Heineken: Charity via partnerships

Business Leader: Corporate Philanthropy: Nominee No 7

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Nearly 10 years ago, Red Stripe (now Heineken) partnered with the Jamaica Public Service Company (JPS) to donate six patient monitors to the accident and emergency unit of Spanish Town Hospital.

In the grand scheme of things, the $1.2-million price tag on this gift represented a relatively modest charitable outreach by the two large corporations.

But this collaboration in philanthropy had one unintended consequence. The publicity the handover generated laid bare the shocking deficiencies in important segments of the country’s health care system. Happily, the event also served as a moment of reassurance that corporate Jamaica was making ‘good faith’ efforts to fill the void in this important area of national life.

At Spanish Town Hospital, 6,000 accident and emergency cases are dealt with each month, 1,500 of them critical.

The uncomfortable truth is that some 400 of these patients were placed at even higher risk of losing their lives because of the absence of suitable equipment to provide the emergency staff with vital real-time information on their conditions.

The six monitors donated by Heineken and JPS have revolutionised the health care of Jamaicans who show up at the emergency station of this hospital. With the new equipment, information on the physiological functions of patients is instantly relayed to their caregivers who can intervene to stabilise them as soon as their vital signals point to impending danger.

Heineken created its charitable arm, Desnoes & Geddes Foundation, a decade ago, one year before the donation to the hospital. During those 10 years the alcoholic beverage manufacturer allocated $120 million to its foundation by setting aside two per cent of its annual advertising and promotions budget as well as royalties from its merchandising, to fund its work.

Within two years of operating, the Desnoes & Geddes Foundation settled on a project that today continues to be the flag bearer by which it provides practical expression for its mission of "Impacting Lives, Enriching Communities."

The Learning For Life programme is undertaken in conjunction with HEART Trust/NTA, the Government’s skills training institute.

It is a symbiotic economic arrangement. Heineken pays the State agency to train and certify youngsters in areas that are related to its own industrial and marketing needs, and in turn gets to absorb many of the talents in its own workforce. Some of them, once armed with new skills, are either able to generate their own employment or seek jobs elsewhere.

These individuals make up the vast majority of the more than 1,000 Jamaicans who are directly impacted each year by Heineken’s charity initiatives. Indeed, $112 million, or more than 90 per cent of the money that the company spent on corporate giving over the past 10 years, went into this programme.

The beer brewer itself has employed over 100 graduates from its Learning For Life project and aims to find work for at least 70 per cent of those who complete the training exercise.

"Red Stripe recognises the importance of being a responsible corporate citizen," the company says, using the brand name that is more easily recognisable to Jamaicans. "The company is strongly supported by the community and as such it is a pleasure to provide assistance in as many ways as possible," it continues, in responding to queries about its philanthropic outreach by the Business Leader Award programme.

Heineken’s corporate social responsibility extends to health, education, the environment and mentorship. An important consideration in which of the many competing priorities ultimately receive its financial backing is that the project must "directly impact a minimum of 30 individuals and must have the potential to indirectly impact a significantly larger number indirectly".

So, for example, in 2015 the foundation donated $5 million to the Cheesefield Community Centre upgrade – a project that benefited hundreds of residents in and around that rural community. In 2012, it gave $1.2 million to the effort of entertainer Shaggy through his biennial concert to aid Bustamante Hospital for Children. Still, hundreds of Jamaicans living in Seaview Gardens in St Andrew would have felt the impact of improvements to their police station, public garden, community centre, and their junior high school – thanks to a $2-million donation from Heineken in 2011.

Another important consideration that drives the decision to target specific groups for its charity outreach is the opportunity for the beer brewer to form strategic and mutually beneficial partnership.

A case in point is the programme that the foundation launched in June this year to sharpen the skills of 1,000 bartenders across Jamaica, and to expose them to the latest trends in merchandising and salesmanship.

HEART will be responsible for the training component of this exercise, which will be executed under the rubric of the Learning For Life programme.

Heineken’s CEO Ricardo Nuncio believes the Certified Bar Programme – as it is called – will help participants become more effective sellers and thus grow their own business, an outturn that he is convinced can only redound to the benefit of his company.

"Quality service and competitive pricing are proven growth drivers for your business," Nuncio declared at the formal launch of the initiative at Spanish Court Hotel in Kingston. "When you grow, we grow, so we see this programme as an important step to help you better engage consumers so you can expand your business."

The project has shown early promise, with 90 per cent of the 200 bar owners who attended the launch signing up for the training sessions.

"Red Stripe is amazing," Latoya Stewart of Cool World Lounge in Kingston told the
Jamaica Observer newspaper. "We’re very excited about this new programme. It’s so good to know that the company is helping us to get certified and at the same time, working with us to grow our businesses."

Yet this firm has demonstrated enlightened self-interest in its approach to corporate social responsibility on a much larger scale. It did so to great effect in its well-publicised collaboration with the Inter-American Development Bank (IDB) to replace the primary (and imported) ingredient in its beer brewing with locally produced cassava.

The Desnoes & Geddes Foundation is investing just over US$4 million in the ambitious project that promises to employ 500 farmers at full realisation. They will be tasked to produce cassava on a scale that is well beyond current levels to feed the brewery, thus replacing the high maltose corn syrup that it now imports.

The Heineken CEO says that in addition to the farmers who could be directly employed within four years, another 2,500 could be indirectly impacted.

The IDB, which is contributing over US$800,000 to this effort, has been laudatory about the enterprise and sees in it the potential for major social and economic impact within the farming community.

"The project will also provide technical training, life skills, job placement, and employment opportunities for 1,000 vulnerable youth to develop a qualified workforce to support the agro processing industry," the agency says. "The aim is to build a value chain that is not only sustainable, but also equitable, and that will provide social and economic benefits to farmers and young people within the value chain through the provision of a secure market."

Ultimately, Heineken aims to substitute 40 per cent of its imports with cassava starch by 2019 – requiring production expansion to 65,000 metric tons of tubers (roots) annually, from the current national production level of 17,300 metric tons.

The foundation says that it has in place an active in-house programme to encourage charitable giving within the workforce of its parent organisation.

"The on-boarding process for new members of staff includes information which deals with the existence of the foundation and its function," the company says. "The staff’s electronic newsletter also highlights any areas supported by the foundation. Recently, there was an initiative dubbed ‘vote-a-charity’ which invited submissions from the staff to nominate projects which can be supported by the foundation. This initiative brought about a renewed awareness and an increased level of interest across the staff."

The organisation believes that its philanthropy has been a win-win for all – helping to boost staff morale, while uplifting thousands of Jamaicans.

"The intangible benefits are numerous as the staff feels genuine pride and joy when given the opportunity to join hands and hearts with those in need," the company notes. "Red Stripe enjoys tremendous goodwill from individuals from all walks of life and a variety of institutions as well."

Because of the alcoholic content of some of its products, Heineken is restricted by law from engaging with Jamaicans under the age of 18. The upshot is that it has had to establish the charitable arm as the vehicle for reaching this age cohort with its philanthropy. Many of these youngsters have seen their lives positively transformed by this engagement.

This twist of irony is not lost on the company. "The numerous areas of need existing for children in Jamaica cannot be ignored," it notes. "To allow our charitable contributions to be all-encompassing, the foundation was formed to ensure that as a corporate company our reach could extend beyond the target consumer."

Incorporated in 2006, the Desnoes & Geddes Foundation is headed by a chairman and a four-member board of directors. It is supported by a volunteer secretary and accountant.

Moses Jackson is the founder of the Jamaica Observer Business Leader Award programme and the chairman of the Award Selection Committee. He may be reached at moseshbsjackson@yahoo.com