We look forward to government protecting investors in non-oil sector – NBC
Q:What will you consider your greatest contribution to the Nigerian economy in NBC’s six decades in Nigeria?
A : At Nigerian Bottling Company, our rich heritage and emotional connection with Nigerians have indeed made us part of everyday life, celebrating and bringing people together across the country. Our passion for marketplace execution and long- term vision underpin our strong commitment towards achieving sustainable business growth in a responsible way. Our business has the capacity for about 7,000 direct employment opportunities and over 900,000 commercial partners (including suppliers) creating many more jobs within our value chain. We are pleased to see our customers successfully pass their businesses from one generation to the next, supporting their households and contributing to socio-economic growth in their communities. Over the last decade, we have continued to make significant investments in the economy annually. From 2011 – 2014, we committed an investment of N109bn in infrastructure modernisation, supply chain capacity enhancement, human capital development and expanded corporate social responsibility initiatives focusing on shared aspirations with our communities in the areas of youth development, water stewardship and women empowerment. As a business, we leverage on women’s economic power as a force for growth to further our shared objective of social and economic development. Our route to market is anchored on women entrepreneurs who represent nearly 70 percent of our network of trade and micro distribution centres across the country. I believe that women are Nigeria’s hidden resource. Therefore, we have strategically integrated women in key segments of our business. We recognise that when we invest in the success of women, we invest in our own success and in the success of our local communities.
Doing business in Nigeria is challenging now more than ever before; how will organisations like yours wade through the economic tough times to remain competitive and profitable?
In an economy characterised by volatile macro-economic forces, we confront the tough operating landscape with great confidence, drawing from the Nigerian resilience and engaging our stakeholders in constructive conversations. From an organisational stand- point, we shall continue to optimise our investments with an underlying emphasis on efficiency and engaging the hearts and minds of our consumers. We continue to invest in building skilled and motivated talents, equipping our people with high performance mind-set and ultimately creating an unparalleled talent pipeline for business sustainability.
In the industry, we advocate for and are strong proponents of fiscal policy measures that balance key stakeholders’ expectations without stifling foreign direct investment or exposing local manufacturers to unfair competition. Therefore, in the face of current global decline of fortunes in the oil sector, continued devaluation of the local currency and the consequences in the Nigerian economy today, I look forward to the government taking critical steps to protect investors in the non-oil sector of the economy to forestall the potential risk of losing these huge investments following the escalation in cost of production.
How are you managing the transport infrastructure challenge while ensuring your product is in every nook and cranny of communities?
We continue to build on the strength of the uncommon entrepreneurial spirit of Nigerians to step-change our route to market and maintain a robust but efficient distribution network all over the country. Every single day, we are faced with distribution challenges in a bid to ensure we are consistently available at the right occasion, channel, location and price. Therefore, whilst we optimise the operation of our various distribution centres, we have commenced an effective logistics model with our distribution partners while addressing efficiencies and managing our cost base in core functional areas.
In the World Bank’s Ease of Doing Business Report released last year, Nigeria didn’t score highly with multiple taxes and other challenges as the major problems. Have regulations been supportive, or disruptive to doing business in Nigeria?
First, although Nigeria’s ranking of 170th for 2015 is slightly better than that of 2014, which placed the country in the 175th position out of 189 countries that were surveyed, it is also important to recognise that the report did not measure all aspects of the business environment that mattered to firms and investors. For example, it does not measure the quality of fiscal management, other aspects of macro-economic stability, the level of skills in the labour force, or the resilience of financial systems. I believe we are familiar with the overarching factors responsible for the challenges in doing business in Nigeria. As a leader of a manufacturing concern, one of my major cost drivers is cost of power or generating electricity and the dynamics of confronting multiple taxation at all tiers of government across our locations. These are some of the vital areas of the economy we seek for a deeper collaboration between government and the private sector through policy debates on findings the right mix of economic policies and balanced regulation. This brings me to your question on whether regulators have been supportive or disruptive. It is our desire to see regulators engage the industry much more and in a way that promotes business development and effective regulation. Given our experience in the industry, I believe we have a lot to contribute in improving operating guidelines and building capacity for regulators.
Just how critical is water to NBC, particularly taking into account your operating environment? Water forms a large part of our operations. It is the single most essential ingredient in our product and we make huge investments in ensuring that the communities where we operate do not suffer on this account. NBC actively works to reduce, replenish and recycle water. In 2004, we began setting annual water use reduction (WUR) targets to reduce the volume of water consumed in our operations by investing in water-saving technologies to control water usage and also recycle waste water in some stages of our production process for house-keeping tasks. To date, we have achieved a 54 percent reduction with many opportunities to do more. All our production facilities have functional on-site Waste Water Treatment Plants. These plants ensure that waste water from our bottling operations is contained and treated in such a way that it supports aquatic life and agriculture. NBC commemorates the United Nation’s World Water Day annually under its Water Ambassadors programme in partnership with the Federal Ministry of Water Resources and water-focused agencies by driving awareness under the theme for each year. In line with the theme for this year, we are fully committed to sustainable partnerships and integrated approaches to solving water problems in our communities under our water stewardship programme. This year, we held an awareness program facilitated by resource persons on the importance of safe water practices with students from select public secondary schools in Owerri and Kaduna. To ensure that more students imbibe these safe water practices, the schools are being supported to form water conservation clubs. The clubs will further provide volunteering opportunities for our colleagues and water specialists to donate their time and expertise to aid knowledge transfer on safe water practices among students in a sustainable way.
How is NBC meeting its huge need for water without endangering the water supply of the host communities of your bottling plants?
In 2011, we conducted a source water vulnerability assessment of our production plants across the country to among other things, develop and implement a source water protection plan. The assessment included identification and assessment of the social, environmental, economic, regulatory and political risks to all sources of process water. Now, this has helped us to iden- tify practical ways we can conduct our manufacturing operations to support the water rights of people, nature, business and government. The assessment also enabled us to ensure that source water is managed at the same level as other ingredients to protect product quality, and ensure the sustainability and supply continuity of water supplies. This includes promoting and supporting the sustainability of local water resources in the communities where we operate. Under our water stewardship program where we provide access to potable water for water-stressed communities, it was an emotional experience for us to know how we impacted a community in Makurdi, Benue State where the members of the community needed to go as far as 5km in search of water before our intervention in the community.
How pivotal are organisations like NBC in raising awareness about climate change and how receptive are Nigerians to these issues?
At the Coca-Cola Hellenic Group, carbon management is a strategic priority for us and we see business benefits resulting from ongoing investment in energy efficiency and low carbon technologies. Therefore, we are benchmarked against our performance in this area together with 27 countries in Europe. So for us in NBC, this is already a self- regulation. The basis of our carbon reduction strategy is our commitment to build multiple combined heat and power (CHP) units in our operations as evidenced by the installation of CHP units in 3 of our production facilities. By installing a CHP unit, each bottling plant improves its carbon emissions by 40 percnt. The CHP system captures heat from the electricity generators, and uses it to cover the plant requirements for hot water, steam and chilled water. We are also implementing energy-saving technologies in our range of cold drinks equipment by introducing more efficient units of a wide range of hydro fluorocarbon- free coolers. To date, all the electric coolers deployed to our customers in trade are HFC-free. Certainly, we believe we have a pivotal role to play in reducing our overall carbon foot- print and more importantly, creating awareness in this regard across our value chain.
How has NBC successfully managed post-consumer waste in the country and when did the business start recycling?
In the beverage industry, we play a leading role in promoting sustainable packaging through light weighting, introducing in 2009 the light weight and eco-friendly glass bottles which require about 16 percent less raw materials and energy to produce. Our PET bottles have been light-weighted from 21 grams to 19.5 grams, with a reduction in the thickness of the shrink films from 100 film thickness (micron) to 60 (micron). In addition to an industry-led extended producer responsibility initiative in the post-consumer waste category, NBC supports a post-consumer PET collection program in collaboration with the Lagos State Waste Management Agency (LAWMA) and a formal collector. We are currently introducing collection channels at designated key account channels in Lagos, where we record the biggest sales volume of non-returnable product packages. Our ambition is to leverage the industry collection capacity and ultimately close the recycling loop by attracting more investors in the waste recycling sector.
As Nigeria joins the rest of the world to celebrate the World Water Day, what are some of the key learning for the nation in terms of improving access to portable water?
In a few words, there is still much room to cover in this regard. As we continue to lend our support to addressing community needs, we believe the country is still on a long journey to achieving access to potable water in local communities which undeniably, requires a multistakeholder approach with measurable milestones.