Sustainable supply chains

Sustainable supply chains

Sustainable supply chains

Sustainable supply chains

Sustainable supply chains

Our supply chains create value directly for local economies, and are one of the most important ways in which we support and build capability in our local communities. They are also an important part of our contribution to driving higher standards in sustainability and business ethics, creating shared value for individuals, businesses and society.

Sustainable supply chains

Sustainable supply chains

Sustainable supply chains

Sustainable supply chains

Building thriving communities: Guinness tankers

From the farming and production of our ingredients to the manufacture and distribution of marketing materials or merchandising, each stage of every supply chain has an impact on our employees, local communities, the environment, and other stakeholders. We want to integrate social and environmental standards into these chains ‒ and we have a clear commercial interest in ensuring that all our supply chains are sustainable.

Our strategy

Our strategy for achieving sustainable supply chains is focused on:

  • Optimising due diligence: Our due diligence processes are designed to help our suppliers improve their sustainability performance. While we have our own standards and guidelines, we also work with industry associations such as AIM PROGRESS, SEDEX, CDP and SAI Platform.
  • Building capability: When we can, we help suppliers meet our standards by offering training to build their skills and capabilities.
  • Supporting and creating value with local businesses: Working with local suppliers is an important way in which we create value and contribute to local economies, especially in emerging markets.

We will achieve our strategy through work in three core areas:

  • Responsible sourcing
  • Reducing environmental impact
  • Agricultural value chain partnerships

Responsible sourcing

We invite our suppliers to be our partners in providing responsibly sourced materials and services, which have a positive impact on the communities and environment in which we operate.

Around 30,000 direct suppliers from more than 100 countries provide us with the raw materials, expertise, and other resources that help us make great brands. Many of those direct suppliers themselves have an extensive supply chain, connecting us with thousands more farmers and businesses.

Standards and guidelines

We have clear sets of standards and guidelines as well as a defined process for managing social and ethical risks throughout our supply chain. Our Partnering with suppliers standard sets out the minimum social, ethical, and environmental compliance standards we require suppliers to follow as part of their contract with us, as well as aspirations for our long-term partners to work towards.

We have also developed a comprehensive but flexible process for identifying, assessing, and managing social and ethical risks in our supply chain. This process involves:

  • an initial screening
  • a prequalification questionnaire which covers social and ethical risks
  • a qualification process in which suppliers with the potential for risk are required to register with SEDEX
  • independent audits of suppliers who represent the highest risk.

This allows us to focus on the areas of greatest risk and greatest potential benefit and to work co-operatively with our suppliers to mitigate the risk and maximise the benefits.

As part of our Sustainability and Responsibility targets for 2020 we aim to:

  • Deliver our responsible sourcing commitments with suppliers to improve labour standards and human rights in our supply chains.
  • Act in accordance with the UN Guiding Principles on Business and Human Rights.

Conflict minerals

We have evaluated our current product lines and identified the use of tin and gold in the packaging and production of two products in our portfolio. We have determined that, to the best of our knowledge, the minerals necessary in the production of these products are not sourced from conflict zones, including the Democratic Republic of Congo or an adjoining country. 

Read our full Conflict Minerals Disclosure

Reducing environmental impact

We are committed to embedding our sustainability principles throughout our supply chains, and helping our supply partners improve their practices as part of our wider environment strategy. We are taking specific measures in three key areas:

  • Water: Our approach is to encourage improved water stewardship through reduced use and better management as well as promoting water replenishment-related activity in local areas and increased sourcing of rain-fed local agricultural raw materials well adapted to their local conditions (including climate, soil, and water availability). These include sorghum and cassava, which are relatively drought tolerant.

  • Carbon: Around two-thirds of the total carbon emissions associated with our products are found within our supply chains, so supporting and encouraging our key suppliers to measure, manage and report their carbon emissions is essential to reducing our overall greenhouse gas (GHG) footprint.

  • Sustainable packaging: We have set ourselves the target of ensuring that 100% of the paper and board packaging we use is certified as sustainably sourced by 2020. We are working with our suppliers on this, including through our sustainable packaging guidelines.

Agricultural value chain partnerships

Challenges such as water scarcity, unsustainable farming practices, and climate change all pose potential risks to the supply of our raw materials and to the livelihoods of the farmers who produce them.

We know that the future prosperity of farmers, suppliers, and our business is closely linked with our ability to create partnerships that are sustainable, secure, and mutually beneficial. We support sustainable sourcing and, where appropriate, local sourcing of raw materials.

In the United Kingdom and Ireland, our largest production region by volume, we typically source about 90% of our grain supply locally. Increasingly, in some markets, notably Africa, we have established suppliers of local raw materials such as sorghum and cassava, which are more resilient to climate change.

Our approach

At the heart of our approach is the recognition that partnerships with farmers are the most effective way to promote sustainable farming practices and secure local supply networks.

We have seen how these partnerships, when successful, can change lives and transform communities. We are keen to ensure that our models and partnerships remain inclusive, allowing for participation by both small and large-scale farmers, women and youth farmers, and entrepreneurs.

In 2015 we became a member of the Sustainable Agriculture Initiative Platform (SAI), the main food and drink industry initiative supporting the development of sustainable agriculture worldwide. Our membership of SAI provides us with a collaborative platform in which to work with our industry peers and suppliers to continue to build capacity for sustainable agriculture across our value chains, working with farmers to strengthen existing approaches.

In recognition of the importance of these partnerships to our business and our suppliers, one of our 2020 targets is to establish partnerships with farmers to develop sustainable agricultural supplies of key raw material.

Our agricultural suppliers

We buy raw materials such as barley, sorghum, maize, cassava and sugar from suppliers ranging from sizeable commercial businesses to smallholders whose area of sorghum or barley might cover no more than a hectare. We deal directly with around 150 first-tier suppliers, and thousands of farmers; and we have an even wider network of suppliers whose produce we buy indirectly.

Capacity building and community investment

Local, sustainable sourcing of agricultural raw materials is a business imperative in terms of supporting our growth ambitions across the world.

In Africa alone, our commitment to local sourcing provides a sustainable source of income for more than 50,000 smallholder farmers across Nigeria, Ghana, Cameroon, Ethiopia, Kenya, Uganda and Tanzania. Local sourcing also provides much needed investment in agricultural economies and local supply chains.

The development of a scalable barley value chain in Ethiopia and the sugar cane value chain in Brazil are examples of our commitment to build capacity and develop local farming communities for the long-term future.

Our ambition for Africa

Our brewing businesses have had close connections with farmers in Africa for decades. Africa continues to be an important focus for our activities, both as our largest region by volume for beer, and as a region where we see significant potential for developing partnerships based on sustainable farming practice.

After meeting our target of sourcing 70% of the agricultural materials used in our African operations locally, from within Africa, by 2015, we have increased our target to 80% by 2020.

We hope to use our position as a large commercial and responsible buyer, to test and prove models that governments and peer organisations can use to accelerate growth within the agricultural sector in Africa.