IJCA - Volume 3 - Flipbook - Page 53
2024 | Volume 3, Issue 1
fully resolved with the root cause determined and
corrective action taken.
Operational. The document review will also be a part
of the operational assessment of the food company,
with some regulatory considerations as well. For
example, FSMA requires that food companies develop
and implement a supplier approval program, a foreign
supplier verification program (where applicable), and
a food safety plan for internal operations. While the
regulatory assessment needs to confirm that these
meet all requirements, the operational aspects should
also be assessed to determine if they go beyond the
basics to ensure effective protection of all products.
Additionally, training is a critical aspect of food safety,
and records should reflect ongoing food safety
training for all applicable employees.
Another key area of assessment in the operational
review involves the company’s controls against
cross-contamination (e.g., separation of raw from
ready-to-eat foods and ingredients) and cross contact
(e.g., separation of allergens from non-allergen
foods and ingredients). Examine the company’s
recall plan—assess their preparedness for a recall or
other crisis; ascertain if a response plan is in place;
determine if they have conducted mock simulations
to ensure all is in order. Review the packaging line—
confirm that all materials are food grade; identify any
potential for finished products to be contaminated
before packaging. Additionally, check if the company
repossesses any packaging standard certifications
required by customers.
Operational due diligence involves a combination of
record review and facility inspection. The reviewer
should conduct a walkthrough of the plant, following
the food processing steps to ensure that the facility
is, in fact, implementing all the food safety practices
that its records state it is. Identify potential food
safety risks, such as sanitation deficiencies or
structural defects that could lead to contamination
or indicate any intentional adulteration vulnerabilities.
This also presents an opportunity to examine the
products and their testing procedures in the in-house
and external labs, and to investigate anything that
seems “off” for any reason.
Attention should also be directed towards the
workers as you navigate the facility. Observe whether
they are diligently carrying out their duties and
adhering to food safety protocols. Assess whether
there is evidence of a food safety culture throughout
the company—i.e., is food safety ingrained in the
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behaviors at all employee and management levels?
A company-wide culture of food safety has been
recognized as an integral component of effective
food safety management. It is not only considered
a “good to have,” but it is also required by GFSI and
included in FDA inspections.
Reputational. Any concerns found while considering
the regulatory and operational due diligence can
also significantly derail a company’s reputation,
leading to decreased customer loyalty and sales,
and quickly impacting the bottom line. In today’s
digital age, where communication is accelerated
through the internet’s capabilities for both media
and social media, reviewing consumer complaints
should not be neglected. Although the old adage
“one person tells 10 people who tell 10 people” now
spreads exponentially online, complaints should not
automatically give a company a black mark. Rather,
they should be judged and weighed based on the
number of complaints, the reasons behind them, and
the company’s resolution.
Risk Mitigation
Once the assessment is completed, the gathered
information can be amalgamated, and a
comprehensive due diligence report developed. The
report should include a compilation of the findings,
an analysis of the data, identification of risks and
opportunities, and an overview of key aspects of the
company’s food safety—both positive and negative.
It should also summarize the due diligence process,
any legal and financial considerations relevant to
food safety, and any other pertinent information.
If the due diligence was undertaken as an internal
review prior to soliciting investment, steps should
be taken to correct any deficiencies and mitigate
identified risks. If conducted by or for an investor,
the report should be diligently reviewed by all
stakeholders to gain a thorough understanding of
the potential benefits and risks associated with
the investment to make an informed decision. A
due diligence conducted by a qualified food safety
consultant should always include recommendations
regarding the feasibility of deficiency correction
and risk mitigation, as well as an assessment of
the strength of the company’s food safety. It is only
through of all these steps that a due diligence will
enable an investor to make a well-informed decision
and mitigate potential challenges that may arise in
the future.
