ThaiBev has a Sustainable Agriculture Guideline in place which is applied to all of our agricultural raw materials suppliers. The guideline covers all essential environmental and social issues in regards to sustainable agriculture practices. ThaiBev requires agricultural raw materials suppliers to acknowledge and accept the guideline before being able to continue any transaction on our supplier portal called Supplier Life Cycle Management (SLCM).
ThaiBev has launched numerous farmer development campaigns, collaborating with both private and government sectors, in order to support and educate local farmers in practicing sustainable agriculture and in compliance with applicable renowned standards, e.g., BonSucro, RSPO, SAI Platform, SEDEX / SMETA, Rainforest Alliance, etc.
ThaiBev will procure agricultural raw
materials which are the main raw materials
in the production process from sources that follow
high standards and
are environmentally and
socially responsible.
Reduce water consumption |
Reduce environmental pollution |
Protect soil health |
Prevent the destruction of ecosystems |
Reduce GHG emission |
Manage waste |
Develop farmer capability |
Ensure human right compliance |
| Water Resources Management for the Community |
|
|
|
|
|
|
|
|
|
| Distribution Soil Conditioner to Local Sugar Cane Farmers |
|
|
|
|
|
|
|
|
|
| Surface Water and Groundwater Assessment Projects |
|
|
|
|
|
|
|
|
|
| Malt Dust for Agriculture |
- Own operation
- Non-tier 1 supplier
|
|
|
|
|
|
|
|
|
| Industrial Managed Aquifer Recharge at Shallow Levels |
- Own operation
- Non-tier 1 supplier
|
|
|
|
|
|
|
|
|
| Wastewater Management through Artificial Wetlands |
|
|
|
|
|
|
|
|
|
| Speyburn Fish Ladder |
|
|
|
|
|
|
|
|
|
| Partnership with Sea Trees |
|
|
|
|
|
|
|
|
|
| GRGI Fish Farming Project using Treated Wastewater |
- Own operation
- Non-tier 1 supplier
|
|
|
|
|
|
|
|
|
| Renewable Energy Project, Solar System Project |
- Own operation
- Tier 1 supplier
|
|
|
|
|
|
|
|
|
| Green Transportation |
- Own operation
- Tier 1 supplier
|
|
|
|
|
|
|
|
|
| Used Cooking Oil
Value Creation |
|
|
|
|
|
|
|
|
|
| ThaiBev Business Partner Award Program |
- Own Operation
- Tier 1 supplier
- Non-tier 1 supplier
|
|
|
|
|
|
|
|
|
| Broken Rice Supplier Development |
|
|
|
|
|
|
|
|
|
Scope Definition
- Own operation refers to the application of agricultural commodities in ThaiBev’s own production process
- Tier 1 supplier refers to the sourcing of agricultural commodities, used in own operation, from suppliers who directly supply goods and services to ThaiBev
- Non-tier 1 supplier refers to the sourcing of agricultural commodities, used in own operation, from suppliers who provide their products and services to the supplier at the next level in the chain
ThaiBev has joined forces with the national Hydro-Informatics Institute (HII) in a “Water Resources Management for the Community” project, to study and assess the risks of floods and droughts in both short and long terms, by using the HII’s Water Resource Information System for Sustainable Development. The first project covers a radius of five kilometers around the Beer Thai Brewery in Kamphaeng Phet province, which is located in the Lower Ping Basin area (downstream of the confluence of the Ping and Wang rivers).
The results showed that the study area as a whole is at low risk of flooding and drought; only about 3% of the area is at high drought risk. High-risk areas are at risk of droughts during December, January and March due to minimal rainfall, which can result in insufficient water to meet production and community demand.
ThaiBev will continue to monitor and plan its water management for the Beer Thai Brewery, even though the area is not categorized as “extremely high water stress” as described by the World Resources Institute’s Aqueduct Global Water Tool. This will be a prototype project that can be extended to support local communities’ water resources management at other production facilities which are located in “high to extremely-high water stress” areas (accounting for 45.2% of total facilities). With this initiative, ThaiBev will be able to operate its business and create value for the communities that share the same water sources.
ThaiBev distribute effluent from the bio-gas production process of a distillery as a soil conditioner to local sugar cane farmers in Khonkaen province because it contains essential nutrients for plant growth, particularly for sugarcane. According to research, distillery slop has been found to increase sugarcane yields without causing negative environmental impacts when used in the farm areas. This utilization of distillery slop can reduce farmers' expenses on chemical fertilizers and result in an increased yield of approximately 10,000-15,000 baht per rai (0.39 acre). In addition, farmers are able utilize distillery slop to water their agricultural crops instead of using surface water or groundwater which can reduce farmers’ water consumption and water-related expense.
ThaiBev continues to conduct Water Sustainability Assessments (WSA) covering both surface and groundwater sources at its production facilities, to identify potential impacts and risks to the business.
These in-depth assessments cover four dimensions:
- Detailed water resources assessment, including the availability of water sources and the internal structure of water resources
- The vulnerability of the watershed, considering both social and environmental factors
- Water-related natural disasters such as droughts and floods
- The quality of water sources
These assessments cover a period of five years to ensure there are sustainable water supplies to support the facilities’ operations. Processes in the study include water sufficiency, water quality, rules and regulations related to water resources, and stakeholders’ perceptions.
In 2022, the company completed water sustainability assessments for both surface and groundwater for 27 factories and plans to expand the assessments to cover all factories in Thailand by 2023.
Malt is the primary raw material used in ThaiBev’s beer and spirit production processes. As well as malt residue, a by-product of the manufacturing process that has many nutritional benefits and is suitable for agricultural use, malt dust has nutritional value as animal feed and
would otherwise go to waste.
In 2022, the distillery in Kamphaeng Phet Province signed an MOU with Mae Lad sub-district administration in Klong Khlung District to supply 14,000 kilograms of malt dust for distribution to the communities as animal feed. The other spirit distillery in Samut Sakhon Province offered malt dust to local farmers for aquaculture feed, which helps the community reduce aquafarming costs, increase productivity, and generate sustainable income.
To encourage the industrial sector to share its social responsibilities by developing and conserving groundwater, the Water and Environment Institute of Sustainability under the Federation of Thai Industries and the Department of Ground Resources organized a program called “Industrial Managed Aquifer Recharge at Shallow Levels”.
The aim is to encourage industrial factories to develop underground water storage (with a depth of not more than 15 meters) on their empty spaces for rainwater collection, which will work as a back-up water source and add moisture to the ground especially in areas that are prone to drought.
Nine of ThaiBev’s factories were selected by the Federation of Thai Industries to participate, in Pathum Thani, Nakhon Sawan, Kamphaeng Phet, Chiang Mai, Nakhon Ratchasima, Buriram, Chonburi, and Surat Thani provinces. The project will act as a model for factories, showing them how to harvest rainwater and conserve shallow underground water without affecting the ecosystem and the environment. ThaiBev is working on expanding the project to cover more locations nationwide. This project is significant for featuring the collaborative participation of the government, the industrial sector and local communities.
ThaiBev utilizes its by-products as raw materials in the agricultural and industrial sectors. For example, using malt residue and grain residue from alcohol production as ingredients in livestock feed. It also provides effluent from the vinasse treatment process as a soil conditioner for crops such as sugarcane, rice, cassava and palm oil. The vinasses/soil conditioner had been proven to provide the right supply of soil nutrients with nutrient demands of these crops as well as increase crop yield. In FY 2021, ThaiBev distributed more than 840,000 m3 of soil conditioner to farmers across the country.
The Knockdhu Distillery Company Ltd, ThaiBev’s subsidiary in Scotland, has further extended its commitment to sustainability by developing artificial wetlands as a treatment system for the liquid residue left after its distillation process; this consists of six separate, aggregate-filled, Bentomat-lined cells, working in two pairs of three cells. With a surface area of 2,000 square meters, the wetlands are home to 21,000 plants of 17 different species. The system, which has support from the Scottish Environmental Protection Agency, has proved to be highly successful at copper removal, pH correction, and removal of both COD and BOD, taking off the road each week 8–10 bulk tankers (each with a 25,000-litre capacity) and resulting in a carbon reduction of approximately 40 tonnes per annum. In addition, the wetlands have become a haven for insects, small mammals, birds, and bats.
The Speyburn-Glenlivet Distillery Company Limited, a ThaiBev subsidiary in Scotland, collaborated with Scottish charity, the Spey Foundation, on their second environmental project to increase fish populations along the River Spey. A new fish pass has been successfully constructed in the Granty Burn to overcome in-river obstacles that prevent salmon and sea trout from spawning and to improve the river’s biodiversity. This project follows the installation of the Mackalea Burn fish pass, also funded by Speyburn. The pass in the Granty Burn was created by extending an intake pipe for the distillery’s cooling pond upstream and building a temporary dam to divert water flow. Its design will open up high-quality breeding grounds to encourage spawning under all flow conditions.
ThaiBev's subsidiaries in Scotland announced a collaboration with kelp restoration non-profit, SeaTrees, making a commitment to plant more than 4,000 mangrove trees globally, and restore 2,665 square-feet of kelp forest. This project is set to sequester carbon, increase biodiversity and protect over 700 species of fish, invertebrates and algae.
To celebrate this new partnership, a special US edition of
Old Pulteney 12 Year Old Single Malt was released, with
US$2 from the sale of every special-edition bottle being
donated to SeaTrees.
Learn more about SeaTrees here.
A project to farm 4,800 fish of four different species, using treated water from a distillery wastewater treatment plant in Myanmar. Local villagers were invited to come on an observation visit, to learn how to farm fish using treated wastewater.
ThaiBev encourages its suppliers and farmers in the supply chain to implement renewable energy scheme within their own production processes such as solar power and biomass. In 2021, one of ThaiBev’s strategic sugar supplier has installed the floating solar at one of their facility in Suphanburi province.
ThaiBev has so far installed solar panels at 23 plants in Thailand. It is expected that all sites will be covered by 2025.
In 2022, ThaiBev started Phase 3 projects to expand solar panel installation to cover all business groups in Thailand and Myanmar. The goal is to produce 13.48 MWp and reduce GHG emissions by up to 9,739 tCO2e per year.
ThaiBev works with its suppliers and partners to reduce transport distances of agricultural crops where possible by cross-mapping the locations of its own production facilities with that of its suppliers to determine the shortest route.
ThaiBev invites agricultural raw material suppliers to participate in ThaiBev Business Partner Award program every year with the aim to increase awareness of sustainable agricultural practice. The program is an incentive for suppliers to implement sustainable agricultural initiatives and operate in line with sustainability standards, such as, BonSucro, RSPO, Rainforest Alliance, SEDEX, etc.
In 2022, ThaiBev requests suppliers to track the carbon footprint of the agricultural raw materials they supply to ThaiBev as well as provides recommendations for suppliers who have not yet tracked their own emissions. To further strengthen this endeavor, ThaiBev aims to have more visibility to its scope 3 GHG emissions and increase the proportion of primary data source acquired from suppliers in order to co-develop reduction plan.
One of the program participants has adopted BonSucro standard in their own sugarcane supply chain. The supplier educates the farmers to ensure the understanding of sustainable agricultural practice and how to apply to the agricultural processes. These farmers are monitored regularly with dedicated team to visit their farms onsite to provide any supports during the transition period. The area with major improvement after applying BonSucro include soil health, soil nutrition, fertilization, waste management, and water quality. In addition, to the application of BonSucro standard in the sugarcane supply chain, ThaiBev also collaborates with the supplier to develop the community within supplier’s facilities, e.g., provide knowledge on organic agriculture, promote the cultivation of quick-growing crop to be used as renewable energy, etc.
The majority of ThaiBev’s agricultural commodity tier 1 suppliers are either manufacturers or distributors. Instead, the local farmers are considered to be ThaiBev non-tier 1 suppliers who cultivate and supply agricultural commodities to the tier 1 suppliers.
Understanding the challenges local farmers face in adopting sustainable agriculture practice, we encourage our tier 1 suppliers to implement similar farmer support programs to ensure that the farmers have sufficient knowledge and resources.
ThaiBev uses palm oil as the key agricultural commodity in food business, especially at its chain restaurants located nationwide, i.e., Oishi Group and KFC. As one of the food waste management measures, ThaiBev sold 1,147 tons of used cooking oil from restaurants for the production of biodiesel in 2022. This not only serves as additional source of income but also promotes the use of clean energy alternative which in turn reduces the environmental impacts in the supply chain.
ThaiBev invites agricultural raw material suppliers to participate in ThaiBev Business Partner Award program every year with the aim to increase awareness of sustainable agricultural practice. The program is an incentive for suppliers to implement sustainable agricultural initiatives and operate in line with sustainability standards, such as, BonSucro, RSPO, Rainforest Alliance, SEDEX, etc.
Since 2022, ThaiBev has requested suppliers to track the carbon footprint and water footprint from the agricultural raw materials they supply to ThaiBev as well as assessing the water-related risks from the location of their agricultural crops. ThaiBev will continue to improve the traceability and visibility to its scope 3 GHG emissions and water footprint in the supply chain to manage any environmental and social impacts.
Sugar suppliers who participate in the program have implemented BonSucro standard in their own sugarcane supply chain. The supplier educates the farmers to ensure the understanding of sustainable agricultural practice and how to apply to the agricultural processes. These farmers are monitored regularly with dedicated team to visit their farms onsite to provide any supports during the transition period. The area with major improvement after applying BonSucro include soil health, soil nutrition, fertilization, waste management, and water quality. In addition, to the application of BonSucro standard in the sugarcane supply chain, ThaiBev also collaborates with the supplier to develop the community within supplier’s facilities, e.g., provide knowledge on organic agriculture, promote the cultivation of quick-growing crop to be used as renewable energy, etc.
Broken rice is among ThaiBev’s five key agricultural commodities which is used in white spirits distillation and beer production. ThaiBev sources 100% of broken rice from local suppliers and is committed to ensure that 100% of broken rice is responsibly sourced in alignment with recognized international and local standards such as SMETA and Thai Labor Standard (TLS). ThaiBev carries out supplier development programs with broken rice suppliers to continuously strengthen their capability and prevent supply disruption from any arising ESG risks. In addition to their participation in ThaiBev Business Partner Award Program, broken rice suppliers also join force with ThaiBev to improve their operation, particularly on occupational health and safety, to be in alignment with SMETA standard for “Labor Standards and Health & Safety.”
PROPORTION OF AGRICULTURAL RAW MATERIALS RESPONSIBLY SOURCED
Malt and Hops |
100% |
100% |
100% |
100% |
100% |
- SAI Platform
- SEDEX
|
Sugar |
37% |
100% |
100% |
100% |
100% |
- BonSucro
- SMETA
|
Broken Rice |
0% |
100% |
100% |
100% |
100% |
- Sustainable Rice Platform (SRP)
- SMETA
|
Palm Oil |
90% |
100% |
100% |
100% |
100% |
- Roundtable on Sustainable Palm Oil (RSPO)
|
Tea Leaves |
100% |
100% |
100% |
100% |
100% |
- Rainforest Alliance
- OneCert International Organic Standards (EU equivalent)
|
ThaiBev has established purchasing policy and bidding requirement to only procure key agricultural raw materials with the leading third-party certification / standards only, i.e., RSPO, BonSucro, SAI Platform, SEDEX, Rainforest Alliance. To ensure the compliance, ThaiBev requests evidence of certification and integrates the requirement into audit criteria. As a result, 100% of key agricultural commodities purchased is certified and responsibly sourced. It also aims to maintain the certified proportion to be 100% in alignment with our 2025 commitment to responsibly source 100% of key agricultural commodities.
Sourcing Policy
Product Specification
Bidding Requirement
Assessment & Audit
MALT & HOPS
Malt and hops are the key agricultural raw materials used in distilling and brewing processes.
of malt and hops are sourced from
SAI Platform members or SMETA verified suppliers
RESPONSIBLE SOURCING STRATEGY
Supplier Selection
Establish mandatory sourcing requirement to source from suppliers who are member of Sustainable Agriculture Initiative (SAI) Platform or operate in compliance with such standards
ACTIONS TAKENS
ThaiBev encourages and supports malt and hops suppliers to become active members and follow the Sustainable Agriculture Initiative Platform (SAI), a global standard for agricultural practices. Most of the suppliers are members of SAI Platform and manage their own farms in accordance with such standard. Those who are not SAI Platform member operate under SEDEX /SMETA and have external verification in place. Non-tier 1 suppliers who supply barley to the malt suppliers who do not have their own farm are SEDEX/SMETA certified as well.
ThaiBev’s supplier also implements digital tool to improve supply chain visibility and traceability. The tool allows farmers to take a holistic view of their farm operations based on a broad set of sustainability criteria. Using this tool, farmers can assess not just the carbon footprint or water usage, but also other important parameters, such as yield, soil health, biodiversity and social aspects.
Other approach adopted by our supplier is the cradle to cradle with an investment in an anaerobic digester that utilizes waste product from the factory to make fertilizer and putting back on the land owned by local farmers that grows its agricultural raw material.
SUGAR
Sugar is mainly used in the production of ThaiBev’s non-alcoholic drinks and is locally sourced in Thailand.
of sugar sourced is BonSucro certified or sourced from SEDEX member
RESPONSIBLE SOURCING STRATEGY
Farmer Support
Partner with sugar producer to support sugarcane farmers to operate in compliance with BonSucro requirements
Supplier Collaboration
Collaborate with affiliated sugar producer to obtain BonSucro certificate (Production Standard including Mass Balance Chain of Custody Standard) and create the demand for certified sugar in Thailand.
ACTIONS TAKEN
ThaiBev adheres to BonSucro standard which covers 3 pillars of sustainability: environmental, social, and economic and incorporates these in its sourcing requirement for sugar. In terms of collaboration with its business partners, ThaiBev collaborates with its strategic sugar supplier to launch farmer development program with the objective to promote sustainable sourcing and reduce ESG impacts in agricultural processes.
ThaiBev’s supplier is one of the largest sugar producers in Thailand. The supplier has implemented farmers’ capability development programs and encourage farmers to practice modern cane farming that promotes effectiveness in quality and products, as well as reducing environmental impacts. One of the successful initiative is buying sugar cane leaves and straws from local to reduce burning sugar cane, the major cause of PM 2.5 smog.
BROKEN RICE
Rice is mainly used in the production of ThaiBev’s product and is locally sourced.
of broken rice is sourced from
Sustainable Rice Platform compliant or SMETA verified suppliers
RESPONSIBLE SOURCING STRATEGY
Supplier Collaboration
Encourage major rice millers and distributors to address human rights and environmental issues in the farming processes in compliance with local applicable ESG standards
Supplier Development
Develop broken rice suppliers to improve their operation in alignment with SMETA standard
ACTIONS TAKEN
ThaiBev engages with the local farmers to properly educate them in adopting sustainable agriculture practice and makes them aware of relevant sustainability issues in the agricultural processes, for instance, water efficiency, soil fertility, organic farming, etc.
Additionally, ThaiBev has implemented a strict pesticide control for rice. It is included as the requirement in its product specification. ThaiBev has systematic process to sample and test the product to ensure food safety.
TEA LEAVES
Green tea products contribute majorly to ThaiBev’s non-alcoholic beverages product portfolio. The highest quality tea leaves grown via organic farming are being used to produce our tea products.
of tea leaves sourced are Rainforest Alliance certified or are organically produced in accordance with OneCert International Organic Standards (EU Equivalent)
RESPONSIBLE SOURCING STRATEGY
Farmer Support
Continuously engage with key suppliers to support farmers in adopting sustainable agricultural with the primary focus on organic farming
ACTIONS TAKEN
All of the tea leaves used in ThaiBev’s production of non-alcoholic beverages are certified in accordance with Rainforest Alliance or OneCert International Organic Agriculture standards. The organic agriculture requirements cover all key essential issues stated in the EU Organic Farming, for instance climate and environment protection, conservation of soil fertility, absence of GMO, etc. ThaiBev also displays the Organic Product label on its tea products to ensure that its customers can make a well-informed purchasing decision.
One of ThaiBev’s suppliers and Thailand’s major tea leaves producer, works closely with farmers in their supply chain through Farmers Empowerment program. As part of this program, farmers are able to acquire knowledge on organic farming practices, pesticide-free farming and preserving soil fertility. As a result, farmers are able to minimize their operational cost while maintaining lowest environmental impacts.
PALM OIL
Palm oil is a key ingredient used in both restaurant business and manufacturing of packaged food.
of palm oil sourced is RSPO certified
RESPONSIBLE SOURCING STRATEGY
Promote the use of RSPO certified sustainable palm oil (Identity Preserved, Segregation and Mass Balanced) focusing on addressing deforestation and GHG emissions through on-going discussions with our key suppliers
ACTIONS TAKEN
ThaiBev supports large-scale palm oil producers and small-scale farmers in the responsible and efficient production of palm oil and to be certified with the Roundtable on Sustainable Palm Oil (RSPO) international standards.
ThaiBev has established a sourcing requirement to procure RSPO certified palm oil. Since 2018, 100% of palm oil use at KFC restaurants is RSPO certified. ThaiBev is extending this requirement to its Oishi restaurant and is committed to ensure that 100% of palm oil used in food business is sourced responsibly.
An Essential Part in Achieving Sustainable Supply Chain
Thai Beverage Group (hereafter “ThaiBev”) seeks to deliver a quality end product which answers our consumers’ demand and originates from a sustainable source. It has always been our concern to build a solid and effective supply chain in collaboration with our suppliers. ThaiBev’s Sustainable Agriculture Guideline (hereafter “the Guideline”) shall be our additional requirements for our suppliers in order to ensure that the material we source meet our standards.
We expect our suppliers to share our vision on sustainable agriculture and adopt the same practice to their own supply chain.
The requirements stated hereinafter shall apply to only agricultural raw material suppliers (hereafter “suppliers”). This includes suppliers’ related business entities, for instance, suppliers’ affiliates. Raw materials shall refer to only unprocessed materials.
Suppliers may protect the natural state of ecosystem, ensuring sustainable use of natural resources and where possible, avoid interfering at all. We expect our suppliers to avoid sourcing agricultural raw materials in high conservation values or legally protected area under any circumstances.
Suppliers may avoid deforestation in ecologically sensitive areas and take into account the prior use of land to ensure that no forests are not cut or burned for conversion to agricultural land.
Suppliers may support local farming in order to promote domestic agriculture and minimize pollution from the transportation of raw materials harvested. We encourage our suppliers to provide local farmers, whose raw materials they rely on, with knowledge and support necessary to promote sustainable and secure long-term supply of raw materials.
Suppliers may adopt organic farming in their own agricultural operation or promote organic farming practice where applicable. We encourage suppliers to obtain organic farming certification from third-party or comply with organic farming standards established in countries where raw materials are being sourced.
Suppliers may optimize energy usage within their supply chain, minimizehouse gas (GHG) emissions and implement activities to mitigate the negative impacts arising from GHG emissions on surrounding communities.
Suppliers may protect and improve soil fertility, for instance, by conserving soil, rotating crop, and maintaining the balance amount of soil nutrient.
Suppliers may optimize water consumption during their agricultural process. Our suppliers are encouraged to measure their water consumption and identify opportunities to reduce their water usage where possible. In addition, we urge suppliers to conduct water risk assessment of their operating sites using internationally recognized tools and implement mitigation plan in area where water stress level is found to be significant.
Suppliers may manage and closely monitor the usage of pesticide especially contamination of nearby water sources. At minimum, we expect our suppliers to establish a maximum pesticide residue limit for their raw materials. Where in use pesticides should be applied responsibly in adequate amount required to control the invasion of pests and should be stored properly in a way that they do not produce negative impacts on surrounding communities.
Suppliers shall notify ThaiBev if their raw materials are GMO or contain or derive from GMO ingredients. They must also comply with regulations concerning GMO in countries where they operate. Please refer to ThaiBev’s GMO Guideline for more detail on our position on GMO.
Suppliers shall not violate the community’s right to access land and natural resource and respect the established rights of indigenous/tribal people to their land as well as their prior and informed consent. Furthermore, we expect our suppliers to maintain a good relationship with the
communities in which they operate, conducting impact assessment of their operations on local community on regular basis and establish development programs where necessary.
Suppliers shall adhere to the laws and regulations
concerning minimum working age in countries where they operate, and avoid any forms of forced labor, including slave labor, indentured labor, bonded labor.
Suppliers shall work to ensure that farmers in their supply chain are entitled to income and wages that meet basic income needs in countries where the raw materials are being grown. Furthermore, we expect our suppliers to maintain good relationships with farmers and implement empowerment programs to develop their skills and capabilities where applicable.
ALSO AVAILABLE AT THAIBEV SUPPLIER LIFE CYCLE MANAGEMENT
