Despite tightening transparency regulations across the globe and increasing demand from consumers for accountability, traceability in seafood supply chains is far from being as robust as it should be, according to a new report from London, U.K.-based investor network FAIRR Initiative.
The report, “Tracing Risk and Opportunity: The Critical Need for Traceability in Today’s Seafood Supply Chains,” analyzed the material business risks posed by insufficient supply chain transparency at seven of the world’s largest publicly listed seafood companies: Charoen Pokphand Foods (CP Foods), Marubeni Corp., Maruha Nichiro Corp., Mitsubishi Corp., Nissui Corp., Nomad Foods Ltd., and Thai Union.
Through this analysis, the report aims to help seafood companies achieve a longer-term goal of ensuring they can trace the origins of all the wild-caught and farmed seafood they sell, as well as the aquaculture feed ingredients they procure.
FAIRR Initiative Senior ESG Analyst Laure Boissat, who was one of the authors of the report, told SeafoodSource these companies were picked based on their sector influence and the readiness of their infrastructures to implement traceability efforts into their supply chains.
According to the report, all seven companies acknowledge the material business risks of insufficient supply chain transparency, but none have so far published plans to implement robust traceability systems. Just two companies – CP Foods and Thai Union – have traceability commitments covering all operations, and none disclose progress against these commitments.
“Despite Thai Union and CP Foods having a group-level traceability commitment covering all seafood operations and aquaculture feed procurement, the implementation of these commitments and reporting on progress remains limited,” Boissat said. “Other companies have a limited commitment, such as at the subsidiary or associate level, covering only specific locations or species or focusing solely on certified seafood rather than on full-chain, digital, and interoperable traceability.”
However, FAIRR said even just the active participation from all seven companies in the research – despite the challenges associated with implementing full-chain, digital, and interoperable traceability systems – sets a promising precedent for potential improvements as the project continues into its second year in 2025.
“All seven companies, [as] part of this engagement, recognized the importance of traceability in identifying and mitigating key risks, such as overfishing and illegal, unreported, and unregulated [IUU] fishing,” Boissat said.
One reason why the work is so important to implement more rigorously, according to FAIRR, is that even with certifications, consumers still can’t be certain the fish they eat is sustainably sourced, with opaque supply chains obscuring links between frequently consumed seafood products and the environmental and social issues they may still carry with them – such as human rights violations, habitat destruction, and overfishing.
“While the use of certification programs is growing, these certifications do not amount to full-chain, digital, and interoperable traceability. This is why our report provides actionable recommendations to companies. These focus on aligning the companies’ approach to traceability to the standards developed by the Global Dialogue on Seafood Traceability,” Boissat said.
It’s not just seafood companies that are waking up to the risks of insufficient supply chain traceability, according to FAIRR, as regulators are also taking notice with an increasing number of laws requiring improved supply chain traceability in major seafood markets. Examples include the Food Safety Modernization Act (FSMA) in the United States, and the Fishery Products Distribution Act in Japan.
This has led to a sector-wide effort to improve, the report detailed.
“We are hopeful to see further collaboration across the seafood sector in terms of traceability since companies are aware that a lack of traceability may hide multiple environmental and social risks across their supply chains. Our aim is to build on the momentum of this first year of engagement and to have further discussions with companies on their traceability efforts,” Boissat said.
As the initiative moves into Phase 2 in 2025 and reopens for additional investor signatories, FAIRR, its partners, and participating investors will continue to engage these companies and increase their focus on providing technical support to drive measurable progress towards robust supply chain traceability.
“At FAIRR, we run our collaborative investor engagements over a three- to five-year period,” Boissat said. “Therefore, we will focus on these same seven companies for the next two years of the engagement.”
By 2030, depending on the progress shown, FAIRR may expand the “company universe” to other key players in the seafood market, Boissat said.
Asked whether the FAIRR network is concerned by how limited seafood traceability systems seem to be currently and whether other companies will get on board, Boissat said bolstering traceability infrastructure is a no-brainer for companies and will only become more important with time.
“Supply chain traceability is a no-brainer from a financial perspective. For companies, better traceability creates numerous benefits in addition to improving operational efficiency,” she said. “For instance, robust traceability enhances regulatory compliance, encourages revenue generation, and creates intangible benefits. In the same vein, improved supply chain traceability helps investors have more trust in their portfolio companies.”
