Stories on food safety issues have become commonplace in newspapers and television broadcasts. Phthalates in plastic bottles, PCBs in wild salmon, salmonella in canned goods – the list goes on. All raise understandable concerns about the food we eat, including what it was packaged in, where it came from, and how it was handled.
Food manufacturers and packagers go to great lengths to answer these questions. Almost all understand that their business success depends on shareholder and consumer trust, which transform into investment and sales. When crisis hits, however, many companies are quick to stray from this fundamental focus.
In the course of risk assessments carried out by government, academics, NGOs, industry and most recently digitally empowered consumers, concerns come quickly to the fore and can leave the public with serious questions about whether a food or consumer product is safe. If the evidence and community pressure is strong enough, government will intercede, and carry out its own risk assessment.
How industry then chooses to respond in these situations becomes the big test.
Many kinds of companies find themselves in these sorts of circumstances. Often how they respond places them in one of two categories: the firefighter or the collaborative risk manager. The choice of which route a company will take relates back to that original business imperative: how do I restore shareholder and consumer trust.
Firefighters immediately try to extinguish the flames – pouring heaps of science, legalese and possibly even denial on the blaze. It’s understandable: not many have the reflex to call the “collaborative risk management department” when the inferno is reaching the rafters. Others are risk managers. They quickly assess the situation and devise a plan to communicate why shareholders and consumers should continue to invest in and buy their product.
Unfortunately, for companies seeking an immediate fix, the former can illicit an outcome akin to water on a grease fire. One great example of this was the American Chemistry Council (ACC) and their response to bisphenol A in baby bottles (the ACC represents many of the chemical and packaging companies connected to BPA).
In April 2008, the Canadian government announced that it had concerns regarding consumer exposure to a chemical believed to be an endocrine disruptor (aka potential cancer-causing substance, among other things) named bisphenol A or BPA for short. In response, the ACC immediately responded that the levels of BPA did not constitute a scientific concern and that consumer product bans were “not supported by the science”.
Whether the science existed (either with industry or government) or the fact that Health Canada’s action was precipitated by NGO pressure and significant media coverage are moot points. As soon as the words “chemical”, “babies” and “cancer” were put in the same sentence by the Health Canada, shareholders and consumers began to question the industry. No amount of ACC science or independent reviews industry referred to could do enough to stop it.
Which takes us back to the art of collaborative risk management.
On November 27, 2009, Health Canada announced as part of an update on its Chemical Management Plan that it would be carrying out a study into BPA’s effect on vulnerable persons such as infants. More than 18 months after its original announcement and the damning media coverage that followed, the regulator had finally decided on its own framework of independent and thorough scientific study that industry – had it adopted the collaborative risk management model – should have directed them towards a year and a half before.
Hindsight, of course, is 20/20. But what if, instead of responding to the cancer assertion by denying the problem existed, the ACC had said in April 2008 that it would be working with Health Canada, or better yet, had been working with Health Canada to determine if any risk existed and would be sharing what it knew with government? This would not only have separated the ACC from other typical industry responses, but it would also have framed them as risk managers rather than risk deniers.
A subtle difference? Perhaps. But one can only imagine the money, resources and – above all – trust that could have been saved had industry foreseen the problem and reached out to the broader risk assessment community before or shortly after the story broke.
Let activist NGOs and blinder-biased journalists be seen as holding industry to account, slaying the corporate dragon, if you like. In the meantime, food manufacturers and packagers should manage risk collaboratively with the rest of the risk assessment community so they can continue to do what they do best: foster shareholder and consumer trust.
