24 SEPTEMBER 2014 • WORLD AQUACULTURE • WWW.WAS.ORG Fish account for 16 percent of all animal protein consumed globally and demand continues to grow in Asia where rising incomes support more protein consumption. Over the next 15 years or so, 62 percent of the fish consumed globally will be produced by aquaculture. The value of fish trade in developing countries is $25 billion, making it their most valuable food export (twice the value of coffee). But there are growing challenges. One-third of ocean fisheries are categorized as “recovering, over exploited or depleted.” More than half are fully exploited. Overall fishing capacity is more than double sustainable levels. The cumulative loss due to fisheries mismanagement is estimated to be $2.2 trillion over the last 30 years. Pollution and other human impacts continue to threaten and stress critical marine habitat. Over the last three decades, production of capture fisheries went from 63 million to 93 million tons. At the same time, aquaculture production increased from 5 million to 63 million tons. By 2030, aquaculture is projected to surpass capture fisheries in total production. The future is bright for aquaculture as long as you can build and maintain Social License. Social License to Operate What is Social License? Every organization operates with some level of it. Social license is the privilege of operating with minimal formalized restrictions based on maintaining public trust by doing what is right. An organization is granted social license when it is operated in a way that is consistent with the ethics, values and expectations of the organization’s stakeholders — customers, employees, local communities, regulators, legislators and the media. Once lost, either through a single event or a series of events that reduce or eliminate public trust, social license is replaced with social control — regulation, legislation, litigation or market action designed to force an organization to perform to expectations (Fig. 1). Operating with social license is flexible and low cost. Social control increases costs, reduces flexibility and increases bureaucratic compliance. Maintaining the public trust that protects the social license to operate is not an act of altruism; it is enlightened self-interest. Protecting Aquaculture’s Freedom to Operate Requires Trust-Building Transparency Charlie Arnot A good example of social license lost in the U.S. is the accounting fraud associated with the collapse of Enron in 2001. Prior to Enron, stakeholders relied on the industry to operate in a way that maintained public trust and in return the public was willing to grant accountants broad social license. The Enron debacle cost the accounting profession its social license. That single event was the tipping point that compelled the U.S. Congress to replace the social license of the accounting profession with the Sarbanes-Oxley Act, a law that requires extensive reporting and verification of financial information by publicly traded companies. The average cost for a public company to comply with SarbanesOxley rose between $10-15 million per year. Those are costs that could have been returned to shareholders as dividends or reinvested in research and development. Environmental NGOs and others who challenge today’s food system are given greater credibility in the public discussion because they are perceived to be committed to a principle or greater good. Business, on the other hand, is motivated by profit. That means that, in the public discussion about who we are and what we do, there is an inherent credibility deficit. Those engaged in business have to be able to consistently demonstrate an authentic commitment to “doing what is right” to overcome that deficit and be believed in the public discussion about issues in aquaculture. Activist opposition to fish farms, incidents of seafood fraud and genetically modified salmon are issues that have potential to erode public trust. The question becomes what can be done to maintain public trust that grants social license and protects freedom to operate? Building and Maintaining Trust Consumer research conducted by The Center for Food Integrity (CFI) shows that confidence (shared values) is three to five times more important than competence (skill and expertise) in building consumer trust (Fig. 2). Because we’ve traditionally relied on science as the basis for making decisions about how food is produced and communicating that information to consumers, communicating shared values and building trust is a new approach for food and agriculture. As global population grows, the need has never been greater for ABOVE, FIGURE 1. Once lost, either through a single event or a series of events that reduce or eliminate public trust, social license is replaced with social control, which increases costs, reduces flexibility and increases bureaucratic compliance.
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