Environmental: Managing our impacts
Climate change has a significant impact on the environment and resources globally and nationally, and is due in large part to agricultural and industrial operations. ThaiBev also contributes to this impact, while being affected by the climate change as well. The patterns of such climate change, ranging from flooding to drought, directly and indirectly affect ThaiBev’s business operations. The recent El Nino resulted in an unusually long drought. Consequently, plantations were affected, including some crops that are ThaiBev’s major raw materials, such as sugar cane for the production of sugar - leading to increases in the price of sugar. It is therefore necessary for ThaiBev to be proactive in managing and mitigating potential climate change risks.
ThaiBev needs to find solutions to these problems and encourage the participation of stakeholders in solving various issues in order to ensure the least possible negative impact on the environment in both the short and long term.
Because ThaiBev understands this impact to our business we intend to minimize the emission of greenhouse gas (GHG) from our production process.
• ThaiBev changed its reporting method of environmental operating results from 3 product groups into a consolidated number.
• In 2015, ThaiBev choose to disclose water withdrawal rather than water consumption. 2014 Energy and emission factors have been updated for more accuracy.
Water is an essential resource for human beings, as well as for agricultural and industrial activities. As a beverage manufacturing company which uses water as a main ingredient, ThaiBev understands its significance, and has a comprehensive water management system. We have integrated water management strategies into our business processes, ranging from:
1. Water risk assessment of suppliers; in order to promote awareness throughout the industry value chain.
2. Efficient water management in production and compliance, ensuring efficient public water usage, and treatment of water before discharging into public sources; and
3. Joint activities with local communities government sector and our employees.
ThaiBev promotes water management and seeks to minimize our negative environmental and social impact to all parties. Risk management in water resources and water management for the production process are key responsibilities of ThaiBev, and is continuously implemented.
Risk Management of Water Sources
It is widely known that currently the volume of rainfall and water in natural water sources has been uncertain, mainly because of volatile climate conditions, resulting in the shortage of water and flooding in some areas of the country. Since ThaiBev realizes the importance of such issue, the Risk Management Committee has determined that water sources management must be seriously considered and driven at the organizational level in order to concretely perform activities and ensure that the company be able to continue the production based on responsibility for the community and social contribution.
In 2015, ThaiBev established a working team for sustainable water resources management, primarily in the spirits business group. The working team is responsible for analyzing problems, planning for water sources management and water usage in both the short and long term, reporting sustainable development operating results to the committee on a monthly basis, and presenting the results to the Risk Management Committee on a quarterly basis.
Over the past period, ThaiBev evaluated the water shortage risk through assessment of its facility locations using the Global Water Tool (GWT) of the World Business Council for Sustainable Development (WBCSD) and the Aqueduct of World Resources Institute (WRI). In 2015, ThaiBev also conducted a Water Resources Review (WRR) by additionally studying data from the government sector and closely monitoring the accumulated volume of water in sources such as dams, wetlands, and rivers, as well as evaluating the effects of our facilities’ water usage on the stakeholders who rely on the same water sources. The objectives are to analyze and estimate the prospective volume and evaluate the sufficiency of water for the production at present and in the future. We also consider rules, legal conditions, as well as water-related expenses which are subject to change afterwards. Such information is then utilized to evaluate the risks and impact on operations in order to facilitate the decisions of the Risk Management Committee about each business group’s investment in water sources for the future.
To achieve the aforementioned objectives, we have implemented the following activities to mitigate the risks to water resources:
The Spirits Business Group
A plastic lining was installed at Sura Bangyikhan Co., Ltd., with a total construction cost of over Baht 17 million. This was done to reserve water for production (60 consecutive days) should there be any risk from flooding or contamination from chloride. Sangsom Co., Ltd, and Red Bull Distillery (1988) Co., Ltd. invested a total of over Baht 19 million in drilling groundwater wells, to ensure water reserves for prevention of water shortages. This enables the production process of the facilities to carry on during the dry season without affecting the water used for agricultural purpose around the facilities.
The Beer and the Non-Alcoholic Beverages Business Group
As a result of the assessment of the Global Water Tool, the Beer and the Non-Alcoholic Beverages Business Group are located outside the stress area. ThaiBev continues to evaluate its water risk by comparing the water usage with the volume of water supply to mitigate the risk of water shortages for production. Because some facilities such as Oishi Trading Co., Ltd., and Sermsuk Public Company Limited are located in industrial estates, the emergency water supply plan is managed by such industrial estates. Meanwhile, some facilities have established plans and evaluated the water usage volume since before the facilities were constructed, such as breweries, in addition to maintaining guidelines on keeping water reserves in storage tanks and reservoirs that can be used in a water shortage for at least 90 days
without affecting the production process, and importantly, not affecting the surrounding community if drought occurs. Moreover, we also utilize the ‘Global Water Tool’ to evaluate the locations of our major suppliers’ facilities to identify if there are any potential water risks. If any partner is at risk, ThaiBev will communicate and organize a meeting with the particular partner, while providing advice and jointly developing measures to mitigate the risk in an appropriate manner as mentioned in procurement and sourcing topic.
Picture of the reservoir lined with plastic sheets at the Sura Bangyikhan Co., Ltd.
Water management of the production process
Apart from risk management in relation to water sources, ThaiBev also manages its water resources efficiently, fairly, and sustainably based on good governance principles. ThaiBev emphasizes efficient water usage for all business activities and encourages all stakeholders to do the same. The activities in 2015 were as follows:
1. Managing water usage from natural sources to maximize the quality and efficiency of the production process. For example, the Red Bull Distillery (1988) Co., Ltd. invested in establishing a water quality improvement system to convert rain water in its reservoir into high quality water for fermentation and distillation of white spirits. Another example is Sangsom Co., Ltd. in Kanchanaburi province, which invested in the installation of a reverse osmosis (RO) water purification unit, with a capacity of 10 cubic meters/ hour, in order to produce boiler feed water, resulting in a lower amount of water being blown down from the boiler.
2. Participating in a project on sustainable water resources management in the food industry for export. In 2015, every business group of the Company which consists of 3 distilleries, i.e., Sura Bangyikhan Co., Ltd., Red Bull Distillery (1988) Co., Ltd., and Sangsom Co., Ltd. in Nakhon Pathom province; 3 breweries, i.e., Beer Thai (1991) Public Company Limited, Beer Thip Brewery (1991) Co., Ltd., and Cosmos Brewery (Thailand) Co., Ltd.; and the facility of non-alcoholic beverages business group, namely, Oishi Trading Co., Ltd., participated in the “Project to Manage Water Resources Sustainably through Water Footprint” initiated by the Federation of Thai Industries. Moreover, Fuengfuanant Co., Ltd., participated in the “Pilot Project for Water footprint assessment by the Water Institute for Sustainability of the Federation of Thai Industries with Fuengfuanant Co., Ltd.” in order to evaluate and calculate reference values of the water footprint. The results will be further applied for efficient management and usage of water resources of the facilities, i.e., reducing water usage, the volume of wastewater, and production costs.
Sources of water supply for ThaiBev include surface water, ground water, municipal water supplies and rainwater. The total volume of water withdrawn by source during 2013-2015 is shown in the table below.
Total volume of water withdrawal by source during 2013 – 2015
|Water Withdrawal Souces
|Municipal water supplies
|Total water withdrawal by source
* Within KPMG’s limited assurance scope (page 124)
Surface water, drawn from rivers or ponds, and rain water are measured by internal flow meters. There is a process to calibrate internal flow meters which will be completed in 2016. For ground water and municipal, water usage is reconciled to invoice.
Water reused and recycled during 2013 – 2015
|Total volume of reused and recycled water
Data of volume of reused and recycled water based on the calculation and meter.
Considering the operating results during 2013 – 2015, the total volume of water that was reused and recycled increased by 11 percent compared to 2014 and represents 11 percent of total water withdrawn in 2015.
4. Cooperating with the government sector, participating in government campaigns, and organizing activities for employees and communities to raise awareness of water conservation and the importance of water management. ThaiBev is determined to support optimization of water usage as well as to improve water quality. Such determination enabled Fuengfuanant Co., Ltd. to receive an award for excellence in river preservation and restoration, and United Winery and Distillery Co., Ltd. to receive an outstanding award for river preservation and restoration from the Ministry of Industry in 2015.
ThaiBev operates its business with care and concern for the environment and society, especially in relation to water resources, as evidenced by our recognition of water as an organizational risk. Our facilities participated in the Water Footprint Project, and efficiently managed water resources in the production process with the 3Rs Principle. Moreover, we considered feedback from our stakeholders, in the process realizing interesting and important issues for consideration in parallel with our business strategy, management plan and activities with our employees, the government sector, the private sector, and the community. As a result, over the past year, ThaiBev was able to reduce the ratio of water withdrawal to its total production volume. We will continue to engage stakeholders on sustainable water management.
Employees and local communities restoring water sources
ThaiBev management received awards for the river preservation and restoration
In 2016, Beer Thai (1991) Public Co. Ltd and Sermsuk Public Company Limited were awarded to be a model of Industrial establishment due to their excellent efficiency management of water and reduction of water withdrawal (surface water and ground water) from Water Institute for Sustainability the Federation of Thailand Industrial
Beer Thai (1991) Public Co. Ltd
Sermsuk Public Company Limited
As of date 31 december 2015