence
complex. There is an increasing array of
in food safety outcomes. We have an enviable
food products with ingredients not thought
reputation and track record, features that we must
of a decade ago and food safety incidents
protect, nurture and enhance.
quickly attract international attention. And
Food safety, similar to workplace health and there is the shadow of difficult-to-predict,
safety, is now a business essential. Once seen as a malicious behaviour targeting foods.
cost burden, the reality is that the cost of having
unsafe food is greater.
safety risk profiles. In response, leading food
Food safety failures can be costly in terms of direct
companies are continually building and developing
costs, such as lost production time and product
food safety capability to keep pace with change
recalls, but other costs such as loss of business
and to remain competitive.
focus, reputation and consumer trust can weigh
more heavily. Collectively, they can lead to The changed market environment and increased
company failure. The efficient response is to legal responsibilities mean that boards of
develop organisation-wide systems and directors must also increase their collective and
organisational culture that can recognise, evaluate individual oversight of food safety in their
and prevent or mitigate these issues. Done well – company.
food safety can lead to a competitive advantage. This document will help directors to understand
Done poorly – it is a disaster waiting to happen. the importance of food safety governance, their
The business environment in which the food sector responsibilities and role in assuring food safety
operates is changing. The Animal Products Act performance. It will also discuss the tools to
19992 (APA) and more recent Food Act 20143 have monitor and verify food safety system
moved from prescription-based to risk-based performance; the essentials of good food safety
legislation, and now companies are required to set governance. This document, while largely written
out and implement their strategies for achieving for directors and boards, is equally relevant to
safe food. senior executives and business owners in the
wider food industry.
The legislation also applies to many hospitality,
institutional and food service businesses, This guidance document is set out in two parts.
including tourism and travel operators where food Part I: Food safety – the board’s role – sets out
is prepared and sold. the case for food safety governance, the legislative
Other changes, such as evolving international requirements, and the leadership role that boards
market requirements, improving analytical of directors must play in the governance of food
technology and testing sensitivities and the safety.
recognition of new hazards, are affecting food Part II: a Director’s briefcase – includes a
director's food safety checklist, sets out the legal
environment, key roles in food safety regulation,
2 Animal Products Act 1999. www.legislation.govt.nz/act/ what comprises a food safety system, examples of
public/1999/0093/105.0/DLM33502.html. Accessed 10 food safety performance measures, and an
October 2018.
introduction to food safety risk.
3 Food Act 2014. www.legislation.govt.nz/act/
public/2014/0032/75.0/DLM2995811.html. Accessed 10
October 2018.NEW ZEALAND FOOD SAFETY
04 PART I: FOOD SAFETY – THE BOARD'S ROLE
Food safety – the issues and
the risks RISK
Why is food safety an issue today? The combination of hazard and exposure
Food safety has always been an important issue, to the hazard is called risk. Without
but similar to workplace health and safety its exposure, a hazard remains a hazard.
profile is growing. Assuring food safety, has
For example, in summer, midday sun is a
become more complex with new consumer-ready
hazard, but if you stay inside and there is
products being sold in many new international
no exposure, it is not a risk.
markets, new production technologies,
(Refer to page 25 for more on risk).
lengthening supply chains, multiplicity of
ingredients and suppliers, and growing potential
for malicious behaviour. The immediacy of media pathogenic bacteria (e.g. Salmonella), fungi or
and social media mean that a local incident can naturally occurring toxins (e.g. tutin or marine
become global overnight. biotoxins) and parasites. Chemical hazards
Company reputations can be quickly damaged by include naturally occurring food allergens
a food safety incident, and restoring reputation (e.g. peanut, milk), chemical contaminants and
and trust in the marketplace can be a lengthy and undeclared food additives or introduced
costly task. Food safety, once the domain of contaminants such as agricultural residues.
technical and production functions, has become a Physical hazards include foreign matter such as
company-wide, end-to-end business glass or metal.
responsibility and consequently must become
For an unsafe food to cause illness or an adverse
part of board oversight of company activities and
health effect there must be exposure to the
performance.
hazard, usually through consumption of the food,
Positives arising from excellence in sufficient to cause an adverse effect. Conversely,
food safety where the hazard is present at non-significant
While the headlines may focus on a few high levels and/or the food consumption is low,
profile food safety events, the New Zealand food adverse effects are less likely.
industry has a sound history of producing and
marketing safe foods. Safe food and our known Food safety – a risk that can
food safety systems are part of the New Zealand
bring lasting harm to consumers
story – a competitive advantage – and this brings
many opportunities for international trade. It also
and families
allows New Zealand to work cooperatively with its Foodborne illness or adverse health effects can
many customers and efficiently resolve any cause lasting harm to consumers and to families.
issues that arise. There are many local and international incidents
that have resulted in serious harm, some leading
What do we mean by unsafe food? to fatalities.
Changes in our food supply and lifestyle have led
In 2008, melamine adulteration of infant foods in
to a broader range of causes for, and
China resulted in more than 50,000 children being
consequences of, unsafe food. Unsafe food takes
many forms but is generally recognised as food
where a biological, chemical or physical hazard is
present and where that hazard could lead to an
adverse health effect. Biological hazards include
microbiological contamination such asFOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
hospitalised and six deaths.4 Many children who 05
were hospitalised face ongoing medical care.
SANLU
In Australia, in 2012–2013 Listeria contamination
in cheese was linked to three deaths.5 This milk powder contamination scandal
caused 290,000 consumers to be affected
In New Zealand (July 2012) Listeria contamination
around the world, more than 50,000
of food supplied to a hospital was linked to two
hospitalisations and six deaths in China.
deaths and two other people were affected.6
(Jiani Yan, Lincoln University, 2011.)
Food allergen incidents can occur rapidly and
without warning, and have resulted in several
deaths in Australia and New Zealand over the last In Australia in 2015, frozen berries were linked to
decade7. hepatitis A contamination, and the brand was
discontinued soon after the incident.9
Food safety – a risk that can bring The melamine incident in China resulted in
lasting damage to companies bankruptcy and business failure of Sanlu.
Food safety incidents can also bring lasting
The fallout from food safety incidents is not
damage to companies. Recalls, legal
readily contained and can have flow on effect on
proceedings, penalties and the ensuing publicity
other operators in a particular sector, and more
can result in loss of earnings, loss of reputation
broadly a whole industry or country. This was
and loss of consumer trust in brands or local
demonstrated in an outbreak of pathogenic E. coli
authorities. There are many instances around the
in bean sprouts in Europe (summer 2011) which
world where food safety failures have led to
resulted in more than 3,000 infections and
business failure.
50 deaths. The health, social and economic
The New Zealand Campylobacter contamination consequences were tragic to those people
of a town water supply (2016)8 resulted in large affected.
numbers of residents seeking medical attention,
Following this event, there was a significant loss
loss of trust in local authorities and worldwide
in confidence in the supply of perishable foods
media attention. (Not strictly classed as a food
and consequential economic loss to the food
safety event, drinking water is covered under the
service sector and producers in that region.10
Health Act 1956 and the Health (Drinking Water)
Amendment Act). The manner in which companies respond can
play a significant role in public and consumer
perception. Company responses and
responsiveness can result in reputations being
4 Yan, J (2011) Fonterra in the San Lu milk scandal – a case enhanced, or severely damaged in the event of a
study of a New Zealand company in a product-harm crisis.
Dissertation; Lincoln University, Canterbury. http:// food safety crisis. The first 24 hours are critical in
researcharchive.lincoln.ac.nz/handle/10182/4200. this regard.
Accessed 10 October 2018.
5 ABC News (11 February 2013) Third listeria death linked
to Jindi cheese. www.abc.net.au/news/2013-02-10/third-
death-linked-to-cheese/4510440. Accessed 10 October
2018.
6 Stuff (26 June 2015) Napier company guilty of supplying 9 ABC News (8 December 2015) Patties Foods takes first
Listeria-infected meat to hospital. www.stuff.co.nz/ steps to drop its frozen fruit brands after Hepatitis A berry
dominion-post/news/69728964/napier-company-guilty- scandal hits profits. www.abc.net.au/news/rural/rural-
of-supplying-%20Listeriainfected-meat-to-hospital. news/2015-12-07/patties-foods-drops-creative-brands-
Accessed 10 October 2018. berries/7006966. Accessed 10 October 2018.
7 Stuff (1 June 2009) Man dies after restaurant meal. www. 10 Burger, R (2012) EHEC O104:H4 in Germany 2011: Large
stuff.co.nz/national/2457419/Man-dies-after-restaurant- outbreak of bloody diarrhea and haemolytic uraemic
meal. Accessed 10 October 2018. syndrome by shiga toxin–producing E. coli via
8 TVNZ OneNews (20 August 2016) Hastings, Flaxmere contaminated food. Institute of Medicine (US). Improving
water supply found contaminated as infections rise. food safety through a one health approach: workshop
https://www.tvnz.co.nz/one-news/new-zealand/hastings- summary. National Academies Press (US); Washington,
flaxmere-water-supply-found-contaminated-infections- DC. www.ncbi.nlm.nih.gov/books/NBK114499/. Accessed
rise. Accessed 10 October 2018. 10 October 2018.NEW ZEALAND FOOD SAFETY
06 A recall can be one step away from REASONS FOR FOOD RECALLS IN
a serious food safety event NEW ZEALAND 2016 (25 RECALLS)
Recalling food is one way of reducing risk,
10 undeclared allergen
through reducing consumers' exposure to the
hazard. Recalls are "after the fact" and 10 microbiological (pathogens)
consumers may have already been exposed
4 foreign matter
to harm.
1 unapproved processing aid
Each food safety event has the potential to cause
serious harm to consumers. In 2016 there were Source: MPI website
25 food recalls in New Zealand, with undeclared
allergens and microbiological contamination
being the leading causes. Efficient recalls are Findings from the dairy industry
dependent on good traceability and usually a high capability study
percentage of foods being recalled are removed The Dairy Capability Working Group was charged
from the market, thereby avoiding further with assessing current and future food safety
consumer harm. But recalls are not always capability needs across the dairy value chain and
100 percent effective and there is always an making recommendations to ensure that those
elevated risk to consumers until the recall needs are fully met.
is completed.
The Dairy Capability Working Group reported
During a recall, the company’s reputation is at back in December 2015. The study concluded that
risk and crisis management and communications the best companies:
processes during this event are critical in
• put consumers at the centre of food safety;
protecting consumers, and in protecting the
• recognise and lead culture as a key
business. This is a high risk situation for the
determinant of food safety;
business – a situation that boards should
consider as a key risk and develop risk • separate food safety decisions from the
management strategies accordingly. commercial imperative;
know how to respond to difficult decisions – the
“grey area”;
• know that with the right culture in place – the
right decisions get made;
Figure 1. Food safety model: Producing safe food
and protecting consumers and recognise that:
• food safety continues to evolve – from HACCP
to risk management programmes, to food
Su security and now food defence.
pp
Formulation
Food
Fraud
l It is MPI’s view that these findings can be applied
h
yC
alt
to the other primary products and broader food
ha
He
Food
in I
industries in New Zealand.
Food for
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Co
at
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New Zealand legislation
Ris
Safe food
ion
for
consumers Traceability
Allergens New Zealand's food industry is primarily
governed by the APA (primary industry focus) and
Micro
-biological
the Food Act 2014 (focused on food for sale),
Chemical along with secondary legislation including food
Physical standards, orders in council, regulations and
notices issued under those Acts. There are also
Food Safety
food safety provisions in industry specific
legislation including the Wine Act 2003 and theFOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
Agricultural Compounds and Veterinary 07
Medicines Act 1997. OBLIGATION AND
Legal obligations under the APA are: ACCOUNTABILITY
• to produce and sell foods that are fit for Unsafe food is bad for consumers and bad for
intended purpose; business.
• to develop, register and operate an end-to-end
As food producers, we are morally, ethically and
or through-chain RMP, and have it
legally obliged to produce and sell safe food,
independently verified.
always. Obligations fall on the body corporate and
Legal obligations under the Food Act 2014 are extend to directors and senior management.
similar:
Directors and executives may face legal action
• to produce and sell foods that are safe and following a serious food safety event. Penalties
suitable; under the APA and Food Act can be up to $500,000
• to develop and use risk-based measures for a company and up to $100,000 and five years
(usually a Food Control Plan (FCP) or National imprisonment for individuals, including Directors.
Programme) to ensure food is safe and
suitable. Where larger, complex food
businesses choose to develop and operate an The food safety governance model (Figure 3, page
end-to-end or through-chain FCP that plan 8) describes how boards of directors can take an
must be registered and independently verified. active and productive role in assuring food safety
in their company.
Penalties under the APA and Food Act can be up
to $500,000 for a company and up to $100,000 Governance, risk and its
and five years imprisonment for individuals, relationship with food safety
including executives and directors.
Risk is one of the key matters that boards of
Directors’ liability directors are required to address (refer to
Figure 2).
Under the APA and Food Act, directors and senior
managers can be held to account for failures in The New Zealand Institute of Directors
food safety, such as a product safety event that publication The Four Pillars of Governance Best
has caused harm, or failure to meet requirements Practice 2017 identifies both culture and risk
of the Acts. Further detail can be found in Part 2 management as a key focus for board. 11
of this document. It defines risk management as a process of
identifying and prioritising risk, establishing
a risk management plan and monitoring
Figure 2. Governance model implementation. It also notes the importance
of a culture that values ethical behaviour.
The purpose of food safety risk management is
to protect consumers (and users) of food products
Governance
through identifying and managing risk. This will
be familiar to directors because risk and risk
Assurance management is a core activity of boards. Risk just
comes in different forms.
Risk Control
11 Institute of Directors in New Zealand (2017) The four
pillars of governance best practice. www.iod.org.nz/
FourPillars. Accessed 10 October 2018.NEW ZEALAND FOOD SAFETY
08 Food safety has its own language and • The best RMPs or FCPs take a broader
methodologies. approach where as well as product
• Food safety risk is present when a foodborne manufacture and supply chain processes, key
hazard (biological, chemical or physical) is relevant activities in business support
combined with exposure to the hazard, usually functions such as sales and marketing,
through consumption of food containing the research and development, human resources
hazard. management and finance are also considered
• Current legislation and industry best practice as valuable contributors to food safety, and are
require that risk-based measures are brought into the risk-based programme.
developed to ensure food is safe and suitable • Food production and processing is inherently
or fit for purpose, in which: variable. Raw materials vary, climatic
ͷͷ food safety risks are assessed and controls conditions vary in turn influencing processing
developed using a structured process conditions. Product specifications vary, staff
HACCP, and that controls are implemented responses may vary, and so on. Producing safe
and records are maintained; and consistent product is an ongoing challenge
ͷͷ the HACCP process is applied through- to staff, processing equipment and to food
chain,that is, throughout all operations safety systems. Design of control systems must
that can impact directly and indirectly on recognise and cater for that inherent variability.
product safety;
• A culture supportive of food safety is an
ͷͷsystems effectiveness is verified. Auditing essential element of sustainable food safety
is part of that process. where “being proactive about food safety is the
• A wide array of technical, social and way we do things around here!” The board has
environmental factors can affect risk. Risk is an important role in leading food safety culture.
ever evolving and food safety systems must be
refreshed on a regular basis. Introducing the food safety governance model
A food safety governance model (Figure 3) has
been developed to help boards in their food safety
Food safety governance: Assuring activities. In this model, the board has two
that food safety risks are identified, principal roles in governance of food safety.
understood and controlled, and that The first role is that of creating the right
this occurs within in a supportive environment in which food safety can operate
organisational culture. successfully. The second is that of holding
management to account for implementation of
Figure 3. Food safety governance model
Monitor system Commit to
design and food safety
41
company governance
performance
Holding
management
Assure risk is
identified,
assessed and
32 Lead food
safety culture Creating the
food safety
to account effectively environment
managedFOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
the food safety system. Step 3 – Assure food safety risk is identified, 09
assessed and managed – covers the practical
Creating the food safety environment steps required to assure that risk is being
Directors have the responsibility to create the assessed and mitigation or management
right environment through committing to food measures are developed and applied to reduce
safety governance, and leading food safety risk. Risk is always evolving and it is essential
culture. These are the foundations of food safety that directors recognise the need for regular
governance and there must be clearly articulated review of risk to ensure that the risk-based
expectations of directors and management, and measures are maintaining pace with change.
of system performance outcomes.
Step 4 – Monitor system design and performance
Holding management to account – comprises the ongoing processes of assuring
– exercising due diligence that the system design is fit for purpose and that
In holding management to account, directors are the food safety system is responsive to the
required to assure that risk is actively assessed information and data generated from the risk
and managed and that system design and management activities.
company performance is satisfactory.
Cyclic activity – The food safety governance cycle
These two principal roles have been developed should be continued as boards and companies
further as an expanded food safety governance seek continual improvement in food safety
model presented in Figure 4. governance and outcomes and respond to
changing business conditions.
Step 1 – Commit to food safety governance – sets
the policy foundation or framework for food In the following pages, the 4 step food safety
safety governance in the food business. governance model (refer Figure 4) is expanded to
provide more detail for directors to consider.
Step 2 – Lead food safety culture – is about
creating a supportive environment, one in which
food safety can become part of the company
“DNA”.
Figure 4. Food safety governance model (expanded)
• Ensure robust reporting using both • Be informed about food safety
lead and lag indicators • Develop food safety governance
• Monitor outcomes and audit results framework, document important
Monitor system considerations
• Verify where necessary. Conduct design and Commit to
annual review company food safety • Set food safety policy and goals
41
• Ensure adequate resourcing performance governance • Discuss risk appetite
• Ensure material conflicts are avoided
Holding management to account
• Know your greatest risks
identified, 32
Assure risk is
assessed and
Lead food
Creating the food safety environment
• Communicate expectations
safety culture
• Ensure risk reviewed regularly effectively • Keep food safety on board and other
• Ensure fit for purpose risk managed key agendas
management strategies are in place • Ensure directors and staff are trained
• Ensure there is opportunity for risk to in food safety
be raised by all staff • Recognise outstanding performance
• Ensure crisis management and • Survey culture
communication plans are in placeNEW ZEALAND FOOD SAFETY
010 STEP 1: COMMIT TO FOOD SAFETY
GOVERNANCE
Commitment can be demonstrated through: • expecting constancy from senior management
• ensuring directors are informed about food in handling food safety matters;
safety; • understanding the appetite for risk (e.g. what
• including food safety in the Board Charter; will we never do; what will we always do, how
• considering food safety from a consumer's do we want the difficult issues to be handled
perspective and potential impacts on health such as the “grey zone” where product is only
and wellbeing in personal and family settings; "just outside" or “just inside” the rules). While
management will make the calls in most
• developing a food safety governance
cases, directors should be aware of the
framework that provides a template and
importance and nature of these important
guidance for directors in discharging their food
decisions, and the risk being taken on their
safety responsibilities, including “turning one’s
behalf;
mind to matters of food safety” and
documenting outcomes; • holding management to account for
implementing food safety strategy and driving
• preparing business-wide food safety policy and
food safety implementation and improvement
goals, and setting clear expectations such as
initiatives;
progress in implementing food safety
programmes, audit results and company food • ensuring organisational strategy and capital
safety culture. programmes include initiatives that can
improve food safety outcomes; and
Commitment can be reinforced by the board by:
• communicating commitment widely to staff.
• having food safety as a standing item on the
important agendas with consumer focus in
mind;
?
QUICK QUIZ
Q1. Do I feel conversant with food safety principles and current issues?
Q2. Do I feel confident in discussing food safety matters with
management, staff, auditors?
Q3. Is there adequate reporting on food safety matters?FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
STEP 2: LEAD FOOD SAFETY CULTURE 011
Leading food safety culture is a critical element Food safety culture relies on strong and
of creating the right environment for food safety. consistent role modelling including unequivocal
support for food safety and constancy of decision
Culture is the underlying set of values and beliefs
making – throughout the organisation – top to
that underpin everyday behaviours and decisions.
bottom – side to side.
It is recognised that directors can have a
The food safety Charter, statement of
profound influence on culture and this is
expectations and policy are the foundations of
fundamental to how food safety is perceived and
food safety culture. Once these have been set,
addressed within companies. The dairy industry
directors can lead food safety culture through:
capability study was clear – that culture is a
critical element of the food safety system, and • expecting unequivocal support for food safety
directors have a clear and direct role in leading and requiring adherence to the food safety
food safety culture. system;
enabled by:
Having the right culture and training means that
• ensuring all directors and staff are inducted,
directors and management can have confidence
trained and regularly updated in food safety;
that the right decisions will be made at all times,
in all aspects of company operations, essential in • expecting constancy of food safety decisions,
a 24/7 operational environment. Yiannas12 makes and constancy of messaging from the board
it clear that food safety = behaviour – and that and senior management;
leadership should focus on behaviour in leading • keeping food safety on the agenda, “walking
food safety culture. the talk” at all levels and all occasions e.g.
board meetings, site visits, customer visits.
Figure 5 from the dairy industry capability report
When directors engage with staff, suppliers
shows the relationship between a strong food
and vendors on matters of food safety it
safety culture and improving food safety capacity
provides a tangible recognition and
and capability leads to future-proofing overall
reinforcement of its importance;
food safety capability.
• ensuring culture is assessed on a regular
basis, and results acted upon; and
12 Yiannas, F (2010) Food safety culture: creating a behavior- • where outstanding food safety performance is
based food safety management system. Springer; New found, it is recognised and celebrated.
York.
Figure 5. Dairy food safety capability, preparing for
the future FOOD SAFETY CULTURE
Food safety culture can be described as
an alignment of values and behaviours
Future-proofing with respect to food safety, from senior
DAIRY FOOD management through to front-line staff.
Building a SAFETY
strong Food safety culture is led from the top and
capability
FOOD driven down throughout the organisation.
SAFETY A strong food safety culture is supported
culture through collaborative partnerships across
the sector including regulators, industry,
education organisations, research institutes
and consumers. (Source: Dairy Industry
Improving CAPACITY and Capability 2015).
CAPABILITY to meet future needsNEW ZEALAND FOOD SAFETY
012 STEP 3: ASSURE FOOD SAFETY RISK IS
IDENTIFIED, ASSESSED AND EFFECTIVELY
MANAGED
As a board, this step is about holding management that is, recognising that risk changes and
to account for designing and implementing the asking what new risks are emerging or have
food safety system, assuring that the food safety emerged?
system design is fit for purpose and that your • assuring that incident and crisis response and
company’s food safety risks are controlled and communications plans are prepared and
managed. rehearsed;
A working knowledge of food safety principles and • asking questions such as “has the possibility of
practices is valuable in providing directors with malicious attack been considered?” or “has the
the understanding to evaluate and contribute to entire supply chain been considered?”.
effective food safety governance discussions.
Risk can occur in any stage of the company’s
Boards can achieve this by: operations and risk identification, assessment and
• members acquiring and updating their management processes should be applied
knowledge of food safety practice; throughout the organisation where there can be
• knowing the company’s greatest risk(s). Boards an impact on food safety. While much of the
should keep key risks in focus and a risk “heat obvious risk can be assigned to manufacturing
map”13 can be useful in representing relative and operations, food safety risk can be found and
risk; mitigated elsewhere.
• including key food safety risks on the company For example, sales and marketing risks can arise
risk register; from tight production scheduling and new
• ensuring fit for purpose processes are in place product-market introduction. Supply chain risk
and operating for the business to assess, can arise from improper storage conditions or
manage and report on food safety risk and lapses in security of product control and product
events; data.
• ensuring a framework is in place for matters Similarly human resource activities, including
relating to risk to be raised and addressed recruitment, training, leadership and
including considering a secure, independent development, can all play a role in food safety risk
channel for staff participation; management capability development and decision
• ensuring a regular review of risk is conducted, making.
Additional material in the Director’s Briefcase
section in Part 2 (see page 16) cof this guidance
13 Chartered Global Management Accountant (11 June 2013) provides information on food safety system design
Risk heat map. www.cgma.org/resources/tools/essential- and scope.
tools/risk-heat-maps.html. Accessed 10 October 2018.
?
QUICK QUIZ
Q4. Do I know and understand our greatest risk(s) and our new and
emerging risks?
Q5. Are they included in the risk register?
Q6. Have we considered risk arising from malicious behaviour, that is,
consideration of food defence?FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
STEP 4: MONITOR SYSTEM DESIGN AND 013
COMPANY PERFORMANCE
This step has two main elements. The first The second element is that of monitoring system
element is ensuring that the food safety system is outcomes and assuring the system is effectively
able to function and perform as designed, and managing food safety throughout the business.
there are no obvious or material conflicts. Boards Boards will be focused on exception reporting,
may consider the following: and should be clear in what reporting they would
• Ensure the Chief Executive role specification like to see. Suggestions regarding scope are
and performance measures include food safety, listed below, and further examples are given in
and encourage food safety to be considered the Directors Briefcase (page 16).
ahead of production imperatives.
• Ensure performance management reporting
• Recognise and address possible conflict includes food safety system reporting using
between food safety outcomes and production both lead (capacity building) and lag
output measures in executive performance (performance or outcome) indicators such as:
incentives. ͷͷ meeting legislated requirements set down
• Consider food safety responsibility and in the APA and Food Act;
reporting lines. Does food safety information ͷͷ building company-wide food safety
get to the right level and place, in time? Does capability, including culture, to reduce risk;
food safety have a voice? Are reporting lines ͷͷinvolving all aspects of the business
conflicted? essential for embedding food safety
• Ensure system capacity is balanced with throughout the business;
current (and evolving) requirements. There may ͷͷreviewing company RMP performance such
be imbalance between food safety demands as serious non-conformances and the
and system capacity e.g. when significant food remedial action taken;
safety issues call upon additional product ͷͷ reviewing the number of serious non
sampling and testing, raising and investigation conformances outstanding and why.
of non-conformance reports. Unrelenting • Review outcomes from third party and
overload can lead to errors and may be an customer audit activities – ensure these have
indicator of core process capability been actioned, and that they are reflected in an
deficiencies. updated RMP or FCP.
• Have audit findings been considered and • Recognise that risk profiles change as
incorporated in refreshed risk management company activities and food safety techniques
procedures? and requirements change. Ensure that there is:
ͷͷregular review of system effectiveness; and
ͷͷperiodic system refreshment.
?
QUICK QUIZ
Q7. Do performance measures incentivise food safety?
Q8. How often does the board hear from the senior food safety manager?
Q9. Is the business constantly under pressure with food safety issues?NEW ZEALAND FOOD SAFETY
014 In discharging their duty of care, directors should event affects the company. Companies that
take the opportunity to "verify" what is being have prepared effective crisis response and
reported on key matters. communications plans and have tested or
rehearsed these plans periodically are better
• Verify through taking a "deep dive" into a small
prepared if, and when, a food safety event occurs.
number of specific important issues, asking for
verbal reports or more information, to ensure Where consumer health and safety concerns are
adequate analysis and response has taken present, the initial decisions and communications
place. are critical. Informing consumers is vital. Media
enquiries become immediate and urgent. Social
Review and reset goals media can trend within minutes. It is essential
that media spokespersons (directors and
It is recommended that periodic review and
executives) are trained for such events.
resetting of goals is undertaken as normal
practice. This then renews the governance cycle While typical product recalls can be rehearsed,
and is the opportunity to refresh all elements of not all scenarios can be planned for. Infrequent,
the food safety governance model. high impact events, sometimes termed "Black
Swan" events, can be overwhelming (see box).
Reviewing capacity to respond to a Building generic capability to respond is highly
beneficial.
food safety event
The way in which a business responds to a food Boards should review response capacity as part of
safety event has a major influence on how the their performance monitoring activities.
BLACK SWAN EVENT
A low-frequency, high-impact event
that can cause significant damage,
e.g. food safety events. Not all Black
Swan events can be prepared for, but
critical response capability can be
developed, e.g. crisis response and
communication plans. In the absence
of an effective response plan, damage
to product brand equity, consumer
trust and reputation can build rapidly.
?
QUICK QUIZ
Q10. Have we rehearsed our crisis management and communications
plans?
Q11. Can we provide initial media response within 1 hour or less?
Q12. Are we able to monitor and use all media channels?FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
PUTTING IT ALL TOGETHER 015
The food safety governance model has two Food safety – an Institute of
principal roles for boards of directors. Directors perspective
The first is creating the right environment in The following points have been adapted from the
which food safety can operate successfully. joint Worksafe NZ and Institute of Directors
Directors have the responsibility to create the publication Health and Safety Guide: Good
right environment through committing to food Governance for Directors.14 The points have been
safety governance and leading food safety adapted, with permission, to the subject of food
culture. These are the foundations of food safety safety:
governance and must be clearly documented, • Be proactive and actively engage in food safety
detailing expectations of directors and of matters (for example, by understanding the
management. business and the associated hazards and
The second role is that of holding management risks).
to account for implementation of the food • Be informed and involved with regard to food
strategy and food safety system. In holding safety risks – bear in mind that risk changes as
management to account, directors are required to the business changes.
ensure that risk is proactively assessed and • Ensure there is robust reporting on food safety
managed and that system design and company issues, audit outcomes and investigations, and
performance is satisfactory. In doing so, directors that action is taken.
should understand the status of food safety in the
• Trust, but verify. Check systems are operating
company, key issues and actions being taken to
the way intended.
resolve them.
• Ensure there are appropriate resources and
If directors are uncertain or dissatisfied with processes for dealing with food safety and that
current performance or trends in food safety there are staff participation practices in place.
performance, they should engage constructively
• Refresh board food safety governance
and delve further to ensure that appropriate
training regularly.
action is taken. In doing so Directors ensure they
• Ensure food safety is on the agenda at board,
discharge their duty of due diligence. As with any
audit and risk sub-committee level.
significant area of risk or exposure, external
advice may be helpful if these concerns are not
able to be resolved. Final points
Food safety – similar to Workplace Health and
Safety – is an investment in Enterprise Risk
Use of a director’s checklist
Management, leading to:
There is a substantial amount of information and
• protecting the health and safety of your
subject matter for questions in the preceding
customers and consumers;
material. A director’s checklist has been
• protecting and building your business
prepared to help directors and boards. This can
reputation and brand value;
be found on page 16.
• ensuring the ongoing success and enterprise
value of your business;
• performing your duties as a director; and
• sustaining the reputation and commercial
success of NZ Inc.
14 Institute of Directors in New Zealand and WorkSafe New
Zealand (2016) Health and safety guide: good governance
for directors. www.iod.org.nz/healthandsafety. Accessed
10 October 2018.NEW ZEALAND FOOD SAFETY
016 PART 2: DIRECTOR’S BRIEFCASE
This section comprises information and support tools that may be helpful when
developing food governance capacity:
• Director’s checklist;
• the legal environment;
• key roles in food safety regulation;
• what the food safety system comprises;
• examples of food safety performance measures;
• introduction to food safety risk;
• principles and examples of HACCP;
• food defence;
• glossary of terms;
• references.
DIRECTOR'S CHECKLIST
1. Commit to food safety Documentation
governance • Do our board minutes reflect our commitment
to, and consideration of, food safety?
• Do I understand my food safety obligations and
liabilities?
• Do I have sufficient understanding about food
2. Lead food safety culture
safety basics and the risk management • How confident am I about the depth and
programme (RMP) and food control plan (FCP) breadth of commitment to food safety in our
structure to enable informed and productive company?
engagement? • How does food safety fare when difficult
• Is food safety in the Board Charter and are decisions have to be made?
expectations established. Are these known by • When I do site visits, does food safety come up
all staff? in discussion? Do I feel confident to raise it?
• Is food safety a standing item on our board • Do we assess food safety culture through a
agenda, and is there true engagement about staff survey? Are we acting on the findings?
issues, performance, capacity building? How • What is the status on food safety training
do we listen to customer feedback including across the business?
audits?
• Does food safety feature in our strategy and
3. Assure risk is assessed and
capital works programme?
managed
Policy and goals
• Do I understand our key food safety risks? Does
• Is there a company food safety policy and are
the Risk Register include food safety risk?
goals established? Are these known by all
• Has there been a review of food safety risk
staff?
recently? Does it reflect changes in risk
• Has the board discussed risk appetite? Has the
profile?
executive team been involved?FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
• Am I assured that there are adequate status and issues, and how they are being 017
business-wide food safety management handled?
processes, controls and reporting in place? • Have we considered benchmarking our
• Does food safety involvement extend across the performance?
whole business? Have we considered upstream • Do I know what types of food safety decisions
and downstream activities provided by other will be referred to the board?
parties?
• How are we performing in verification and
• Have incident and crisis response and customer audits? Are we learning from them?
communication plans been prepared and
rehearsed?
Incident and crisis response
• Has our crisis management and
• Does the communication plan identify who can
communications plan been rehearsed recently?
say what? Is there a back-up spokesperson?
ͷͷDid we learn from it?
ͷͷWas it truly testing?
4. Monitor system design and ͷͷWere there independent observers?
performance
• Am I confident that our media response will be
Design appropriate? Do we have a trained alternate if
• Does the senior food safety manager have the primary media person is unavailable?
ready access to the Chief Executive Officer
(CEO)? Types of food safety decisions that
• Has the senior food safety manager reported to the board may consider
the board recently?
• Setting the board Charter food safety
• Does food safety have a place in CEO
statement.
performance incentives? Is there conflict
• Setting food safety expectations including
between food safety and other performance
culture and key performance measures.
measures?
• Contributing to food safety policy.
• Is system capacity balanced with
requirements? • Setting risk appetite for food safety:
ͷͷthings that we will always do;
• How do we address tension between food
safety and other objectives e.g. production ͷͷthings we will never do; and
throughput, sales and marketing or research ͷͷa process where issues are not clear cut –
and development? the "grey areas".
• Have we thought about malicious or criminal • Reviewing food safety situations where
attacks on our business? decisions are not clearly covered by the risk
appetite statement.
Performance
• Setting strategy with respect to food safety.
• Is reporting balanced with a mix of lead and lag
indicators coupled with performance reporting • Authorising and approving capital investment
on specific matters? and major maintenance decisions where food
safety is a decision factor.
• Do I have a clear picture of our food safetyNEW ZEALAND FOOD SAFETY
018 THE FOOD SAFETY LEGAL ENVIRONMENT
New Zealand's food safety legislation is set out • describe the steps the business operator will
primarily in two Acts, the Animal Products Act take to confirm that the programme is working
1999 (APA) (primary industry focus) and the Food effectively;
Act 2014 (focused on food for sale), along with • provide for appropriate corrective actions
secondary legislation including food standards, (including recall of product) to be undertaken
orders in council, regulations and notices issued where the product may not be fit for intended
under those Acts. There is also supporting purpose or not in accordance with its labelling
guidance such as codes of practice. or identification;
There are also food safety provisions in industry • set out appropriate and auditable
specific legislation including the Wine Act 2003 documentation and record keeping; and
and the Agricultural Compounds and Veterinary • make appropriate provision for verification
Medicines Act 1997. activities.
The Acts are similar in that they require Offences involving endangerment of human or
companies to develop and use risk-based animal health include:
measures to ensure where foods are produced • failing to comply with the APA knowing that the
and sold they are "fit for purpose" (APA) or "safe contravention or failure would or is likely to
and suitable" (Food Act). endanger the lives or health of the public, or
The Ministry for Primary Industries (MPI) the life or health of any individual;
administers these Acts including implementation • where an operator of a risk management
and enforcement. programme or a regulated control scheme,
In the following paragraphs a number of excerpts contravenes or fails to comply with any
have been taken from the Acts to illustrate their provision of this APA knowing that the
requirements. As excerpts they are incomplete contravention or failure:
and are not intended to interpret or summarise ͷͷmay create, directly or indirectly, a risk to
the Act(s). Where necessary boards should seek human or animal health; or
independent legal advice to ensure compliance. ͷͷmay, directly or indirectly, increase the
likelihood of an existing risk to human or
animal health.
Animal Products Act 1999
• sale of non-complying animal material or
The APA makes it clear that foods must be "fit for
product (abridged):
intended purpose". This is a broad term
ͷͷfailure to meet specification;
comprising:
ͷͷfailure to be processed in accordance with
• using a registered RMP for animal products
an RMP or regulated control scheme.
such as dairy, meat and seafood processing,
packaging, and distribution; Penalties (depending on the offence)
• applying any relevant standards or regulations; • Corporations – up to $500,000 fine.
and • Individuals – up to five years imprisonment,
• ensuring that the product including packaging and up to $100,000 fine.
and labelling is suitable for the purpose for
Liability
which the product is specifically stated.
Where the body corporate is found guilty of an
An RMP must: offence the liability may flow on to senior
• set out the procedures the business operator managers and directors.
will use for identifying, controlling, managing,
eliminating, or minimising risk factors;FOOD SAFETY GOOD GOVERNANCE GUIDE FOR DIRECTORS
Food Act 2014 Companies operating in other countries 019
While many countries are moving to risk-based
Food sold in New Zealand is subject to the Food
food safety requirements there are differences in
Act. MPI administers this legislation. The Food
structure and application. Directors, executives
Act takes a similar risk-based approach to the
and business owners should be aware of and
APA.
respond to specific country requirements.
Legal obligations under the Food Act 2014 are
similar:
Companies Act 1993
• to produce and sell foods that are safe and
suitable; The Companies Act includes relevant provisions
for directors’ behaviour and conduct – including
• to develop and use risk-based measures
clauses related to "acting in good faith and in
(usually a FCP or National Programme) to
best interests of company", "reckless trading"
ensure food is safe and suitable. FCPs must be
and "duty of care". While risk analysis and risk
registered and independently verified.
management are not specifically mentioned or
The Food Act applies to food sold in New Zealand defined in the Companies Act, board practice
and covers food manufacturing and retail, typically includes active consideration of risk, and
catering, quick service restaurants, food service, the development and management of a company
hospitality and tourism and some logistics risk register. Food safety risk is increasingly
businesses. being included in the risk register.
Safe means a condition in which food, in terms of
its intended use, is unlikely to cause or lead to Ministry for Primary Industries
illness or injury to human life or public health. website
Suitable includes matters not related to food The MPI website has a great deal of information
safety but that could make food unacceptable e.g. relating to the APA and the Food Act. There are
mislabelling, faulty packaging, composition many threads to follow once you have "landed" on
issues. the opening pages:
www.mpi.govt.nz – use keywords such as:
Penalties (depending on the offence)
Liabilities and penalties are similar to those of • Animal Products Act;
the APA in that corporations can be fined, • Food Act .
individuals and directors fined and/or subject to a
term of imprisonment:
• corporations – up to $500,000 fine;
• individuals – up to five years imprisonment and
up to $100,000 fine.NEW ZEALAND FOOD SAFETY
020 WHAT ARE THE MAIN ROLES IN FOOD SAFETY
REGULATION?
The current legislation is based on companies Regulator (NZ Ministry for
taking responsibility for managing their food Primary Industries)
safety risks. This is done using a systematic
• Provides policy advice to the Government.
process of risk assessment, risk mitigation and
risk management including validation and • Administers law.
verification of the risk-based plans, that is, it is • Issues codes of practice and guidance.
up to the company to identify and manage risk. • Supports and monitors implementation.
The regulator's role is to provide information on • Undertakes audits of the system.
how the legislation works, to ensure food • Undertakes enforcement.
companies are using a recognised risk
management scheme, to oversee verification Company
activities and carry out enforcement activities.
• Prepares and validates through chain risk
Verification is typically carried out by a third party based systems e.g. an RMP required by the
within a regulatory framework that is developed Animal Products Act 1999 and/or an FCP
by the regulator. The regulator has power to required by the Food Act 2014.
intervene where food safety risk is considered to • Obtains verification that the RMP and/or FCP is
warrant special and immediate action. compliant with legislation (through an
There are three main roles in food safety independent registered verifier).
regulation as shown in Figure 6. The roles of each • Registers the RMP and/or FCP with the
party are described below. regulator.
• Operates the RMP and/or FCP.
• Reports specified product non-compliances to
verifier and regulator.
• Arranges ongoing third party verification
activities and close out of the RMP and/or FCP
non-conformances.
Verification (third party verifier)
• Verifies RMPs and/or FCPs are compliant with
Figure 6. Main roles in food regulation the law.
• Responds to product non-compliances and
verifies corrective actions.
• Maintains recognition or accreditation as a
Regulator
verifier.
(MPI)
Verifier CompanyYou can also read
