Risk Talk: Insights into AB InBev and Corporate Social Reporting
When the Business Roundtable, a group of CEO’s from Americas largest corporations, released a statement, pledging to rethink its corporate priorities and increasingly shifting focus to stakeholders, they set a statement that indicates severe changes in the business world. Whether it was out of self-defence, fearing the ring suspicion against big companies or a legitimate move to use their immense influence for good, today’s corporate world seems to become increasingly concerned with social responsibility and accountability. For decades, companies have solely focused on profit maximization as the paramount objective to achieve, thereby often neglecting stakeholders such as employees or societies. Could change be on the way?
In one of the talks of this year’s Risk Conference “The Dark Side of the Financial World”, Nicolas Bartholomeeusen – AB InBev’s country manager for the Netherlands – illustrated how the leading global brewing company uses corporate social reporting as a tool to address stakeholder issues and introduce accountability. Since we are now starting the new academic year, the Risk Magazine wants to use the opportunity for a short flashback and share the insights he gave us when he agreed to sit down for a short interview after the conference, discussing AB InBev as a company and how corporate social reporting can be used to turn policies into action.
It is good for us, but it is also good for society, so why not doing it?
Nicolas Bartholomeeusen is 31 years old and AB InBev’s country manager for the Netherlands. With a background in Business Engineering and Finance, he started working for the company right after finishing his studies when he applied for their General Management Traineeship. When asked about the importance of corporate social reporting and its’ current rise in popularity, Bartholomeeusen does not have to think long to find an answer: “As a company, we have a responsibility to the societies that we operate in. We have to make sure that everything that we do, we do in a sustainable and responsible way.” He explains that AB InBev implements that in two ways. First of all, the firm makes use of local resources and materials in the countries and markets where the brands are being sold. Therefore, the firm has a positive impact on a variety of communities, supporting them in individual ways. “It is good for us, but it is also good for society, so why not doing it?”. Secondly, the company also uses clear policies and tracking mechanisms to make sure they deliver on their ambitious agenda.
However, it is no secret that many companies abuse official reporting tools to appear in a positive light while not actually following through on their promises. Since corporate social reporting is a voluntary measure without any restrictions or policing, it is easy for firms to misuse it. When asked about how potential shareholders can recognize reliable corporate social reporting, Bartholomeeusen shares his personal opinion: “My personal view is that you need to look at some key indicators, such as a company’s transparency on strategy overall, the level of informality in internal & external communications and the level of bureaucracy and therefore the barriers for employees to report on misbehaviour. Next to this, you should also test how many of the promised actions are actually being delivered, to ensure management walks the talk. So if a company tries to build up a reputation that classifies them as reliable partners make sure that they deliver it transparently and that they check and monitor their progress. How I personally see it: It is crucial in a company that you are not too bureaucratic. If someone at the bottom of the company structure spots misbehaviour or wrongdoing, it is important that they dare to speak up and will not be fired for it. I think at our company, that mentality kind of grew over time because we have always been very informal anyways. For example, a person that is just being hired as a trainee could immediately go to our CEO because we have a very open and informal culture, and so most people don’t see a lot of barriers to talking to one another. Our structure is very lean and that allows people to speak up their mind when they see things that are not being done in a responsible way. I think that is very crucial. At some companies, you might feel like there is a punishment for you if decide to whistle-blow. That makes it harder to safeguard that no bad practices happen at the bottom without management knowing.”
Overall corporations would be helped if they get a better steer from governments or from overlooking commissions.
As voices are growing louder that big corporations should take on more responsibility, it becomes more and more important that companies do not only publish information that creates a good reputation without taking on sufficient action but that they reliably disclose what they are actually doing. This raises an important question: what would be a solution for the lack of accountability? Bartholomeeusen agrees that increased involvement of the government could be helpful. “I would say that overall corporations would be helped if they get a better steer from governments or from overlooking commissions in terms of what initiatives would help them to become more sustainable & responsible and how to turn their action plans into reality. In my view this is currently left in the open: every company is building their own agenda, and some are clearly performing better than others. Some companies have very strong ambitions with clear action plans, whilst there are other ones who have emptier policies that make them look good, but they are not really delivering any tangible results. I believe AB InBev sits in the first group, as we have a clear dream that we are translating into clear actions across various continents. We have a big agenda on responsible drinking and the sustainable usage of water, energy and packaging on which we make significant progress every year. We are measuring this with numerical KPI’s and make use of external parties to help track the advancement in an objective way. Next to other great companies who are leading the social responsibility agenda, there are definitely some companies who have good intentions but do not really know what they should do in terms of CSR compliance. I think they would benefit from a framework that clearly shows them what they should focus on and how they can track clear KPI’s to deliver improvements.
For everyone who is interested in AB InBev and its operations, the company offers three one-year traineeship programmes: the General Management Programme (GMT), a Sales & Marketing Programme (MVP) and a Supply Management Trainee programme (SMT). When being asked about the programmes and whether he has some general advice for students of the University of Groningen, Bartholomeeusen shares some personal tips: “You need to dare to fail quickly and rapidly, then learn from your mistakes, move on and apply your learnings to your future endeavours, in order to be successful. My second advice would be to go into roles where you know that you are going to be challenged and where your resistance will be tested from the start. Do not be tempted to take the easy route but dare to take on big responsibilities where you can show people what you are worth. The third advice would be: make sure you do something you love. If you have the feeling that you are doing something purely for the money, then you will look back when you are 60 years old and think: “Now I am sitting on a pile of money, but I have done something for 40 years that did not make me happy.”
We want to thank Nicolas for taking the time to talk to us and for the interesting insights he shared.