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Certifier competition and audit grades: An empirical examination using food safety certification

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  • Yuqing Zheng
  • Talia Bar

Abstract

Third‐party certification bodies (CBs) audit companies to determine compliance with standards. Using panel data from the British Retail Consortium food program, a leading international food safety standard for manufacturers, we empirically examine determinants of audit grades. We show that on average, audit grades are lower the first‐time manufacturers certify, consistent with certification improving food safety practices. Small manufacturers are disadvantaged compared with large (multisite) producers who obtain on average higher grades. We also test and support the hypothesis that a higher degree of CB competition leads to higher grades, raising concern for a potential conflict of interest in certification.

Suggested Citation

  • Yuqing Zheng & Talia Bar, 2023. "Certifier competition and audit grades: An empirical examination using food safety certification," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(1), pages 182-196, March.
    • Handle: RePEc:wly:apecpp:v:45:y:2023:i:1:p:182-196
    DOI: 10.1002/aepp.13211
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    References listed on IDEAS

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