Anheuser-Busch InBev December 2019

A sustainable approach to the brewing of beer

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Harnessing the potential of the Middle Americas at AB InBev

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AB INBEV

Gabriel Guzman, Director of Raw Materials, Agricultural Development & Utilities for AB InBev’s Middle Americas region discusses the zone’s potential and the sustainable strides the company is making

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s the world’s largest beer company, AB InBev (ABI) maintains a complex and interrelated global supply chain. One of

the regions most important to the company’s oper04

ations is the Middle Americas, as Gabriel Guzman, Director, Raw Materials, Agricultural Development and Utilities elucidates. “It’s a fast-growing region, for sure. Out of the entire ABI group it is the second largest in terms of revenue and the largest in terms of EBITDA. It’s a growth engine.” The region’s potential is obvious, but it also brings its own set of challenges. “We deal with less developed economies, so we sometimes have problems with taxation and changing regulations and treaties.”

Guzman’s role requires the management of a number of teams, each dedicated to the different sections under his purview – the provision of raw agricultural materials, the coordination of utilities and the sustainable development of agriculture all being examples. That last area is covered by Jose Luis Taylor, Director of Sustainability and

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Year founded (the Artois brewery)

$54.6mn Revenue in US dollars

170,000+ Number of employees

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AB INBEV

“ Our goal for 2025 is that 100% of our farmers are to be skilled, connected and financially empowered” 06

— Gabriel Guzman Director, Raw Materials, Agricultural Development & Utilities AB InBev Middle Americas

Agricultural Development at the company, who speaks to the importance of treating farmers ethically and with respect. “Our goal for 2025 is that 100% of our farmers are to be skilled, connected and financially empowered,” says Taylor. “We have a base of around 4,000 farmers, the majority of which are in Mexico, where we implemented this programme four years ago. We have another programme now in Colombia, and we are making strides in Ecuador. In Mexico, we were challenged to ensure that 100% of the

CLICK TO WATCH : ‘WE ARE AB INBEV’ 07 barley came from local farmers instead

sustainability targets to benchmark

of being imported, which we have now

its progress in these areas, including

achieved. In doing that, we’ve invested

in energy. “By 2025, the target is for

in machinery and created jobs for local

ABI to use 100% renewable electricity,”

people.” This focus on having a positive

says Guzman. “In Mexico we should

effect on the people with whom the

be at 100% by the end of this year,

company works is echoed by Guzman.

which is our largest market – about

“The question is, ‘can we truly talk the

45% of the entire zone. Our goal is

talk and walk the walk and empower

to continue to expand that, so we’re

the communities in which we oper-

looking at opportunities in Colombia.

ate?’ In the early stages, it can be more

in Honduras we have found a source

expensive, but it’s an investment. After

of 11 megawatts of hydro power that

that it can become self-sustainable as

we can potentially use. It will not satisfy

it should be.”

100% of what we are looking for but

ABI has implemented a number of

will definitely help us with our target.” w w w.a b- i nb ev. com

AB INBEV

“ We’ve invested in machinery and created jobs for local people” 08

— Jose Luis Taylor Sustainability & Agro Development Director, AB InBev

Water Management is also a focus,

this vegetable protein to change their

as the company’s CEO Carlos Brito

diet, and we are looking at a number

demonstrated during a recent talk.

of disruptive projects to create the

Guzman himself discussed the corol-

right products to match this consumer

lary concern of decarbonisation at a

demand. For instance, last year we

Bloomberg event last year.

launched a smoothie made out of

A sustainable approach can also

spent grains. It’s been in a pilot in the

offer opportunities for value crea-

US and it’s being positively received.

tion. “We have a significant amount

We are also making snack bars from

of byproducts left over after finishing

the grains – we have a significant

the beer-making process, in the form

amount of protein value there.”

of vegetable protein content,” says

ABI’s sustainability work serves to

Guzman. “There is a trend in the mar-

complement its focus on making the

ket where consumers are looking for

best beer. “The quality of the beer is

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E XE CU T I VE PRO FI LE

Gabriel Guzman Gabriel leads Anheuser-Busch InBev’s Middle Americas Zone teams for Raw Materials, Agricultural Development and Utilities Procurement. Gabriel oversees the Zone’s plan to achieve its ambitious 2025 100% renewable electricity commitment, which is an integrated part of the company’s strategy across procurement, sustainability and supply chain. He works in close collaboration with cross— functional teams, supporting the company’s energy and water reduction targets. Gabriel holds a Bachelors in Management and Economics and an MBA from Case Western Reserve University.

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“To maintain a sustainable, high standard of beer, you have to be dynamic” — Gabriel Guzman Director, Raw Materials, Agricultural Development & Utilities, AB InBev Middle Americas

determined, not only by the expertise

computer models which can help to

of the chief brewers, but by the quality

protect against future price volatility.

of materials,” says Guzman. “Without

Robotic process automation has been

that, you cannot achieve the high

another focus. “We can reduce the

standards that we have in the organi-

amount of man hours spent on very

sation.” Regionally, this year, adverse

basic tasks, freeing us up to evaluate

weather conditions led to 50% of the

the procurement function, to think in

barley crop in Mexico being lost. ABI’s

more strategic ways and to add value.

worldwide presence, however, means

We use robots, for instance, to help

that such an eventuality does not spell

with managing and indexing contracts.”

disaster. “In order to find the quality

Another innovation involves the intro-

that we need, the teams have to mobi-

duction of inter-departmental buying

lise globally with all their counterparts

software. “We use a platform similar to

in other regions. To maintain a sustain-

Amazon whereby the different func-

able, high standard of beer, you have to

tions within the organisation can order

be dynamic.”

whatever they need,” says Guzman.

Tying its efforts together is the

“That may be people in marketing, in

deployment of technology. The vola-

legal, et cetera. They can order certain

tility of prices and currencies in the

amounts without approval, which help

region has led to the development of

them to expedite the process.” w w w.a b- i nb ev. com

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AB INBEV

Aside from making easier the work of employees, technology is also serving to improve the quality of raw ingredients. ABI has pioneered an AI technology pilot, internally referred to as a “brain”, which is able to closely monitor the state and health of cargo as it is being shipped. “We can measure the moisture content of the barley being loaded in Denmark, for instance, and then track that moisture content, based on factors such as weather conditions, all across the route from 12

Denmark to Colombia. When the ship arrives, we will know that the barley arrived with X amount of moisture

“ My dream is to increase Mexican barley to the highest of international standards” — Gabriel Guzman Director, Raw Materials, Agricultural Development & Utilities AB InBev Middle Americas

content, therefore at the malting process we will only need X amount of energy to convert that barley into malt.”

In the near-term, ABI will continue to chase its sustainability targets, covering not just the brewing side of the operation but also manufacturing and the entire distribution network, where it is introducing a number of electric trucks to deliver products. ABI is also furthering its origination programme in Mexico. “In Mexico, we use about 400,000-500,000 tonnes of corn imported from the United States,” says Guzman. “You can imagine the impact to Mexican agriculture if we could buy that from a local grower, instead. That’s precisely what we are trying to do right now by launching a corn origination programme. This year we are going to get to 40,000 but our goal is to get to 400,000.” In the longer term, ABI is interested in consolidating its position in the region. “From an agrodevelopment standpoint the goal is to improve the quality of Mexican barley,” says Guzman. “My dream is to increase Mexican barley to the highest of international standards.”

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Anheuser-Busch InBev Brouwerijplein 1 3000 Leuven Belgium T +32 16 276 111 www.ab-inbev.com