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Grupo Bimbo: Maintaining Culture Amid Growth

Ignacio Stepancic, Chief Compliance Officer, Grupo Bimbo

When it was founded 74 years ago, Grupo Bimbo began as a family owned company, but it would go on to revolutionize the baking industry in Mexico. From day one, acting with ethics and integrity has always been part of the company’s philosophy and its only way of doing business.

In 1989, the company’s cross border expansion began, entering into Central America. In the years to follow, Grupo Bimbo expanded to South America, the United States, China and Spain. In 2011, we became the largest baking company in the world, now operating in 32 countries with almost 135,000 associates. With this fast-growing footprint and a solid cultural philosophy, in 2014 the company began a journey to implement Grupo Bimbo’s Compliance Program.

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Today, Grupo Bimbo has a presence on four continents and in 32 countries, including many with high perceptions of corruption, far away from Latin America. So, how can we maintain a culture of ethics and integrity throughout the whole company in such a fast-growing environment, especially when much of our growth has required mergers and acquisitions?

Due Diligence before M&A

First of all, we start from the premise that every company has a culture, some more similar to Grupo Bimbo’s and others significantly different. A merger or acquisition is not destined to fail if there are cultural differences. However, addressing them immediately, establishing the importance of compliance requirements, and monitoring the implementation of the program are all essential to minimizing any risk and promoting a homogeneous culture of ethics and integrity.

Before an M&A opportunity, as part of the anti-corruption due diligence, Grupo Bimbo performs an integrity due diligence. We address two topics: what is the local compliance risk level in the country where the target company operates, and what type of culture does the company have?

Besides international risks maps, matrixes, and indexes to get a sense of the local challenges, a clear way to get a much broader and well-rounded sense of the specific organizational culture is to communicate with associates in operations, sales, and administrative departments.

Once the M&A process has ended, the implementation of the compliance program begins. The implementation strategy is deployed including the following elements:

Mavín Domínguez, Global Compliance Manager, Grupo Bimbo

Commitment from All Levels

We’ve all heard the term “tone at the top” as one of the main elements of a compliance program, and it truly is. The commitment to ethics from the Board of Directors, CEO, and VPs is fundamental to the effectiveness of any compliance program. However, in a company with over 135,000 associates, commitment must come in all levels of management, or as we put it, “tone from all leaders.” Especially in new acquired companies, commitment from leaders becomes a must-have.

Risk Assessment

Conducting a risk assessment after any M&A is necessary to visualize risks and areas of opportunity. Grupo Bimbo does a risk assessment after the completion of any M&A as part of the compliance program implementation. The results from this activity lets us know where there are pain points, and provides the input to plan the program for the next couple of years. It’s a great way to get a clear picture of the new acquired company.

Awareness and Education

In order to spread Grupo Bimbo’s culture to new associates, we give onsite training on the company’s philosophy, model and global policies. Brochures, videos and visual aids are posted in the facilities, intranet, internal educational programs (GB University) and handed out to associates. Constant communication of initiatives, achievements, Speak-Up Line (hot line) and the philosophy itself is key to not only implement culture, but to achieve commitment from associates.

To measure the effectiveness of the activities mentioned above, Grupo Bimbo established KPIs to monitor the implementation:

  • Percentage of completion of training: Number of associates trained.
  • Percentage of effective compliance training: Number of associates who passed the quiz after training.
  • Number of reports: Speak-Up Line reports.
  • Number of views in intranet to compliance related communications.

By performing due diligence about culture and compliance before any merger or acquisition, getting commitment from all levels, performing suitable risk assessments, and following through with awareness-raising measures, Grupo Bimbo ensures that our culture spreads to all new associates around the globe.

About the Author:

Ignacio Stepancic is the Chief Compliance Officer of Grupo Bimbo. In this role, he is in charge of the design, implementation, management, and control of the compliance program in 33 countries, including anti-corruption policies, anti-money laundering prevention, data privacy, and conflicts of interest. He is also in charge of internal and external integrity processes, M&A integrity due diligence, internal and external training, background checks, and antitrust issues.

Mavín Domínguez is a Global Compliance Manager at Grupo Bimbo. In this role, she is responsible for coordinating the implementation and continuous improvement of the compliance program in the 33 countries where Grupo Bimbo operates, including training and communication, due diligence, risk assessments, global policies, and monitoring in anticorruption, anti-money laundering, and data privacy.

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