AB InBev’s sustainability chief on building flexible, ‘future fit’ teams

Is your team ‘future fit’? This is a key question for Ezgi Barcenas , the Chief Sustainability Officer of Anheuser-Busch InBev, the global brewer behind big brands like Budweiser and Corona. In an ever-shifting world, the company must constantly consider how the future of farming, logistics and supply chains will evolve - and how it can prepare itself.

For Barcenas, being future fit means sidestepping a top-down management style and embracing a ‘team of teams’ approach. Leveraging holacratic approaches that distribute power across cross-functional teams ensures decisions don't wait on outdated hierarchy or protocols, and quick action can be taken across a number of big goals simultaneously.

Barcenas talked to Meet The Leader at the Annual Meeting in Davos about why exploring new organizational structures are so important to tackling climate change — and making sustainability everybody’s business. She talks about all this — and what she hopes moves forward at the COP27 climate summit. A transcript is below.

Linda Lacina: Given all the changes that are happening, what should leaders be prioritizing?

Ezgi Barcenas: Impatient optimism. I really think we live in a world where we need to remain optimistic and hopeful about the future, but also bring a sense of urgency and impatience to what we're trying to drive. So, it's a balance between that impatience and the optimism that we're bringing.

Another piece I want to highlight is the double vision, right? I think leaders around the world, as we're looking to tackle challenges that are much greater than ourselves, our families, societies and stakeholders or companies, I think what we really need to see is having that belief system that a better future or better world is possible and not only seeing the world clearly as it is today with its realities, but also imagining what the future could look like and really try to close that gap and play a role in getting there.

Linda Lacina: In your own work, how have you shown or deployed impatient optimism?

Ezgi Barcenas: I think this is incredibly important for internal engagement and collaboration across what I call 'team of teams' across so many different functions within a business. But also externally, really again, articulating that authentic reason why we're pursuing, you know, purposeful innovation, why we're looking at collaboration around the world to tackle some of these challenges.

Linda Lacina: Explain what 'team of teams' are.

Ezgi Barcenas: Team of teams is this operating model that we're building out at ABinBev where, we are working across functions , you know, building cross functional teams that are tackling shared challenges across the business all the way from finance to supply chain, to the people team, to the commercial teams where we are really cascading targets to a group of people to tackle interdisciplinary challenges together and to really innovate the future.

Some of my favourite classes in business school have been managerial and organizational behaviour classes. I really try to lean into our culture, which is a very target driven, analytical culture and how we think about our business and business initiatives. So, try to bring that lens, but also the collaboration. And I think in building what I'm calling a team of teams, not only working in hierarchies anymore, but really building out holocratic organizations where there's team of teams that are connected to each other and tackling these issues from their own perspective.

For me, this has been really rewarding and we're still trying to codify what this means and to really operationalize it, because I really think that we're onto something here that, you know, sustainability is not a siloed function that's operating on its own, that, one team sets a vision and tries to rally up an entire company to drive. But actually, the business functions themselves are actually identifying what is their role within that.

Just to give an example, this year, we've got eight different functions or departments that are carrying targets linked to ESG, which is tied to their bonus. So from Finance to our People team, which is our HR function, to Procurement, Supply, Logistics, we are engaging the entire company on these topics. And for me, it's been really rewarding. We're learning a lot from it. And I think this is just the beginning. There's so much more we could do in how we think about organizational design and how we actually craft the future together.

Linda Lacina: Can you give a little bit of a description for people who don't know what holacracy is.

Ezgi Barcenas: In many companies, what you would see is the tracking and monitoring or the monthly performance reviews that take place where the finance team gets together and they do their own monthly reviews, the procurement teams get gets together and they do their own monthly reviews. This actually entails bringing together people from different functions that are working on the same projects and making sure that they're not only applying that sense of ownership that exists already in the company, but the sense of accountability, the shared accountability, as well. You're no longer really putting sustainability as a responsibility in one team, but across the whole company.

Linda Lacina: And leaders who maybe have not worked in a holacratic environment — people are scared of change. They might be a little resistant or reluctant. How can they become more comfortable with it, get their toes into it. What do you suggest?

Ezgi Barcenas: My advice always, to the teams that are just starting to do this, is really focus on articulating how you're adding value to those teams. Because ultimately, you're not going to the five, six, seven, eight different teams and asking them to do something for you. You're there to help create value for them, to help make their jobs easier, to help make their products and their designs and processes more sustainable.

So, if you're really looking at it from a point of view of: “How can I help these teams be better, be more efficient, be more collaborative, be more future fit?” Then you're actually approaching at the right angle, as opposed to: “Well, we should all go do this because I said so.”

Linda Lacina: In order to tackle sustainability, we can't just use sort of one tool in our toolbox. I think it's really interesting to take a holacratic approach as you're talking about. Do you think that's a surprise to people, that there is maybe a tie to how we organize ourselves within companies, global organizations, to what the results and the outputs are and how we're tackling these problems?

Ezgi Barcenas: To some people, yes. Because ultimately what you're really looking to do is what consultants for years have called 'change management'. What I would call really a culture revolution. I really think it speaks to the ethos of a company and how you're looking to redefine it for the future in how teams come together with that shared sense of purpose.

I think over the last few years, many companies have been on this journey, especially on the supply chain part, looking at it from supply security point of view. I think a few others have also started looking at it from an innovation angle. Like for us, you know, what does the future of farming look like? The future of packaging? The future of logistics? We're asking these big questions to ourselves, but also to our supply chain partners. I think the next step is: “Okay. Now, how do I then empower my consumers with more choice, more information?” Really show up in the world and create those, kind of, more choices, more occasions for the consumers as well. So really looking into the commercial aspect of this as well, and not just the operational angle. And that really requires a whole new level of engagement within a business where, again, historically, there've been very function-specific engagements.

Linda Lacina: Why don't we just talk about change for the climate? What is one that could make a real turning point in your mind?

Ezgi Barcenas: I think scalable innovation. This is really a big one. Because even when you're looking to set new public commitments or a net-zero ambition or vision, there's certain pathways that you plan out for yourself, and there is a piece of your supply chain or operations that you know how to tackle. And then there's other areas where you don't know the full answer, right? You don't know exactly how to get there, but you know the importance of innovation and identifying new partnerships, new supply chain partners that are going to come in and help you tackle. Scalable innovation is really a big one.

And for us, about four years ago, we created a programme called 100+ Accelerator that has accelerated 70 start-ups around the world in 20-plus countries. In its third year right now, we're wrapping up the third cohort, we've also invited Unilever, Coca-Cola, and Colgate-Palmolive to join us, as four iconic companies to look at some of these sustainable innovation solutions that are out there that are going to come in and pilot their products in our operations or in our supply chains. And once, at the end of that pilot, you find the results that can be scaled, now there's your answer to the future, to that unknown that you're trying to close the gaps on.

Linda Lacina: And what will also be really important? Are there capabilities that need to be built in order to sort of continue to close those gaps?

Ezgi Barcenas: I think in terms of the capabilities, really having that broader sense of the world and the leadership that we bring in — always questioning this status quo. I am naturally a very curious person and I always tell my team: continue asking questions, right?

We may not have all the answers, but as long as you're asking the right questions, you're going to find the right partner along the way, internally or externally, that are going to help you tackle and find solutions for the shared challenges that we have around the world.

Linda Lacina: Is there a particular piece of climate tech that you're excited about? That you think could really make a difference?

Ezgi Barcenas: There's a lot of solutions that we're piloting. There's a renewable heat solution that we're looking to pilot and learn from that pilot in Africa. But also we're working with some of our peers on eco-coolers and solutions there.

We're working with our farmers in our direct supply chain to bring in regions, agricultural practices that are going to help in with that climate resilience, but also, you know, the mitigation as well. So, there's many different angles. We just try to tackle them along our entire value chain.

One example I always like to give is this company called BanQu. That is a blockchain-enabled technology platform that operates basically over SMS. So, you don't need a smartphone, you just need a cell phone. It increases the traceability and transparency of our value chain. So now, for the first time in certain markets, we actually know where our barley comes. And that farmer also has visibility around the amount of barley they sold to us, at what price they sold it to us.

They're being enabled and empowered with a digital financial identity, because now they have sales records that they worked for a global company like ABInBev, and they now exist in our supply chain. Whereas beforehand, that visibility did not exist. It did not make them bankable. So a huge opportunity for us to increase transparency and have access to that data, but also think of the communities around us and really empower them so that they can continue to bring the skills that they need to their own businesses.

Linda Lacina: And that level of prosperity, because that helps build these businesses, it helps build families and towns and communities, how does that also help progress against climate change?

Ezgi Barcenas: This really goes back to about eight months ago when we refreshed our ESG strategy, we wanted to really lean in on the category.

As a category leader, the world's leading brewer, we want to shift our approach from being the 'category leader' to 'leading the category' and, you know, in our ESG efforts and strategic priorities that we've identified, what really came about were the three what we call signature themes for our business: being inclusive, being natural and being local.

So what we are identifying and finding out is that inclusivity really not only extends into our value chain - think of the tens of thousands of smallholder farmers that we work directly with, or the 6 million retailers, the small, medium-sized enterprises, mom, and pop shops, around the world that sell our products - that inclusivity extends from the value chain to our product offerings, through non-alcoholic options, affordable options, really creating that inclusive category. And once you start building that out, and then once you start thinking through how you work with nature, instead of against it, and really elevate the natural ingredients, the nature-based solutions and bringing that local view. We really believe that the future is local. So once you tie these three themes together — the inclusive, the natural and the local — engaging with the farmers, engaging in local supply chains, revitalizing local economies, really play a big role in tackling climate change locally because you can't do this globally.

Linda Lacina: What do you want to see happen before COP?

Ezgi Barcenas: I would love to see more urgency, but also that impatient optimism. What we really need to see is a growing recognition of the steps that have been taken so far and the solutions that have been identified and finding ways to scale those up, finding ways to finance to some of those solutions.

But at the same time, also, openly talking about the gaps that we have around policies, enabling environments, the regulatory backbones that are needed in so many countries where we can continue to drive this agenda with our with our partners across the value chain.

Linda Lacina: There's sort of buzz of the recession coming. How will that impact efforts for climate progress?

Ezgi Barcenas: The questions we would get in the first few months of the pandemic - both the champions and the skeptics of sustainability and climate change, specifically, would come to me and my peers and other companies, and really ask questions around, well, what does this mean? Is this going to put sustainability on the back burner? And are companies going to shift their focus and attention because there is now a global pandemic?

I think, it’s more or less the same now, what we're seeing with the recession, with the food security, energy security challenges that are coming down the pipeline. Ultimately, what you're going to realize is that you need to continue to invest in local economies and local supply chains. And if we don't do that, we will be more susceptible to global shocks and disruptions to our supply chains and the systems that we created for ourselves.

So, I think if we continue to build for resilience and design for resilience, like we've learned in the last two years of the pandemic, I think we will come out of the inflation and the new economic environment as well really better off because now we're really being challenged to ask ourselves the right questions.

Linda Lacina: And what happens if people don't stay on the right course?

Ezgi Barcenas: There will always be some that will stay the right course and will continue to advocate for the right policies and champion the right innovations and continue to identify the right partnerships that may be, in some cases, very unlikely partnerships, right?

You know, the 100+ Accelerator programme that I talked about, these are start-ups and they're working with a global company with operations across 50 markets around the world with $50 billion in revenue. These are not likely partnerships, right? And we're going out and we're purposefully chasing these innovations to come in and bring us the learnings.

That doesn't mean we're not working with the big suppliers as well — we are, because there's a different type of innovation and scalability that exists there. But I think some may not stay the course, others will. And you see this in governments as well. I think the power that we have, despite the local-rootedness, we have that global reach.

So, we've actually been through this through the renewable electricity sourcing. Over 75% of our electricity is sourced or contracted to be sourced through renewable electricity. When you go through those engagements and you're trying to increase local renewable capacity, so this is not about offsetting, we're really investing in additional, renewable capacity in the markets where we operate in. Now you have a good understanding of what are the enabling conditions that make renewables competitive in the marketplace, who are the suppliers and partners that are going to come in and help you do that. What is the would-be cost? You know, the 'should cost', the would-be cost of that renewable electricity, and what are the regulations that you need that are going to help you bring that electron to the grid? And you can take those learnings from one market to another.

So, I think there will always be opportunity to learn and to drive progress, even if some maybe got left behind a little bit earlier on, you could still bring them along.

Linda Lacina: The role of business — it's changing a lot. What do you see as the biggest and most stark changes maybe even in, in the last five or 10 years?

Ezgi Barcenas: I think companies and business leaders are stepping up to shoulder this greater sense of leadership. And you know what we're seeing — and we've gone through this change in our organization as well — is we're starting to look outside our four walls, really deep into our supply chain, our ecosystems, and having that much broader view of the world and the role that we can all play within it. And I think the dialogue is increasingly shifting away from sustainability and broader ESG being a supply security issue or a risk mitigation issue, to innovation, to value creation and really an enabler of that commercial vision that we're setting for ourselves.

I think this is where materiality really becomes very important. And what we've seen throughout the pandemic as well is the materiality of the environmental, social, governance issues becoming really a lot more accentuated, a lot more widely recognized and understood because ultimately what we've done for years is design our systems and processes for efficiency. And then we woke up to a world where we saw that the importance of resilience and building for resilience and designing for resilience.

So ultimately, I see sustainability as an ultimate brief for design. So, I think as leaders are looking into this, for them to stay authentic and to build programmes that are long term and sustainable, they really need to take into account the materiality of why they do what they do, and why it matters to their business, their stakeholders.

And that point of entry, I think is always very, very important.

Linda Lacina: While you've been at ABinBev, how have you evolved as a leader?

Ezgi Barcenas: I've been a lot more resilient than I thought I was, so, you know, learning that over time. And I think this comes with the nature of the profession as well, right? When you're driving a sustainability agenda and you need to educate, inspire, inform people. So, I think that's one.

And showing to the teams that you can be part of the change that you want to see. Every new recruit that comes in, through business school or lateral hires externally, they always ask us: “What are you doing in sustainability?” They always want to find out they always want to play a role. They also should feel empowered that they could be part of that change. So I think that's the one piece that we continue to deliver the messages on. And for me, I think I see myself playing that role very uniquely in my leadership style, in the inclusivity that we bring in, the collaboration, how we invite others to come and be part of the solution, and really help lead this agenda together.

Linda Lacina: When it comes to organizational change — it's an evolution, right? Is there something that you changed your mind, made a new plan or you pivoted?

Ezgi Barcenas: Pivoting and taking different routes to the same ultimate outcome is definitely part of the job description.

It's a couple of things, right? One is you can look at something from an operational angle and try to solve for a regulatory risk, a physical risk, a reputational risk, and that's how you design your programmes and initiatives. But you can also look at things from a commercial angle and say, this is increasingly what the consumers want to see, or this is what's important for our retailer partners, and here's how we show up in the world on-shelf, and the shopper insights or the consumer insights that we need that are going to drive those.

So, for me, I think the biggest learnings that we've had is to continue to listen, that active listening of the partners externally and entire stakeholder groups — be it the consumers, be it the customers for us, or supply chain partners.

Linda Lacina: And how can any leader make sure that they are actively reaching out, talking, collaborating, with these people? For instance, the CEO of Yara, prompts his team and also asks the same question to himself: how many meetings did you have outside the organization this week, this month? You know, to sort of say, “hey, if we're really going to partner with other people, we need to start talking to other people.” Are there habits like that you guys are doing to build that collaboration, that partnership?

Ezgi Barcenas: I've been with the company nine years now. And when I first joined, the function was within the corporate affairs team and it gave me a lot of ability to learn about the industry and what we stand for and the cultural heritage, and the operational excellence.

Then we moved sustainability under procurement. So I would report into our Chief Procurement Sustainability Officer, where again, it gave us a lot of ability to influence our supply chain partners, really get into strategic dialogues, more so than a transactional cost-related discussion and negotiation with the suppliers, to now, last year when we had a new CEO come in, our new CEO Michel Doukeris, elevating the position and creating a Chief Sustainability Officer position, a fully dedicated CSO position that reports into him, we've been through that journey and in that journey we’ve learned how we can tackle these things and how we can engage the organization.

So I think for me, that has been a really big signal to the whole company that this is really important for us. But again, going back to our target driven culture and how we think about strategic priorities for the sustainability team and the broader team of teams around the world, including our finance teams, we have really now taken on more of a public leadership role in a few big areas where we think that we've got a lot of learnings and a lot of local insights that we can share with the world. And beyond that, looking into some of the regulatory and reporting frameworks that are also coming out and having a voice in those discussions as well as the industry standards are being set. Because again, I think, I work in such an industry where we really know the nuts and bolts of our business because of the local supply chains and how close we are, how deeply rooted we are in those local supply chains that I think we are no longer shy about leveraging those learnings and insights and trying to bring them to global discussions or industry discussions as well to lead agenda-setting dialogues.

Linda Lacina: Did you think, when you were starting your career, that this would be your job?

Ezgi Barcenas: I don't think so. You know, it's a great question. I was a big math and science student in high school. So, I ended up getting a double major in engineering. So I did electrical and biomedical engineering and, despite my professors asking me to stay on for a Masters and PhD, I wanted to see the impact of my work in the world and went on to get a Master's in environmental health, and then did a number of years in the public sector in international development and still felt that the impact of my work was no seen immediately. I went back to school, got my MBA, and found myself at ABI about nine years ago. I feel incredibly fortunate, privileged, humble to have found this early in my career, and to also have been part of the journey that we've been on as a company, in how we build our understanding and appreciation for sustainability and how we're not working on building a sustainability strategy, but a business strategy that is more sustainable.

So for me now, for the first time I see the impact of my work at scale around the world and that vision and how we can bring it to life.

Linda Lacina: Is there a book you recommend?

Ezgi Barcenas: I am, currently reading this book called Humankind: A Hopeful History, by Rutger Bregman.

I really think it's a really interesting big book because it argues that humans are wired to be kind. And I'd like to think that, you know, I've got two little kids, a three and a seven-year-old, and I'd like to believe that the natural state of humanity is not selfishness.

It may seem a radical idea, but I think it's quite refreshing to be thinking of humankind as kind. I think there is a lot of power in positive thinking, especially, again, in the state of the world that we live in today. So, I encourage everyone to read and I find it very refreshing so far.

Linda Lacina: Is there a piece of advice that you would give to yourself? You haven't been working in sustainability your entire career, but a good chunk of it, right. But what advice would you give to yourself at the beginning of that journey?

Ezgi Barcenas: Be bolder. I think we need to move faster on people, products, markets. There's a lot happening in the space right now and things are moving really fast. So, it's time to be bold.

This transcript, generated from speech recognition technology, has been edited for web readers, condensed for clarity, and may differ slightly from the audio.

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