LIPTON Teas and Infusions has agree to terms of a partnership that will result in the transfer of its tea estates in Kenya, Rwanda, and Tanzania to Browns Investments alongside an agreement that all tea sold by Browns worldwide will be grown and harvested to a new set of standards covering quality, social, and environmental protections.
This long-term partnership will make Browns the world's leading tea exporter, with around 87 million kilograms each year, as well as one of the largest suppliers to the world's largest tea company, LIPTON Teas and Infusions.
By working together, the two companies will raise tea quality globally and accelerate the application of responsible farming methods across the industry to drive sustainable growth.
"Browns is the perfect partner, with the credibility, capabilities, and scale to work with us to raise standards in the whole tea industry," says Nathalie Roos, CEO of LIPTON Teas and Infusions. "The team's commitment to sustainability and community development aligns with our own. Together, we are setting a new precedent for transforming the global tea market--one cup at a time."
Developed together with producers across East Africa and beyond, LIPTON Teas and Infusions has established a series of rigorous standards that span critical areas of tea quality, human rights, climate mitigation, and nature protection. A scorecard-based approach that recognizes tangible progress by producers has been designed to encourage rapid and meaningful action.
Browns will invest in its estates in Kenya and Sri Lanka to meet the new standards by 2025, as well as in the creation of additional skilled employment opportunities in Kenya. This includes initiatives on its existing Sri Lanka and Kenyan estates, such as factory modernization and crop diversification in support of biodiversity. Browns also commits to maintaining and extending all environmental and social practices already in place on the LIPTON Teas and Infusions estates.
The proceeds of the investment will be reinvested into the East Africa region to drive local and industry-wide progress in relevant areas like skills development and climate change mitigation.
Further funding in education will expand the reach of the recently inaugurated Lipton Tea Innovation & Technology Academy in Kabianga, Kenya. The Academy provides vocational training as well as bachelor's, master's, and PhD level courses to develop the highest standards of tea cultivation, harvesting, and processing. Additional funding will allow for extra programs, more student places, and the digitization of the curricula to provide online learning for maximize accessibility and impact.
Other initiatives will support climate change mitigation and resilience efforts. LIPTON Teas and Infusions, for example, will lead the development of a self-sustaining ecosystem for green and/or low nitrogen fertilizers in the region, enabling a step change in the finances of growers - as fertilizer is typically among the largest costs of production - and achieve an acceleration toward net zero for the entire industry.
The Government of Kenya has supported the companies in identifying opportunities for local communities to benefit from the partnership and future growth of the industyr. Shares totaling 15% of the main Kenyan operating company will be offered to the communities of Kericho and Bomet, where the estates are situated, at a substantial discount to create accessible communal equity and mutually aligned economic participation. LIPTON Teas and Infusions and Browns are also jointly creating a Community Welfare Trust with an initial one billion Kenyan shillings dedicated to helping address other needs of local and neighboring communities.
In addition to the offer of shares, which includes a guaranteed annual dividend payout, Browns will pay an above-market premium to Kenyan smallholders to produce superior quality tea. Offering double what farmers would previously have received will incentivize a shift from quantity to quality, while securing a substantial uplift in farmers' livelihoods.
All these efforts will further contribute to LIPTON Teas and Infusions' collaboration in the country's development of the "Kenya Origin" mark for tea, symbolizing sustainable quality and unique geographic characteristics.
"We look forward to working hand-in-hand with LIPTON Teas and Infusions and local partners to foster a sustainable, responsible, and prosperous future for all," says Kamantha Amarasekera, Chief Executive Director of Browns Investments. "This partnership marks a significant step towards elevating the industry as a whole, while also ensuring a positive impact on the livelihoods of the communities we serve."
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