Bacardi Global Tax Policy Statement
Global Tax Policy Statement for Financial Year Ending 31 March 2018
This statement describes the global tax policy of Bacardi and applies to Bacardi U.K. Limited and all qualifying UK companies in the Bacardi Group for the financial year ending 31 March 2018. By making this statement public, Bacardi U.K. Limited is fulfilling its responsibilities under paragraph 19(2) of Schedule 19 to the Finance Act 2016.
Founded in 1862, the BACARDÍ rum business, like the family that owned it, was Cuban. In October 1960, revolutionary government forces illegally confiscated all company assets in Cuba – a devastating blow for a business just shy of its 100th anniversary. Shortly after the Cuban Revolution, Bacardi established its global corporate headquarters in Bermuda, which manages all Bacardi global brands. This strategic move served as a geographical bridge between Europe, where Bacardi targeted growth, and the U.S., where its products were already established.
Today, Bacardi is a leading global spirits company. Our Bermuda operations control and manage our global spirits business, as well as give back to the local community as part of our commitment in investing in the areas where we live and work through charitable efforts.
Our Corporate Responsibility Commitment
Our Code of Conduct established by Bacardi’s Board of Directors, applies to all employees and guides our professionals in their key responsibilities, their professional conduct, and how they work with third-party partners. As stated in the Code of Conduct, Bacardi also recognizes the substantial interest of governments in the regulation and taxation of cross border trade in alcoholic beverages. As such, Bacardi and its employees must always abide by all applicable laws related to customs, taxes, cross border trading and transporting of product.
Our Approach to Tax Policy, Oversight and Engagement with Tax Authorities
The Bacardi Group’s approach to tax is to comply with all tax laws and regulations, both in letter and in spirit, in all the jurisdictions in which we operate. We are committed to following all the prescribed measures as set forth in The Organisation for Economic Cooperation and Development Transfer Pricing Guidelines for Multinational Enterprises and Tax Administration (“OECD Guidelines”) regarding transparency, including Country by Country reporting and Transfer Pricing documentation.
Bacardi seeks to cooperate and pro-actively engage in open dialogue with tax authorities, including HM Revenue & Customs, to minimize the potential for disputes. We also disclose any relevant information that is required to enable tax authorities to carry out a sufficient review. We also seek advance agreement with tax authorities where possible and appropriate in the circumstances.
Our Group’s approach regarding tax is overseen by our Global Tax Team which operates under the guidance and control of the Group’s Bermuda-based senior management group, the Global Leadership Team, and is reviewed by our Audit Committee, approved by our Board of Directors, as necessary, and then implemented by our local finance teams.
Bacardi pays the appropriate amount of income tax in countries where our activities take place, consistent with the OECD Guidelines. In addition to direct (income based) taxes, Bacardi is also responsible for other indirect (non-income based) taxes. These include, but are not limited to: value-added tax (“VAT”), excise taxes, customs duties, employer-related taxes, property taxes, capital taxes, and withholding taxes. Where there are complex factual circumstances and/or local laws, we also work with local advisors and subject matter experts to ensure that areas of uncertainty are properly addressed.
Our Approach to Tax Planning and Risk
Bacardi protects the interests of its stakeholders by ensuring that available tax incentives and allowances are claimed where it makes commercial sense to do so. The Global Tax Team works with our local finance managers to manage the tax affairs of Bacardi in the relevant jurisdictions in which it operates. This may include tax compliance, tax planning in response to commercial activities or business needs, tax controversy support and management, tax risks, and ensuring that implementation of Bacardi tax policies are carried out at the local level. Bacardi adopts a conservative approach to tax risk management.
Anti-Slavery and Human Trafficking Statement
Anti-Slavery and Human Trafficking Statement for Financial Year Ending 31 March 2019
Bacardi U.K. is committed to responsible labour and sourcing standards in order to ensure that we are producing and selling our products in a manner consistent with the needs of our key stakeholders and in compliance with all applicable laws and regulations. We believe that with responsible management of our social and environmental impacts, Bacardi will be an even better and more sustainable business in the long term.
Bacardi is active in the UK through Bacardi U.K. Limited and its UK subsidiaries: Bacardi-Martini Limited, Bacardi-Martini Corporation Limited, John Dewars & Sons Limited, and the Bombay Spirits Company Limited. In these companies, we employ approximately 650 employees across the United Kingdom.
Our Supply Chain
We source high-quality ingredients and raw materials from many countries around the world, including those places where achieving good workplace standards, environmental protection and sound governance can be complex. Nonetheless, we want to ensure that the companies from which we purchase products and services are operating in an ethical and responsible manner and therefore have put in place robust Responsible Sourcing Standards based on The Ethical Trading Initiative (ETI) Base Code, the Fundamental Conventions of the International Labor Organization (ILO), and the United Nations (UN) Universal Declaration of Human Rights.
Our Responsible Sourcing Standards apply to all suppliers providing goods and/or services to Bacardi and encompass what we expect from our suppliers in terms of labour standards, human rights, health and safety, environmental protection and business integrity. We seek to gain agreement on, and compliance with, our Responsible Sourcing Standards from all our suppliers. They represent minimum standards, and we encourage suppliers to implement even higher standards within their operations. In addition, suppliers are expected to promote our Standards to their staff and subcontractors, and are expected to promote and assess compliance with the Responsible Sourcing Standards with their own suppliers.
We also partner with Sedex, the largest collaborative platform for sharing ethical, supply-chain data. This organization provides a third-party Audit Management Service which enables Bacardi’s suppliers to drive and report in accordance with an audit program based on Ethical Trade Audit Protocol (SMETA).
Our Relevant Policies
As a signatory, we are aligned with the principles set forth in the United Nations Global Compact, that encourage the adoption and reporting of sustainable and socially responsible policies. These standards guide our overall approach to Corporate Responsibility and how we communicate our progress.
As the first principle in our Responsible Sourcing Standards, we make clear that employment is freely chosen.
• There is no forced, bonded or involuntary prison labour.
• Workers are not required to lodge “deposits” or their identity papers with their employer and are free to leave their employer after reasonable notice.
As per Bacardi’s Code of Conduct, we also aim to maintain a working environment in which all employees are treated in a professional manner based on mutual respect and free from verbal or physical harassment, intimidation or abuse.
Training our People
All employees receive a copy of, and are trained on, our Code of Conduct and we also operate an annual certification system to ensure continuing compliance. In addition, relevant employees who work with our suppliers are trained on our Responsible Sourcing Standards and we work with our suppliers to ensure they comprehend and abide by our standards.
Supplier Adherence and Tracking Performance
All of our contracts with suppliers require compliance with all applicable laws, the Bacardi Code of Conduct and our Responsible Sourcing Standards, which do not tolerate any form of slavery or human trafficking. We communicate any reports of slavery or human trafficking through our annual responsibility reports.
This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes our slavery and human trafficking statement for the current financial year.
Gender Pay Gap Report 2018
JOHN DEWAR & SONS LIMITED (“Company”)
The gender pay gap shows the differences in average pay between women and men across the Company as a whole. It does not measure equal pay, which relates to what women and men are paid for the same or similar jobs or work of equal value.
Population split by male/female employees:
- 76% Male
- 24% Female
Median gender pay gap:
Median bonus pay gap:
Mean gender pay gap:
Mean bonus pay gap:
Males/Females receiving a bonus payment: 75%/70%
Understanding the mean gender pay gap and bonus pay gap
The director level roles in the company are currently held by men. A senior executive transferred in from another group company and there were payments to some directors during the year of a long term incentive bonus. This explains both the mean gender pay and mean bonus pay gap.
Removing the director level roles from the calculations would change the Mean gender pay gap to -3% and the Mean bonus pay gap to -21.8%
All employees are eligible for a bonus but must have completed at least 3 months’ service.
We had a high number of new joiners in 2018 which explains why the actual % receiving a bonus is not 100%. There were more female new joiners as a proportion of the female population than there were males joiners as a proportion of the male population. This explains the difference in males / females receiving a bonus payment.
Proportion of males and females in each quartile* pay band (Female%/Male%):
- Upper quartile: 28% F / 72% M
- Upper middle quartile: 14% F / 86% M
- Lower middle quartile: 29% F / 71% M
- Lower quartile: 25% F / 75% M
*Quartiles are based on hourly pay rates
2017 Gender Pay Gap Report Submission Correction
Whilst preparing our submission for the 2018 report, we became aware that long term bonus payments were inadvertently omitted from the 2017 figures, when they should have been included, as was a one off moving bonus for a director who had been internationally relocated. An employee had also been wrongly classed as ‘relevant’ when they should have been classed ‘full pay relevant’.
In order to fully comply with the spirit of the reporting requirements we have recalculated the data for the snapshot as of 5th April 2017 to include these long term bonus payments, one off moving bonus, and incorrect employee classification. The resultant changes in the key metrics are as follows:
5th April 2017
|Corrected Figures for
5th April 2017
|Mean Gender Pay Gap||6.20%||8.50%|
|Median Gender Pay Gap||-3.20%||-10.60%|
|Mean Gender Bonus Gap||-1.60%||17.50%|
|Median Gender Bonus Gap||-14.60%||-10.60%|
The 2018 Company report includes long term bonus payments.
Last year, we also reported that the % of Males/Females receiving a bonus payment was 100%/100%. This was another unintentional error on our part in the understanding of what should be included. The 100%/100% statistic referred to eligibility for a bonus but as some employees had not completed the minimum 3 months’ service, they did not actually receive a bonus payment during the year. The correct % for Males /Females actually receiving a bonus payment was 81%/79%.