SAB’s PIC investment journey – R1bn over 5 years, leaving a lifetime of social impact through Public Private Partnerships
As South Africa celebrates heritage month based on the cultural-societal roots that make us Proudly South African, The South African Breweries (SAB) is in the last stretch of the 5-year merger conditions as part of the ABInBev acquisition of SABMiller. The past 5-years have seen a robust and vibrant private public partnership with government that has ensured that the Public Interest Commitment (PIC) were grounded on economic inclusion and social upliftment.
As part of the historic merger conditions, SAB is on track to invest R1bn into SA economy by the end of 2021. The following are three key areas of investment spend:
1. Agricultural Development
2. Enterprise and Supplier Development
3. Societal Upliftment initiatives.
Implementation of the PIC was driven by SAB in partnership and collaboration with the Department of Agriculture, Land Reform and Rural Development (DALRRD), the Department of Trade, Industry and Competition (DTIC). The intent and purpose of the PIC was to develop and support a cohort of smallholder farmers to participate in mainstream value chains. Further, it stimulates and turbo-charges enterprise and supplier development. Additionally, it supports the social upliftment through investment in education, sports infrastructure, water stewardship and waste management. Consequently, it improves the success prospects of local entrepreneurs and respective businesses including and livelihoods of communities.
The PIC investment has allowed SAB an opportunity to invest in the farmers, entrepreneurs and communities in which it operates across the nine different provinces of the Republic. SAB Corporate Affairs Vice President, Zoleka Lisa said, “Our philosophy is rooted in improving lives across the country. Our PIC commitment has sought to transform and uplift our communities, something we could not do alone. We are grateful to the many social partners, suppliers and our employees who have been on this amazing transformation journey with us.”
To understand the scale of impact, one has to dig deeper, and it begins with the soil to soul...
The 30 year vision and master plan for the Republic of South Africa titled the National Development Plan (NDP) identified the latent potential of agriculture and agro-processing industries to ameliorate the triple challenges of poverty, unemployment, and inequality. The SAB localisation and enterprise strategy hinges on the agricultural industry. “The transformation of this sector forms a pinnacle role in the success of our farmers which is why we have allocated 60% of our PIC funding towards this.” Lisa said.
The programmes and interventions that have been sparked by this commitment have seen the growth of many black-owned, women-owned businesses like Fezile Msomi whose inner-city, rooftop hydroponic farm is challenging the perception of what it means to be a young agropreneur; and Mapula Seboko, an emerging farmer whose improved yields and access to markets via competitive performance have made it possible to sustainably expand her agribusiness. She is therefore able to take care of herself and the family.
“It is these inspiring stories of real social impact on how our investment empowers people, and ultimately drive our country and society forward. All these beneficiaries have infused our business with passion, and in turn, we are able to channel that passion to deliver great impact,” says Lisa.
Through the agricultural development programme, SAB has been able to develop and capacitate over 920 new emerging farmers and increased local barley production by 63% as compared to 2016 output levels within the sector. “These commitments have not only made significant contribution to the agriculture sector, but have also had a positive impact in SAB to source locally”, Lisa said.
Lisa is most proud of the fact that PIC enables SAB to maintain its 95% local sourcing ratio. “This means SAB can continue to invest in jobs and supply chains in this country. From farm to bottle, SAB beers are 95% locally sourced and we are proud that the PIC could form a part of the development legacy.”
Central to the growth of the economy is a thriving Small, Medium, and Micro Enterprises sector which is at the heart of driving economic growth. Resultantly, SAB understands the importance of supporting and equipping entrepreneurs with the requisite skills, access to finance and off-takes geared to build and empower them to create sustainable enterprises, and grow their communities.
“Our five-year vision has been to focus on the inclusion of more black-owned SMMEs in our supply chains and ensuring a healthy pipeline of suppliers that represent the demographics of our country,” says Lisa.
Right in its Johannesburg offices, SAB business coaches and engineers have focused on equipping black women-owned and black-owned businesses with the right skills to grow within our supply chain. “It is inspiring to see these businesses learn, grow and succeed and also overcome some of the real challenges that face small business in SA”, Lisa said.
The company has also developed the SAB Thrive Fund, which helped establish the first black woman hops farm-owner in George, in the Western Cape. The Thrive Fund facilitates enterprise development and local sourcing programme, ownership transformation of businesses in SAB’s supply chains. To date SAB has invested over R200 million in the Thrive Fund.
She adds that the development of enterprises and suppliers is also intended to address the goal to maximise exports from South Africa and minimise imports into South Africa.
Sustainability and education
Sustainable development means investing in tomorrow, today. SAB’s youth education programme committed to introduce an additional 200 learnerships for learners who were unemployed and have no formal education. “We are proud to report that 200 learnerships have been created thus far,” says Lisa.
SAB has also invested R190m through the PIC into uplifting communities through the provision of education, mentorship opportunities and promoting environmental sustainability.
As the PIC investment journey is coming to a close, Lisa is confident that the programmes, initiatives and empowerment that this investment has sparked will continue to grow the beer industry, value chain and the South African economy.
“This is part of our heritage and legacy. We look forward to see how we can continue to build a sustainable future for our communities and our country. Our commitment does not end with the five-year PIC, it was always designed to create a lifetime of impact,” concludes Lisa.