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'NO EVIDENCE OF AN IMMINENT THREAT': CARLSBERG

Carlsberg steps up security at Malaysian brewery on Islamic State attack threat

18-Aug-2014
Last updated on 18-Aug-2014 at 18:27 GMT - By Ben Bouckley+
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Carlsberg tells BeverageDaily.com it is maintaining heightened security at its Malaysian brewery near Kuala Lumpur, after sympathizers of terrorist organization Islamic State told police they had planned to attack the facility.

Last Monday the South China Morning Post quoted a senior official for Malaysia’s Special Branch Counter Terrorism Division who said his staff had arrested around 19 people for links to the terror organization over the past seven months.

Questioned by police, the militants said they wanted to attack the government, Khan said, adding that they also discussed “planning attacks against a disco, pubs in Kuala Lumpur and a Carlsberg factory in Petaling Jaya”.

Today Carlsberg confirmed the news to this website. International media relations director, Kim Daniell told this website: "Carlsberg can confirm that it has been in contact with the Malaysian authorities, following reports of a planned attack on one of its breweries in Malaysia.

"While no tangible evidence has been found of any imminent threat, Carlsberg is maintaining a heightened security presence at the facility for the time being," he added.

No tangible evidence of imminent threat 

Daniell said the safety of employees was of the utmost importance to Carlsberg, "and we have procedures in place around the world to ensure safe working environments". 

"Please understand that we do not discuss details of our security arrangements, as doing so would be detrimental to their effectiveness." he added.

Carlsberg has brewed its eponymous beer at the brewery in Selangor southwest of Kuala Lumpur since 1972, and the company claims the brand has a 50%+ share of the nation’s beer market.

Sharia Law opposes drinking alcohol

Of course, terrorists pose a threat to international companies in general, not just Carlsberg – although the alcoholic drinks dimension suggest such companies may face higher risks – the Islamic State (formerly ISIS) endorses Sharia Law which forbids the consumption of alcohol.

In his 2005 paper published in Major Themes in Economics, ‘Terrorism and Multinational Corporations: International Business Deals with the Costs of Geopolitical Conflict’, John Mazzarella notes the costs to multinational businesses of terrorist organizations.

“As multinational corporations continue to operate across international boundaries, they will undoubtedly continue to clash with fanatical terrorist groups bent on achieving political goals through violent means,” he writes.

Mazarella warns that terrorists will continue to target the staff, facilities and operations of multinational firms – protecting these is a drain on resources and managerial talent.

Terrorism – Counting the business cost

One cost could involve upgrading personnel, property and plant security in high-risk regions, Mazzarella says. For example, closed-circuit TV, metal detectors and reinforced doors for executives.

Employing security consultants is another option, where they provide multinationals with detailed economic and political risk assessments of different geographies and advise on company strategy.

Global supply chains are also vulnerable to terrorist attack, Mazzarella warns, noting increased shipping costs to secure sea freight due to piracy in Southeast Asia in particular, and the risk of disruption or delay due to terrorist activity.

“Global terrorism creates significant business costs for multinational firms that must first be understood by managers and then minimized to the greatest extent possible,” he writes.

“To do otherwise would not only degrade the overall health of the global economy but also serve to encourage more terrorist violence against multinational corporations in the future.”

Carlsberg reports its Q2 2014 results on Wednesday, with the Russia/Ukraine crisis expected to weigh on the group’s results.

*Article updated 18:00 BST to include Carlsberg statement.

Related topics: Emerging Markets, Manufacturers, Regulation & Safety, Carlsberg, Beer, Wine, Spirits, Cider