Types of Certification - Understanding Restaurant Managers’ Expectations of Halal Certification

The increasing effort to provide better food safety and quality leads to increasingly stringent safety specifications and a considerable growth in the number of quality assurance schemes. Certification is a means for firms to deliberately position themselves in the market to capture the attention of consumers. It is also a way where the consumers can differentiate between firms. In order to assure that food is safe for consumption, producers should take necessary steps to comply with the quality standard set by regulatory bodies.

Organic Certification

According to Cicia et al. (2002), organic products have received substantial attention by consumers and Makatouni (2002) suggested that organic food is one of the fastest growing areas of the food market in Europe, Northern America, Australia and Japan. Trade Mart (2006) reported that the USA is the world’s largest organic food market that covers 34% of global market value. In contrast, Padel and Foster (2005) argued that the demand in the UK slightly deteriorates over the last few years due to lack of intervention by policy makers in the supply chains. Therefore, there has been a growing concern on the usage of pesticides, the development of Genetically Modified (GM) crops and the possible impact these may have on people’s health for the past 10 years.

Moreover, since 1998, the amount of land used for organic farming has increased seven-folds and there were nearly 4,000 organic holdings in the UK by June 2001. Apart from that, it is generally known that consumers chose to buy organic food for both health and ethical reasons (Cicia et al.,

2002; Essoussi & Zahaf, 2008; Gutman, 1999; Harper & Makatouni, 2002; Krystallis &

Chryssohoidis, 2005; Makatouni, 2002; Onyango et al., 2007; Padel & Foster, 2005; Roddy et al.,1994).

Makatouni (2002) further explained that organic food is perceived as food without

“chemicals” and “growth hormones”, food that is “not intensively” produced but it is “natural”.

However some researchers like Gutman (1999) as well as Krystallis and Chryssohoidis (2005) thought that organic refers to a set of philosophical beliefs about the relationship with the environment, not merely to the physical characteristics of a product. Meanwhile, Padel and Foster (2005) claimed that the term organic and organic labels have strong emotional quality from the customers’ point of view in ensuring good health and personal wellbeing as well as tasty and protects the environment. In fact, this myriad of claims is very confusing to consumers (Harris, 2007). On the other hand, Essousi and Zahaf (2008) who did a focus group study in a community market in the province of Ontario, Canada created a new dimension to the definitions of organic.

The respondents defined organic as products that contain no fertilizer, no chemicals, no pesticides, no antibiotics, no hormones, no GMO and is not processed, nor packaged, with no injection, and brings no harm to animals, natural, tasty, nutritious, colourful, fresh/stay longer and labour intensive.

A study on Greek consumers’ willingness to pay for organic food done by Krystallis and Chryssohoidis (2005) showed that factors like quality, security and trust are basis for them to choose organic food. They reasoned that Greek consumers are significantly less confident about their food supply and fearful of pesticide residues compared to the British consumers. In contrast, Roddy et al. (1994) argued that the general perception of Irish consumers toward organic food is divided into two attitudes although organic farming in the Republic of Ireland is very much in its infancy. The positive attitudes in relation to the product are taste, quality, health, safety and environment.

Marshall (2005) stated that early proponents of organic and sustainable agricultural practices emphasized restoration of soil fertility as a primary goal, with a clear linkage between healthy soil, food, animals and humans. Thus, the organic movement originally emphasized diet and nutrition, health, sewage disposal and rural life as well as agricultural methods. As an alternative to the dominant agro-industrial methods prevalent in the United States post-World War many viewed organic as part of radical fringe.

As mentioned earlier in the topic of food safety, consumers are demanding for assurance that the product they want to purchase can be trusted. In the case of organic food, certification is also an important issue where retailers are competing with each other to provide this perceived healthy food as certified organic products being trusted by one third of the consumers (Krystallis &

Chryssohoidis, 2005). In this context, they found that 130 countries are currently producing certified organic food of which 90 are developing countries with ideal environmental conditions to produce satisfactory organic food.

In order for the organic products to be certified, Lohr (1998) determined that certification of organic products served three functions. First, it assures consumers that a product that is not observably different from non-organic food was grown, processed and packaged according to rules that limit or ban synthetic inputs and such protect the environment. Second, it assures producers that unscrupulous use of the term organic does not defraud them of price premiums and market share that can be earned from certified foods. Third, it makes the market more efficient by reducing information asymmetry along the marketing channel from producer to consumer.

Additionally, the organics sector integrates all aspects of a pesticide-fertilizer free production process using specific standards and is subject to a rigorous certification system (Essoussi & Zahaf, 2008). In addition, to fulfill these functions, the certification must follow a credible process whereby there will be a set of standards, verification of the standards, followed by inspection of the facility and operating records and approving the producer or processor. The approving authority confers the license to allow display the certifier’s label on the product. Lohr (1998) also added that harmonization is a critical issue because consumers form strong loyalty to labels that they perceive as credible organic indicators.

There has been direct implications on certification and sustaining the supply chain in order to fulfill the growing demand from the consumers as the organic industry is heading from niche market industry to a mainstream industry (Essoussi & Zahaf, 2008; Krystallis & Chryssohoidis, 2005). Thus, establishing a well known and trusted certification system is essential (Wier &

Calverley, 2002). Trust is also the main factor raised by Essoussi and Zahaf (2008) when consumer deals with certification and relationship with the farmers. They gathered that consumers expressed concerns on seeing the certification because they feel a lot better and safer.

53 Genetically Modified Organisms (GMO) Certification

Baker and Mazzocco (2005) found that the introduction of GMOs or organism with DNA from foreign organisms, have been received with mixed reaction by consumers and the debate over the safety of GMOs have varied greatly in intensity. Consumer attitudes play a significant role toward the acceptance of GMO products and its application in society (Miles et al., 2005). Thus, negative perceptions will certainly have an impact on commercialisation. Marshall (2005) argued that modern biotechnology has extensive contributions and implications for the food industry and benefit the consumers as the technique will stimulate plant breeders to develop plants with new characteristics and enzymes for food processing industry. Marshall further emphasized that genetic modification can directly improve food quality and processing by suggesting one example that is a modified tomato that can stay on the vine for a longer time and rich in flavour. However, because of the recent tomato scare as a result of the current salmonella outbreak that affected more than 1, 200 people in 42 states in the United States of America (Alonso-Zaldivar, 2008), tomato growers have lost more than $100 million and this has contributed to increasing level of discomfort among consumers toward food safety.

GM food is perceived as being associated with both health and environmental risks (Hunt

& Frewer, 2001). As a result, stricter safety specifications and quality assurance schemes have been introduced to provide higher food safety and quality both in international and European Union (EU) level. As Dimara and Skuras (2005, p. 90) stated “food consumption and production in Europe has been marked by the renaissance of quality”. Similarly, Japan and South Korea do not welcome imports of GMO food (Xue & Tisdell, 2002).

A study on the perceptions and attitudes of Singaporeans toward GMO food revealed that slightly more than half of the respondents were worried by this food type (Subrahmanyan &

Cheng, 2000). At the same time, the study suggested that as people become aware and knowledgeable about GMO, their negative perceptions decrease. Fortin and Renton (2003) had also found similar results. On the other hand, China has been paying greater attention to developing its own GMO technology and products (Xue & Tisdell, 2002) due to China’s food shortage. Similarly, DeWaal (2003) found that US consumers were largely unconcerned with the safety of GMOs.

In Europe, the debate has been vigorous and consumers have, in general, been extremely skeptical of the technology and unwilling to assume the risks associated with GMOs (Botonaki et al., 2006; Fortin & Renton, 2003; Hunt & Frewer, 2001; Miles et al., 2005; Scully, 2003;

Vendurme & Viaene, 2003). In fact, Whitman (2000) mentioned that different governments have their own stand towards this issue. Thus, several countries responded differently. Japan for example has taken action that health testing on GM foods will be mandatory and some states in Brazil have banned GM crops entirely. However, India’s government has not yet announced a policy on GM foods because no GM crops are grown and available in retail outlets although the country is very supportive of transgenic plant research. Meanwhile, a survey conducted in Beijing, China found that the Chinese consumers accepted the use of biotechnology to grow GM rice and GM soybean oil which are the staple foods of the Chinese diet (Li et al., 2002).

Whitman (2000) however, raised the issue of confusion in the United States regulatory process when she reasoned that there are few different government agencies that have jurisdiction over GM foods. Fox (2000) explained that the US Department of Agriculture (USDA) presented a proposal in March 2000 for nationwide standards defining organic foods. The proposal specifically prohibits the use of genetic engineering from agricultural products bearing the organic label.

Similarly with organic labeling, consumers demand GMO food products to be labeled in order to develop a system of traceability throughout the food supply chain (Miles et al., 2005). In addition, Tenbült et al. (2007) and Ellahi (1996) claimed that through labeling, consumers have more complete information and they can make more informed choices.

Partridge and Murphy (2004) extended the labeling concerns by stating that it should be informative to consumers and to also look into international trade and economic implications.

Thus, the realities of biology and commerce need to be considered when framing certification and labeling rules in their study of transgenic soya. Dimara and Skuras (2005) argued that although labeling may serve as a powerful quality signal for consumers to make decisions its efficiency has been seriously questioned. For instance, product labels may have too much information and be too complex to understand. The notion of farm to fork or commonly known as the food supply chain (Figure 3.1) that starts from the primary production to processing, distribution and consumers shows the importance of having a circle of quality products where they can be traced down from where they started (Kirwan, 2006). As mentioned earlier, failure to implement the traceability strategy will generate negative impacts on consumer confidence in food security as they are very much concerned on the issues on food safety, outbreaks and risk regulation (Miles et al., 2005).

Figure 3.1: Schematic Diagram of a Generic Food Supply Chain

Source: cited from Vorst et al. (2000)

3.3 Religious Certification

Source: Vorst et al. (2000).

Regenstein et al. (2003b) highlighted halal and kosher foods as important components of the food business because both religious foods have their own valuable niche markets. Diamond (2002) also pointed out that observant Muslims may buy kosher certified food to suit their religious requirements. Although many Muslims purchase kosher food in the US, these foods do not always meet the needs of the Muslim consumers (Regenstein et al., 2003b). This issue is also brought up by Rosenblith (2008) who noted that Muslims were tired of not being able to find halal food in Western countries and having to rely on the kosher stamp. However, even if kosher looks similar, there are substantial differences between the laws of kashrut and the laws of halal as noted in Chapter Two.

Nevertheless, by considering these two religious certifications, companies can better understand the needs and demands of the related consumers because most people are not aware of certain foods that are under religious supervision (Al-Harran & Low, 2008). They emphasized that halal and/or kosher certification should be an authoritative, reliable and independent testimony to support a food manufacturer’s claim that his products meet the certain religious requirements.

Thus, customers will have greater confidence in consuming such products or foods as halal is fast becoming a new market force and identifier and is now moving into the mainstream market, affecting and changing the perception and landscape on how businesses are being conducted.

56 Kosher Certification

Gutman (1999) focused on kashrut organizations that certify kosher food which have spent a lot of effort to create trust in providing information to the observants of the Jewish laws. In relation to this, self-informed consumers rely on the reputations of particular kashrut organizations. Although, this is in fact a difficult issue to address because there are so many different kosher supervision agencies (Regenstein et al., 2003b). They pointed out the fact that some authorities chose more lenient standards while others preferred more stringent standards and also claimed that people in the food industry particularly, are not aware of religious foods. Thus, the present trend tends to neglect consumers who follow the religious supervision.

However, Diamond (2002) noted the acceptance of Orthodox Jewish in Canada who started to involve themselves in the concept of eating out which occurred by late 1950s. As a result, in 1961, the first kosher restaurant was opened in Toronto to suit not only their new lifestyle but to maintain their religious observance. Since then, the number of kosher restaurants increases.

According to Regenstein et al. (2003a), providing consumers with this particular choice will enhance potential market opportunities. As previously noted, by having certification, companies can make claims in the marketplace that their products meet the Jewish religious dietary restrictions. Apart from that, there are also millions of non-Jewish consumers who viewed the kosher designation as representing “quality”, “healthful” and “good for you” (Diamond, 2002).

The trend in the mainstream kosher community is that more stringent standards (Regenstein et al., 2003b) employ sophisticated and privately driven labeling system to alert consumers to kosher status food. Gutman (1999) made reference to the situation in the US where religious organizations, national and local contract with food producers supervise production before finally certifying the finished outputs as kosher. Regenstein et al. (2003a) detailed that those supervising organizations, for instance, the OU, the OK, the Star-K and the Kof-K are responsible to certify larger food companies. Meanwhile, the OU and the Star-K are communal companies, which are part of a larger community religious organization.

Gutman (1999) highlighted the OU as the largest organization that certifies products in fifty four countries with more than 200 registered kashrut symbols existed in the United States.

Additionally, there are also mainstream and lenient kosher standards which are under supervision of individual rabbis (Regenstein et al., 2003a). The evolution of kosher lifestyle has become one of the factors that change kashrut supervision from small time individual rabbis to multimillion dollar

international supervisory organizations. Gutman (1999) concluded that consumers will purchase products from trusted organizations. In fact, the whole system is based on trust together with the close relationship among religious communities although Diamond (2002) argued that most consumers are likely unaware of the reasons for an OU logo on a food label.

Halal Certification

Companies need to have additional concerns for halal standards because in many countries, halal certification has become necessary for products to be imported (Regenstein et al., 2003a).

According to Riaz and Chaudry (2004), South East Asia has 250 million Muslim halal consumers and halal is considered a symbol of quality and wholesomeness by both Muslims and non-Muslims in countries like Malaysia, Indonesia and Singapore. A halal program was initiated by Malaysia during the early 1980s with the introduction of halal/haram Act and formulation of a high government level halal/haram committee (Riaz & Chaudry, 2004).

Riaz and Chaudry (2004) defined halal certificate as a document issued by an Islamic organization certifying that the products listed on it to meet Islamic dietary guidelines as defined by that certifying agency. Some of the major halal certifiers that are internationally recognized include:

Department of Islamic Development of Malaysia/Jabatan Kemajuan Islam Malaysia (JAKIM), Malaysia

Majelis Ulama Indonesia (MUI), Indonesia

Islamic Religious Council of Singapore/Majlis Ugama Islam Singapura (MUIS), Singapore Muslim World League (MWL), Saudi Arabia (Riaz & Chaudry, 2004, p. 172)

There are certain processes before an organization can obtain a halal certificate. Generally, the process will start from filling out an application form, explaining the production process, detailing the products to be certified, listing down the ingredients used along with other relevant information on manufacturing process and other products manufactured in the same facility.

Subsequently, a facility audit will be performed and upon the approval, fees will be imposed on the applicants.

58 3.3 Halal Certification - International Approaches

There is a continuous effort done by halal authorities internationally in delivering services particularly on halal food to the stakeholders. The International Market Bureau Canada (as cited by Wan Omar et al., 2008) stated that the average global halal food trade is estimated at US$560 billion per year. Thus, encouraging the Muslim and non-Muslim producers to seek and obtain the halal certification in fulfilling the increasing demand by Muslim consumers globally in their obligation to consume halal food.

Halal standards and certification procedures need to be continuously improved by all the certifying bodies around the world as halal standard covers not only to food but it also include non food products. One of the issues that still remain as a public debate is on developing a standard global halal logo and certification. This covers mainly on the process of slaughtering of animals, ingredients for food preparation and inspection that will be covered in Chapter Seven and Eight.

The halal market is growing at a fast pace, having drawn so much attention and interest from various areas, further development initiatives and strategies are essential for the halal certifying organizations to lead and formulate ways to strengthen their credibility with the current and relevant issues surrounding the global halal market. Thus, halal certification and standards is a continuing process that reinforce on scientific research towards the development of a truly standard halal processes and procedures.

This study focuses on several halal certifying organizations in South East Asia, United Kingdom and North America that are recognized by JAKIM. As Malaysia is situated in South East Asia, it is relevant to look into the tasks and accomplishments in other neighbouring countries that include Singapore, Indonesia, Brunei, Thailand and Philippines that can provide further improvements in the halal regulatory framework as a whole. As discussed in Chapter Two, due to the high number of Muslims in United Kingdom and North America, it is appropriate that the

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