Financial Times

Unravelling the ISO certification riddle
By Duruthu Edirimuni
With more and more companies publicising claims of ISO certification as a badge of approval to sell their products or services, this international standards system has become a brainteaser beyond the understanding of most ordinary people. Dishonest certification organisations that peddle such certification are also challenging the credibility of standards assessment and duping the public, prompting calls for better 'policing' to eliminate malpractice. The Sunday Times FT probed deep into the technicalities of standards certification in an effort to unravel the ISO riddle.

The International Organisation for Standardisation (ISO) is a network of national standards institutes of 148 countries, with one member per country. It has a Central Secretariat in Geneva, which coordinates the system by facilitating the international coordination and unification of industrial standards.

ISO develops and maintains the ISO 9000 series of quality management standards (QMS) and the ISO 14000 series of environmental management system standards (EMS). The standards address issues such as impartiality, competence and reliability leading to confidence in the comparability of certificates and reports across national borders.

Sri Lanka Standards Institution (SLSI), functioning under the Ministry of Science and Technology, is a participative member body of ISO. Certification bodies are those which assess QMS or EMS in companies to be consistent with ISO 9000 or 14000.

If they comply with these standards, the certification bodies issue certificates to the companies concerned. These certifiers of systems and products need to demonstrate their competence. They do this by being accredited by a nationally recognised accreditation body.

Accreditation bodies are the organisations established in a number of countries to approve certification bodies as being competent to issue the ISO certificates. Checking this is the job of accreditation bodies. Accreditation delivers confidence in certificates and reports by implementing widely accepted criteria set by the ISO.

ISO does not carry out certification, issue certificates, does not have the authority to control certification bodies or accreditation bodies and it neither monitors nor endorses the certification activities.

However, to promote convergence amongst national practices, guidelines prepared by the ISO Committee on conformity assessment (ISO/CASCO) have been published in a collection of guides.

There are two guides, called ISO/IEC and 61 and 62, which are directly applicable and specify general requirements for assessment and accreditation of certification bodies and their operation and certification of quality systems. These have been adopted in many countries, either in the rules of assessment and certification programmes or in national standards.

SLSI received ISO 9000 series of standards certification scheme from the world's oldest accreditation body, Raad voor Accreditatie (RvA) of the Netherlands ("Dutch Council for Accreditation") in 1996 for 16 scope sectors out of a total of 39 in relation to ISO 9001-2000 QMS.

The ISO certificate is to be renewed once in three years and SLSI charges an annual fee for issuing ISO certificates based on the annual turnover of the company. The charges are in the range of Rs. 270,000 - 300,000 for an ISO 9001-2000 QMS certificate.

The 16 sectors accredited by RvA for SLSI are food products, textiles and textile products, leather and leather products, wood and wood products, pulp, paper and paper products, publishing companies, printing companies, chemicals and chemical products, pharmaceuticals limited to Ayurvedic drugs and Ayurvedic therapeutic products, rubber and plastic products, non metallic minerals, concrete, cement, lime and plaster, basic metals and fabricated metal products, electrical and optical equipment, hotels and restaurants, and transport.

Besides RvA, there are many other accreditation boards, such as Registrar Accreditation Board (RAB) in Canada, and United Kingdom Accreditation Service (UKAS), which accredit certification bodies. The accreditation bodies audit each other to see whether they maintain the ISO standard.

Apart from SLSI, there are other private certification bodies such as SGS International Certification Services, Bureau Veritas Quality International (BVQI), Det Norske Veritas (DNV), CIUK and Lloyd's functioning in Sri Lanka who issue ISO 9001-2000 certificates. SLSI Director General B. S. M. Mendis said that SLSI has a market share of over 50 percent of the ISO certificates issued in the country. "SLSI is the one and only member body representing Sri Lanka at the ISO and pays an annual membership fee of two million rupees to the ISO," Mendis said.

There are two kinds of ISO certificates, namely 'accredited' ISO certificates and 'non-accredited ISO certificates'. ISO certificates issued without accreditation are called non-accredited certificates.

The Sunday Times FT learns that recent certificates issued to HSBC and Merchant Bank of Sri Lanka (MBSL) by SLSI are 'non-accredited ISO certificates'. Only two departments of HSBC (payment services department and custody and clearing department) are ISO certified.

Mendis said that there is no necessity to get accreditation from any organisation to issue certificates for ISO 9001 -2000 quality management system, as SLSI, which is the national standards institution, is a participative member body of ISO. "There is a situation where another company or even an individual can certify a particular organisation saying it conforms to ISO 9000 standards and this is where accreditation has come into the picture due to credibility and acceptance of a certificate," Mendis said.

Mendis argues that when a standard body, which is an official body, issues a certification it becomes acceptable. "Even without accreditation our certification will be accepted," Mendis pointed out. He confirmed that the certificates given to the two banks are non-accredited ISO 9001: 2000 certificates. "Primarily the accreditation is based on ISO guide 62 and when we do any ISO 9000 assessment we follow this," he said.

MBSL Managing Director and CEO Sunil G. Wijesinha said that MBSL is confident about the ISO certification from SLSI and is aware that it is a non-accredited certificate. Mendis said that a private certification body's certificates will not be accepted unless an accreditation body accredits that institution.

"When a private certification body is formed, and issues certificates, a question arises about the acceptance of their certificates and they need accreditation for this reason." Because of this there is a subtle difference between SLSI and other certification bodies certifying ISO systems for companies.

When asked why SLSI obtained accreditation for the above 16 sectors, he said that was done for marketing purposes as the national standard body was facing much competition from other satellite certification bodies in the country.

Speaking at the opening of the 17th meeting of ISO/CASCO, Committee on conformity assessment, held in Geneva on 29-30 November 2001, ISO Secretary-General, Dr. Lawrence D. Eicher had declared that ISO 9000 certification bodies and the accreditation bodies that approve them as competent need to do a better job of policing their community to weed out malpractice and dishonest operators.

"We regularly receive complaints about certificates being awarded undeservedly to companies who have not been properly audited, or about certification bodies who offer to write the quality manual for the company and then sell them a certificate, or about others who claim to have been approved by ISO.

No one at ISO has ever approved such certification bodies," he has said. Eicher has said that the conformity assessment community was facing a serious challenge caused by a certain number of certification bodies, which acted without integrity.

When The Sunday Times FT wrote to ISO on this issue, the ISO/IEC Information Centre in a response said that if an organisation is a member body of ISO, this does not confer any rights on it in the certification or accreditation arena.

A member body of ISO is the national body 'most representative of standardisation in its country'. Only one such body for each country is accepted for membership of ISO. Member bodies are entitled to participate and exercise full voting rights on any technical committee and policy committee of ISO.

If they are involved in the business of certification, this is carried out totally independently of ISO and usually from a separate arm of the organisation.

"As far as we can see, SLSI is accredited by RvA. Even if they were not accredited by any organisation, there is nothing to stop them offering certification services in any sector of their choosing,"

DNV Manager Certification Administration and Marketing, Srinath Samaranayake said that acceptability is automatically granted when the bodies that certify on ISO standards are well known. "If a certification body is accredited by an accreditation body that is recognised worldwide, the ISO certificates are even more recognised," he said.

The SLSI's Mendis said: "What is important is carrying out a correct assessment or an audit for companies to improve their quality and productivity and their bottom line."

Although ISO certification is not, or should not be viewed, as an end in itself for companies to be of standard, it must be realised that there are good and bad companies, which are ISO accredited, and vice versa.

However, the fact that a company has expended the effort to achieve ISO status is an indicator of a company's commitment to serving its customers and competing with its competitors. (Next: The public perception of ISO and certifying companies. What does the ISO series mean to consumers).

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