New Belgium Brewing Co. has always set the bar pretty high for balancing profit and purpose. Let me toss a few high points your way: 1) still currently employee owned, 2) awarded “Best place to work for millennials,” 3) WorldBlu certified “Freedom-Centered Workplace,” 4) a B Corp “Best for the Environment” 5) one of Outside’s Best Places to Work; 6) one zillion philanthropic projects; 7) Ok, you get the point. It’s a business that has held itself to a higher standard than most.
It’s one of the last places you’d expect to be dealing with protestations of supporting war crimes, but here we are, and it’s almost Christmas.
Iconic American craft beer brand New Belgium Brewing recently announced it was selling to Lion Little World Beverages, a subsidiary of Kirin Holdings Company Limited. Lion Little is the fully-owned craft subsidiary of Kirin, and it’s been gobbling up craft breweries in Australia, the United Kingdom and New Zealand. In the New Belgium deal, it will also gain ownership of San Fran’s Magnolia Brewing Co. Let’s also note here that Kirin bought a 24.5 percent stake in Brooklyn Brewery back in 2016 and, through them, small stakes in 21st Amendment Brewery and Funkwerks.
What does all of this have to do with genocide?
This past weekend some protesters drove through a snowstorm from Denver to Fort Collins, Colo., to urge New Belgium employee-owners not to sell to Lion Little, as Kirin has been accused multiple times of working with war criminals in Myanmar (formerly Burma), selling beer in the backdrop of southeast Asia’s sad 70-year civil war. That’s not great news, especially when craft beer legend and New Belguim Cofounder and former CEO Kim Jordan noted Lion Little’s ethics specifically as one of the big reasons this sale was a good fit for the heritage craft brand. From her open letter on Nov. 19:
We are a Certified B Corp. Which means that we’re dedicated to being a force for good as a business. Right away, the folks at Little World told us that they were captivated by this model, and they are asking us to retain our B Corp status. In addition, Lion announced last week that they’ve made a pledge to be carbon neutral in their Australian and New Zealand breweries starting in 2020. That’s exciting! And now we will be accelerating our own journey toward Carbon Neutrality. Imagine a world where publicly traded companies are dedicated to business as a force for good, taking into account an array of stakeholders — their workers, their shareholders, and the environment. This is a model for a big, compelling future and is in line with the needs of our rapidly changing world.
What’s all this about Kirin and the Myanmar military?
In 2015, Japan-based transnational beverage giant Kirin Co. bought a 55 percent stake in Myanmar Brewery Limited. The other 45 percent is owned by Myanma Economic Holdings Limited or MEHL, an opaque military-owned conglomerate run by high ranking generals in the Tatmadaw (the official name of the armed forces of Myanmar or Burmese military). Myanma Economic Holdings Limited (yes, there’s no R) is now a public company, but it’s not really, and you can read more about that below.
Last week, the International Court of Justice began hearings in the Hague for accusations of genocide against Myanmar, specifically operations in 2017 against the Rohingya Muslim minority. This includes accusations of rape, mass murder and the diaspora of a culture by the Myanmar military. Buddhist majority Myanmar rejects those accusations, and you can read all about the complexity of such a high profile international court case right here.
This past August, the United Nations Human Rights Council released an independent international fact-finding mission on the “economic interests of the Myanmar military” — basically where the Myanmar military gets its funding — and the report named Kirin directly. This is after Amnesty International urged Japanese authorities to: “urgently launch an investigation into payments that a subsidiary of the multinational brewing giant Kirin made to Myanmar’s military and authorities at the height of an ethnic cleansing campaign against the Rohingya population in late 2017.”
These trash donations to the military, which Kirin admits, are peanuts compared to the $90-ish million (USD) per year that the Myanmar Brewery joint venture generates, as reported in Kirin’s financials (check page 49). So, long story short, Kirin operates a highly profitable joint venture with Myanma Economic Holdings Limited, which is basically owned by folks in the Myanmar military (see proof below), which is making headlines this week because of a genocide case in an international court.
That’s a really shitty thing to throw on the employee-owners at New Belgium who now have to vote on this sale and the life-changing money that comes with it.
Protesters try to convince stakeholders
You’d probably never guess it, but there is a significant Karen refugee population in both North Carolina and Colorado. Karen are one of the many ethnic groups that have been displaced around the world because of a 70-year civil war in Myanmar.
You probably do know that New Belgium Brewing has a beautiful brewing facility in Asheville, N.C. So, last week, the Karen Community of North Carolina, the Karen Organization of America and Inclusive Development International (a human rights organization) released an open letter titled “Vote no to Kirin! Oppose Kirin’s partnership with war criminals,” urging New Belgium employees not to sell to Lion Little and Kirin. You can read that letter below. This past weekend, folks showed up at New Belgium’s Fort Collins, Colo., brewery for the “Bikes, Beers and Genocide? Protest against New Belgium Brewery.”
Apparently, Jordan and New Belgium execs actually ended up meeting with those protesters (see photo above). From KUNC, Colorado public radio:
About an hour after walking into New Belgium’s offices, [Fort Collins Community Action Network] spokeswoman Cheryl Distaso stepped outside, looking disappointed.
“It’s really clear that they know what the situation is in terms of knowing who they’re going to be involved with,” Distaso said. “If they didn’t know then, they certainly know now.”
Distaso said Jordan and other executives seemed concerned about Kirin’s history in Myanmar.
“But I don’t know what they can do,” she said. “I don’t know if the deal can be stopped at this point in time.”
New Belgium Brewing employee/owner stakeholders still have to ok the sale to Kirin via a vote that is supposed to happen today (Dec. 17). But we must also realize that, according to Jordan’s letter, “more than 300 employees are receiving over $100,000 of retirement money with some receiving significantly greater amounts” with this sale, so there is a lot of money on the table for New Belgium voters.
We reached out to both Kirin and New Belgium to get their sides of the story, and this is what they provided.
New Belgium statement:
“New Belgium is proud to be an ethical organization that is deeply rooted in our communities. We have a 29-year history of proving that business can be a force for good and nothing about our potential agreement with Kirin will ever change who New Belgium is or what we support. While reports about Kirin’s operations in Myanmar gave us pause, we believe Kirin’s commitment to human rights aligns with our mission and we remain fully committed to our core values and beliefs. Our view remains that the partnership with Lion Little World Beverages is the right one to take NBB into the future, and we have a firm commitment from Kirin that our own commitment to doing the right thing by our co-workers, planet and communities will continue to thrive under this new ownership.”
“At Kirin, respect for human rights is fundamental to all of our business activities and we are committed to ensuring that our operations are carried out in line with the Kirin Group Human Rights Policy. Kirin takes the Amnesty International report very seriously and has published its approach and actions relating to Amnesty International’s allegations on the donations [see below]. Kirin also conducted a Human Rights Impact Assessment in Myanmar to strengthen its approach to identifying, preventing and mitigating adverse human rights impacts of its business activities.”
But isn’t Myanma Economic Holdings Limited a public company?
What exactly is Myanma Economic Holdings Limited? It’s one of two major conglomerates run by the Tatmadaw. According to the Myanmar Times:
For almost two decades since the conglomerate was set up in 1990, MEHL and its sister company Myanmar Economic Corporation dominated the economy, controlling everything from imports, exports and natural resources to alcohol, cigarettes and consumer goods.
The last decade has brought increased economic and political reforms in Myanmar. In 2016, MEHL announced that after being linked to the military for more than two decades, the conglomerate had transitioned into a public company, but it’s basically still owned by the military. Here is an explanation from a source that wanted to remain anonymous:
MEHL is a public company and there used to be two classes of shares: “A” shares and “B” shares. “A” shares were held by the Ministry of Defense and “B” shares were held by senior active and retired military officials, regiments and battalions and a veteran’s organizations. When MEHL registered as a public company in 2016, “A” shares from the Ministry of Defense were all sold. So, in the post-2016 structure, there is no Ministry of Defense shares. Now shares are solely owned (and can only be bought by) active and former military personnel, battalions and regiments.
On page 70 of this aforementioned UN report, you can easily read the names of the folks running MEHL — its governance structure — and each person’s position in the military.
What is Kirin doing to remedy the situation?
This past August, the United Nations Human Rights Council named Kirin directly in its independent international fact-finding mission on Myanmar’s economic interests of the Myanmar military. Here’s what it said:
It is particularly noteworthy that among the foreign businesses partnering with MEHL or MEC, Kirin Holdings Pte Ltd. provided financial support to the Tatmadaw during the first of these fundraising ceremonies.279 The Mission notes that following a public condemnation from Amnesty International,280 Kirin Holdings Pte Ltd. issued a response which demonstrated its sensitivity to external scrutiny by taking measures to influence MEHL, their joint venture partner, by announcing a 6-step action plan.281
In 2018, the Kirin Group released its human rights policy, and the company also came up with a lengthy action plan that included “a planned human rights impact assessment of Kirin’s operations in Myanmar, conducted by an external independent consultant.” The summary and findings for that action plan can be found here.
Below are also a few links that address Kirin’s response to the Amnesty International report, the investigation it took as a result and the six-step action plan it has implemented for its dealings in Myanmar.
These are steps in the right direction, but are they enough?
Here’s that letter I mentioned
Dear New Belgium employees,
We are writing to you as the Karen ethnic minority community from Burma, living in the USA. Most of us sought protection in the USA to escape from Burmese army’s campaigns of ethnic cleansing that targeted Karen and other ethnic minorities. Our community is over 193,000 strong, living across the USA. In North Carolina, we have a community of 8500 Karen and we are joined by Inclusive Development International, our ally in Asheville, NC. We are deeply concerned that New Belgium Brewing is being bought by Kirin’s fully-owned subsidiary, Lion Little World, pending your vote. It’s inspiring to learn about New Belgium as a progressive business, a certified B Corp dedicated to being a “force for good”. In contrast, Kirin are a business partner of the Burmese military, perpetrators of the genocide and crimes against humanity in our country. We ask you to stand for human rights and justice. Vote no to Kirin’s acquisition of New Belgium Brewing.
The Burmese state and its key actors have committed genocide against the Rohingya people of Burma, and crimes against humanity against other ethnic minorities, including the Karen. The UN International Fact-Finding Mission on Myanmar (FFM) “found ‘genocidal acts’ in Burma’s 2017 ‘clearance operations’ that killed thousands and caused more than 740,000 Rohingya to flee for their lives to Bangladesh.” Human Rights Watch reports that 106,000 civilians are relegated to displacement camps in Shan and Kachin States, with “indiscriminate attacks, forced displacement, and aid blockages.” In October, the UN Fact-Finding Mission warned of “a continued threat of genocide.” These crimes are enabled by the military’s business interests, including their USD$960 million partnership with Kirin. As a subsidiary of Kirin, New Belgium would become part of a key financial network empowering the Burmese military to continue committing genocide and crimes against humanity, unless you vote no.
Legal mechanisms are currently underway in the International Criminal Court, the International Court of Justice and under Argentina’s system of universal jurisdiction. The first hearings are due to take place in the International Court of Justice on December 10-12, with Aung San Suu Kyi leading Burma’s defense. International accountability may include the investigation of financial supporters of the Burmese military, including Kirin.
In August 5, 2019, the United Nations FFM released an independent report, Economic Interests of the Myanmar Military, that highlighted Kirin’s shocking business conduct in Burma. They found that “any foreign business activity involving the Tatmadaw [Burmese military] and its conglomerates MEHL and MEC poses a high risk of contributing to, or being linked to, violations of international human rights law and international humanitarian law.” They state that “the revenue that these military businesses generate strengthens the Tatmadaw’s autonomy from elected civilian oversight and provides financial support for the Tatmadaw’s operations with their wide array of international human rights and humanitarian law violations.” We are deeply concerned that New Belgium may join Kirin, despite the serious concerns the UN has raise regarding Kirin’s conduct in Burma.
Myanma Economic Holdings (MEHL) is a major military conglomerate with shares controlled by military generals, army units and veterans. The patron is Min Aung Hlaing, the Commander-in-Chief of the Burmese military. Earlier this year, the US government put sanctions on Min Aung Hlaing for his role in mass killings and the forced expulsion of the Rohingya.
MEHL, overseen by Min Aung Hlaing, is Kirin’s partner in Burma. Kirin and MEHL jointly own Myanmar Brewery, a highly profitable business that has an 80% market share. 49% of the profits of Myanmar Brewery go directly to the military, including Min Aung Hlaing and to the very military units responsible for genocide. In 2018, Kirin reported normalized operating profit at 10.1 billion yen, more than $92 million USD. If you vote to join Kirin, New Belgium will be directly connected to these perpetrators of genocide.
While Kirin did a human rights assessment in Burma and put in place a human rights policy, they have failed to address the fundamental problem of their business in the country: that their business partners are responsible for genocide and crimes against humanity. There is no doubt that Kirin’s presence in Burma generates major profits for the military, including Min Aung Hlaing.
By operating breweries in Burma with the Burmese military, Kirin are propping up a genocidal regime and normalising its conduct. We support the UN’s calls for all businesses to divest from the Burmese military and for sanctions against military businesses, including Kirin’s Myanmar Brewery. We urge you to add your voice to support action for justice and human rights.
As a New Belgium employee, you are in a unique position to send a strong message to Kirin that doing business with war criminals is wrong. Use your vote to block New Belgium’s sale to a company that profits from genocide. Stand for human rights and justice in Burma by voting no.
Karen Community of North Carolina
Karen Organization of America
Inclusive Development International