Monthly Archives: November 2014

Could the Irish Craft Beer Industry do with a shot of CSR?

The Irish Craft Beer industry is currently undergoing a renaissance, as it seems that barely a week goes by in Ireland without a new independent brewery sprouting up or a new craft beer pub opening for business. But, despite its rapid growth, could the craft sector be doing more to communicate a message of sustainability?

The rise of the Irish Craft Beer Industry

The thriving Irish craft beer market is set to achieve sales worth €15 million in Ireland this year. This represents an increase of 50% since last year, an increase of 180% since 2011 and, furthermore, the number of independent Irish breweries is expected to swell to over 100 by 2015 . All of this has happened at a time when overall beer consumption has been falling in Ireland (the overall beer market slumped by 6.2% in 2013).

Next Glass

Copyright: Next Glass

Despite these impressive figures, it should be remembered that craft offerings still comprise just under 2% of the Irish market. This means craft beer still has big room for growth in Ireland and the sector still has quite a distance to go before it matches the U.S market, where craft varieties make up almost 8% of all beer sales and the craft sector provides over 100,000 American jobs. There is a consensus within the Irish drinks market, however, that the only way is up for craft beer, with the Irish trade magazine Licensing World recently claiming the sector is “expected to expand at least tenfold over the next seven to eight years”.

So, how do we account for the newfound popularity of craft beer? It appears to be part of a cultural change, where some drinkers have opted to “drink less, but better”, leading to a gradual shift away from mass-produced lagers towards more interesting and challenging craft options. Tied into this are the obvious economic changes wrought by the recession. The economic downturn actually seems to have helped the rise of craft beer; as Seamus O’Hara of the Carlow Brewing Company claims, “the recession helped us because it disrupted the beer business and the bar business … people started thinking more local with local jobs and local produce”.

Craft Beer and Corporate Social Responsibility: a good mix?

From our own perspective, the craft beer sector might be an excellent fit for corporate social responsibility. Local Irish brewers like Whitewater, Blacks of Kinsale, and Dungarvan place much emphasis on how they are supporting local suppliers and stockists; craft beer manufacturers tend to market their wares on the basis of their country of origin (or, in the case of Irish brewers, their county of origin).

The Irish Craft Beer and Cider Festival
The Irish Craft Beer and Cider Festival 2014 (Copyright: Irish Food Guide Blog)

In terms of market demographics, Hospitality Ireland recently drew up a profile of the typical craft beer consumer and deduced that they were most likely to be males between the ages of 25 and 40 with “higher income levels, lower debt and higher disposable income” than average and more likely to be “exceptionally well- travelled”.

The typical craft drinker has a greater interest in the ingredients that are going into making their beer – and in the brewing and fermentation processes that create these beers. Similarly, they’re likely to have more curiosity regarding locally-sourced artisan food, and a related interest in what varieties of food compliment different types of beer.

With this in mind, one would’ve thought the Irish craft beer market was ideally suited to deliver a message of CSR and sustainability, and to demonstrate how business can have a positive impact in the community.

Yet, from looking at the websites and packaging of independent Irish brewers, not many of them appear to be pushing this message. While it would be unreasonable to expect small craft breweries to replicate the major CSR projects of the multinational companies like the Arthur Guinness Fund, there are some ways that the independent breweries might communicate a message of sustainability and social responsibility.

Are there any global examples that Irish craft producers could imitate? Here we present some craft breweries from around the world that are flying the flag for CSR:

Brooklyn Brewery

Brooklyn Brewery
Brooklyn Brewery (Copyright: Triple Pundit)

The mission statement of this NYC-based brewery declares their aims of “brewing flavourful beers and to enrich the communities who enjoy them”. They achieve this by making ‘product donations’ to local museums, theatres and community projects. They also facilitate these community groups by allowing them to hold their meetings in the brewery, and the company actively encourages brewery employees to serve on the boards of local not-for-profits.

Alaskan Brewing Company 

Given their isolated geographic location, a big challenge for Alaskan Brewing Company is getting their products to the marketplace in a sustainable way and that doesn’t cause further damage to the environment. That’s why they have established a CSR programme called Coastal CODE (with ‘CODE’ standing for “Clean Oceans Depend on Everyone”). Through their Coastal CODE, Alaskan Brewing Company ensure that 1% of all proceeds from their Icy Bay IPA are donated to the preservation of the Pacific Ocean and its coastlines. Alaskan has embedded these values of sustainability into their marketing communications, as can be seen from this promotional clip:

Cavalier

Cavalier Courage is an Australian craft beer that was originally developed to help raise awareness and funds for Motor Neurone Disease (MND). The producers say that the main strategy for brewing this beer is to “increase the profile of this disease in Australia and beyond, whilst satisfying the true beer lovers’ thirst”.

BATTLEDOWN BREWERY

Operating out of Cheltenham in the U.K., Battledown Brewery outline a comprehensive corporate social responsibility policy on their website. Battledown offer a 10% price discount to any charity, run a beer festival in aid of The Samaritans, and collaborate with other local breweries on distribution so as to reduce ‘beer miles’.

The Right Glass La-Quinta-Blues-and-Brews
Copyright: La Quinta Blues and Brews

CSR & Sustainability options for Craft Breweries

This is just a small sample of the corporate responsibility initiatives that the craft beer industry are implementing across the world. A further project that might be imitated by Irish brewers is the keg-sharing partnership that some American independent brewers have created to cut both costs and carbon emissions. The Irish Craft beer industry is generally based around more of a collaborative culture than cutthroat competition – about putting on fairs and conventions and working together to grow the sector – so you could see a similar keg-sharing partnership working here.

Given that a lot of craft breweries are essentially family operations, the question remains as to whether a lot of Irish craft breweries might be too small scale to implement an effective CSR programme? It is here that the ‘corporate’ part of the CSR acronym might be unhelpful and off-putting to a lot of independent breweries; perhaps they would be more willing to support these types of projects if they were instead labelled as ‘sustainability’ or ‘community’ initiatives. The argument that craft breweries are “too small to do CSR” is refuted by the fact that a lot of other Irish SMEs are increasingly integrating social responsibility into their core business strategies. A lot of SMEs are paradoxically excellent at CSR but woeful at publicising their activities, so perhaps craft breweries need to be more vocal about the positive impact they’re having on the environment and their local communities.

Ironically, climate change could accelerate the shift to craft beer, as pressures on global supply chains could mean there will be a greater demand for locally-sourced ingredients. A further challenge for the drinks industry is that the growing problem of global water shortages (also associated with accelerating climate change) could pose a threat to the future of brewing.  Beer manufacturers may need to get serious about water sustainability if they are to survive, and this is an area where craft breweries – with their localised supply chains – already have a head start.

Kinnegar Brewing Company, Co. Donegal
Products from the Kinnegar Brewing Company in Co. Donegal