The report, entitled “Point of View: FDA Food Safety Modernization Act”, claims that food manufacturers will need to go beyond compliance in order to ensure the loyalty of consumers and investors, and to gain a competitive advantage.
The new bill is intended to shift the Food and Drug Administration’s (FDA) focus toward prevention of foodborne illness, away from a more reactive approach to food safety. It gives the FDA the authority to mandate product recalls, when in the past it has had to negotiate with a company for it to withdraw potentially contaminated food from the market. It also requires food manufacturers to keep detailed food safety records and gives the FDA greater access to those records.
Managing director of Leavitt Partners’ food and import safety practice David Acheson said: “Heightened focus on food safety by consumers, regulators and Congress has created new challenges for the food industry that can result in erosion of a brand overnight. The new food safety legislation is going to make these challenges more acute and the need for change more urgent.”
Although it may take some time for the FDA to establish new food safety rules, the report said that companies could be at an advantage if they act swiftly to review their food safety procedures. Food manufacturers that are at the forefront of communicating their food safety, record-keeping and product tracking strategies to consumers and regulators could even influence the new rules, the report said.
Carter Pate, who leads the global government and infrastructure teams at PwC, said: “Today's globally extended supply chains mean that, unfortunately, contamination can turn up in more products and more often than in the past. With the new legislation, food companies at every level will be required to develop and document food safety plans that identify and prevent hazards at each facility.”
The report cites the peanut product recall that originated at the Peanut Corporation of America in early 2009 as an extreme example of what can happen if company bosses do not pay sufficient attention to food safety. The company shipped deadly salmonella-tainted products, causing more than 700 reported illnesses (of an estimated 22,000 in total) and nine deaths, leading to one of the largest food recalls in US history.
“Making people sick can literally kill your company,” it said.
The report is available online here.