50 Years of Promoting Free Enterprise

In this report, Ugo Aliogo writes on the 50 years journey of International Breweries Plc to promote free enterprise, drive environmental sustainability, and support economic growth in Nigeria.

Nigeria is a country that presents huge business opportunities for international and local investors. In the ease of doing business index, the Federal Government, under President Muhammadu Buhari, has addressed some fundamental issues to promote an enabling business environment for investors. Although there are still areas of challenges that needs to be fixed, however, progress is being made.

While other international investors are leaving the country for what they term as a difficult business environment, others have chosen to remain having seen the innumerable business opportunities such as access to raw materials, large arable lands, availability of human capital for production, market for sales of commodities, and others.

As the largest economy in Africa, the Nigerian economy holds a huge prospect for any investor wishing to do business in Africa. One of the growth strengths of any economy is its population size, which in turn translates to a viable workforce and strong purchasing power. Nigeria boasts of a viable workforce (with 70 percent between the ages of 19-40years) and strong purchasing power, ingredients that are attractive to any investor wishing to do business in any economy.

Another factor that has continued to draw investors to Nigeria is the diversification of its economy which comprises oil and gas, solid minerals, agro-allied value chain, and ICT. It is these economic indexes that have kept many companies in Nigeria for decades—some have stayed for five decades. For instance, International Breweries Plc has operation within the Nigerian space for 50 years.

As a global organisation within the AB InBev Group, the focus of the company is to operate for 100 years and beyond in any country they establish their business. Without doubt, the first 50 years of the company’s operation in Nigeria have been rewarding.

International Breweries Plc are manufacturers of beer, stout, and non-alcoholic malt drinks. Its activities include the brewing, packaging, and marketing of beer, stout, alcoholic flavoured and non-alcoholic malt beverages.
In 2018, International Breweries Plc, a proud part of the world’s largest brewer, Anheuser-Busch InBev (AB InBev), inaugurated its $250 million greenfield Gateway Brewery in Ogun State. The plant, the biggest in sub-Saharan Africa, re-defined the concept of balancing business with environmental responsibility in Corporate Nigeria. Its operation is run on renewable energy generated from 2,000 square metres of solar panels, a feat they have said they plan to replicate across other plants.

On December 9, 1978, IBL, in partnership with its technical partners – Haase Brauerei GmbH of Hamburg, Germany officially launched its flagship brand, Trophy Lager.
The brewery complex was formally inaugurated in April 1979 as the first indigenous brewery in the old Oyo State. The company has come a long way from a humble beginning when the legacy International Breweries Limited (IBL), with an installed capacity of 200,000 hectolitres per annum, was incorporated in December 1971 by Dr. Lawrence Omole, a renowned businessman and community leader in the old Western State. That investment by AB InBev, producers of over 400 beer brands worldwide, made International Breweries Plc the first company in Nigeria to power its operation with solar energy. It also underscored the company’s determination to improve its positive footprints on the environment and society.

In three years, Trophy Lager became a household name ahead of the projected 10 years. Households in the brewery’s host community also benefited directly or indirectly as workers, marketers, suppliers or distributors. The company’s steady growth culminated in its listing on the floor of the Nigerian Stock Exchange, NSE, (now Nigerian Exchange Ltd, NGX) in April 1995.

To mark this milestone, the company organised the 50th anniversary launch in Lagos recently which brought together captains of industry, key players in the brewery industry, and members of the political class.

Speaking at the 50th anniversary ceremony, the Managing Director, International Breweries Plc, Hugo Rocha, stated that the celebration was not about numbers, noting that they are not just counting the years, “our celebration is about the value we have been able to deliver and will continue to deliver to our stakeholders: employees; shareholders, customers/consumers; communities, government and the society.”
He also noted that the 50th celebration constantly reminds them that they are a company of dreamers, in line with the company’s number one principle, ‘we dream big.’

He further explained that the foundation of the company, started with a dream, indeed, a very humble beginning, stating that it is the same spirit of dreaming big that has made the company to initiate various transformational moves that have propelled them to become an international and multinational enterprise while keeping the humble attitude as a local business.”

According to him, “Since 1971 when International Breweries Plc was founded, we have grown to become a leading brewery. We appreciate the vision of our founders both in Nigeria and at the global level. We have and will continue to build on that vision.”

“Yes, we are part of a global company, but we are at the same way a local enterprise. We don’t produce a cellphone in China to sell in Nigeria. We produce 100% of our products in the country. We use local ingredients, and we just import when we can’t find the raw materials in Nigeria. Our employees are from here! Our consumers, costumers, farmers are from here.”
“So, we are part of the community. When the community suffers, we suffer and when they succeed, we celebrate. Due to that, we will keep supporting our society and doing our role to help on the transformation of this great nation.”

Supporting the Economy
Rocha revealed that as part of their continuous drive towards growth, the last few years has seen the company invest billions of dollars in the Nigerian economy cutting across the different spectrum of their business operations. An example, he stated, is the $250 million-dollar state-of-the-art Gateway Brewery which uses renewable energy for cleaner environment.

He hinted that their support for the agriculture value chain: procuring, in about 3 years (and counting) over N77 billion worth of local rice, sorghum, maize, sugar and others to support the economy.

“Several millions of Naira have been invested in our various social investment initiatives. Across our communities where we have our plants and operations. We have identified needed gaps and we have supported the communities with infrastructures such as hospitals, school renovations, provision of portable drinking water, road rehabilitation and other countless interventions. In 2019, we repositioned and launched the International Breweries Foundation to better manage our Corporate Social Responsibility (CSR) activities. In particular, our Kickstart – entrepreneurship program where we put in relevant investments to support our youths who are the future of the country,” he said.

Company’s Impact on Society
In the last six years, the company has given almost 500 million Naira seed capital as grants to 334 Nigerian youths. The company has trained more than 1,200 youths in entrepreneurship courses. The youths in turn have generated almost 600 jobs by employing others, while reaching out to youths in 23 States of the country

Rocha said the company believes strongly in local talent, hence, about 99.9% of its employees are Nigerians, creating job opportunities directly and indirectly for young men and women across the entire value chain.
He added that the company will continue to focus on quality and responsible consumption of the beverages and multiple product brands.

Future Plans
He remarked that as one of the leaders of this business, he enjoined customers to continue to count on the company.
He revealed that they remain committed to the continuous transformation of the business with concentration on delivering great value to stakeholders.

With the growth of the company’s business, they have even greater chance to keep transforming lives and to support communities. He reiterated that the purpose of the company is to bring people together for a better world. Dreaming big to create a future with more cheers.

On his part, the Chairman, Board of Directors, International Breweries Plc, the Obi of Onitsha, Nnaemeka Achebe, said “in today’s business environment, starting and maintaining a business for five years can be a tedious task, how much more for 50 years.”

He also noted that 50 years is the age of maturity, stating that it is the age where you have seen a lot of things in your lifetime – the good, the bad, and the ugly.
The Chairman revealed that it can be said that International Breweries have come, seen, and conquered, “we are not resting on our oars and would continue to drive value for all stakeholders.”

“I am content that we have achieved epochal strides these past 50 years. Our story has been a classic case of ‘transformation and delivering great value’ and we are immensely grateful to Nigerians for standing by us since our incorporation and helping us reach this milestone where we have moved from being a regional brand to become a household national name with international pedigree,” he added.

Achebe revealed that despite the challenging socio-economic conditions and the very recent COVID-19 pandemic, they have accepted and worked round the challenges to deliver a strong performance.

According to him, “As the Chairman of the Board, my colleagues and I are focused on continuously entrenching values of strong ethics, with corporate governance as a top priority for us. We are convinced this is what will help us to continue to build a sustainable organisation that will continue to serve our shareholders year-on-year.

“I am also asking consumers to maintain their love and acceptance for our products. The market’s reception to our products has been phenomenal and encouraging. This is not surprising as we continue to focus on research and development – backed by our global office – to brew great quality beers that continue to bring people together for a better world.

“Importantly, I would love to especially say a big thank you to our consumers. Your passion for our brands is very much appreciated – Hero Lager and Trophy Lager, Trophy Stout, Budweiser, Eagle Lager and Stout, BetaMalt, Grand Malt and others.

“Owing to the importance attached to Nigeria by AB InBev, our Group has consciously and consistently invested in the country when faced with investment decisions around the world. It means they have confidence in our company and confidence in the opportunities that abound in Nigeria as a country.

“Today, the economic impact of those investments is felt across Nigeria. Our expansion opportunities that have seen us enter partnerships that have made us establish our presence in five different States of the federation – Anambra, Ogun, Osun, Rivers and Lagos States. These investments have contributed massively to improving economic growth in our country.

“Living in line with our principle on reputation, corporate governance and ‘no shortcut’, our company remains a key contributor to Nigeria’s internally generated revenue through increased volumes and introduction of new brands.
“As we commence our journey into the second half of our march to 100 years and beyond, we pledge to remain committed to our culture of bringing people together through the conscious support of our host communities, pursuing environmental stewardship and driving economic value.

“We will continue to work together with the government and our other key stakeholders to generate shared value for the country. I would end on a note of appreciation by extending our deep appreciation to our partners and stakeholders for their support over the last 50 years – this would not have been possible without the great support of everyone present in this room.”

2025 Sustainability Goals
In March 2018, IBPLC, as part of the global AB InBev Group, introduced its most ambitious public commitments yet: the 2025 Sustainability Goals to drive transformational change across its entire value chains. The goals underscore IBPLC’s understanding of the importance of a better tomorrow for future generations. The initiative focuses on five pillars of action – Smart Agriculture, Water Stewardship, Circular Packaging, Climate Action and Responsible Drinking – and are hinged on the United Nations Sustainable Development Goals (UNSDGs).

Smart Agriculture: Our goal by 2025 is to ensure water access and quality for both our communities and breweries such that 100% of our communities in high stress areas will have measurably improved water availability and quality. By 2025, we aim to improve water-use efficiency at our four breweries to reach a 2.7 hl/hl water-to-beer ratio as part of our contribution to SDG 6 – Water and Sanitation. Goal: By 2025, 100% of IBPLC’s direct farmers will be skilled, connected and financially empowered because we support the livelihoods of our farming communities to farm organically with a view to giving us high quality crops that will enable IBPLC brew the best beers.

Water Stewardship: Our goal by 2025 is to ensure water access and quality for both our communities and breweries such that 100% of our communities in high stress areas will have measurably improved water availability and quality. By 2025, we aim to improve water-use efficiency at our four breweries to reach a 2.7 hl/hl water-to-beer ratio as part of our contribution to SDG 6 – water and sanitation.

Circular Packaging: By 2025, 100% of our products will be in packaging that is returnable or made from majority recycled content. We promote zero waste by operating a strict adherence to 100% waste segregation, effluent treatment and recycling of bottles and by-product. Only 3.60% waste (mostly organic) goes to the landfill, and we are committed to achieving zero waste to landfill across our breweries.

Climate Action: By 2025, 1 0 0 % o f o u r p u r c h a s ed electricity will come from renewable sources. We will have a 25% reduction in CO2 emissions across our value chain.

Responsible Drinking: By 2025, 20% of our products will be made up of low or no-alcohol beer We believe alcohol, when cons u m e d in moderation, can be part of a well-balanced lifestyle. We are committed to eliminating irresponsible drinking through our packaging, marketing, sponsorships, partnerships, and campaigns designed to educate our stakeholders and the public on the harm caused by alcohol abuse, thereby contributing to a positive drinking culture and lifestyle that ensure our products are enjoyed in a moderate and responsible way.