Investments in local agriculture have helped AB InBev, the world's largest brewer, deal with supply-chain challenges and the climate crisis

• Ezgi Barcenas is the chief sustainability officer at AB InBev, maker of Budweiser and Stella Artois.
• She spoke to Insider at the World Economic Forum in Davos, Switzerland.

Investing in local agricultural has made the world's largest brewer more resilient to supply-chain disruptions and climate change, a top executive at AB InBev said.

"About five years ago, there was a fundamental change in how we thought about supply security and risk management," Ezgi Barcenas, AB InBev's chief sustainability officer, told Insider on Wednesday. "That gave us the ability to work more strategically with suppliers. This is about the water, the raw materials, the packaging, the energy that we need."

AB InBev, which is based in Belgium, brews beers such Budweiser, Corona, and Stella Artois.

Barcenas said the shift has paid off as industries grapple with global supply-chain bottlenecks because of the pandemic and Russia's war in Ukraine. AB InBev has been able to avoid major hits from the disruptions, underscoring that having local farming and recycling operations is more sustainable for the company.

Climate change, however, still remains a major threat. The beer maker operates in nearly 50 countries and has plans to expand over the next decade, including across markets in Africa, where intense drought and other natural disasters in some regions have caused food production and water security to suffer.

"What policies are going to allow us to actually achieve that growth?" Barcenas asked. "How do you lift people out of poverty so they can be part of our consumer base?"

AB InBev has been monitoring how climate change affects the regions where it sources ingredients. Many farms rely on rain and lack irrigation, making them vulnerable to crop loss and disease, Barcenas said.

AB InBev convened a discussion on food security alongside the World Economic Forum in Davos, Switzerland. The event highlighted the need to get farmers the right seed varieties, weather insights, and capital to be financially stable. Partnering with "influencers" or "early adopters" in farming communities who apply less fertilizer, use less water, or use certain seed varieties can encourage other farmers to adopt more sustainable practices, Barcenas said.

National governments and development banks also have a role to play, she added. They can devote more financing to projects that help farmers adapt to the climate crisis.

For its part, AB InBev aims to power its operations with 100% renewable energy and is more than three-fourths of the way there. The company is targeting net-zero greenhouse-gas emissions by 2040 across its entire business, including the farmers it works with, its product packaging, and the energy to keep those products cool.

AB InBev's investments in clean energy are also reducing the company's risks amid an oil and gas crisis exacerbated by Russia's invasion of Ukraine.

"Some of the projects that we've invested in, where the payback would have been five or six years, will now be two or three years," Barcenas said. "So this is actually accelerating investment into alternative sources of fuel or energy-efficiency improvements."