Local wealth creation
We have a strategic interest in ensuring that our value chain is both commercially and ethically robust. Doing so underpins our success and contributes to local economic prosperity.
Like most businesses, we create wealth directly for our local stakeholders through our daily business operations, including providing jobs, sourcing locally, and paying local duties. However, creating wealth in a lasting way requires more: we must work with local people to address development challenges such as education and health, and advocate high standards of governance in the communities where we operate.
This work is only going to become more important as our presence in high growth markets increases: recent investments, namely in Turkey, Brazil and India, are shifting Diageo’s centre of gravity. These markets represent over 40% of net sales today and are expected to represent 50% by 2015. Contributing to economic and social development will become core to our business success and reputation in those regions, as it already is in the markets where our production footprint is long-standing and well‑established.
There are many ways that our business created wealth for its local communities this year. For example:
- We employed an average of 28,410 people in 2013, with 54.6% from high growth markets in Africa, Latin America and Caribbean, and Asia Pacific
- In Kenya, Ghana and Nigeria, we contributed 6%, 3% and 0.7% respectively of the government’s total tax receipts
- Some of our subsidiaries are publicly listed on local stock exchanges, where investors receive dividend payments and potential capital growth; in total we have over 100,000 local shareholders in high growth markets.
- We also create wealth through sourcing our core ingredients and packaging, for example we purchase about 180,000 tonnes of grain from farmers in Africa, as discussed in the sustainable agriculture section of this report
Performance against target
|Target by 2015 ||2013 performance ||Cumulative performance (2011-2013) ||Achievement
|Source 70% of raw materials used in African operations from Africa
- Given that this number represents agricultural raw materials only, we are confident that, once we include all raw materials in our reporting, we will be on track to achieve our target.
The cash value added diagram below illustrates our total direct cash contribution to the global economy. Roll over the circles marked with a ‘+’ to learn how our revenue flowed to stakeholder groups in our value chain.
Cash value added in 2013
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