The Global Innovation Index (GII) provides detailed metrics about the innovation performance of 127 countries and economies around the world. The index is the result of a collaboration between Cornell University, INSEAD, and the World Intellectual Property Organization (WIPO). The GII has gained international recognition, establishing itself as both a leading reference on innovation and a ‘tool for action’ for decision makers. It recognises the link between innovation as an engine for economic and social growth in an increasingly knowledge-based global economy.
One of the 81 indicators used to measure a country’s innovation performance is the number of accredited certificates to the quality management system standard, ISO 9001.
The 2017 report can be accessed from the Global Innovation Index website.
Source: Cornell University, INSEAD, and WIPO (2017): The Global Innovation Index 2017: Innovation Feeding the World, Ithaca, Fontainebleau, and Geneva.
The EU and Japan are have been encouraging industrial sector to sector dialogue to identify mutually beneficial solutions to non-tariff measure (NTM) issues. They are working together to strive for a seamless business environment through regulatory cooperation using means such as harmonisation and mutual recognition of standards and regulations, but without lowering safety standards.
You can find out more detail about the EU – Japan Regulatory Cooperation – Joint Statement by BusinessEurope and Keidanren (13/12/16) here.
The Skills Funding Agency, an executive agency of the Department for Education (DfE), has set a policy goal of creating 3 million more apprentices by 2020. To support this goal, the agency provides funding in the form of grants for small businesses and levy relief for large organisations. The aim of this policy is to boost the skills of the UK workforce and in turn help to improve economic productivity.
Apprenticeships are full-time paid jobs which incorporate on and off the job training. A successful apprentice will receive a nationally recognised qualification on the completion of their contract. Apprenticeships take between one and five years to complete and are available in 1,500 occupations across 170 industries varying from construction to manufacturing through to IT and the creative and digital sectors.
In order to measure the effectiveness of the apprenticeship programme, the government has put in place a rigorous system to ensure that the content of each apprenticeship is of high quality and that the apprentice will be assessed fairly and consistently at the end of the apprenticeship, to ensure they have full occupational competence in the job. The Skills Funding Agency runs a register of organisations that are approved to carry out the assessment of apprentices.
Their guidance for applicant assessment organisations provides for the possibility of an exemption from some of the application requirements for UKAS accredited organisations. More information about the register is available at https://www.gov.uk/government/publications/register-of-apprentice-assessment-organisations-how-to-apply (See section 25).
Making Accreditation Mandatory in Sri Lanka for Taking Technical Decisions
In order to create a quality conscious culture in Sri Lanka, it was the view of the Cabinet Ministers that technical measures on the issues related to quality, environment, food safety, occupational health and safety, energy etc. must be controlled and monitored through stipulated standards and technical regulations.
The Cabinet of Ministers of Sri Lanka has taken a decision and proposed to implement relevant regulations by making conformity assessment procedures such as testing (including medical testing and calibration), inspection and certification mandatory and using accreditation as a means of providing assurance and trust on consumers. The proposal contains following main three activities;
a) To use regulations and implement conformity assessment procedures such as testing, inspection and certification by regulators for controlling activities in relation to quality, environment, food safety, occupational health and safety, energy etc.
b) To update regulations in which conformity assessment procedures are not mentioned and/or accreditation is not used as a means of acceptance and to include statement to reflect “not to use any facility that is not assessed and accredited”.
c) To develop a conformity assessment framework which is composed of testing laboratories, inspection bodies and/or certification bodies as applicable, within and outside the regulatory bodies to facilitate accreditation.
Attention has also been drawn on the frequently questioned market fairness issues related to the assurance of safety and public utility measures in relation to accuracy of water meters, electricity meters, taxi meters etc.
Hon. Minister of Science, Technology has requested from relevant Ministries and Regulatory bodies to take immediate measures to comply with the above Cabinet Decision.
To encourage more certification bodies (CBs) and laboratories to support Standards Malaysia’s accreditation schemes, the Government offers tax incentives in the form of tax deductions for costs such as Assessment Fee, Annual Fee and other Fee imposed by Standards Malaysia. The tax deduction is applicable for all programmes operated by Standards Malaysia under its various accreditation schemes.
The scheme was introduced by the Ministry of Finance and the Board of Inland Revenue to increase the adoption of standards and quality assurance across all sectors.
Further information is available on the Standards Malaysia website.
Dubai Silicon Oasis Authority (DSOA), the regulatory body for Dubai Silicon Oasis (DSO), the integrated free zone technology park, is certified to ISO 20000. The certification is awarded to organisations for meeting the requirements in establishing, implementing, maintaining and continuously improving its ICT service management system and adopting effective management methods throughout the high-tech park.
The certification is used by the Regulator to attract investors and entrepreneurs to base their operations at DSO by demonstrating the quality of the integrated ICT system, and guarantees of uninterrupted business.
Further information in available on the DSOA website.
Tax Authorities as well as individual companies need a reliable system that provides objective and homogeneous information to demonstrate the innovative component of projects and activities.
Accredited certification provides a system that enables the creation of a climate of confidence and greater certainty, both for companies seeking to make investment decisions, and for Tax Authorities in assessing tax reductions that are available to Spanish companies that promote the practical application of policies designed by the public authorities for promoting R&D&I.
Operating in technologically advanced sectors is both a challenge and an opportunity for Spanish companies. In this framework, global competitiveness, investment in research, technological development and innovation are increasingly the key elements of business development and maintaining competitiveness, which will progressively contribute to the country’s economic growth and the improvement of social welfare.
Some of the tools the Administration can use to promote business innovation include tax incentives and bonuses. These tools are aimed at encouraging private sector initiatives and implementing them without limiting companies innovative fields.
ENAC, the Spanish Accreditation Body (ENAC). delivers accreditation in the following Research, Development and Innovation (R&D&I) related fields:
- Certification of R&D&I projects: The bodies accredited by ENAC provide a technical report to qualify the nature and costs of the R&D&I activities of a project, enabling companies to request an R&D&I content and costs report from the Ministry of Economy and Competitiveness. This report is binding on the Tax Authorities and therefore provides the company with certainty by qualifying the nature of the R&D activities. Royal Decree 1432/2003, published in Spain’s Official Gazette, allowances in social security contributions for investigators.
- Research staff R&D&I activity certification: The bodies accredited by ENAC certify that staff participate full-time and exclusively in R&D&I activities, enabling the report to be obtained for Social Security bonus contributions or corporate tax deductions for this type of activity. Royal Decree 475/2014, about reductions to the social security contributions of research personnel.
- Innovative SMEs and Young Innovative Company certification: The bodies accredited by ENAC certify the organization’s innovative character and the SMEs condition, if it is needed. Subsequently the Ministry of Economy and Competitiveness will recognise these organizations with the official seal of “Innovative SME” and including them in the Registry for that purpose and so they may benefit from tax incentives. Therefore the bonus contributions are fully compatible with the research staff deduction system application for R&D activities. Royal Decree 475/2014, about reductions to the social security contributions of research personnel.
- R&D&I Management Systems certification: This enables organisations, regardless of their size or their economic sector, to improve their innovation resource management, as the ability to innovate is a company resource that must be managed efficiently. Such management is a business process oriented towards organizing and managing the available human, technical and financial resources. Based on UNE 166002:2014 Standard.
Further information is available from the Spanish Ministry of Economy and Competitiveness (in Spanish).
The Office of Management and Budget (OMB), the business division of the Executive Office of the President of the United States that administers the United States federal budget and oversees the performance of federal agencies, published a revised Circular on the federal use and development of voluntary standards:Federal Participation in the Development and Use of Voluntary Consensus Standards and in Conformity Assessment Activities. U.S. federal agency use of the global accreditation infrastructure continues to grow in line with the OMB conformity assessment policy.
Download the circular from the Office of Management and Budget website.
The government represented by General Organization for Import and Import Control, GOEIC, has conditions of acceptance products to be imported or exported
GOEIC sets conditions for the acceptance of imported and exported products in the customs area. GOEIC is authorised to permit or block products in the customs area. This condition stated that an inspection certificate from an accredited inspection body should be submitted.
This has improved the competitiveness and reliability of imports, as well as having a positive effect on the export sector through the acceptance of products and services overseas.
This policy has supported the Egyptian Government to realise the their targets of improved product quality, especially food and water products, and increased consumer confidence.
Visit the GOEIC website for further information.
GCC Member states United Arab Emirates , Kingdom of Bahrain, Kingdom of Saudi Arabia, Sultanate of Oman, State of Qatar, State of Kuwait and the Republic of Yemen operate a single regulatory system to control products in the GCC market.
The System is comprised of two sets of Technical Regulations (TR):
1) Horizontal Regulations applied to all products wishing to access the GCC Single market which are:
a) GCC Conformity Marking TR.
b) The General TR for product Safety.
c) Conformity Assessment Modules.
d) Notified Bodies Selection and Notification.
e) Market Surveillance technical Regulation
f) Product Liability technical Regulation
g) Rapid Exchange of Information System(AGEL)
2) Vertical Regulations each addressing a Category of Products including:
a) Toys (Approved)
b) Low Voltage Devices (Approved)
c) Other products (in process)
Accreditation is considered an essential tool for the implementation of the regulatory system as it is used in all regulations to assure the competence of notified bodies.
SENCE, The National Training and Employment Agency in Chile, requires technical training organisations to be certified by an accredited certification bodies. (Chile)
Over 123,000 professional people have accredited certification to verify technical ability and specific knowledge of a profession. It is a legal requirement that competences can be assessed by professional associations where it is possible for such persons to register or by means of voluntary self-regulation implemented in accordance with the relevant UNI technical standard. These processes of qualification are underpinned by an assessment undertaken by an accredited certification body. (Italy)
Invitalia, the national agency for attracting investment in Italy and for the development of business, invest in projects to promote the increased use of accredited certification, testing reports and calibration reports to facilitate inward investment in Italy. They work in association with ICE (the Italian association for the promotion of Italian business abroad), with international Chambers of Commerce, and with the Ministry of Economic Development. The aim is to create opportunities for the development of Italian products and services. (Italy)
The Italian Ministry of Economic Development has allocated € 900,000 for the quality certification of international trade fairs against standard ISO 25639-2. This will provide greater value to trade fairs in Italy by providing insight into the statistical data such as the number of visitors, exhibitors, and related fringe activities. (Italy)
The New Approach was established in the European Union to ‘recast technical harmonisation within the European Union (EU) on a new basis by only harmonising the essential requirements of products and by applying the “general reference to standards” formula and the principle of mutual recognition in order to eliminate technical obstacles to the free movement of goods.’
The New Approach has a number of objectives, all seeking to use standardisation, to achieve aims such as supporting the single European market – especially for products, reducing barriers to trade, increasing product safety, delivering an efficient system based on consensus standards.
Product areas covered by the New Approach vary from toys to pressure equipment, from boilers to boats, from medical devices to explosives. The full range of products can be seen under the New Legislative Framework.
Within the framework of an association agreement between Tunisia and the European Union, a mutual recognition agreement is being developed in the field of conformity assessment through an accord entitled ACAA (Agreement on Conformity Assessment and Accreditation of industrial products).
This project, which has brought in public and private expertise in the field of standardisation, accreditation, metrology, analysis and tests as well as market surveillance, aims at supporting the Tunisian administration for the preparation of the ACAA.
Priority sectors involved in this project include products from the mechanical, electrical and construction industries. The aim is to simplify import/export and customs formalities.
Further information is available on the EU website.
The Trans-Pacific Partnership (TPP) is a trade agreement, released on November 5th 2015, between twelve Pacific Rim countries. The agreement’s goal is to promote economic growth; support the creation and retention of jobs; enhance innovation, productivity and competitiveness; raise living standards; promote transparency, good governance, and enhanced labour and environmental protections.
Accreditation, recognised by existing regional and international mutual recognition Arrangements (the ILAC MRA and IAF MLA) is referenced as being as a key measure to support trade through the removal of technical barriers.
The twelve Pacific-rim countries include Mexico, New Zealand, Australia, Brunei, Chile, Singapore, Canada, Japan, Malaysia, Peru, Vietnam and the USA.
Sector & Segment, a research agency, tracks investments in quality standards by monitoring expenditure by companies on technical accreditations. In this report, they examined investment trends in ISO/IEC 17020 accreditation across Latin America, to evaluate policies enforcing quality and their impact on different industries and sectors.
Investments in ISO 17020 inspection accreditations have grown significantly in the past 5-6 years. Their research finds that the investment in accreditation has increased from $52 million to $69 million between 2013 and 2017. Despite challenging political and economic conditions in some economies in Latin America, companies have been pushed to invest in accreditation as a way of increasing competitiveness and complying with domestic regulations.
This study, which resulted from a research project commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ), aimed to assess the impacts that quality services contribute to improve the understanding at the political, entrepreneurial and academic levels about the relevance of quality infrastructures to the functioning of innovation systems, how they enhance the performance of economic agents and improve the outcomes of social, economic and environmental policies.
The key objectives aimed to identify the following positive areas:
- the identification of the range of positive and negative effects that they have in societies;
- to advise policy makers on how the accomplishment of their strategic goals may be facilitated through the development of quality services;
- To raise awareness of consumers, firms and industries about the existence of such an institutional complex, i.e. how it shall be used as a platform where various economic agents are to participate and interact in order to address to a multitude of social, economic and environmental challenges;
- to learn ways of improving the functioning of the existing quality infrastructure.
A copy of the report is available on the Physikalisch-Technische Bundesanstalt (PTB) website.
The Standards Council of Canada (SCC) has published three reports that identify different and/or duplicative standards, codes, and certification requirements between provinces and territories in Canada. These differences and duplications demonstrate the importance of aligning standards to strengthen Canada’s economy, create jobs and help Canadian companies compete.
In Standardization Solutions to Remove Trade Barriers in Canada, SCC analyzes internal trade barriers in the crane, heating and plumbing, and emerging regulatory sectors, and presents policy recommendations for aligning standards. If implemented, these recommendations could reduce red tape and lead to economic growth in a way that is sustainable and beneficial for Canadians—today and in the future.
The Case for Aligning Requirements for Water Heaters Across Canada, takes an in-depth look at the Canadian Registration Number (CRN) system, as it applies to water heaters. Through consultation with key industry stakeholders, SCC notes different regulatory requirements between provinces and territories in Canada, which cause headaches for manufacturers and distributors. This unnecessary barrier to internal trade can increase direct costs and delay the time it takes to bring new products to market. To remove this barrier, SCC recommends that provinces and territories negotiate a consensus on how to align regulatory requirements for water heaters.
Conformity Assessment in Canada: Understanding the Value and Implications for Internal Trade, examines how conformity assessment – the practice of determining whether a product, service or system meets the requirements of a particular standard – can help to facilitate internal trade in Canada. The report provides an overview of the conformity assessment system, what it is and how it operates, and also looks at its social and economic importance to Canada. The report examines how duplicative conformity assessment requirements can act as a barrier to internal trade.
All three reports were made possible through a partnership between SCC and Innovation, Science and Economic Development Canada.
This report shows how the role of the infrastructure – standards, measurement, accreditation, design and intellectual property – can be integrated into a quantitative model of the innovation system and used to help explain levels and changes in labour productivity and growth in turnover and employment.
- The infrastructure is a key resource for the effective functioning of innovation and for economic performance more widely. Standards, design, accreditation, metrology and IP are all deeply embedded in the modes and styles of innovation practice across industry and commerce and in the public sector.
- They are complementary to, and supportive of, the other drivers of innovation, such as new technology, knowledge from the research base, organizational and managerial changes and marketing strategies.
- Notably, information from standards tends to be conjointly used with scientific and trade publications and with direct sourcing of knowledge from the research base.
- Certification to ISO 9001 by UKAS accredited bodies is positively and significantly associated with several modes of innovation and with productivity directly.
- The National Measurement System is part of or directly supports several types of innovation strategy and has a distinct impact on productivity.
- The innovation and efficiency promoting roles of the infrastructure are contributors to economic growth and productivity as well as to international competitiveness.
A full copy of the report is available from the UK Government website.
AIRMIC, the Association of Insurance and Risk Managers in Industry and Commerce, has published a white paper on the value that standards and accredited conformity assessment can play in the management of risk. The report states that there is plenty of evidence that organisations perform better when they adopt voluntary quality standards, yet for the most part, insurers ignore these standards when setting terms and conditions for policyholders.
Standards assure customers and other stakeholders of consistent quality in products, services, processes, systems and people. They are based on the practical experience of sector professionals, and are a means by which organisations can demonstrate assurance about the quality of their risk management. The paper builds on an earlier study commissioned by BSI, conducted by the Centre for Economics and Business Research earlier this year, which underlined the economic and practical value that standards can have.
The paper also states that the wider quality infrastructure, namely accreditation and the conformity assessment community, play a supporting role in the management of risk for the insurance sector. The report contains case studies that demonstrate how insurers are using accredited services to evaluate risk and therefore provide discounted premiums or improved terms and conditions.
The paper titled Standards: Supporting Risk Management and Adding Value was published at a press conference during the AIRMIC annual conference on June 11th.
A study titled “Standardisation: a contribution to the competitiveness of Colombian organisations, case studies to measure the economic impact of technical standards.” was published in 2018, to increase the awareness of the multiple benefits that the technical standards bring to Colombian organisations.
This publication describes not only the evolution of standardization in Colombia, but also presents three case studies that have allowed us to quantify, in organizations of different sizes and sectors, the direct economic benefits of the implementation of the standards. This study gives continuity to a similar study carried out in 2011.
The economic contribution of the standards in organizations such as Gerfor (tube systems, large size organization), Doria (food, large size organization) and Vilaseca (food, medium size organization) range between 0,9% to 88% to the EBIT of the organization, as well as to the benefits that impact on the processes that cover organization improvements in the productive processes, saving of resources, among other aspects.
The publishing organisation (ICONTEC – a Colombian Certification and standardisation body), highlights that the economic benefits derived from the application of the standards were observed in two fundamental aspects:
- Derived from the improvements that impact the productive processes, which enables the optimisation and saving and access to resources,
- Maintenance in markets, aware of the importance of quality, safety and sustainability.
Finally, it stated that maintaining competitiveness is one of the greatest challenges for Colombia. Therefore, the development and promotion of the application of Technical Standards is considered to represent a concrete action for the fulfilment of this objective.
This study is available in Spanish here
The National Association of Testing Authorities, Australia (NATA) is Australia’s national authority for the accreditation of laboratories and producers of reference materials, and a peak body for the accreditation of inspection bodies and proficiency testing scheme providers. It commissioned the University of Technology Sydney (UTS) to conduct research to evaluate the economic value of accreditation focused on NATA’s five sectors of accreditation: Inspection, Infrastructure, Calibration, Life Sciences and Legal and Clinical.
It analyses the attributes of NATA accreditation distributed across five key themes exploring the benefits of NATA accreditation – Importance of Recognition, Standards and Quality, Efficiency and Productivity, Innovation, and Organisational Culture.
The report concludes that accreditation in Australia provides indirect but real benefits for the community and consumers of intermediate and final goods and services. This research report highlights the measurable and intangible attributes of NATA accreditation as a contributor to the Australian economy. Whilst the estimated measurable economic worth represents a value of between AUD $315m and AUD $421m, to place a value on the intangible attributes of accreditation is impossible as the services NATA provides are intrinsically woven within the fabric of the Australian business, economy, and society.
A copy of the report is available here.
Author: R Agarwal, R Green, C Bajada – Australia, University of Technology Sydney
Standardisation and standards have often been perceived as a contradiction to innovation. This report provide conceptual arguments and empirical evidence that standardisation as such and standards can be used as to promote innovation especially in three different areas. After a brief section on the general economic functions of standards, the relationship between research and standardisation is examined by first showing both standardization as a technology transfer channel and standards as enablers and facilitators for research. The second area focuses on the difficult but promising issue of transferring intellectual property rights (IPR) into standards, and shows how this can be beneficial both for IPR holders and standards implementers. The third newly emerging field concerns the role of standards and standardization in procurement processes, which are more and more forced to address and promote innovation. In the final chapter, the results are summarised and recommendations for policy makers are derived.
A copy of the report is available on the National Endowment for Science, Technology and the Arts (NESTA) website.
Author: Knut Blind, TU Berlin, Rotterdam School of Management and Fraunhofer FOKUS
Following the introduction of Regulation (EC) No 765/2008 setting out the requirements for accreditation and market surveillance relating to the marketing of products, the Commission has published a report to review its impact between 2013 and 2017.
This report confirms that the European accreditation infrastructure created by the Regulation has provided added value, not only for the single market but also for international trade. Accreditation has wide support from European industry and the conformity assessment community for ensuring that products meet the applicable requirements, removing barriers for conformity assessment bodies and helping entrepreneurial activities to flourish in Europe. The Regulation established a trustworthy and stable accreditation system in all Member States, as well as EFTA countries and Turkey.
The report concludes that more than 34450 accreditations were delivered (in regulated and non-harmonised areas) covering a wide range of activities by the end of 2016. This has been a significant contributory factor in deepening the single market and seemless trade.
A full copy of the report is available from the EU Commission website.
Economic research carried out by NZIER, a specialist consulting firm, reveals that accreditation facilitates $27.6 billion of New Zealand’s exports – over 56% of total goods exports.
Exporters need to be known and recognised overseas as delivering high-quality, safe goods and services to market. IANZ, the New Zealand accreditation body, provides precisely this ‘seal of approval’, which reduces exporters’ transaction costs and risks, and supports ongoing government and business efforts to lift the value-added from exports.
An illustrative economic modelling exercise provides an indication of the additional value that accreditation delivers to New Zealand exporters. If an 8% ‘accreditation price premium’ that an overseas survey suggests exporters receive from accreditation were to be removed, it would cost accredited exporters around $4.5 billion, and cause New Zealand’s GDP to drop by 0.63% or $1.65 billion.
IANZ also plays an important role in the domestic economy. Its accreditation services support industries that account for $35.8 billion of New Zealand’s GDP, and which employ almost 358,000 workers (17% of total employment).
A publication titled “Good practices: Experience in the Market Surveillance of ISO 9001 quality management systems” has been released by the United Nations Industrial Development Organization (UNIDO).
The report presents the lessons learnt and good practices in applying Market Surveillance methodology to monitor the effectiveness of ISO 9001 certification in manufacturing enterprises and to evaluate the performance of respective accredited certification bodies.
The report concludes that the proper use of ISO 9001–based quality management systems assists developing countries in promoting sustainable trade, thereby helping them achieve inclusive and sustainable industrial development and the 2030 development agenda.
A full copy of the report can be downloaded from the UNIDO website.
This 25-page report, commissioned by the Standards Council of Canada (SCC) and produced by the Conference Board of Canada, clarifies and confirms the essential role that standards play in Canada’s economic growth and labour productivity. The report is an update to the Conference Board’s July 2007 research report entitled Economic Value of Standardization.
Developing and using standards will help fuel a more competitive and innovative Canadian economy. They help businesses thrive and compete, keep Canadians safe, and support clean growth and infrastructure. A full copy of the report is available from the SCC website.
Reducing unnecessary trade costs is an important aspect of International Regulatory Co-operation (IRC). But trade costs are only one of the many considerations that countries take into account when engaging in bilateral, plurilateral or multilateral efforts to address non-tariff measures that are related to differences in regulations. They are also concerned about pursuing domestic regulatory objectives. This report develops an analytical framework to help understand the trade-offs between trade costs and domestic regulatory objectives that will determine outcomes of IRC. It shows the possible scope and landing zones of IRC initiatives, ranging from simple information exchange to negotiations to harmonize regulations between countries. The analytical approach is based on economic game theory and provides a basis for regulators and trade negotiators to determine which specific IRC approach would be promising to pursue.
The report states that the ILAC and IAF global arrangements provide the platform for trade cost reductions. A full copy of the report is available from the OECD website.
ILAC and IAF, the global accreditation associations, have contributed to research conducted by OECD to analyse the impact of international organisations (IOs) in supporting regulatory co-operation. The research identified that International organisations (IOs) play a growing role as standard setting bodies in supporting regulatory co-operation with evidence showing that IOs contribute to International Regulatory Co-operation (IRC) by:
- offering platforms for continuous dialogue on regulatory issues;
- facilitating the comparability of approaches and practices;
- providing member countries with flexible mechanisms to identify and adapt to new and emerging regulatory areas or issues;
- contributing to the development of a common regulatory language
- developing international legal and policy instruments.
The OECD gathered unique evidence from 50 international organisations on their governance, operational modalities, rule-making practices and approaches to assessing implementation and impacts, which is presented in the report International Regulatory Co-operation: the Role of International Organisations in Fostering Better Rules of Globalisation (launched 2 November 2016). This comparative analysis takes into account the diversity of mandates, expertise and strengths of the 50 participating IOs.
By establishing the international accreditation arrangements based on the mutual recognition of certificates and reports issued by conformity assessment bodies, the development of common rules and policies, and the harmonising of accreditation practices, the report identified that ILAC and IAF play a growing role in supporting regulatory co-operation.
This OECD work on IRC and IOs is part of a broad study into the various mechanisms available to governments to promote regulatory co-operation, and their benefits and challenges. A full copy of the report is available from the OECD website.
While there is a substantial body of literature on the economic theory of international standards, and their presumed effects, much less is known about how international standards work in practice. This paper surveys empirical studies investigating the relationship between international standards and trade. The main focus is on econometric studies using secondary data on international standards and trade, but surveys and some of the literature investigating the relationship between standards and other economic measures, such as productivity, growth and welfare are also summarised.
The paper sets out some conclusions that can be drawn from the econometric studies that have sought to estimate the relationship between international standards and trade:
- In most studies, when exporting countries use international standards, this has in most cases a positive (or at least neutral) effect on their export performance.
- When exporting countries use national standards (i.e. standards specific to country x), that may lead to superior export performance by x.
- When the importing countries also adopt international standards, the most common effect is also to increase imports. The exceptions can in part be explained.
- When the importing country uses national standards, the results are more diffuse. For studies that relate exclusively to voluntary standards, the effects are distributed quite evenly. For studies that relate to regulations (i.e. mandatory standards), the effects on imports tend to be negative.
A full copy of the report is available from the OECD website.
This report provides a comprehensive account of quality systems for private sector development: what works on the ground and what doesn’t, and why. It explains why quality and standards matter for export growth, productivity, industrial upgrading, and diffusion of innovation, all central ingredients in improving economic growth and generating real gains in poverty reduction. The report examines the diversity of institutions, linkages, and arrangements involved in quality systems, identifying success factors and obstacles in the quality strategies of particular countries. A portion of the volume is devoted to experiences in Latin America and the Caribbean, a region with a great deal at stake in the drive to improve quality. Policy makers in Latin America and throughout the developing world will find Quality Systems and Standards for a Competitive Edge to be a valuable tool for meeting the challenges of building trade competitiveness in the new global economy.
A full copy of the report is available on the World Bank website.
In many countries in Eastern Europe and Central Asia (ECA), the National Quality Infrastructure (NQI) does not support business competitiveness, though this is one of its functions in organization for economic co-operation and development countries. In most of the Commonwealth of Independent States (CIS) countries, it even impedes competitiveness. The most common economic benefits of adopting standards include increased productive and innovative efficiency. Standards lead to economies of scale, allowing suppliers to achieve lower costs per unit by producing large, homogeneous batches of products. Standards spur and disseminate innovation, solve coordination failures, and facilitate the development of profitable networks. Participation in world trade increasingly requires that suppliers comply with standards determined by lead buyers in global value chains. The nature of participation in the global economy has changed dramatically over the past two decades. Rarely do producers turn raw materials into final products and sell them directly to customers. Improving the quality of goods and services and diversifying into sectors where quality matters can be a sustainable source of global competitiveness. Some of the productive tasks associated with high-quality goods have high learning and technological externalities. In those sectors, producers tend to form tight relationships with global buyers who transfer their knowledge and support the producers’ quality-upgrading processes. Diversifying into a broad range of sectors also reduces macroeconomic volatility, but quality upgrading becomes necessary to enter new sectors that compete on quality.
A full copy of the report is available on the World Bank website.
Citation “Racine, Jean-Louis. 2011. Harnessing Quality for Global Competitiveness in Eastern Europe and Central Asia. World Bank. © World Bank. https://openknowledge.worldbank.org/handle/10986/2305 License: CC BY 3.0 IGO.”
National Quality Infrastructure (NQI) reforms are an important part of broader efforts aimed at enhancing trade and investment opportunities, opening markets for new innovative products, and improving the business environment. As demand to access new markets and compete with higher quality products rises, the World Bank Group is committed to supporting government’s efforts to build a more harmonized and integrated NQI. This leaflet sets out how the World Bank can support the development of standards, accreditation and metrology systems to boost economic performance and cross-border investment decisions.
A full copy of the leaflet is available here. World Bank NQI Leaflet
Standards define how products, processes, and people interact with each other and their environments. They enhance competitiveness by offering proof that products and services adhere to requirements of governments or the marketplace. When used effectively, they facilitate international trade and contribute to technology upgrading and absorption. This brief discusses the importance, the central elements, and constraints to success of national quality infrastructure.
A full copy of the policy document is available on the World Bank website.
The ISO 9001 – Impact and Relevance in Brazil is based on UNIDO Project 140107 “Impact assessment of ISO 9001 Quality Management System Certification in Brazil”, co-funded by Inmetro and UNIDO. The overall objective of the project was to assess the effectiveness of the ISO 9001 certification process in Brazil from the perspective of certified organisations and their customers, as well as by conducting a number of “market surveillance” visits to a sample of certified organisations.
This study provides useful information about the take-up by and benefits for those who have decided to seek an accredited certification of their quality management system based on ISO 9001. The results of this study in Brazil are generally positive. They show that organisations do get value from accredited certification to ISO 9001; that users can rely on accredited certification to ISO 9001 as a reasonable basis for having confidence that the products or services provided by a certified organisation will fulfil their expectations; and that, despite commercial and competitive pressures that can undermine the impartiality and effectiveness of audits and certification, the audits and certifications are, in most instances, effective and valuable.
A full copy of the ISO 9001 – Impact and Relevance in Brazil report can be downloaded from the UNIDO website.
UKAS, the UK accreditation body, carried out a survey to capture feedback on the value of accreditation for conformity assessment bodies that have stable scopes in established technical sectors. The survey aimed to gain insight into the reasons for maintaining accreditation, to identify the positive outcomes that are realised through accreditation, and to investigate the value of selected elements of the accreditation process.
Respondents identified that there are clear external factors for maintaining accreditation:
- 67% maintain accreditation as it is perceived as the right thing to do
- 82% maintain accreditation due to customer expectations
- 46% maintain accreditation due to government expectations or requirements
The survey also identified that these businesses derive both internal and external commercial benefit from their accredited status:
- 93% of respondents agree that accreditation provides confidence to their customers and stakeholders
- 76% agree that accreditation differentiates them from their competitors
- 85% agree that accreditation improves the quality and validity of their work
- 71% agree that accreditation helps them to win new or maintain existing business
A copy of the report can be downloaded from the UKAS website.
This report is the outcome of a research project conducted between June and November 2013 which explored how voluntary standards markets might be applied to financial services regulation and sought to provide independent verification of their potential in the financial services sector.
The central finding of this report is that voluntary standards could play a greater role in rebuilding a safer and more trusted financial services sector. The report illustrates the use of standards in other industries, the drivers behind their development, the application of existing standards in the financial services sector, other areas in financial services to which standards markets might also be applied, and who might be the potential users of new standards for areas of financial services.
A copy of the report, published by BSI, the Chartered Institute for Securities & Investment and Long Finance in November 2013, can be downloaded from the BSI website.
Professor Michael Mainelli, Z/Yen Co-Founder
Chiara von Gunten for BSI and the Chartered Institute for Securities & Investment (CISI)
This report provides an overview of the opportunities for standards development in the insurance industry (particularly wholesale insurance) that emerged throughout this study, based on interactions with industry professionals and associations during workshops, informal discussions, and responses to an online questionnaire.
The research showed that voluntary standards market approaches would be particularly suitable around product development, product information and processes in insurance. Respondents confirmed the striking need for standards aiming to improve transparency, information quality and access in order to increase customer satisfaction and product comparability in insurance. Such standards could take the form of a ‘Fair Insurance’ product information standard (similar to the Fairbanking scheme but for insurance). These could build upon recent achievements, such as the first life insurance product that was awarded (in August 2014) a trusted mark in accordance with the Sergeant Review of Simple Financial Products and based on an independent certification process run by BSI – the BSI Kitemark for Financial Products.
A full copy of the report can be downloaded from the longfinance website.
Michael Mainelli, Z/Yen Co-Founder
Chiara von Gunten and Therese Kieve, BSI and Long Finance
This report provides an overview of the opportunities for standards development in the investment and asset management (I&AM) industry that emerged throughout this study, based on interactions with industry professionals and associations during workshops and informal discussions, and responses to an online questionnaire.
While voluntary standards could help to strengthen the I&AM industry in the long run and thus contribute to restoring trust, related industry efforts have generally been undermined by short-term concerns over asset gathering and revenue generation, which makes industry-wide consensus difficult to achieve. As a result, recent improvements to the way the industry operates have come through regulation (e.g. EU UCITS or AIFM) rather than being initiated by the industry itself. Despite this, this study finds that voluntary standards could have particular value around the design of product and services, related information and processes in I&AM.
A full copy of the report is available on the longfinance website.
Michael Mainelli, Z/Yen Co-Founder
Chiara von Gunten and Therese Kieve, BSI and Long Finance
To have an in-depth understanding of the actual impact of ISO 9001 certification on organisations, Certification and Accreditation Administration (CNCA) and UNIDO jointly conducted a survey of the effectiveness of ISO 9001 quality management system certification in China from September 2012 to September 2013. China has overtaken the early implementers of ISO 9001 and now represents approximately 30% of the 1.1 million ISO 9001 certificates issued worldwide. The survey covers the whole of China (except Taiwan, Hong Kong and Macau). Over 9000 questionnaires were sent out to ISO 9001-certified organizations and institutional purchasers in China, and 6974 effective completed questionnaires were collected. Physical on-site visits were conducted by trained experts at 958 certified organizations.
According to the survey results:
- 93% of all the institutional purchasers surveyed expressed that they regarded ISO 9001 certification as an important criterion for evaluation of their suppliers.
- 75% said their perception of the credibility of ISO 9001 CBs operating in China is “good” or “very good”.
- Purchasers had a good level of satisfaction with their ISO 9001-certified suppliers.
- Of the various parameters studied, the highest level of satisfaction is with the product quality of ISO 9001-certified suppliers (98% purchasers stated that they were satisfied, including 7% of all purchasers who were very satisfied).
- Compared with non-certified suppliers (or comparing the same supplier before and after certification), most purchasers think that the performance of certified suppliers is notably better than that of non-certified suppliers (or the same supplier before certification).
Among all the certified organizations surveyed;
- 51% said the most important reason for them to implement a QMS was to obtain competitive advantages, for internal improvement or to achieve corporate or top management objectives
- 43 % said the most important reason was to gain market access or to respond to customer pressure or tender requirements
- 6% said it was for marketing and/or public relations.
- 98% of the organizations surveyed said that regardless of the overall cost, the implementation of ISO 9001 had been a good or a very good investment.
- Most of the certified organizations said they obtained substantial benefits from the implementation of an ISO 9001-based QMS. 9% of the certified organizations estimated that it brought a benefit of up to RMB 100,000, either in cost savings and/or increased profits. 39% believed it to be between RMB 100,000 to 1,000,000. (c.US$ 15,000 – US$ 150,000)
- 37% estimated that it could bring more than RMB 1,000,000 of benefits (either cost savings or increased profits).
A full copy of the report can be read on the UNIDO website.
The Standards Council of Canada (SCC) report, Getting Aligned: How Adopting Standards Affects Canada’s Productivity and Growth, clarifies and confirms that standards contributed nearly $3 billion of the $39 billion increase in Canada’s real GDP in 2014, proving the essential role standards play in our nation’s economic growth.
Key findings of the report, commissioned by the SCC and produced by The Conference Board of Canada, include:
- It is estimated that, by the end of 2014, growth in the number of standards contributed $91 billion to real GDP.
- Between 1981 and 2014, standardization contributed 7.8 per cent of the growth rate in Canada’s real GDP.
- Over the same period, the number of standards rose, on average, 1.2 per cent per year, and real GDP grew at an average of 2.5 per cent annually. Standardization was also associated with an increase of 16.1 per cent in the growth of labour productivity.
Developing and using standards will help fuel a more competitive and innovative Canadian economy. They help businesses thrive and compete, keep Canadians safe, and support clean growth and infrastructure.
Read the complete report: Getting Aligned. How Adopting Standards Affects Canada’s Productivity and Growth.
Several studies highlight the economic benefits of standards, while the benefit of taking part in standardization remains a rather unexplored mystery to date. In theory, standard setters not only benefit from the possibility to monitor and shape the development of standards but also access a wide range of knowledge sources in the standards committee. Therefore, the authors investigate how the participation within formal standardization is related to the performance of 1561 German companies. A Cobb-Douglas production function is estimated in order to use the Solow-residuals as indicator for the firm performance. Participation within formal standardization is measured by the number of committee seats at the German Institute for Standardization (DIN). The results suggest that participation within formal standardization is positively related to firm performance in the manufacturing sector. In the service sector, no clear evidence for such a relationship is found.
A copy of the research paper can be downloaded from the Springer website.
Paul Wakke – Chair of Innovation Economics, Technische Universität Berlin
Knut Blind – Chair of Innovation Economics, Technische Universität Berlin
This paper develops theoretical hypotheses about driving factors of service companies to participate in formal standards development organizations at the national, European and International level and tests them based on a sample of German service companies. Our results of Multivariate Probit regression models reveal that company size and export activities play a significant positive role. Moreover, internal R&D expenditure and successful service innovation have a positive and statistically significant impact on the likelihood of participation in for-mal standardization processes which indicates that taking part in service standardization requires a certain absorptive capacity but is complementary to innovation activities. Based on the empirical results we derive implications both for managers of service companies and policy makers.
Driving Factors of Service Companies to Participate in Formal Standardization Processes: An Empirical Analysis (PDF Download Available). Available from: https://www.researchgate.net/publication/228321305_Driving_Factors_of_Service_Companies_to_Participate_in_Formal_Standardization_Processes_An_Empirical_Analysis
Axel Mangelsdorf, BAM Federal Institute of Material Research and Testing, Germany
The authors base their paper on data from a global company survey of certified companies carried out by the International Accreditation Forum (IAF) in 2010/11. They use multivariate Probit and ordered Probit models to analyze how company internal and external factors influence the perception of benefits from accredited certification. Benefits from accredited certification are divided into added value for the organization, increased sales and regulatory compliance. As for company external factors, they find that benefits from certification are higher for companies that went through a challenging certification process, had a competent certification body team, and are aware of the importance of accreditation. Internal factors are related to different motives for seeking certification. They find that the benefits from accredited certification are largest when companies become certified in order to improve their own business performance. Dividing the sample in high-income and middle income countries shows that the latter put more emphasis on company internal improvement through certification and are more likely to benefit from certification when they employ an external consultant. Finally, they can show that benefits are unequally distributed among companies. That is, smaller companies have a lower probability to benefit from certification compared to larger companies.
A copy of the report is available on the ResearchGate website.
Axel Mangelsdorf, Berlin Institute of Technology and Chair of Innovation Economics
Tilman Denkler, BAM Federal Institute for Materials Research and Testing, Germany
In this paper, the authors explore the relationship between firms’ external knowledge sourcing and their decision to participate in standardization alliances. Based on micro data they show that the importance of external knowledge is positively correlated with participation in standardization. This suggests that firms aim to access the knowledge of other companies and stakeholders in order to increase their own knowledge base. The analysis also shows that firms cooperating with different actors are more likely to join standardization. Due to the positive relationships with incoming knowledge spillovers and forms of cooperation, they conclude that standardization represents a specific form of collaborative knowledge-sharing and knowledge-creating strategy. In addition, we are able to show that absorptive capacity measured via companies’ research intensity promotes the involvement in standardization.
External knowledge sourcing and involvement in standardization-Evidence from the community innovation survey (PDF Download Available). Available from:
Knut Blind, Berlin Institute of Technology
Henk de Vries, Rotterdam School of Management
Axel Mangelsdorf, BAM Federal Institute of Material Research and Testing, Germany
The authors examine the impact of technical standards on trade in global value chains (GVCs), and find that while national standards hamper trade in European value chains, European and international standards foster trade. European standards have greater influence on trade in value-added whereas international standards have strong effects on gross trade flows. European standards therefore connect market actors in European value chains. Because gross trade figures contain value from outside of Europe, international standards facilitate trade with market actors from non-European countries. In addition, the authors find a positive trade effect of the interaction term between national and European standards. These standards generate gains from trade when their specifications are combined in the production process.
The paper is available from the ResearchGate website.
Florian Ramela, Axel Mangelsdorf, Knut Blind
While it is widely acknowledged that international standards facilitate trade, much less is known about certification requirements and mutually recognition of certification results. In this paper, the authors examine the impact of ISO 9000 certifications and the multilateral recognition arrangement for international acceptance of ISO 9000 certificates of the International Accreditation Forum (IAF-MLA) on trade in manufacturing goods. Using a gravity model, the authors find that certification intensity-the percentage of ISO 9000 certificated establishments in the manufacturing sector-promotes trade. Signatories of the IAF-MLA significantly trade more with each other and the trade enhancing effect has about the same magnitude as regional trade agreements. The analysis shows that IAF-MLA is most important for ex-porters from less developed countries aiming to access markets in developed countries. For policy makers, the results show the importance of technical assistance for accreditation services in developing countries.
The Trade Impact of ISO 9000 Certifications and International Cooperation in Accreditation (PDF Download Available). Available from: https://www.researchgate.net/publication/267961486_The_Trade_Impact_of_ISO_9000_Certifications_and_International_Cooperation_in_Accreditation
Knut Blind, Berlin Institute of Technology
Axel Mangelsdorf, BAM Federal Institute of Material Research and Testing, Germany
The national quality infrastructure (NQI) is the institutional framework that establishes and implements standardization, including conformity assessment services, metrology, and accreditation. Governments play a crucial role in designing, developing, and implementing an effective NQI. Developing an NQI begins with an assessment of the current system and identification of areas where reforms are required. The legal framework should establish transparent, independent institutions within a national structure that can work with international organizations such as the World Trade Organization (WTO). The World Bank and other donor agencies are assisting a number of countries in the development of NQIs in order to encourage industrial development, reduce barriers to trade and entrepreneurship, and facilitate global technical cooperation.
Download the report from the World Bank website.
Research carried out by the Centre for Economics and Business (Cebr) concludes that standards boost UK productivity and improve performance, kick-start innovation, and support UK domestic and international trade.
The report analyses the macroeconomic and microeconomic impact of BSI’s consensus based voluntary standards across the UK economy. It concludes that they are a vital part of the strength of UK industry and play a crucial and often invisible role in supporting economic growth.
The main findings are that:
- £8.2 billion is the amount that standards contribute to the UK economy
- 37.4% of UK productivity growth can be attributed to standards
- 28.4% of annual UK GDP growth can be attributed to standards, equivalent to £8.2 billion
- £6.1 billion of additional UK exports per year can be attributed to standards
The full report can be downloaded from the BSI website.
Trade policy is an important topic in global public policy. It is recognized that trade is hampered when buyers have incomplete information about the offered products, a problem accentuated in the international markets by the physical and cultural distances between buyers and sellers. Buyers look for proxies to assess product quality, and exporters that can provide assurance about quality gain a competitive advantage. Our paper focuses on voluntary or private regulatory programs that have emerged as important instruments to correct policy failures. We examine how trade competition motivates firms to signal quality by joining ISO 9000, the most widely adopted voluntary quality certification program in the world. Methodologically, our study is novel because we observe trade competition at the bilateral and the sectoral levels.
Structural equivalence, the measure of competition we introduce in this paper, captures competitive threats posed by actors that export similar products to the same overseas markets. We study ISO 9000 adoption levels from 1993 to 2002 for 134 countries, and separately for non-OECD countries and non-EU countries. Across a variety of specifications, we find that trade competition drives ISO adoption: The uptake of ISO 9000 is encouraged by ISO 9000 adoption by firms located in countries that are “structurally equivalent” trade competitors. Given that information problems about product quality are likely to be more salient for developing country exporters, we find that trade competition offers a stronger motivation for ISO 9000 adoption in non-OECD countries in relation to developed countries. © 2010 by the Association for Public Policy Analysis and Management.
Xun Cao, University of Essex, UK; Aseem Prakash, University of Washington, Seattle, USA
Xun Cao, Aseem Prakash, ‘Growing exports by signaling product quality: Trade competition and the cross-national diffusion of ISO 9000 quality standards‘, Journal of Policy Analysis and Management, Volume 30, Issue 1, pages 111–135, Winter 2011
Christos V. Fotopoulos, Evangelos L. Psomas, (Department of Business Administration of Food and Agricultural Enterprises, University of Ioannina, Agrinio, Greece); Fotis K. Vouzas (Department of Business Administration, University of Macedonia, Thessaloniki, Greece)
‘Certification and Integration of Environment with Quality and Safety – A Path to Sustained Success‘ (Santos, Rebelo, Barros, Pereira – 2012) looked at organisations in Portugal to examine the benefits of certification to Quality, Environmental and Health & Safety management system standards.
From the origianl 300 SMEs approached who had certification for ISO 9001 quality management system standard, with 46 giving valid responses from a variety of sectors. Of these 17 were also certified to ISO 14001 and 12 had OHSAS 18001 Health & Safety certification.
The chief benefits of certification to ISO 9001 were seen as:
|Major Impact||Impact||Little Impact||No Impact|
|Internal Organization of the company||72%||22%||6%||0%|
|Continuous assessment through internal audits||54%||44%||2%||0%|
|Ease of access to information||44%||39%||15%||2%|
Paper available to download
Gilberto Santos, Manuel Rebelo, Síria Barros and Martinha Pereira, College of Technology, Polytechnic Institute Cávado e Ave, Imasys Research Centre, Barcelos, Portugal, 2012, ‘Certification and Integration of Environment with Quality and Safety – A Path to Sustained Success‘
Formally adopted in 1996 by the International Organization of Standardization, ISO 14000 represents a new voluntary international environmental standard, which will likely be adopted by the vast majority of corporations. Its major focus is on the structure, implementation, and maintenance of a formal environmental management system. While the literature is clearly divided in its assessment of ISO 14000, an underlying common theme is that the decision to achieve ISO 14000 certification constitutes a major undertaking for most firms. Such an undertaking, it is argued, does not take place in a vacuum. Rather, it is a response to a number of factors or influences. However, no research to date has empirically identified these factors and explained how they can be leveraged into a competitive advantage. In this article, we use qualitative case studies to identify which factors affect the decision to attain ISO 14000 certification and we also explain how these factors can influence the level of success achieved during the certification process.
Sime Curkovica, Robert Sroufeb, Steve Melnykc – a Management Department, Haworth College of Business, Western Michigan University, USA;b Operations and Strategic Management Department, The Wallace E. Carroll School of Management, Boston College, USA; c Marketing and Supply Chain Management Department, The Eli Broad Graduate School of Management, Michigan State University, USA
Curkovic, S., Sroufe, R., Melnyk, S.A. (2005), ‘Identifying the Factors Which Affect the Decision to Attain ISO 14000′, Journal of Energy, Vol. 30, No. 8, pp 1387-1407.
This research paper aims to explore the relationship between ISO 9000 certification and organisational performance by developing an ISO 9000 relationship model.
Mei Feng, Milé Terziovski, Danny Samson, (2008) “Relationship of ISO 9001:2000 quality system certification with operational and business performance: A survey in Australia and New Zealand‐based manufacturing and service companies“, Journal of Manufacturing Technology Management, Vol. 19 Iss: 1, pp.22 – 37
Gavin P.M. Dick (Kent Business School, University of Kent, Canterbury, UK)
Citation: Gavin P.M. Dick, (2009) “Exploring performance attribution: The case of quality management standards adoption and business performance“, International Journal of Productivity and Performance Management, Vol. 58 Iss: 4, pp.311 – 328
Francisco Starke (FEA (School of Economics and Administration), Universidade de São Paulo, São Paulo, Brazil)
Rangamohan V. Eunni (Williamson College of Business Administration, Youngstown State University, Youngstown, Ohio, USA)
Nuno Manoel Martins Dias Fouto (FEA (School of Economics and Administration), Universidade de São Paulo, São Paulo, Brazil)
Claudio Felisoni de Angelo (FEA (School of Economics and Administration), Universidade de São Paulo, São Paulo, Brazil)
Francisco Starke, Rangamohan V. Eunni, Nuno Manoel Martins Dias Fouto, Claudio Felisoni de Angelo, (2012) “Impact of ISO 9000 certification on firm performance: evidence from Brazil”, Management Research Review, Vol. 35 Iss: 10, pp.974 – 997
ISO 9000 is the most popular and widely adopted meta-standard for quality and operational improvements in manufacturing supply chains. However, few studies have quantitatively examined its impact on supply chain efficiency. In this paper we measure the material and cash flow efficiency of ISO 9000 certified firms in terms of inventory days and account receivable days. We analyzed changes in these time-based efficiency indicators prior and after ISO 9000 implementation in 695 US-listed manufacturing firms. We found that ISO 9000 certified firms shortened the number of inventory days by 3.68 days 1 year after ISO 9000 implementation. They showed continuous improvement and shortened the number of inventory days by 8.75 days (8.29% shorter) 3 years after certification. Account receivable days and overall operating cycle time also showed similar significant reductions after ISO 9000 implementation. The results reveal that ISO 9000 adoption helps improve the material and cash flows in manufacturing supply chains.
Chris K.Y. Lo, Andy C.L. Yeung, T.C.E. Cheng, Department of Logistics and Maritime Studies, The Hong Kong Polytechnic University, Hung Hom, Kowloon, Hong Kong
Lo, C.K.Y., Yeung, A.C. L., Cheng, T.C.E., (2009), ‘ISO 9000 and supply chain efficiency: Empirical evidence on inventory and account receivable days’, International Journal of Production Economics, Volume 118, Issue 2, pp 367-374.
ISO certification has become a pervasive mechanism adopted by firms to improve their operational performance. In this paper, we examine the operational and organizational factors that increase the likelihood of adopting ISO certification and the impact that ISO certification and ownership structure have upon firm performance. Using a sample of 163 Spanish manufacturing firms for the period 1996–2000 we perform a rare events logit model and a regression analysis. Our findings show that firms producing intermediate goods that have implemented just-in-time practices are more likely to adopt ISO certification. Furthermore, we report a strong influence of the ownership structure upon ISO adoption policy, especially when a multinational firm is the largest shareholder. Empirical evidence supports that ISO certification and ownership structure positively impact firm performance. However, our results indicate that the positive impact of ISO certification on performance diminishes in firms where ownership is highly concentrated.
Esteban Lafuente1, Alberto Bayo-Moriones2 and Miguel García-Cestona1
Several studies have examined how the ISO 9001 quality management systems standard predicts changes in organizational outcomes such as profits. This is the first large-scale study to explore how employee outcomes such as employment, earnings, and health and safety change when employers adopt ISO 9001. We analyzed a matched sample of nearly 1,000 companies in California. ISO 9001 adopters subsequently had far lower organizational death rates than a matched control group of nonadopters. Among surviving employers, ISO adopters had higher growth rates for sales, employment, payroll, and average annual earnings. Injury rates declined slightly for ISO 9001 adopters, although total injury costs did not. These results have implications for organizational theory, managers, and public policy.
The ISO 9000 series of quality management systems standards, introduced in 1986, has been adopted at over 560,000 locations worldwide. Anecdotal evidence suggests that firms can achieve internal benefits such as quality or productivity improvements or that certification can help firms maintain or increase their market share, or both. Others argue that the standard is too generic to cause performance improvement but can be seen as a signal of good management. In this paper, we track financial performance from 1987 to 1997 of all publicly traded ISO 9000 certified manufacturing firms in the United States with SIC codes 2000–3999, and test whether ISO 9000 certification leads to productivity improvements, market benefits, and improved financial performance. We employ event-study methods, matching each certified firm to a control group of one or more non-certified firms in the same industry with similar pre-certification size and/or return on assets. We find that firms’ decision to seek their first ISO 9000 certification was indeed followed by significant abnormal improvements in financial performance, though the exact timing and magnitude of this effect depend on the specification of the control group. Three years after certification, the certified firms do display strongly significant abnormal performance under all control-group specifications. The degree to which the precise results vary across control-group specifications indicates that event studies should always include extensive sensitivity analysis, for instance matching by size and performance separately and jointly, using both single firms and portfolios as controls.
Corbett, C.J., Montes-Sancho, M.J., Kirsch, D.A; (2004), ‘The Financial Impact of ISO 9000 Certification in the US: An Empirical Analysis‘, Management Science; V. 51; No. 7; pp 1046-1059
Shwu‐Ing Wu (Department of Business Administration, National Chin‐Yi University of Technology, Taiping, Taiwan)
Jui‐Ho Chen (Department of Electrical Engineering, National Chin‐Yi University of Technology, Taiping, Taiwan)
Citation: Shwu‐Ing Wu, Jui‐Ho Chen, (2012) “The performance evaluation and comparison based on enterprises passed or not passed with ISO accreditation: An appliance of BSC and ABC methods“, International Journal of Quality & Reliability Management, Vol. 29 Iss: 3, pp.295 – 319
The World Trade Organization (WTO) Economic Research and Statistics Division produced the report ‘International Standards and the WTO TBT Agreement: Improving Governance for Regulatory Alignment‘ (Erik Wijkström and Devin McDaniels, WTO, 19 March 2013), with some key points on the value of key conformity assessment tools such as ISO standards and ILAC accreditation.
Of particular interest as regards conformity assessment is 3.1.1, the section on Specific Trade Concerns, ‘One of the core functions of the TBT Committee is acting as a forum to address trade issues – these are referred to as “Specific Trade Concerns” (STCs). These are concerns that one or several Members have with the design or implementation of another Member’s measure. An analysis of the TBT (Technical Barriers to Trade) Committee’s records shows that about one third of all STCs raised in the TBT Committee are associated in one way or another with the subject of international standards. By “associated” we mean that international standards have been mentioned by a delegation in the discussion of a particular trade concern – either by reference to a specific body or organization, or through general reference to the existence (or non-existence) of some source of international guidance.’
‘While over forty different bodies or organizations are mentioned, a number of them recur frequently in discussion. The International Organization for Standardization (ISO) is mentioned in 30% of STCs associated with international standards; the International Laboratory Accreditation Cooperation (ILAC) in 10%.’
The report gives a number of examples of the kind of problem, including: ‘Lead in pottery. The European Union objected to a Mexican draft standard for glazed pottery, ceramics and porcelain, which mandated more stringent lead and cadmium limits than those laid down in the relevant international ISO standards (ISO 6486-1/2). Specifically, the European Union was concerned that Mexican authorities would no longer accept test results accompanying EU ceramic tableware conducted in compliance with these ISO standards. Mexico explained that while its draft standard was partially based on ISO standards, it deviated in certain aspects due to a greater level of health protection required by Mexico, and due to the circumstances of Mexico as a developing country.’
The conclusion of this kind of problem is that ‘The vast majority (around 90%) relate to some form of “challenge” on international standards (from one Member to another). The tone of the discussions may range from a polite request for clarification about the use or non-use of international standards in a measure, to a direct accusation that a Member is not following a specific (and in their view relevant) international standard and therefore violating a WTO discipline.’
The use of international standards and systems in world trade, such as ISO and ILAC which stick to the ‘Six Principles’ of Transparency, Openness, Impartiality and Consensus, Effectiveness and Relevance, Coherence and Development Dimension, would reduce the instances of the STCs.
‘The Economics of Accreditation’ commissioned by the Department for Business Innovation and Skills has assessed the economic benefits derived from the accreditation of certification, measurement and inspection services. Researchers from Birkbeck, University of London, surveyed a selection of businesses and other independent analysis to create the report. Its aim was to provide a financial evaluation of accreditation’s contribution to the UK economy, which it valued at more than £600 million per annum.
A central element of the analysis is the multiplier effect of accreditation, indicating that UKAS and the other institutions in the quality infrastructure jointly amplify each other’s effects, so leading to an impact greater than the sum of the parts. This set of interdependencies and cross-amplifying effects combine to create a significant financial advantage for those using accreditation to distinguish their products and services.
Standards are a vital component in the conformity assessment arsenal to address public policy issues. International standards developed by consensus used in conformity assessment are in two key categories:
- The standards on which assessment is based, whether for products & services or process (management system standards)
- The standards which guide many of the key processes, such as certification, accreditation, inspection, etc. More of details of these standards, referred to as the ISO CASCO Toolkit can be found here.
A number of major research reports have been produced in a number of economies which help quantify and explain the contribution standards makes to these economies. These reports are:
- The Economic Benefits of Standardisation (2012) Standards Australia
- The Economic Benefits of Standards to New Zealand (2011), Report to The Standards Council of New Zealand and The Building Research Association of New Zealand
- The Economics of Standardization: An Update (2010) to The Economics of Standardization (2000) UK Department of Business, Innovation and Skills (BIS)
- The Economic Impact of Standardization: Technological Change, Standards Growth in France (2009) AFNOR
- Economic Value of Standardization (2007) Standards Council of Canada
- June 2015: The Economic Contribution of Standards to the UK Economy, UK Department of Business, Innovation and Skills (BIS)
- Economic benefits of standardization Part A: Benefits for business; Part B: Benefits for the economy as a whole (2000) DIN German Institute for Standardization
The Central America region is a small market. The region contains around 43 million inhabitants (0.6 percent of total world population) who generate around 0.25 percent of the world’s Gross Domestic Product (GDP). While the region has successfully embarked on a regional integration agenda and has strong commercial links with the US, extra-regional trade-mainly with large fast-growing emerging economies-remains a challenge. Export performance is analyzed along three dimensions that, together, give a fairly comprehensive picture of competitiveness:
1) the composition, orientation and growth of the export basket;
2) the degree of export diversification across products and markets; and
3) the level of sophistication and quality of their main exports.
This analysis allows exports dynamics at the different margins of trade (intensive, extensive, and quality) to be evaluated and individual countries’ to be benchmarked with peers in the Central American region. The results of this report allow policy makers to identify key areas to explore in the overall discussion of export competitiveness in the Central American region. This paper relates to the literature on challenges and opportunities that trade liberalization can bring to the Central American region. Much of the recent literature focuses on the role of the free trade agreement negotiated by Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua, with the US.
Given the importance quality infrastructure plays in advancing the trade agenda, greater priority should be given to developing accreditation, standards, and metrology and obtaining international recognition to unlock their export potential.
A survey covering quality management system development, certification, accreditation and economic benefits, using a variety of research tools to judge the awareness and use of accredited certification to ISO 9001 by purchasing organizations. Research included a survey of purchasing organizations (the present and potential customers of ISO 9001 certified suppliers); interviews with some of these; survey of ISO 9001-certified organizations and visits to some of these.
As the commissioning organization UNIDO (United Nations Industrial Development Organisation) DIrector-General Kandeh K. Yumkella felt, ‘It is pleasing to see that the results have demonstrated (with some exceptions) that the implementation of ISO 9001 and the associated certification has been a good investment of resources, from both the perspective of the certified organizations and that of their customers (the major purchasing organizations in the regions).’
Some of the key findings were:
There are clear empirical economic benefits to the effective implementation and accredited certification of quality management systems in the manufacturing sectors of the Asian developing countries in which the project was conducted.
Credibility of ISO 9001
Overall, the perceptions of both the ISO 9001 standard and accredited certification to ISO 9001 in the region are good, though the role of accreditation is not well understood either by purchasers or by certified organizations
Purchasers’ perceptions of their ISO 9001-certified suppliers
The purchasers surveyed were mainly satisfied with the performance of their ISO 9001-certified suppliers (with some exceptions), and, in general, ISO 9001-certified suppliers performed ‘better’ or ‘much better’ than non-certified suppliers, based in a number of parameters.
This document has been prepared jointly by the Colombian Directorate of Regulation of Ministry of Commerce, Industry and Tourism, together with the leading actors from the National of Quality. It was supported by the Quality Program for the Cosmetics Sector – Safe, and UNIDO.
The purpose of the document is to propose a roadmap for Colombia which incorporate the use of the Quality Infrastructure’s technical competence as the basis for good governance, business competitiveness, and prosperity.
The Chinese accreditation body (CNAS) have translated over 70 case studies from this website to support their engagement work with Government. They have published these case studies in a brochure which they distribute to Government officials to promote how accreditation is being used in other countries to solve policy problems.
Download a copy (In Mandarin) 认可采信国际实践（20160606定）
This video, produced by ENAC, the Spanish accreditation body, sets out how accreditation can support economic growth and market competitiveness. Click here to view the video (in Spanish)
Standards make a huge economic contribution to the UK. They are a vital part of the strength of UK industry and play a crucial and often invisible role in supporting economic growth. This video highlights the key statistics.
In order to improve trade prospects and the quality of products and services in West Africa, this directory provides a list of accredited testing laboratories, inspection bodies and certification bodies in the region (as of August 2017). The directory was sponsored by UNIDO to ensure that public and private organisations are aware and have access to a network of accredited suppliers. It also hopes to inspire other conformity assessment bodies to become part of the programme.
The directory is available from the UNIDO website.
A Strategic Roadmap for the Quality Infrastructure of the Americas was launched at the Joint General Assembly of ILAC and IAF which supports their common goal – ‘tested, inspected or certified once and accepted everywhere’.
The Roadmap, funded by the Spanish contribution to the United Nations Industrial Development Organization (UNIDO) Trade Trust Fund, provides a high-level overview of the key topics that need to be addressed in order to leverage the collaborations between regional standards, metrology and accreditation organizations and their constituent members. This will support inclusive and sustainable industrial development, specifically, intra and inter-regional trade.
This initiative to develop a high-level strategic roadmap for Quality Infrastructure (QI) development and improvement in the Americas was conceived during the UNIDO General Conference in 2013, under the leadership of three main regional entities, namely COPANT (Standards), SIM (Metrology) and IAAC (Accreditation). Subsequently, in 2014, the three entities created the Quality Infrastructure Council of the Americas (QICA), established to provide and promote effective deployment of QI in the Americas, as well as collaboration between national and regional initiatives.
The Roadmap proposes five steps to provide a systematic and efficient approach to QI development in line with national and regional needs. This Roadmap should be considered as an evolving planning tool that is to be reviewed and updated periodically to reflect changing priorities, environment, contexts and the emergence of new challenges and opportunities.
Further information is available on the UNIDO website.
Watch this short video on the Quality Infrastructure in Grenada, providing an introduction to standards, conformity assessment and metrology.
The United Nations Economic Commission for Europe (UNECE), has updated its trade recommendations to include references national accreditation systems and the global arrangements. UNECE Working Party 6 on Regulatory Cooperation & Standardization Policies which works to:
- Promote the use of standards by policy-makers and business as a tool for reducing technical barriers to trade, promote increased resilience to disasters, foster innovation and good governance
- Promote the use of standards in the implementation of UN-wide goals, including the implementation of the Agenda 2030 and the Sendai framework for action
Sixteen UNECE recommendations have been adopted to address standardization and regulatory issues. They set out good practice regarding Regulatory cooperation, Metrology, Standards and Norms, Conformity assessment, and Market surveillance.
While these recommendations are not binding and do not aim at rigidly aligning technical regulations across countries, they are used to encourage policy makers to base their regulations on international standards to provide a common denominator to the norms that apply in different markets.
All sixteen recommendations can be downloaded from the UNECE website.
The recommendations that reference accreditation are:
Recommendation G: Acceptance of Conformity Assessment Results
The UK Accreditation Body, UKAS, has prepared ‘the case for accreditation’ aimed at large consultancies and research organisations. The briefing note is intended to provide an introduction to support UKAS’ engagement with these organisations, so that they are in a position to understand that accreditation is a proven tool to solve the issue of delivering consumers, suppliers, purchasers and specifiers with the assurance that services will be run efficiently, goods will conform, and working environments will be safe.
It is hoped that standards and accreditation will be referenced in future sector research or position papers.
A copy of the briefing note is available from the UKAS website.
The Philippine Accreditation Bureau (PAB) has produced a video to increase public awareness on and demonstrate the benefits of accreditation. It aims to further encourage wider acceptance and use of accreditation and build trust in conformity assessment — a tool that helps businesses not only to comply efficiently and effectively with regulations and standards around the globe but also to gain competitive advantage and to expand into new and wider markets.
This short presentation best responds to the question “How do we look for the best quality?” This is a tough question to answer with the vast number of products and services in the market. The video shows how accreditation can help consumers in whittling down their choices to safe, reliable and quality products and services which pass through accredited conformity assessments.
AIHA Laboratory Accreditation Programs, the US accreditation body, has produced a shot video to guide applicants through the accreditation process. View the video on Youtube.
ISO/CASCO has published a new brochure describing how “ISO Technical Committees (ISO/TCs) are often required to choose between developing requirements for a management system for an organisation’s activities, or developing requirements for the competence of an organisation to carry out its activities”.
Not only does this document assist ISO/TCs in understanding the difference between the two standards, but it is also helpful for organisations in the process of deciding whether to implement a management system or a competency based system. In addition, the brochure indicates the benefits and values of meeting either set of requirements.
The ISO/CASCO document – Frequency Asked Questions: Competency or Management System Based Standards?” is available here.
UNIDO has published a briefing note to set out how setting up a Quality Infrastructure System can be one of the most positive and practical steps that a developing nation can take on the path forward to developing a thriving economy as a basis for prosperity, health and well-being. A Quality Infrastructure is a system contributing to governmental policy objectives in areas including industrial development, trade competitiveness in global markets, efficient use of natural and human resources, food safety, health, the environment and climate change.
Download a copy of the briefing note from the UNIDO website.
UNIDO has published a new brochure which highlights the contribution of accredited conformity assessment services to the implementation of the 2030 Agenda for Sustainable Development. UNIDO’s vision to address today’s economic, social and environmental challenges is enshrined in the Lima Declaration, adopted by UNIDO Member States in December 2013. On this basis, UNIDO pursues “Inclusive and Sustainable Industrial Development” to harness industry’s full potential to contribute to lasting prosperity for all.
17 Sustainable Development Goals (SDGs) with 169 associated targets constitute the core of the UNIDO 2030 Agenda for Sustainable Development. These provide a new development framework that seeks to transform the world and guide all global, regional and national development endeavours for the next 15 years. UNIDO’s programmatic approach is guided by three interrelated thematic priorities: creating shared prosperity, advancing economic competitiveness, and safeguarding the environment.
Maintaining strategic partnerships and technical cooperations, together with the use of standards and compliance related activities, also form an important part of UNIDO’s approach. The relationship between UNIDO, the International Accreditation Forum (IAF), and ILAC is one such partnership. This strategic partnership in the field of accreditation enables UNIDO, IAF and ILAC to coordinate activities in complementary and mutually supportive areas of operation, in order to enhance the impact of industrial development on economic growth.
A copy of the brochure is available on the UNIDO website.
The significance of an accreditation system for trade and the economy, as well as practical advice for the establishment of accreditation bodies, are the focus of a newly released publication titled, “Establishing accreditation in developing economies – A guide to opening the door for global trade”.
Prepared by the United Nations Industrial Development Organization (UNIDO), in cooperation with the International Accreditation Forum (IAF) and the International Laboratory Accreditation Cooperation (ILAC), the publication was launched at the ILAC – IAF joint General Assembly. The guide aims to support the common goal of “tested, inspected or certified once and accepted everywhere”.
It is comprised of two parts. The first part focuses on the need for accreditation and the benefits that an accreditation system can bring to good governance. It provides policymakers with a framework for establishing an accreditation body or partnering with neighbouring economies to form a shared system, which can bring an economy closer to its trading partners through mutually recognized arrangements of accreditation.
The second part offers comprehensive practical advice and building blocks to those who are tasked with establishing an accreditation body. It presents information on the essential operational requirements for accreditation bodies, and outlines available resources, as well as potential challenges. Case studies then follow to offer an illustration of practical applications of the guidance provided in the publication.
A copy of the brochure is available on the UNIDO website.
With examples from everyday life, this video, produced by COFRAC in France, highlights the fact that accreditation impacts, even if we are not always aware of it, numerous activities benefiting from conformity assessment services.
As someone who is involved in the selection of suppliers and, possibly, responsible for making purchasing decisions, you may have seen or used products and services that are promoted using reference to ISO 9001:2015. This informative text provides some answers to these questions and will inform you about how you can get the most out of using ISO 9001 as a supply chain tool.
A full copy of the brochure is available from the ISO website.
A booklet created by European Accreditation sets out how the ISO CASCO toolbox can support the work of Regulators.
View the booklet on the EA website.
UNIDO’s Trade Capacity Building Branch has published a briefing paper to set out how it can support Developing Economies develop the effective building blocks of using accredited testing, inspection and certification, using hamonized standards, in order to boost trade.
Download a copy of the briefing from the UNIDO website.
A short video to show how standards, metrology and accreditation can help sustainable development in Developing economies.
Click to view.
Regulators are increasingly relying on independent third party declarations of compliance to support their enforcement and monitoring activities.
The ILAC MRA and the IAF MLA remove the need for products and services to undergo additional tests, inspections and certification in each country where they are sold. These Arrangements remove technical barriers and therefore support cross-border trade.
The IAF MLA ensures the mutual recognition of accredited certification between signatories to the IAF MLA, and subsequently acceptance of accredited certification in many markets based on one accreditation.
The ILAC MRA supports international trade by promoting international confidence and acceptance of accredited laboratory data and inspection body data. Technical barriers to trade, such as the retesting of products, each time they enter a new economy would be reduced.
SGS has created a portfolio of solutions to support compliance with regulatory requirements, enhance government revenue, facilitate trade, support efficiency and promote good governance along with sustainable development.