The current chain of custody requires visibility one step up and one step down, and it requires full internal batch traceability for companies with MSC chain of custody certificates.

This means an auditor can trace product up and down the supply chain, but there is no centralized electronic database of all MSC certified seafood sales.

If the MSC program had a high level of fraud or misrepresentation, there might be justification for a more rigorous system. But the MSC itself says its DNA testing has found over 99% of all MSC products tested were correctly labeled.

“The results gave us confidence that our chain of custody measures work. With other industry studies showing mislabelling levels closer to 10%, the level for MSC products was extremely low, ” said Alison Roel, product integrity manager in the MSC’s Standards team. 

If there is no credible risk of fraud in the MSC chain of custody system, what is driving the MOTS program?

Some companies are already actively engaged in full supply chain traceability, using new reporting tools sold by traceability companies. 

This can be a competitive advantage for some companies.

For example, a trader in Europe who uses such a system can guarantee to his customer that the fish he purchased from China in fact was MSC certified Alaska pollock from a particular vessel, processed by a particular company. For buyers who want such assurance, these systems will help make a sale. 

But when such information is aggregated across the global seafood industry, it gives tremendous power and leverage to the company that owns the data. 

The MSC says there are currently over 3000 companies with chain of custody certificates. They hope this number will grow to 10,000 by 2020, and they also plan to incorporate Aquaculture Stewardship Council (ASC) products in the same chain of custody process. 

In their discussion document, the MSC says “This expansion of the program into different regions and species is accompanied with increasing concerns around the presence of fraud and Illegal, Unreported and Unregulated fishing (IUU) in seafood supply chains in general. Addressing these challenges with the existing CoC system, such as the traceback and mass balance exercises during audits and across the supply chain, might not be cost effective enough or adequate due to their sample-based and manual nature. “ 

“The need for the MSC to look into new online solutions to maintain the credibility of its well respected CoC program was supported in the stakeholder survey in April 2012 and during several discussions with the MOTS Steering Committee and the MSC’s Technical Advisory Board (TAB). “ 

The stakeholder survey that is cited in support of this massive data collection program, asks questions such as whether users want to see a reduction in costs, reduced fraud, fewer audits and enhanced credibility. Much of these are motherhood and apple pie issues, where of course the survey respondents would say they are desirable. 

The MSC says the program, after further consultation and review and approval by the Board, would be voluntary in 2017 and have a mandatory roll-out in 2018. 

This would mean that any MSC chain of custody holder would have to report monthly – mostly with automated software – the sales volume and customers of all MSC products. 

Normally when sensitive business data is collected by an organization, especially a government or a bank, there is a very strict accountability about confidentiality and use of data.

For example, in the US, there are numerous laws protecting the confidentiality of business information for tax purposes, and of economic data collected by the National Marine Fisheries Service, all of which give businesses legal recourse to prevent abuse, and also result in fines and possible jail terms for officials that violate mandated confidentiality. NMFS for example, will not even report the volumes of catch for individual fisheries where there are less than 3 quota holders, to protect confidentiality. 

The problem with the MSC holding such sensitive data in such a visible database is the lack of accountability that comes from it being an International organization that claims only to work through CAB’s – conformity assessment bodies. 

The weakness of the MSC was highlighted during the current Alaska salmon season when a rogue client openly violated all MSC guidelines and rules regarding certificate sharing, and the MSC said they were totally powerless to take any action. Why should they be trusted to spend the resources and time necessary to secure sensitive chain of custody data when they will not secure compliance with their own rules by client groups through setting up accountability measures. 

Imagine the employee of a certifier in Russia, lets say, who is bribed to reveal the database of all export transactions of a rival company – i. e. all its customers and volumes of sales. The MSC has no control over this. Yes they can decertify the CAB, or the CAB can fire the employee, but the value of the information could be much greater than a simple job or contract.

It is a fair question to ask the industry that given the track record of interactions with the MSC, would they trust the organization with 100% visibility to all their sales and operations.

The other potential avenue of abuse is the visibility it gives the MSC into sales of all products from a fishery not going to MSC oriented customers. 

For example, full visibility of sales from the Norwegian Barents Sea cod fishery could determine what percentage of the fishery – which is 100% MSC certified, is going to customers who don’t pay for the MSC certification. This could give the MSC sales teams leverage to go to these companies, and or their suppliers, to suggest they join the MSC fishery ecosystem.

This is where such a database could entrench the MSC as a permanent seafood monopoly. Major retailers such as Metro and Ahold have committed through GSSI – the Global Seafood Sustainability Initiative – to move towards a benchmark sustainability standard that would be open to all scheme owners that met the basic requirements. It would lessen the role of private standards owners, and prevent the perversion of a conservation scheme into a arms race between standards owners to add features and requirements. 

But if the MSC database required full visibility from every MSC fishery – through the mandatory requirement for chain of custody holders – the MSC would have an effective weapon to cripple attempts to use other certification schemes. 

At that point the MSC would have data to favor its friends, and punish its enemies. 

This is what a sample screen from the Database looks like. 

Of course, the MSC claims that their global data system would be very secure. But in a world where even Pentagon and IRS computers are vulnerable to hacking, the most secure option is not to create such a database in the first place. 

Those companies that want full visibility up and down the supply chain should continue to contract with private traceability companies who can provide it. Putting the MSC into the traceability business, with a mandatory program, is a recipe for disaster. 

The MOTS program is currently being tested and piloted, and there is a public consultation period now open. 

Unfortunately, unlike GSSI and the US government, and other international bodies, the MSC does not promise full transparency for comments received during the consultation, but will only provides a summary in their decision memorandum. 

Therefore the only way this program is likely to be derailed is through the MSC stakeholder committees, especially those representing major fisheries such as Norwegian and Icelandic cod and haddock, or Alaska pollock and Alaska salmon.

These stakeholders will have to make clear that the MSC must remain in a limited role, and not enter into the global traceability business. The MSC has already said its system is 99% effective. 

The best guarantee of robust traceability is to certify entire fisheries, and have open and expansive rules for gaining certificates of custody. For example, in Iceland all the certificates are held by a non-profit body that makes them available to the entire industry. 

In Alaska, the new client for salmon, the Pacific Seafood Processors Association, also holds the certificate in trust so all users who qualify can easily use it.

Since Alaskan, Icelandic, Norwegian, New Zealand and many other major fisheries are fully certified, there is no additional benefit to add the mandatory global reporting to fight fraud in these fisheries. 

Where it is an issue is where the MSC is attempting to certify a small part of a questionable fishery. For example, MSC tuna certifications are questionable because the widespread use of FAD’s means most of the fishing is not qualified for MSC – yet the demand for the label creates pressure for fraud, and the claim a tuna is FAD free when it is not. 

In this case, private traceability systems, such as that implemented by longliner NORPAC where every tuna and swordfish can be traced back to the individual longline vessel, can easily accomplish the goal. 

We think the mandatory global database for monthly reporting of all seafood transactions by chain of custody holders is a step too far, and hope the MSC board and stakeholders will see this for the overreach that it is. 

To participate in the comment system, please go here: 

In the interests of transparency, we will also be happy to reprint a certain number of comments from companies and organizations on this proposal. Just send us a copy.  This proposal certainly deserves an industry wide debate.

This story originally appeared on Seafood.com, a subscription site. It is reprinted with permission.