Kirin Holdings should end its partnership with Myanmar’s abusive armed forces according to several human rights organizations including Human Rights Watch, Human Rights Now, Japan Volunteer International Center, and Shapla Neer. “Kirin is putting money right into the pockets of Myanmar’s military, which is responsible for countless atrocities against the Rohingya and other ethnic minorities,” said Phil Robertson, deputy Asia director at Human Rights Watch in a letter to Kirin on May 22, 2020. “Kirin should repair its damaged reputation by disentangling itself from the Myanmar military’s business conglomerate and its abusive armed forces,” he added.
The entanglements with the military in Myanmar date from 2015 when Kirin bought a majority stake in local beer market leader Myanmar Brewery from the military-backed Myanmar Economic Holdings (MEHL). Two years later, Kirin bought another majority stake in Mandalay Brewery (inside.beer, 12.2.2017) with the rest still in hands of the seller.
According to a United Nations fact-finding mission report from August 2019, the business partnership with Kirin provides the much-needed foreign currency for the isolated Myanmar military. Revenues from the joint-venture in the two breweries help the military to finance their apparatus of oppression. The Tatmadaw, as the armed military forces in Myanmar are also known, are accused for grave violations of human rights against ethnic minorities like the Rohingya. In addition, Kirin was also named in the report as having donated USD 12,000 to the Myanmar military
As a direct response to the UN report, Kirin’s President and Chief Executive Yoshinori Isozaki said in an open statement in February the company was “closely monitoring the current situation and reviewing strategic options for [the] operations in Myanmar.”
In order to discuss the accusations, Kirin met with the management of MEHL and also sought the strategic advice of its International Advisory Board (IAB) on this matter. The IAB is a consultative body to the CEO of Kirin Holdings on the Group’s global growth strategies, risk management and corporate governance. It is composed of three executive officers of the Kirin Holding and four international experts from outside the Kirin group. It is currently headed by Gavin Walker who has had a long career in investment banking, having previously held the roles of Chief Executive of Bankers Trust Australia Investment Bank and member of the Business Council of Bankers Trust Company in New York.
On June 6, Kirin announced in another statement that it “has appointed Deloitte Tohmatsu Financial Advisory LLC to conduct an independent review of MEHL’s financial and governance structures to determine the destination of proceeds from the joint-venture businesses Myanmar Brewery Limited and Mandalay Brewery Limited as a matter of urgency.
“Kirin is exploring alternative structural options for the ownership of the Myanmar joint-ventures as part of a review of the business relationship with MEHL,” the company said. “While the COVID-19 pandemic continues to pose further significant challenges to advancing this process swiftly, we are making every effort to address the issue as quickly as possible.”
On June 12, Kirin finally responded to the letter of the human rights organizations and confirmed to “address the concerns raised by the international community regarding our business operations in Myanmar.” The company is “considering all actions and options available to us that will lead to a positive outcome for the people of Myanmar.”
Kirin also stated that “it is wholly unacceptable to Kirin that any proceeds from the joint-venture with the MEHL could be used for military purposes.”