Publications

Comply or Die: When Social Responsibility and Sustainability Compliance Goes Well Beyond Food Safety Laws and Regulations
 

FSMA. The Produce Safety Rule(i). Preventative Controls for Human Food(ii). Preventative Controls for Animal Food(iii). Foreign Supplier Verification(iv). Sanitary Transportation(v). It is 2025, and your client (let’s call it “ABC Produce” or “ABC”) “thinks” it finally has a handle on the plethora of laws and regulations surrounding food safety. Policies, procedures, and people have been put into place at ABC to achieve compliance with all of these laws and regulations, so ABC Produce’s business is on track for a smooth ride without seatbelts needed? Not so fast – ABC’s compliance ride will be taking some rollercoaster-like twists and turns because of social responsibility and sustainability.  

In today’s complex business environment, mere compliance with federal, state, and local food safety laws and regulations alone is not enough for most retailers, brokers, and buyers. Influencers and consumers are demanding transparency across the supply chain because they want their wallets to align with their hearts. And without their purchases and social media posts, we all know that ABC Produce’s business can’t improve its financial standing or customer demand for ABC’s fruit and vegetables.   
 

Most retailers have established their own food rules and standards, which ABC Produce and its employees, subcontractors (including domestic and H2A labor providers), vendors, and suppliers have agreed to comply with long ago. Though some of these are not statutory or regulatory requirements for selling the product, ABC will become legally, contractually obligated to comply with the rules and standards if ABC chooses to become a supplier or maintain its supplier role. Food safety from crop to consumer is only the ticket into the concert, folks. If ABC wants an all-access pass with VIP sourcing opportunities, then it must understand, monitor, verify, and certify with a recognized third-party audit provider two newer barriers to entry: 1) Social Responsibility and 2) Sustainability.  
 

Now, don’t let those alliterative “S” words confuse you, as there are distinct differences. In the simplest of terms, “social responsibility” focuses on labor standards and health and safety, while “sustainability” focuses more on environmental impacts and business ethics. Social responsibility and sustainability do go together—like peas and carrots—but each term has essential and differing components for compliance.  
 

If you or your clients have confused the terms - don’t feel bad. We all have been guilty of combining them. Maybe it is because those same retailers, buyers, and brokers who are asking ABC to comply with food safety laws and their internal food safety standards are the same ones who began the discussion several years ago by combining the concepts of “sustainability” and “social responsibility” in writing and seminars. Examples given by these retailers, buyers, and brokers were fuzzy and were provided in non-mandatory, online seminars during COVID without retailer or buyer agreements in place, and ABC was given no real deadline to comply or show that it was meeting benchmarks in this new compliance journey. ABC may have even blindly answered “Yes” to the multitude of information-gathering questionnaires sent by each customer concerning both topics. Sound familiar? Maybe not, as the legal teams for many produce companies never even saw the questionnaires.  
 

ABC thought that doing business with several outwardly respectable labor providers and having a tight and federally compliant H-2A contract for pay, transportation, food, and housing would equal simultaneous compliance with “social responsibility.” ABC is also a respected brand in its own right and has a year-round supply of its core produce items from both internal, domestic grower contracts and international grower contracts. ABC has achieved superior food safety scores throughout the supply chain, maintains high credit ratings, and is a “preferred” supplier for multitudes of domestic and Canadian store distribution and processing centers. However, this just might not be enough in this new world of sustainability and social responsibility requirements.
 

Late last summer, the proverbial “hammer” was dropped with a consortium of larger brands requiring social responsibility and sustainability audit certification in accordance with international standards, including ISO and the United Nations. We aren’t in Kansas anymore - or California, Arizona, Florida, Michigan, or New York. Simple legal compliance in those states does not equate to international standard compliance or ABC’s ability to demonstrate compliance during an audit. In the seminars mentioned above, ABC, along with most of its fellow producers and suppliers, realized that it had a major, internal knowledge and capacity deficit when it came to this new level of compliance, as well as a budgetary deficit.  
 

ABC, like most other produce entities, added a food safety team member or a retained consultant to its management pool 10-15 years ago. This one person or small team probably wears more than the food safety/quality assurance hat and is already stretched thin with maintaining and transferring to buyers via a myriad of electronic systems the required training, monitoring, testing, and trade recordkeeping documents—oftentimes, by every truckload. These compliance champions may even lead every single farm or facility tour because “they know all the answers.” Of course, everyone’s favorite “Safety Guy” or “Safety Gal” who saves the day during every food safety audit can manage two more emerging compliance areas that sound similar, right? Not so fast, my produce friend! Crop to Consumer corporate compliance for social responsibility and sustainability may just have more ambiguities and complexities than food safety. Why?  
 

Food safety in the produce industry has evolved more from response to the following: 1) outbreak-driven lawsuits, 2) commodity-association membership requirements, mutating FSMA guidance and 3) customer directives founded on perceived or known risk—potentially from a commodity grown, harvested, packed or even processed far differently than ABC’s product. Time and time again, a “one size fits all” approach has shown to not work well in food safety, and it is already proving to make social responsibility and sustainability compliance extremely difficult.   
 

ABC will have to be able to “prove” its compliance with the social responsibility and sustainability requirements put in place by its customers, but how will it do this?  Well, some retailers are now requiring this “proof of compliance” through a “SMETA” 4 Pillar Audit. SMETA stands for Sedex Members Ethical Trade Audits. The four pillars of these audits are: 1) labor standards; 2) health and safety; 3) environmental impacts; and 4) business ethics.  
 

These SMETA 4 Pillar Audits are a new concept for most in the agricultural industry in general. The standards in these audits are often applicable more for manufacturing, and the application in the world of produce just doesn’t translate very well. Produce companies selling to many of the desirable retailers are starting to have to comply with and undergo SMETA audits, and they truly have no idea what to expect. This is a whole new world of compliance and audits for the industry. What ABC and others thought was going to be a pretty smooth ride has now turned into a rollercoaster full of drops, inversions, and helixes!
 

ABC has always worked hard to treat its employees well and to use only vendors, subcontractors, and suppliers who treat their employees well. ABC also acts as a good environmental steward, and its leaders are very ethically minded.  So ABC might think “why do we need to jump through more hoops when we are doing the “right” thing already. This buyer-imposed ‘social responsibility and sustainability’ thing is too costly and too time consuming. We are already complying with “the law” – we don’t legally have to do this, and we are not going to!”   
 

ABC can absolutely make this choice and not contractually obligate itself to comply with retailer, buyer, and broker-imposed social responsibility and sustainability requirements. Consequently, ABC will also be choosing to walk away from a market for its product, income for its business, and an opportunity for its business to survive and thrive. The agriculture industry faces enough challenges in America - high costs of labor and inputs, weather challenges, a society that has been taught to hate and distrust farmers, regulatory challenges, and more – and ABC might think it is simply avoiding more challenges to its ability to just survive. However, realistically, ABC Produce’s choice to “avoid more challenges” really could be a choice of taking itself out of the produce marketplace. You see, producers now have to accept that we live in a world where food “compliance” means far more than statutory and regulatory compliance – it means complying with private, contractual obligations with customers. Producers, including ABC, now must consider whether to “comply or die,”
 

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(i) 21 CFR Part 112
(ii) 21 CFR Part 117
(iii) 21 CFR Part 507
(iv) 21 CFR Part 1
(v) 21 CFR Part 1  

As published in the March, 2025 edition of "Farm to Firm - The Official Newsletter of The American Agricultural Law Association"