Overview from our board
Our progress and performance are overseen by the corporate accountability and risk assurance committee of the board (CARAC).
We've become a global brewer by excelling locally – nurturing strong, local brands which suit the tastes of consumers in each of our markets. One of our four strategic priorities is to be constantly raising the profitability of local businesses, sustainably. We do this by producing high-quality beers and soft drinks which are enjoyed by millions of people, and by doing so create jobs, pay taxes and build the skills base in our local markets. This year, we generated over US$25,042 million of economic value through our business activities, most of which was distributed to employees, shareholders, governments and local communities.
Business does not operate in isolation. Our success is linked to that of the communities we serve and to how we respond to society's changing needs. By 2030, the middle class1 is expected to rise from two billion to five billion, with most of the increase in emerging and developing markets. Given that these are important growth markets for SABMiller, we're investing in their future. In the past five years we've invested more than US$1,760 million in breweries and bottling plants in Africa alone.
Promoting economic growth and innovation across our value chain
Small and medium-sized enterprises (SMEs) are a major driver of economic growth. In Latin America, for example, SMEs make up over 95% of local businesses and provide employment for over 60% of the population2. In our value chain, small retailers play a critical role in helping hundreds of thousands of families to escape poverty through their own efforts, often in just one generation.
Around the world we've enabled entrepreneurs to establish thousands of new businesses. Many have grown from informal businesses into self-sustaining companies. This year alone, SABMiller – including our foundations – invested over US$6 million in programmes to foster entrepreneurial activity worldwide.
In Africa, the livelihoods of 65% of the population depend on smallholder agriculture. We've pioneered the use of sorghum and cassava in brewing, opening up new markets and incomes for local farmers and helping them to increase their yields. We launched Impala – the world's first commercially-made cassava beer – in Mozambique in 2011 and this year introduced a cassava beer in Ghana. This year our African division sourced 52% of its agricultural crops from within Africa, achieving a year early its target of 50%.
Reducing the harmful use of alcohol
We operate over 100 programmes around the world to contribute to reducing the harmful use of alcohol, such as drink-driving or underage drinking. Much of our work is in collaboration with government, local partners and communities.
Our approach to helping to reduce alcohol harm requires regular reviews of our commercial governance practices to reflect society's expectations. We believe that our policies on employee behaviour, commercial communication and product innovation are at the leading edge of our industry, as is the company-wide training programme that reinforces our beliefs in this area.
In October in response to the call by the World Health Organization and its member states in the WHO's Global Strategy to Reduce the Harmful Use of Alcohol, we signed a five-year global action plan with other leading beer, wine and spirits companies to help reduce the harmful use of alcohol3. These commitments address important issues such as underage drinking; responsible marketing; consumer information and responsible product innovation; drinking and driving; and retailer support.
We have further committed to independently audit our compliance and report annually to the international community. We're confident of meeting these commitments according to the stated timetable.
A joined-up approach to water, food and energy
According to the 2013 World Economic Forum Global Risks Report, water supply is one of the top five global risks in terms of likelihood and impact. SABMiller relies on high-quality water and crops and water scarcity is already becoming a reality for some of our breweries.
Our Water Futures partnership, established in 2009 to protect watersheds and boost groundwater levels, covers local projects in eight countries. In South Africa we're a founder member of the Strategic Water Partners Network – part of the global Water Resources Group (WRG) – which brings together businesses and other organisations to improve water efficiency and infrastructure.
Last year water efficiency within our operations improved by 8% while fossil fuel emissions per hectolitre of lager produced fell by 10%. From a 2008 baseline, we're on track to meet our goals of reducing water use per hectolitre of lager by 25% by 2015 and to halve our on-site fossil fuel emissions per hectolitre of lager by 2020.
Our 10 sustainable development priorities provide a consistent framework for managing sustainable development, informing how each of our operations focuses its efforts and prioritises resources. This report illustrates how sustainable development is integrated into SABMiller's regional and in-country business strategies, addressing the issues most material to our local businesses and communities.
As a change in leadership occurs, our commitment remains unwavering. By sharing our local knowledge and collaborating with our stakeholders, we're confident we can continue to find innovative local solutions to shared challenges.
- The emerging middle class in developing countries, Homi Kharas, OECD Development Centre Working Paper No. 285, January 2010. 'Middle class' is defined as having daily per capita spending of US$10 to US$100.
- OECD, Latin American Economic Outlook 2013, SME Policies for Structural Change, 16 Nov 2012.
- More information on the Beer, Wine and Spirits Producers' commitments can be found at www.commitments.global-actions.org.
Messages from our directors
Video messages detailing our sustainable development activities in Africa, Latin America and our breweries.