Fernando Tennenbaum became CFO of Anheuser Busch InBev, the world’s largest brewer, in April 2020, just as the coronavirus pandemic gripped the nation. At his first earnings call, in May, the company reported "materially worse" business, including a nearly 6% revenue decline, but by the fall, it found its footing, with 4% revenue growth in the third quarter.
But the experience confirmed to Tennenbaum, who has spent almost his entire career at the company, two key lessons. The first: beer is a very resilient business. The second: successful business demands a commitment to environmental, social and governance (ESG) standards.
After recovering from its brief downturn, AB InBev saw very strong demand across its entire portfolio, which includes Budweiser, Corona, Modelo and Stella Artois, and that demand has remained consistent since, Tennenbaum told CFO Dive.
“It’s been a challenging year and a half, but we’ve done a lot of things we can be proud of,” he said. “We were able to help the community. In the first one to two weeks of the pandemic, we were able to produce hand sanitizers to donate. Then we repurposed our portable coolers to deliver vaccines.”
In April, Budweiser — one of its flagship products — commenced a campaign offering free beer to people who get vaccinated, Marketing Dive reported.
For AB InBev and its new CFO at the time, the pandemic stress-tested its strategy, and magnified both its strengths and weaknesses, Tennenbaum recalled. “Sometimes you can hide, but you can’t hide when a pandemic hits.”
Ultimately, AB InBev’s, and particularly its finance department’s, quick decision-making process, gave it an edge when the broader outlook appeared grim. “Our strategy made it very clear the direction we were going, so the decisions were almost obvious,” he said. “And if we can continue doing that, and finance can support the company in doing that, that will be key.”
Tennenbaum’s career followed a winding path to leading finances at the world’s largest brewery. He entered the brewing market in 2004, as a debt specialist at Ambev, a Brazilian company. That same year, Ambev merged with a Belgian brewmaker, Interbrew, to become InBev.
Tennenbaum spent more than 7 years with the company, eventually leading its investor relations, M&A team, and finally serving as its treasurer, before moving to St. Louis-based Anheuser Busch as its Global Treasurer in 2012.
“Investor relations differs from treasury, because you make fewer decisions,” Tennenbaum said. “But how you explain the company to analysts has a meaningful impact on its perception and valuation, and you learn a lot about how to organize your thoughts clearly and transparently.
On the other hand, leading M&A taught Tennenbaum the merits of managing frustration. “I was trying to put 10 different initiatives in place, and 9 of them would fail,” he said. “But that’s not your fault; it’s part of the learning process. When you get one right, it’s a much more robust solution, because you just went through 9 trial and errors.”
In 2016, InBev merged with Anheuser-Busch to form Anheuser-Busch InBev. And in 2018, Tennenbaum returned to Ambev, now an autonomous subsidiary, as its CFO, before finally landing back at AB InBev as CFO in April 2020.
“Regardless of your role or expertise, you have to make sure you’re doing it because it’s the right thing for the business,” Tennenbaum said of his time in various financial leadership positions at the companies. “The different positions we have at AB InBev are almost like ongoing reinforcements of having the right mindset.
ESG comes first
As CFO, Tennenbaum has been deeply committed to environmental and social governance (ESG) issues, and has only become more so amid the pandemic. He is a founding member of the United Nations’ Global Compact CFO Task Force, which, the UN says, was formed in 2019 to “inspire a new meaning” for CFOs’ roles in sustainability, and in an effort to “raise awareness of the transformative impact of corporate finance across ... the global economy, and society as a whole.”
At the United Nations’ annual General Assembly gathering last week, Tennenbaum and his fellow Task Force members shared a pledge committing to the UN’s Sustainable Development Goals (SDGs), a broad list of ESG-centric goals intended to be achieved by 2030.
The Task Force, which includes CFOs of 60 companies worth a combined $1.7 trillion in market capitalization, per Fortune, committed to collectively invest $500 billion over the next five years toward reaching the 17 goals the UN has outlined, which include “no poverty,” “zero hunger,” “gender equality” and “affordable and clean energy.”
The pledge sets “a necessary milestone on a journey which began in December 2019 when a small group of CFOs started working together towards a vision of boosting the integration of sustainability within business operations,” Alberto De Paoli, CFO of Italian utilities corporation Enel and co-chair of the CFO Taskforce said. “Now, we aim to increase awareness even further and help create the necessary environment to attract more capital towards sustainable development.”
Tennenbaum said he was formally introduced to ESG, and AB InBev’s commitments, his first week on the job as CFO.
“When you join AB InBev, we go and visit breweries, and points of sales, and try to get a glance of the business,” he said. “I remember talking to a brewmaster who was very proud to report he was reducing the water consumption compared to the previous year, and had finally broken a certain threshold.”
As part of its multi-pronged list of 2025 Sustainability Goals, AB InBev is currently aiming to make 100% of its products with renewable energy, which, while great for its environmental footprint, also brings financial benefits.
“Whenever you have these huge fluctuations, we’ll know our energy is stable, so that's another win,” he said.
It also has committed to reduce its carbon dioxide emissions by 25% by 2025, which also will make the company more efficient, he said; a win-win. And in February, AB InBev announced a $10.1 billion sustainability-linked revolving credit facility.
“The whole debate over finance and ESG, that you either choose one or the other, is a false dilemma. I’ve learned since my first week, they go hand in hand,” he said. “The more efficient you are, the more sustainable and more profitable you are."