SICPA: Building trust in global supply chains – Business Brief

Safe international trade is essential for the economic growth governments are currently seeking but is threatened by the ever evolving asymmetrical threat of fraud and illicit activity. These crimes, be it through sale of counterfeits, contraband, tax evasion, avoidance of quality controls or theft of intellectual property, damage governments revenues, undermine policies and put at risk public health and citizens well-being.

The work of international organisations such as the OECD in promoting co-operation and best practice between governments is crucial to tackling the issue. So is direct action by national governments to reinforce their own capabilities and build robust systems which can be linked across borders to build an interoperable international network.

SICPA is at the forefront of those in the private sector investing in developing up-to-date tools for governments so they can meet these challenges now and in the future. Our SICPATRACE® platform is designed to accommodate numerous products, to protect licit industries and help promote the conditions suitable for economic development and investment.

Our approach builds on our long experience providing security inks and security features to protect bank notes and in working in partnership with governments. SICPA has developed a modern tool box which can be implemented in a modular way and adapted to take account of national needs. At the core of the approach is secure track and trace which provides transparency and control for governments across the length of complex supply chains which criminals are so adept at exploiting.

Digital technology is crucial but needs to be complemented by material-based security

Secure track and trace is based on marking legitimate product securely so as to guarantee authenticity and gives each item a unique identity so that it can be monitored through its life cycle from manufacturer to consumer. Digital technology is essential for monitoring and for the full exploitation of data, but to protect against the vulnerabilities of cyberspace secure marking needs to use material-based features such as high security inks.

To meet government needs, a secure tracking and tracing system should be modular and adaptable to a wide range of products–be they excisable goods, medicines or sensitive equipment. At each stage there are benefits. At the beginning of the supply chain benefits include production control which tackles the mis- or under-declaration which result in tax losses. There are further tax and health gains from preventing diversion frauds, adulteration and illegitimate repackaging. At inspection stages there are tools to counter corruption. Business intelligence, risk profiling and reporting modules exploiting ‘Big data’ ensure best use of enforcement resources. Real-time information of evidential quality improves enforcers’ ‘hit rates’ for seizures and prosecutions.

Implementation requires a holistic approach and expertise

SICPA knows from its experiences across the globe that implementing a successful track and trace system requires a holistic approach and proven expertise. It needs to address the needs of all stakeholders. Permissive legislation needs to be in place. A good system is unintrusive and has minimal impact on production processes – it copes with difficult industrial environments. The integrity of data capture is crucial – it has to be error free and acceptable to all supply chain actors. It requires a fully reliable and secured system of aggregation so that e.g. a bulk package does not require unpacking. Checks by the authorities need to be quick and easy, compatible with trade facilitation schemes based on AEO and contain anti-corruption safeguards.

The cost of illicit trade is high. The benefits of combating it are significant. The technology now exists to do so successfully. It is a tool par excellence of good governance. We stand ready to support governments to make it happen!

OECD Sponsored Business Brief

See also

Trust in Government

OECD Forum 2014 Issues