Annex 3. Aquaculture Certification and Zonal Management

Anton Immink and Jesper Clausen1

Abstract

There has been concern among academia, consumers and nongovernmental organizations (NGOs) that certain forms of aquaculture, mainly high-value species for export, are environmentally unsustainable, socially inequitable, raise issues of animal welfare and have issues about food safety. Certification schemes addressing the sustainability of aquaculture production have emerged to address these concerns. However, these certification schemes deal with single production units, and have not, until recently, developed mechanisms to validate the performance of groups of farmers or the management of zones of farms.

As aquaculture continues to grow to meet global demand, governments and production industries must address the need to effectively manage the key resources that aquaculture relies upon, most notably water, and minimize the risk of disease impacts.
In order to maintain supplies, improve food safety, increase traceability and develop greater social equity, it is in the interest of the market to promote mechanisms to encourage this resource-level governance. Managing the risk of disease transfer between farms and developing mechanisms to control the spread of disease are key components of emerging zonal management certification. Early industry-led examples of coordinated action from Scotland, the United Kingdom of Great Britain and Northern Ireland and Surat Thani province in Thailand are discussed. Group certification and zonal management certification both enshrine the development of management bodies as a core component.

These producer organizations or zone managers carry the burden of compliance on behalf of producers, but also guide and support them to better overall performance. The need for certification approaches that more effectively engage small-scale producers in supply chains is also briefly discussed.

1 The views expressed in this annex are those of the authors and do not necessarily reflect the views or policies of FAO or the World Bank Group.

Immink, A. & Clausen, J. 2017. Aquaculture Certification and Zonal Management. In J. Aguilar-Manjarrez, D. Soto & R. Brummett. Aquaculture zoning, site selection and area management under the ecosystem approach to aquaculture. Full document, pp. 87–94. Report ACS113536. Rome, FAO, and World Bank Group, Washington, DC. 395 pp.

 

Note on scope and definition

This document is a chapter in a wider document on aquaculture zoning, site selection and area management under the ecosystem approach to aquaculture and should be read in that context. The term “zonal management” is used in this chapter because it is the terminology that certification developers and the supply chain use to refer to the need to introduce and deliver aquaculture management at the resource level.
Zonal management currently includes processes to develop effective industry institutions and voluntary and compulsory management of shared water resources, disease risks and feed supplies. At present, the market has not introduced into zonal management the social licence consideration included in the ecosystem approach to aquaculture; also the term “area management” under “the ecosystem approach to aquaculture” and “zonal management” are generally interchangeable.

Introduction

Future projections for demand for aquaculture products predict that there is a need to double production before 2030. This is an opportunity for aquaculture producing countries that requires both government and private investments in aquaculture management systems. The investments can be used for aquaculture production infrastructure and operations, for enterprises along the value chain (supplying inputs such as seed and feed and delivering product to markets), and for supporting services, processes and institutions at the sector level. Future demand for aquatic products is expected to provide business opportunities across the sector, but risks within the framework in which producers operate must be effectively governed.
Opportunities for the continued (and increasing) involvement of small-scale producers in these supply chains need to be developed.

VietGAP—An example of a current national certification programme.

The overall strategic principles of the aquaculture VietGAP are that aquaculture must ensure quality and food safety by complying with the current standards and regulations of the state and the provisions of the Food and Agriculture Organization of the United Nations (FAO) and the World Health Organization (WHO). Aquaculture must ensure aquatic animal health and living conditions for farmed animals by creating the best conditions for health, reducing stress, limiting the risk of disease, and maintaining good farming environments in all stages of the production cycle. Additionally, aquaculture activities should be done according to detailed plans and limit negative environmental impacts, according to the regulations of the state and international commitments. There must be an evaluation of the impact on the environment of the planning, development and implementation of aquaculture.
VietGAP looks not only at the production steps of the aquaculture value chain, but also looks at the other links in the value chain (e.g., breeding facilities, processing), and is therefore one of the ASEAN national programmes that takes a value chain approach; most other member states only look at the production steps.
The VietGAP programme, together with other certification programmes and a general focus on prudent use of veterinary drugs to treat aquatic animal diseases, managed to bring down the use of antibiotics and improve aquatic disease management practices, greatly reducing the number of antimicrobial alerts from the main importing markets in the period from 2004–2013 RASFF—the EC Rapid Alert System for Food and Feed, 2016). In particular, the larger, more commercial farms that gained certification quickly managed to reduce the use of antimicrobials. However, in the period from 2013 through the end of 2015 there was a dramatic increase in the number of alerts, which could be related to the increased problems with diseases. It might be that focusing on individual farm certification is not enough for the industry, but that a wider focus on zonal management and certification is needed to limit and prevent the spread of diseases (for more information on VietGAP, see www .quacert.gov.vn).

Aquaculture Certification

The rapid expansion of aquaculture production and the change from being mainly locally produced and consumed towards internationally traded products have raised concern among academia, consumers and NGOs that certain forms of aquaculture, mainly shrimp and marine finfish production (with salmon as the one species in particular focus), are environmentally unsustainable and socially inequitable, and that products are not safe for consumers (Corsin, Funge-Smith and Clausen, 2007).
Certification is understood to be the procedure by which a body or entity gives written or equivalent assurance that the activity under consideration conforms to the relevant standards. Impartial certification based on an objective assessment of relevant factors provides assurance to buyers and consumers that a product comes from an operation (or operations) that conforms to the certification standards. Both national and voluntary certifications currently focus on farmlevel performance only, with limited consideration of zonal management elements. To date, the only zonal requirement has been for salmon farms wanting Aquaculture Stewardship Council (ASC) certification to engage in area management systems if one exists (ASC, 2012). However, some examples specifically focused on zonal management are starting to develop, as discussed below.
There are a number of international, regional and national certification schemes that focus on confirming responsible management by individual farms. In Asia, most of the main exporting countries, including China, Indonesia, Malaysia, Singapore, Thailand and Vietnam, have their own national schemes, as well as producers who comply with international certification schemes.
Certification schemes are a way for consumers and retailers in developed markets in Europe, the United States of America, Japan and larger Asian cities such as Singapore, Hong Kong and some capitals of the countries that are members of Association of Southeast Asian Nations (ASEAN) to communicate their demands to producers in other regions. There is a need for certification schemes to understand both consumer concerns and requirements, and at the same time ensure that producers are able to produce sufficient volumes at the quality demanded.
Sometimes a knowledge gap exists between what consumers know about the production and what they ask for. The certification schemes are not only created or driven by consumers, but they are often used by retailers to differentiate among themselves (Belton and Little, 2009; Belton et al., 2010).
Whereas the international certification schemes have high confidence among consumers but perhaps are seen as a burden by the producers, the regional and national certification schemes or the good aquaculture practices (GAPs) and better management practices (BMPs) are more focused on communicating the current good practices by producers, and working with producers first and secondarily looking at consumer concerns. In some cases, these national schemes are seen as validating the performance of producers in a way that allows them to meet their bottom line rather than encouraging change in response to customer requirements.
According to Bush et al. (2013), only 4.6 percent of the world aquaculture production is currently certified.
This is, given the huge attention certification schemes are given, quite a low number, but the number is increasing. It is easier for larger-scale, better capitalized production units to deal with infrastructure, record keeping and administrative requirements demanded by certification. It is often observed that smallholder farmers are excluded from markets that require certification, even when external support such as donor-funded projects, governments or NGOs have tried to increase their involvement. It has been suggested that cluster certification systems or group certification that specifically addresses problems of smallholders can increase their likelihood of participation (Kassam, Subasinghe and Phillips, 2011), although the market is only starting to utilize these approaches as the supply from larger farms becomes limiting. One way of including more of the production in certification schemes could be to include zonal management in more of the schemes.
Kassam, Subasinghe and Phillips (2011) also mention the need for an international certification that recognizes risk reduction by smallholder farmers, something the world is still waiting for. However, progress is being made on the certification of aquaculture zones, which makes sense not only from a social point of view, potentially increasing market accessibility for small-scale farmers, but also makes good sense from an environmental and production point of view. In particular, in Asia, by far the majority of aquaculture production comes from smallholders, and the accumulated environmental impact from this production is largely unknown, especially since many smallholder farms are not licensed. If certification recognized and rewarded local efforts to introduce carrying capacitybased measures for establishing production volumes for both new and existing areas, or if aquatic animal health programmes encouraged farms to coordinate management and treatment approaches and openly report disease incidence, improvements to overall sustainability would benefit all producers, increasing market access and reducing risk for smallholder farmers. The challenge in this approach is who would take on the role of “zone manager.”

Zonal management

There are some examples of industry taking a lead in the development of good management approaches at the farm and zonal levels, often in response to external pressure, but also to respond to disease challenges faced by the industry. The Scottish salmon industry developed a Code of Good Practice that is adhered to by 95 percent of the industry, verified through audits, and has become a requirement for membership of producer organizations. Compliance with the code is not demanded by the market, although it was developed in part to demonstrate to the market the responsible approaches taken by the sector. It also includes requirements to be active in area management processes (see www.thecodeofgoodpractice .co.uk), something not typically included in current voluntary standards. The Surat Thani Shrimp Club developed disease notification processes and local groupings of farmers in the hope of reducing disease risk. Success has been mixed, but is widely recognized as a leading example of voluntary coordinated action between producers (Boromthanarat and Nissapa, 2000; Yamprayoon and Sukhumparnich, 2010).
The Sustainable Fisheries Partnership has been working on a bottom-up zonal management approach in several Southeast Asian countries and in China that has shown that there is significant positive value in farmers developing both formal and informal communication and representation mechanisms within a zone or group (www.sustainablefish.org and www.hntsa .org). Building trust among producers strengthens internal management of the industry, but an effective multistakeholder entity that involves feed companies, processors, hatcheries and technical support/input suppliers can also speak with more confidence when representing a unified industry with outside stakeholders from government, other industries or the market.
Having such a producer organization also enables the market to communicate market requirements more effectively to a whole industry, meaning changes can happen more quickly, benefiting everyone once trust has been built. These projects have had varying degrees of market support and are discussed in more detail as examples elsewhere in this publication.
These examples highlight the value of the private sector initiating collaboration among multiple industry stakeholders. The added value of these processes was the strengthening of producer groups to become effective representative organizations that can guide members and engage with governments, NGOs and other stakeholders. But the aquaculture sector has been short on such examples and to answer the concern about irresponsible aquaculture production, governments and markets developed farm-level certification requirements for food safety and aquatic animal health, subsequently adding environmental and social issues. Some of these processes have been government driven, whereas others have been market driven, but all have focused on improving performance on individual farms.

Group certification

Two different approaches to certification are currently considered within the area of zonal management. As a proxy for full zonal management, the market is engaging in group certification, particularly as a mechanism to bring more products from small-scale producers into the market without the need for changes to the overall sector management regime required in zonal management—or the need to develop a standard at a simpler level that would address the reduced risks typically posed by small-scale producers. Many of the standards are developing group certification mechanisms, following on from GLOBALG.A.P., which was the first international standard and which also delivered pilot projects, for example, with pangasius producers in Viet Nam. GLOBALG.A.P. has had great success with its group certification processes for agricultural crop farmers. The Global Aquaculture Alliance (GAA) is finalizing a group certification standard and ASC is in the late stages of drafting a standard.
At the heart of group certification, there is still a need for each farm to fully comply with individual farm-level certification requirements. There is an additional obligation for an internal quality control process within the group to ensure each farm is in compliance, which reduces the requirement for every farm in the group to be visited by an auditor in each certification period, and therefore reduces overall auditing costs for the group. The auditor will instead look for evidence that the internal control system is operating effectively and will visit a sample number of farms each time certification is renewed, eventually visiting all farms over a number of renewal cycles. In group certification, the farms do not all have to be located in the same area, although they have to be within reasonable travelling distances to be effectively managed. Groups also do not need to be constituted from all the farmers within a specific area. This is an important distinction from zonal management, because although increased collaboration between farms is a requirement of zonal management, group certification does not require those farms to be in geographically contiguous zones or for a majority of farmers from a specific zone to be involved. So far, for aquaculture group certification, the groups are dispersed suppliers to particular processors that become the certification applicant, whereas in agriculture the certification applicant is more commonly a farmer cooperative. Details of what is required for effective group certification are available from the standard demanded by the market.

Zonal management certification

Zonal management certification, however, requires the industry to look at aquaculture management from a different perspective, taking into account the need for resource-level management, not just multiples of farm management. At the request of the market, the GAA is currently leading the development of a new zone management standard and certificate that it plans to offer under its Best Aquaculture Practice (BAP) certification programme (Global Aquaculture Advocate, 2014). BAP is already widely recognized for a range of standards covering farms, processing plants, feed plants and hatcheries. Other international voluntary aquaculture standards including ASC and GLOBALG.A.P. are involved in the multistakeholder zonal management standard development process.
The standard will initially focus on biosecurity area management, but it is expected that environmental and social components will be added to the standard as market demand increases. At the heart of the standard is the need for a “zone manager”—an entity or a person who will take responsibility for ensuring that a zone management system is developed and followed by all producers within the zone. A competent disease control specialist, likely a veterinarian, needs to validate that the scale of the zone proposed and the measures to be followed by farms offer effective disease control. The programme requires that the majority of farms within the zone are active participants in the zone management process and follow farm-level requirements within that process, but not all farms need to be individually certified to all the requirements of current farm-level certifications. This means that small-scale producers can more easily be part of the programme. The programme will provide businessto- business reassurance. The zonal programme is in the pilot-testing phase, working with producers in Canada, Chile, China, Honduras, Ireland, Thailand and the United States of America where interest has been shown. Producers in Canada, China and Honduras are furthest in the process. There are some indications that these zonal certification programmes will significantly lower the risk for the aquaculture industry in these zones and hence make aquaculture more attractive to the large amount of investors who are looking for suitable investment opportunities within the aquaculture industry (Hatanaka, Bain and Busch, 2005).
It is important that a zonal certification module or programme is in compliance with the FAO technical guidelines on aquaculture certification and addresses environmental, aquatic animal health, animal welfare and socioeconomics (WWF, 2007 and FAO, 2011).
By covering these management requirements at the resource (zone) level rather than just at the farm level, certification should be more confident in making claims of verifying sustainable management—rather than the current approach of claiming “responsible” management.

Challenges and opportunities for zonal management certification

Aquaculture certifications are typically market-driven approaches that certify the performance of particular producers. The underlying assumption in most certifications is that the legal framework takes care of the issues considered in zonal management (and the ecosystem approach to aquaculture). However, in most countries, the legal framework has not been based on approaches like carrying capacity and epidemiology, and the industry is often not effectively pulled together and represented by producer organizations.
In fisheries management certification, the validation of the effectiveness of the legal framework to manage fisheries is a specific requirement. For fisheries management certification, the legal framework is understood to be vital to the long-term availability of products and therefore of critical interest to the market. Aquaculture continues to supply increasing volumes of products to the market despite many countries not having effective zonal management regimes. The challenge will come once supplies are limited because the regulatory framework is not ensuring sustainable management at the resource level (e.g., when production crashes because of uncontrolled disease outbreaks or when water quality rapidly deteriorates causing mass fish kills). The dialogue around aquaculture, however, continues to talk of substantial production growth even with a “business as usual” approach to regulation and management. This is placing a dangerous reliance on good performance at the (multiple) individual farm levels rather than the much needed improvements in resource-level governance.
The market, through the use of mechanisms such as zonal management certification, should drive the necessary improvements before—not once—supplies become severely constrained or reputations are at risk.
But governments and larger-scale producers must also take action nationally, now, to protect their rapidly developing industries from the inevitable collapses that come from intensified production practices that are reliant on natural resources severely lacking in effective management (Hall et al., 2011). The burden cannot be put on the shoulders of small-scale producers alone through group or zonal management certification.
Developing effective industry associations (whether part of a group or zonal certification) will also have a benefit for the wider social acceptance of aquaculture.
Effective guidance and management of multiple producers to deliver responsible practices will enhance the overall understanding of non-aquaculturists to the value of producing food this way. Effective producer organizations also provide the industry with a coherent voice to counter criticism. A confident industry, within a well-regulated environment, is also more likely to positively engage with detractors and regulators rather than retreat into defensive positions that further distance opposing views.
The formation of groups and the internal control systems that are demanded by these certifications enable improvements in traceability and food safety.
Full zonal management can provide the market with further confidence around traceability and food safety when all producers within any given zone are licensed—and therefore identifiable—and all operating according to best practice that means no single farm is posing an unmanaged risk to all its neighbours; this should significantly reduce the need for unnecessary and non-prudent use of chemicals to treat disease outbreaks, leading to safer food for consumers. Where emergency disease response plans are developed and a clear plan of action is agreed upon between producers, regulators and scientists, there is increased likelihood of further reductions in the unnecessary use of chemicals, improving food safety, environmental quality and industry reputation (World Bank, 2014). A coordinated demand from an industry for sustainable feed ingredients also helps to drive improvements in traceability of marine ingredients from legal, regulated and managed sources.

Conclusions

Zonal management within the context of both regulation and certification schemes has not previously received much attention. The focus on farm-level best practices and the established certification processes that validate performance at the farm level offers a challenge to zonal management and zonal certification to demonstrate long-term value to an ever-increasing aquaculture industry.
Group certification and zonal management certification offer mechanisms to enable small-scale producers to enter more formal supply chains at a potentially lower price, but it still requires them to commit to what is usually an improved level of performance. It also requires neighbours to collaborate. Both group certification and zonal management certification are opportunities for smallholders, but it is important to emphasize that the standards for these schemes are as stringent as for individual certification schemes.
There is still space in the market for a specific standard aimed at recognizing the lower levels of risk reduction needed from small-scale producers, therefore keeping them as suppliers to the ever-growing demand for certified seafood.
A key component of group and zonal management certifications is the formation of management bodies that coordinate performance among member farms.
These producer organizations carry the burden of conformity on behalf of the producers, but still require best practices at the farm level. The idea of strong producer organizations should be adopted across the industry as a mechanism for improving the reputation of the industry, reducing disease risk and environmental impacts, and increasing food safety and traceability—whether or not it is part of a certification process.
Group certifications have developed in part because it has become increasingly difficult for the market to source all products they need from larger already individually certified farms. It is also increasingly obvious to the market and producers that certified farms are often connected through shared resource use to uncertified producers who pose risks such as disease transfer or water supply quality reduction that cannot be addressed through current farm-level certifications. An approach that addresses risks at the resource (zonal) level is needed, especially as aquaculture production is forecast to grow significantly to fulfil market demand. Sustainable intensification or blue growth will require action from governments and demand from markets for resource-level management.
A continued push for scaling-up production as rapidly as possible with an almost-exclusive focus on farmlevel best practices will bring continued disease and environmental challenges that affect the reputation of aquaculture, negatively impact the livelihoods of millions of people, disrupt supply chains, increase prices and slash national productivity. There is an urgent need for better governance mechanisms within the private sector as well as a government that acts on the realization that farms do not operate in isolation.

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