SGS S.A.

Email sent to Magali Dauwalder, Global Head of Corporate Affairs, and John Coolican, Global Head of Corporate Communications, and a media email.

The email said: "For several months, we have been conducting an investigation of the shrimp company, Choice Canning. Choice Canning has passed audits by SGS for Best Aquaculture Practices (BAP) certification and for Brand Reputation Compliance Global Standards (BRCGS) certification. Part of that investigation has involved an ongoing conversation with a former Choice Canning employee who managed a plant for the company in Andhra Pradesh. We began talking while they were still on staff with Choice Canning and we have continued the dialogue since they stepped down from their position with the company. This person has filed a whistleblower complaint to U.S. federal authorities.

Through them and other channels, we have collected a variety of materials concerning Choice Canning, particularly regarding the company’s operations in Andhra Pradesh. These materials include: internal emails, WhatsApp messages, voice memos from senior management, security footage, audio recordings of meetings of Choice Canning staff, invoices from employment contractors, documentation produced by auditors for internal and external use, among other items. We have conducted an intensive review of all those materials. We have also interviewed current and former workers from the plant. We have also corroborated various findings using other documentation (including local news reports from Andhra Pradesh and industry analysis by non-governmental organizations), interviews with experts (such as shrimp industry groups and industry lawyers), and analysis of hundreds of videos taken in and around the Amalapuram plant in Andhra Pradesh. We also dispatched a videographer to the plant to visit one of the offsite peeling sheds and to inspect conditions at the Amalapuram compound.

Our investigation found evidence of:

Document falsification by Choice Canning management to mislead auditors about where it sources shrimp and the true count of employees on-site;

Decisions by senior Choice Canning management to ship to customers in the U.S. shrimp that it knows to be antibiotic-positive;

Contradictory documentation by SGS auditors, with SGS reports produced for Choice Canning’s internal use raising concerns about unsanitary production conditions, while SGS reports for external review raised no such issues and instead supported BRCGS and BAP certification of Choice Canning;

Senior Choice Canning management approving the underpayment of workers, and complaints to local police by workers who did not receive payment or who received payment long after it was due;

Choice Canning staff complaints about inadequate living conditions on-site, including worker dorms without proper bedding, or with unhygienic canteen food;

Workers being prevented from leaving the site of their own volition;

Choice Canning’s ongoing use of unsanitary off-site peeling sheds which it concealed from auditors;

Understatement of the number of workers based at the plant and the temporary relocation of some of those workers when auditors visited so as to give a false picture;

Repeated complaints from people living near Choice’s Amalapuram plant of pollution causing health problems in the community;

“Gift” payments to local officials that some might view as bribes.

Questions we have for SGS:

1. While we understand that you might not be aware of any of the above issues, does SGS have any comment or statement to make in response to this email?
2. When did SGS most recently conduct an audit of Choice Canning’s facilities in Andhra Pradesh?
3. Did that audit raise any concerns over living conditions for workers or unsanitary production conditions?
4. Is SGS aware of Choice Canning’s use of off-site peeling sheds?
5. Are SGS auditors still producing site reviews for Choice Canning's internal use?
6. What system or process does SGS have in place to review the auditing practices and standards of SGS auditors?
7. What steps does SGS take upon receiving allegations that SGS auditors have produced contradictory documentation about the same site within the same timeframe?

Please let us know your answers to these questions by close of business on March 15, 2024. Please also note that we will need for all our interactions to remain on record and in writing."

A subsequent email was sent to SGS, saying: "We understand that some aspects of the BAP certification process in India are contracted to SGS. The piece touches on a number of issues of concern about the BAP certification process in India, on which we believe to be in the public interest to report. We are writing to give you the opportunity to comment on them. We will consider any response for inclusion in the piece. Please reply by 1pm ET on Monday March 18 if you would like us to do so.

The issues of concern include: A forthcoming report by the Corporate Accountability Lab, an advocacy group, which argues that the BAP auditing process in India is deeply flawed Internal communications which suggest that Choice Canning employees routinely misrepresented the source of their shrimp as BAP-certified farms. Internal communications which appear to show that Choice Canning, a BAP-certified supplier, has authorised shrimp to be shipped that has tested positive for antibiotics (We understand that Choice Canning dispute this characterisation of the materials). An apparent discrepancy between the public-facing audit on Choice Canning produced by SGS on behalf of BAP, which commended its hygiene practices, and a private daily audits sent by the same firm to Choice Canning’s management which cited a litany of sanitary and food safety issues at the on-site peeling shed including spoilage smell, flies, “slime”, “sludge”, lack of proper icing, broken refrigerators, algae and fungus on machines, hair and black spots on shrimp, and a full chewing-tobacco spitoon in the factory area."

The Outlaw Ocean Project replied: "Thanks for your reply to our query. Could you clarify a couple of points for us:

In your response to question 4, you said that “No external /offsite peeling sheds were declared for the BRC GS Food audit by the client in the signed contract.” Is the client you are referring to here Choice Canning or BAP?

In your response to question 5 in which we asked "Are SGS auditors still producing site reviews for Choice Canning's internal use?" you said that “no certification reports are being shared with the client for internal use.” Can SGS confirm or deny if it has been producing reviews or reports for Choice Canning's internal use?"