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Terms of Reference (ToR) for the MSC Chain of Custody Program Review 1

MSC – Marine Stewardship Council

Terms of Reference (ToR) for the

MSC Chain of Custody Program Review 2018

This document is publicly available on the MSC Program Improvements website

(improvements.msc.org)

.

https://improvements.msc.org/


Terms of Reference (ToR) for the MSC Chain of Custody Program Review

Table of Contents

Terms of Reference (ToR) for the MSC Chain of Custody Program Review 2018 ..........1

1. Introduction to the MSC ................. .. .. ... .. .. ... .. .. .. ... .. .. ... .. .. ... .. .. .. ... .. .. ... .. .. .. ... .. .. .. 3

2. About this Terms of Reference (ToR) document ................ .. ... .. .. ... .. .. ... .. .. .. ... .. . 4

3. Objectives of the CoC Program ................ .. ... .. .. ... .. .. ... .. .. .. ... .. .. ... .. .. .. ... .. .. ... .. .. .. 4

4. Objectives of the CoC Program Review......... .. ... .. .. ... .. .. .. ... .. .. ... .. .. .. ... .. .. ... .. .. .. .. 5

5. Stakeholder participation..................................................................................10

6. Guiding standard setting principles ..................................................................11

7. Process for the review ......................................................................................12

8. Governance structure, working approach and decision making procedure ..... .13

9. Assessment of risks .........................................................................................14

10. Contact information ..........................................................................................14



1. Introduction to the MSC The MSC runs the only certification and ecolabelling program for wild-capture fisheries consistent

with the ISEAL Code of Good Practice for Setting Social and Environmental Standards and the United

Nations Food and Agricultural Organization Guidelines for the Ecolabelling of Fish and Fishery

Products from Marine Capture Fisheries (FAO, 2009).

The MSC works with fishers, seafood companies, scientists, conservation groups and the public to

promote fisheries best practices through its certification program and seafood ecolabel. When any

buyer chooses to purchase MSC-ecolabelled fish, certified fisheries are rewarded for their sustainable

practices through market preference. The MSC and its partners encourage processors, suppliers,

retailers, and consumers to give priority to purchasing seafood from MSC-certified fisheries and to

demonstrate this through use of the MSC ecolabel.

The MSC Chain of Custody (CoC) Standard is a traceability and segregation standard that is

applicable to the full supply chain from a certified fishery or farm to final sale. Companies in the supply

chain handling or selling an MSC certified product must have a valid MSC CoC certificate. This

assures consumers and seafood buyers that MSC labelled seafood comes from a certified sustainable

fishery.

Following the completion of the 2014 Chain of Custody Program Review, the CoC Standard and

certification requirements were updated in February 2015. The CoC Standard consists of one Default

version, along with Group and Consumer-Facing Organisation (CFO) versions.

There are five key principles that every company must meet to achieve certification:

http://www.isealalliance.org/our-work/defining-credibility/codes-of-good-practice/standard-setting-code

http://www.fao.org/docrep/012/i1119t/i1119t00.htm



https://www.msc.org/about-us/standards/chain-of-custody-standard/updated-chain-of-custody-program



The standard defines requirements under each principle, and defines what the management system

needs to include: management/ training, reporting changes, control of subcontractors, non-conforming

product procedures as well as other specific elements including those for group management as

applicable.

MSC vision and mission The vision of the MSC is of the world’s oceans teeming with life, and seafood supplies safeguarded for

this and future generations. The MSC’s mission is to use our ecolabel and fishery certification program

to contribute to the health of the world’s oceans. The MSC does this by recognising and rewarding

sustainable fishing practices, influencing the choices people make when buying seafood and working

with our partners to transform the seafood market.

2. About this Terms of Reference (ToR) document This document provides an overview of the review and revis ion of the MSC CoC program

inc luding both its s tandards and cert ification requi rem ents for the reference of all interested

parties. It explains:

i. The objectives of the CoC Program

ii. The objectives of the CoC Program Review

iii. Who is affected and how they will be engaged in the review

iv. The stages involved in the project

v. Consideration of risks resulting from changes to the program within the scope of this review,

and measures to mitigate and/or avoid those risks

The review and any subsequent revisions will follow the ToR o u t l i n e d in t h is d o c um en t . This ToR

has been developed following the ISEAL Standard Setting Code version 6.0.

3. Objectives of the CoC Program The objective of the CoC Program is to provide assurance that products bearing an MSC ecolabel, or

sold with an MSC claim, originate from an MSC certified sustainable fishery. The MSC also provides

the CoC service for the Aquaculture Stewardship Council (ASC) providing assurance that products

bearing an ASC logo, or sold with an ASC claim, originate from an ASC certified farm. The MSC

achieves this by maintaining a rigorous, credible, effective and efficient program that focuses on

product integrity. In turn this allows to grow the demand for and supply of MSC certified fish through

increased participation of end-of-the-supply chain organisations.

The program assures that traceability, segregation, and identification are in place at each step within

the supply chain. It aims to be outcome-based and accessible to a wide range of supply chain

companies, and those serving final consumers in retail and restaurants.




4. Objectives of the CoC Program Review The MSC CoC Program is reviewed to ensure it remains relevant, accessible, robust, and reflects best

practices in product integrity. The last review and revision in 2014 resulted in the CoC Standard being

split to form a Default CoC Standard with specific modifications for Group Certification and Consumer-

Facing Organisations. The CoC Certification Requirements (CoC CR) were substantially revised.

This next review will assess the success of these changes and address issues raised by stakeholders

since the release of the previous scheme documents. Revision will only be proposed where changes

are needed to ensure the objectives of the program are met. Some issues raised have already been

prioritised and projects to address them have begun.

MSC sets strategic objectives for each program review, developed from MSC’s broader objectives for

the CoC program detailed above. Four objectives for the 2017 review have been identified that are

met by various projects, as seen in table 1:

Achieve greater efficiencies. Efficiency is achieved when a task is conducted with fewer

resources (monetary, time, effort, labour). The 2017 CPR wishes to introduce efficiencies for

certificate holders. Options will be explored on increasing the eligibility for remote audits,

recognition of robust digital traceability systems, and improving Group certification

requirements.

Address risks to product integrity. The aim of the CoC program is to avoid and deter product

substitution. Key areas of attention since the last programme review have been around

traceability at the fishery and first landing and availability of more detailed origin information

throughout the supply chain. Additionally, the labour issues project is addressing reputational

risk present.

Align with industry trends and technological improvements. The CoC program must stay

abreast of technological improvements that can offer benefits to MSC, CABs, and certificate

holders and respond to changing expectations of consumers and government to maintain its

best in class status. Projects on digital traceability, product provenance information and labour

requirements are analysing what is changing and how MSC should respond to this

appropriately.

Broaden the MSC CoC offering. As MSC moves into new markets and products, the current

CoC model is not always suited to all supply chains. For this CPR the focus will be to launch a

new mass balance standard for aquaculture feed, which may also become available for other

business to business situations.

Changes proposed as a result of this review may be included in the following scheme documents

where requirements for achieving certification are found:

MSC Chain of Custody Standard (default, group and CFO versions)

MSC Chain of Custody Certification Requirements

MSC General Certification Requirements

MSC/ MSCI vocabulary

MSC Fishery Certification Requirements

MSC CoC Audit Checklists



4a. Projects within the scope of the review

A list of projects comprising this review are detailed below in Table 1. The outcome of these projects will be changes to the CoC scheme documents

released in 2018 or at the following update.

Table 1: Projects identified for the 2018 Program Review

Project Purpose CPR Objectives met Efficiencies Integrity Alignment Broadening

CPR 2015 Monitoring and Evaluation

To evaluate the impacts of the updated CoC Standard and CR, focusing on the following areas: 1. Monitoring impacts from audit process changes to the CoC

Certification Requirements v2.0, including the introduction of unannounced audits.

2. Monitoring the success of the new CFO standard in: a) engaging the food service and fresh retail sector (including growing CoC in this sector and reducing the administrative burden for existing clients) b) upholding product integrity

✓ ✓

Smaller improvements to the Scheme Requirements

Rectify gaps, inconsistencies, and redundancies in the scheme documents that have been raised by stakeholders. Options will be developed to address these issues. Solutions that are likely to result in changes to the requirements will be highlighted at consultation.

✓

Digital Traceability Develop a strategy for the long-term direction of the CoC program, giving changing expectations of the industry, consumers and governments and emerging new technology and digitalisation as main drivers. Deliverable objectives include:

Involvement in initiatives to establish alignment of data requests and formats

Engaging with governments to get MSC/ ASC certification recognised as low risk of mislabelling or IUU

Requiring more information on product origin to pass through the chain in more detail.

Consider including use of credible digital systems as reduced

✓ ✓ ✓ ✓


Project Purpose CPR Objectives met

Efficiencies Integrity Alignment Broadening risk factor in standard

Fishery Traceability Ensure that traceability risks between harvest and first sale by a fishery client are effectively addressed within the MSC program. Whilst it is expected that the majority of fisheries have good traceability systems in place the MSC has identified the following challenges: Lack of comprehensive information within fishery assessment

reports Stakeholder concerns especially in relation to complex at sea

operations Lack of clarity around the need for CoC for on-land operations

and the responsibilities for the seller and/or buyer in verifying product is from the Unit of Certification

✓ ✓

Labour Requirements Labour abuses within the global fishing industry and supply chain remain a widespread concern. To ensure the MSC fisheries and supply chains are operating at internationally accepted norms and free from labour abuses, the MSC seeks to provide further assurance in addition to its current policy. Whilst several social standards have started to provide a solution for on-shore supply chain verification, there are significant challenges to providing similar assurances for at-sea vessels. Stakeholder perspectives and expertise will be essential to the process for developing a new set of requirements to eliminate labour violations in MSC fisheries and supply chains. These requirements will be integrated into the Fishery and CoC Standards.

✓ ✓

Mass Balance Standard Develop an alternative CoC standard based on mass balance and associated claim likely to be limited for B2B use only for application to supply chains where segregation is not possible or practical. This project was originally driven by the need for a mass balance CoC solution as part of the requirements for traceability of marine ingredients in the new ASC Responsible Feed Standard, to cover feed mills. May also apply to seaweed supply chains, where segregation is not possible at all steps.

✓ ✓


https://improvements.msc.org/database/labour-requirements/background

http://www.asc-aqua.org/upload/ASC%20Responsible%20Feed%20Standard_v0.1_FINAL.pdf


Project Purpose CPR Objectives met

Efficiencies Integrity Alignment Broadening For more information, refer to the Mass Balance CoC Standard ToR.

Provenance & Source Data

Allow fishery origin information to be passed through the chain to respond to changing expectations from governments, consumers and end of chain companies. The aim is to find solutions that provide more information about provenance, product form (fish meal/oil) and other data about origin through the supply chain, where needed in a verified form.

✓ ✓

Shared CoC Audit Checklists and increased recognition of other schemes

Several food/supply chain certification schemes exist that share similar objectives to MSC CoC. These include British Retail Consortium and Global Gap. MSC is keen to explore how CoC audits could take other certification schemes into account more explicitly. The overall aim is to reduce audit burden in supply chains, in frequency and/or scope.

✓

✓


https://marinestewardshipcouncil.sharepoint.com/sites/standards/StandardsEdit/24.%20CoC%20Mass%20Balance%20Standard%20ToR%20Appx%2024D.docx


4b Projects out of scope for the Review Some projects have been excluded, for reasons identified in Table 2 below.

Table 2: Projects excluded from the 2018 Program Review

Project Purpose Rationale for excluding

Restaurant licensing To offer an alternative to the CoC certification program to allow small independent restaurant businesses to use the MSC ecolabel and ASC logo. The aim was to make entry to the CoC program more accessible, by moving away from CoC certification, but retain product integrity by using inspections.

Pilots with a few dozen participants have been run in the Netherlands and Germany, and demonstrated poor compliance. As an alternative model, MSC has evaluated that licensing pilots are not acceptable as they introduce too high a risk of substitution. As a result, no change will be introduced to the requirements to allow for this model.

Product authentication testing (e.g. DNA) and tracebacks for traceability and assurance in the supply chain

An on-going workstream that involves product sampling to monitor and evaluate the ability of the CoC program to meet its objectives of upholding product integrity throughout certified supply chains.

This is a longer term workstream that informs MSC about the success of the CoC program, and directs the need for potential changes to requirements. It will not explicitly result in changes to the CoC Standard or auditing requirements in 2018.

Illegal, Unregulated, and Unreported (IUU) fishing

IUU fishing is increasingly being prioritised by fishery managers, regulation authorities, and traceability systems. This project aims to ensure CoC and fishery requirements are enhanced to identify and prevent IUU fishing from entering certified supply chains.

Work investigating IUU at the fishery level and in supply chains and how this interacts with MSC certified supply chains is underway. Due to a lack of capacity it is uncertain whether changes will be introduced in 2018 as a result of this work.

Risk Management This project aims to develop a definition of CoC risk and establish a list of factors applicable at different levels of the supply chain. It will do this by:

Profile the various stages of the supply chain with common risk types, and identify factors that amplify or reduce risk of substitution

Test how effective current tools are in detecting, deterring, and mitigating risk

Improve data collection and availability Identify new internal and external datasets Test the utility of existing, accessible data to inform risk

management

Explore external partnerships to encourage research

The most pressing known risks will be addressed through the fishery traceability project and improving the scheme requirements. This is a longer-term workstream that will not result in changes to the CoC Standard or auditing requirements in 2018.




o Primary and secondary processors Governments/policy makers (Industry) o Traders, transporters and Media distributors Donors o Retailers Scientists/academics

5. Stakeholder participation

The review and subsequent revision of MSC standards are an open, transparent and stakeholder-led

processes. Stakeholder inputs are an integral part of the standard revision process.

The MSC’s processes for consultation on a new or revised standard follow the ISEAL Standard

Setting Code and FAO Eco labelling Guidelines. ISEAL requires two rounds of public consultation and

effective stakeholder engagement opportunities, particularly focussing on those who are typically

under-represented (such as those in the developing world). The MSC will monitor the participation of

stakeholders throughout the standard revision process to ensure balanced and effective stakeholder

participation.

Stakeholders are: Key Secondary

Fishery clients (including on-land operations, auctions and agents)

CoC certificate holders including:

MSC & ASC staff and governance bodies

International Standard Setters

o Consumer serving companies ASC Certification bodies (CABs) ASI (the Accreditation Body used in the

MSC multi-CAB system)

Industry partners

NGOs Technology (data or IT related)

MSC strategies for involving these groups of stakeholders in the Chain of Custody Program Review

may include the following:

Direct contact with company/ industry contacts

E-mail newsletter

Engagement in pilots if relevant (potentially for the mass balance standard, or digital

traceability)

Engagement through a third party (e.g. engaging clients via their CABs)

In-person seminars

In-person workshops

NGO networks

Online consultation/ questionnaires

Trade press

Webinars

Website (including improvements.msc.org)

MSC will identify stakeholders (type and region) and expertise needed for each project. We aim to

reach stakeholders and achieve good participation across groups that may be impacted by the

proposed policy changes through the opportunities identified below. More detailed stakeholder

engagement plans are available on request for each project. If you wish to provide more detailed input

in advance of full public consultation, your feedback is welcome via [email protected] at any

time.



http://www.fao.org/docrep/012/i1119t/i1119t.pdf

https://improvements.msc.org/database/seaweed-standard/consultations/first-consultation-seaweed-standard/MSC-Consultation-Document-Seaweed-Standard.pdf/view

mailto:[email protected]



Public consultation opportunity

Location and date Purpose of consultation

In-person workshop with companies and auditors

Ho Chi Minh, Vietnam

January 2017

Discuss draft proposals for changed requirements. Feedback from these

consultations help MSC refine proposals and consider new

proposals where relevant. These consultations enable stakeholders to

participate in the requirement drafting process.

In-person workshop with accreditation body and auditors (Tripartite Meeting)

London, UK March 2017

In-person seminar with companies and auditors

Boston, USA (TBC) March 2017

In-person seminar with companies

Brussels, Belgium (TBC)

April 2017 Webinars with companies and auditors

Conference call April 2017 (TBC)

Online MSC website March – April 2017

Targeted meetings/ calls with companies and auditors

Global (TBC) June 2017 (TBC)

Confirm final proposed changes to scheme documents. Feedback from

these consultations help MSC finalise changes. These

consultations inform stakeholders of upcoming changes and provide the

opportunity for them to ask questions about impacts.

Webinars with companies Conference call

August 2017 (TBC) Online MSC website

September 2017

In-person workshop (TBD) with auditors

London, UK (TBD) September 2017 (TBD)

Online MSC website March – April 2018

Online MSC website August – September 2018

6. Guiding standard setting principles

The MSC use their standards to achieve their missions and visions. Therefore, it is important that both

the process of setting standards and the standards themselves observe widely recognised credibility

principles. These are adapted from the ISEAL Credibility Principles.

Improvement – The standard will be reviewed, and if needed revised, approximately every three

years. This allows the MSC to incorporate learning from stakeholders’ feedback and from the

Monitoring and Evaluation (M&E) program. Performance levels will be adjusted over time to reflect

new science and improved management practices.

Relevance – It is industry best practice to accompany a sustainable product certification with

certification of the associated supply chain. This gives consumers assurance of product integrity. The

MSC CoC system requires traceability, segregation and identification at each step of the supply chain

from the MSC certified fishery or ASC certified farm. Consumer trust in this chain of custody is critical

to the success of the wider MSC program.

http://www.isealalliance.org/our-work/defining-credibility/credibility-principles



Rigour – Companies in the supply chain trading, and handling MSC or ASC product must adhere to,

and be certified to, the MSC CoC Standard to sell product with the certified claim. The Chain of

Custody Standards are based on the key principles that assure product segregation, identification and

traceability through each trading step from the MSC certified fishery or ASC certified farm. The

standards also include the need for effective management controls, training and procedures to

maintain these systems. All certifiers must be accredited by Accreditation Services International (ASI)

in compliance with MSC requirements. MSC provides oversight of the program on a sample basis,

including reviewing samples of audit reports, tracebacks and DNA tests.

Engagement – Multiple stakeholder groups are proactively engaged throughout the program review

process, from the initial feedback through to the decision-making stages. Final decisions are taken by

the MSC Board of Trustees, which includes a variety of stakeholder interest groups.

Transparency – All information on the program review process except confidential minutes of

governance bodies and other internal meetings is made publicly available on the MSC websites. The

information is kept up-to-date, including the ToR, synopsis and all public comments, draft version(s) of

the standard, and the final (valid) version of the standard.

Accessibility – The standard’s requirements are not overly burdensome. The standard does not

create obstacles to trade or exclude small-scale operators from market access and facilitate access to

information about meeting the standard, training to build capacity at the local level and for actors within

the supply chain. The standard and guidance documents are translated into different languages as

deemed necessary.



7. Process for the review The table below lists the steps planned for the CoC Program Review 2018.

Activity Planned date

Collation of all issues raised with the CoC scheme documents Jul-Oct 2016

Publish draft ToR and work plan Jul 2016

Consultation on the ToR with other standard setters Jul 2016

Early public consultation on Provenance Data and Mass Balance Standard

Aug-Sep 2016

MSC TAB and Board approve final ToR Nov 2016/Jan 2017

Public consultation on specific topics Mar-Apr 2017

Review and publish feedback Jul 2017

MSC TAB evaluation of proposed changes to CoC Standard Jul 2017

Public consultation on all proposed changes Sep 2017

Review and publish feedback Nov 2017

MSC TAB and Board evaluation of proposed changes to CoC Standard Dec 2017-Jan 2018

Public consultation on specific topics Mar-Apr 2018

MSC TAB evaluation and recommendation Jun 2018

Final public consultation on proposed changes to CoC Standard Aug-Oct 2018

MSC TAB and Board decision and final approval Dec 2018-Jan 2019

Release of revised scheme documents and supporting material for stakeholders

Feb 2019



8. Governance structure, working approach and decision making

procedure

The MSC is governed by a Board of Trustees. Our Technical Advisory Board (TAB) and Stakeholder

Council advise the Board. MSC staff carry out the work of the organisation from offices around the

world, and report to the Board of Trustees.

Our structure involves a wide range of stakeholders with different views. This allows the MSC to be

balanced, and decisions reflect many sectors and interests. The Board of Trustees, Technical

Advisory Board and Stakeholder Council include representatives from industry, environmental groups

and science, and from different geographical regions.

In addition to our three governance bodies, committees and working groups are set up to address

specific regional or topical issues. Their members come from the MSC Board, Technical Advisory

Board and Stakeholder Council, and may include other experts who are invited to advise the MSC.

Reporting requirements A summary of MSC Board discussions arriving at a decision to endorse a standard will be made

publicly available.

Decision-making procedure Formal adoption of a new or revised standard rests with the MSC Board following recommendation

from the TAB and advice from the Stakeholder Council. Adoption of a standard will only be confirmed

where there is consensus in the Technical Advisory Board.

Participation It is possible for stakeholders to attend and observe TAB meetings. Those interested should contact

[email protected] for more information.

https://www.msc.org/about-us/governance/structure/board-of-trustees

https://www.msc.org/about-us/governance/structure/technical-advisory-board

https://www.msc.org/about-us/governance/structure/msc-stakeholder-council

https://www.msc.org/about-us/governance/structure/msc-stakeholder-council

https://www.msc.org/about-us/offices-staff




9. Assessment of risks

The MSC have identified the following risks associated with changes to the scheme documents

resulting from this review:

Type of risk Identified risk Mitigation strategy

Reputational, credibility

Changes to make the program more flexible to different sectors may lead to criticism regarding integrity. This may include changes to the breadth of our traceability offering such as development of a ‘mass balance’ approach.

Monitor product integrity to assess whether risks are real or perceived.

Engage communications team to manage perceived risks.

Engage relevant stakeholders (e.g. retailers and NGOs) to discuss if potential trade-offs are required and acceptable.

Reputational, credibility

Changes to make the program more robust e.g. fishery traceability, may result in reduced accessibility and increased effort for some supply chain actors .

Engage fishery clients and supply chain companies throughout the process to understand feasibility and impact of proposed changes.

Operational There may be conflicting timelines and different governance structures for MSC and ASC, which could result in delay or uncertainty about objectives in collaborative projects.

Close on-going collaboration with ASC on all projects affecting them, and ensuring timelines are understood and objectives are agreed.

Operational, reputational

Extensively changing requirements for CABs and CoC holders may result in knowledge gaps and confusion. Initially, auditors may not be fully trained or competent in the new requirements.

Publish training and support materials in advance of new requirements becoming effective. Provide opportunities e.g. webinars, for stakeholders to ask questions.

10. Contact information Please contact [email protected] to submit any comments on this document and/or CoC program

development.


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