Pilot project to deter organic fraud sets the stage for industry-wide adoption

The Organic Trade Association in May announced a groundbreaking pilot project to prevent and detect fraud in the global organic system. 

The Global Organic Supply Chain Integrity (GOSCI) Task Force of the Organic Trade Association initiated the far-reaching three-month pilot project. This group of 48 members 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 industry-wide implementation of systems and measures to preserve the integrity of organic, both inside and outside of the United States.

“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,” said Laura Batcha, CEO and Executive Director of the Organic Trade Association, in announcing the initiative at the association’s Annual Policy Conference in Washington. “Everyone has a role and responsibility to detect and deter fraud. I commend the Organic Trade Association members participating in the pilot for the commitment to doing everything in their power to address the problem and taking the lead in finding constructive and workable solutions.”

Participating in the pilot project are 13 members of the GOSCI Task Force, representing the entire organic supply chain, from farm to retailer and a diverse range of products, services and commodities including fresh produce, grain, spices, dairy, eggs, meat, beverages, packaged and prepared foods, farm inputs, importers and consulting services. Pilot participants are: 

  • Clarkson Grain Company Inc. (handler/processor/feed grains/oilseeds)
  • Egg Innovations LLC  (producer/handler/eggs, livestock feed)
  • Field Farms Marketing (importers of corn and soy)
  • Global Organics Ltd. (handler/importer)
  • Grain Millers Inc. (handler/processor/grains)
  • I Was Thinking (importer/handler/co-packer, grains, seeds, legumes, sweeteners)
  • MOM’s Organic Market (retailer)
  • Organically Grown Company (distributor/produce)
  • Organic Valley CROPP Cooperative (producer/handler/livestock/dairy/meat)
  • Pipeline Foods LLC (handler/supply chain solutions/feed grains/oilseeds)
  • J.M. Smucker Company (processor/multi-ingredient)
  • Stonyfield (livestock, dairy, producer/handler)
  • True Organic Products Inc. (manufacturer/fertilizer). 

The pilot is running from June to September. It is designed to be an intensive-focused exercise in which participants will “test drive” in their specific businesses the fraud prevention and detection strategies developed by the GOSCI Task Force. Participants are concentrating on one product or ingredient, or a specific location to run through the pilot program. During the pilot, the participants will create fraud mitigation measures based on the results of vulnerability and risk assessment and then share feedback on their experience and provide recommendations on how to improve and strengthen the suggested strategies explained in the GOSCI Best Practices Guide. 

Collaborating partners in the project are the U.S. Department of Agriculture’s National Organic Program, the Accredited Certifiers Association (ACA), and the NSF International. The collaborating partners will review and provide feedback on the set of recommendations put forth by the task force, as well as provide continuing support on implementation, training and adoption efforts.

“We’ve worked for a year to develop a fraud prevention program for organic. 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,” said Gwendolyn Wyard, Vice President of Regulatory & Technical Affairs for the Organic Trade Association and staff coordinator for the GOSCI Task Force. “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.”

"Pipeline Foods is honored to work with the Organic Trade Association and member organizations to develop and test these industry best practices for assuring organic integrity. This collaborative industry initiative is critical to the health of the organic industry,” said Erin Heitkamp, Managing Director of Sustainability and Assurance at Pipeline Foods.

The GOSCI Best Practices Guide, presented to the National Organic Standards Board in draft form at the Board’s 2018 spring meeting, provides organic businesses with a risk-based approach for developing and implementing a written strategic plan to assure the authenticity of organic products. The plan focuses on identifying and assessing specific weaknesses or vulnerabilities in their business that pose the most risk of fraud, identifying and taking measures to reduce those vulnerabilities to deter fraud, establishing a monitoring program to ensure the fraud prevention measures are in place, and developing an actionable complaint system to be used when fraud is suspected or detected.

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. Once the pilot project completes its work and the GOSCI Best Practices Guide is finalized, 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.

“We envision a program that will create an opportunity for organic companies to be recognized and to become GOSCI card-carrying members,” said OTA’s Wyard. “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.”

The global organic market has been on a steady rise for more than two decades, and has never been bigger. It is now an almost $90 billion market, with the American organic market alone accounting for close to $50 billion. Organic imports into the United States in 2017 totaled around $2.1 billion, up nearly 25 percent 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.

“If we want to grow as an industry, we as industry are going to need to challenge our policymakers to become better. It is then equally as important that we as industry challenge ourselves to become better. We believe this pilot program is a great format for Grain Millers Inc. to look at our organic procedures from a different point of view,” said Sam Riser, Manager of Organic Procurement for Grain Millers.

“The success of organic relies on consumer trust of the Organic seal,” said OTA’s Batcha. “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 Organic Trade Association thanks its member participants in the Pilot Project for their time and commitment and for serving as the leading companies to adopt the GOSCI Best Practices. We invite other OTA members that would like to learn more about the program to reach out to OTA’s Gwendolyn Wyard, VP of Regulatory and Technical Affairs. //