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H. Schulze, F. Albersmeier, A.Spiller, G. Jahn (2006) Audit risk factors in certification. How can risk-oriented audits improve the quality of certification standards?
Paper,
98 th EAAE Seminar ‘Marketing Dynamics within the Global Trading System: New Perspectives’, Chania, Crete, Greece as in: 29 June – 2 July, 2006
Document:
Schulze_et_al..pdf Δ
Abstract
Over the past few years, certification standards have become increasingly relevant as a marketing signal for agribusiness. Substantial parts of the value chain are already certified by standards such as QS, IFS or Eurep Gap?. It is hardly researched, however, if these approaches can actually ensure a high quality control. In theoretical regards, the following contribution reverts to concepts from auditing theory. Since the 1970s and increasingly after the recent scandals, auditing theory has developed approaches that are geared to the risk potential of the audited company. The same basic parameters that led to the development of the risk oriented auditing concept similarly apply today to certification systems. Certifiers in agribusiness today are in severe competition for contracts, which are commissioned by the companies that are to be audited. Here the risk for faulty incentives and processes of adverse selection is high. The fast growth of the certification systems could lead to the suspicion that auditing procedures and staff qualifications are not yet sufficiently developed. In empirical regards, this article is based on the analysis of the data base of the QS system with more than 100,000 businesses involved. It tries to deduce some first empirically rich hypotheses about the connection between auditing quality and the institutional framing of the certification.
Keywords: certification, quality assurance, risk oriented auditing approach
Relevance to our study:
That paper describes the different certification systems as a structure, focussing on the effectiveness of certification structures and analysing these for the agribusiness on a broad quantitative basis.
Considerations regarding the reliability of the audit procedure (from checklists to risk oriented auditing). The risk oriented approach contrast sharply to some expectations in the agribusiness that auditing should be more standardised and equal.
Certification systems which try to introduce risk classifications have to convince clients and certification bodies of the advantages of risk
oriented approaches. At first sight, different auditing intervals, auditing depth, unannounced spot checks and differentiated auditing focuses seems to be unfair for some clients. However, in the long run, a certification system can only survive if it is able to guarantee the unobservable credence qualities which lie in the foreground of consumer
interest (food safety, animal welfare, social standards etc.). The use of checklists is a necessary tool for auditing, but risk oriented means are much more useful to safeguard against opportunistic behaviour.
Relevancy on a scale from 1 to 5 = 5
Review status: Finished
Review started on 2009–01–21
Reviewed by Samanta Rosi Bellière?
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