Lorenzo Mendoza Giménez • Commitment to country and core business

Photo: Courtesy of Empresas Polar

CEO, EMPRESAS POLAR
2009 SOCIAL RESPONSIBILITY CEO OF THE YEAR

“I don’t go through life asking for advice, but I look and listen,” said Lorenzo Mendoza Giménez, CEO of Empresas Polar. “I listen, and then it’s up to me to cut up the pie and be responsible. If one does well, fine, and if one does badly, he has to get up and leave,” he added. He doesn’t think there are jobs you can stay in for life, not even in a family business. “We’re here to give results to everyone: to the workers, the customers, the shareholders. If you don’t do that, you shouldn’t be here.”

With that kind of vertical commitment, accompanied by the sensitivity and cordiality with which he approaches the officers in his organization, Mendoza Giménez has changed the direction of the group he joined in 1992 after his father died. He thinks the most important decision of the last 20 years at Empresas Polar was focusing on the core businesses. Like many Latin American conglomerates, his firm had gone into business in a variety of areas with local or international partners. The group was in petrochemicals, in the banking business when BBVA arrived in Venezuela, in trade with Makro and the Colombian company Cativen. “We decided to focus so that we would have clear capabilities, to enable us to operate in a Latin America that was moving toward integration and a higher level of competitiveness,” he said.

To do that, Polar concentrated on food and beverages and divested from other sectors in an orderly fashion, or else changed from controlling to minority interests. Now he doesn’t expect to expand again without this focus.

The hardest decision of all for the group in the last two decades was to stay in Venezuela. However, in spite of having other options, and unlike many others who left the country, they decided to stay, and today Mendoza Giménez thinks that was a wise decision. “It was the hardest one, but also the one that has given me the most satisfaction,” he said.

His Venezuela operation hasn’t been easy. “We’ve had to struggle with a country that has been trying to find its way. But we are a company with deep roots in Venezuela. We are first and foremost a Venezuelan company,” he said.

They have expanded quickly into other regions of Latin America – in Mexico and Colombia through acquisitions, although now Colombia has become less attractive for buying because companies there have risen so much in price. “One has to be disciplined and not think something that is extremely expensive is going to add value,” he said. All in all, they continue to take advantage of the possibility of exporting from Colombia, and from there, they serve 30 markets. They are also looking at the possibility of going into Peru, a country they see as having great potential.

Still, Mendoza Giménez thinks that in the food and beverage sector, the best way to expand in the region is through local companies “with business models where there are neither conquerors or conquered.” With this type of plan, they identify the strengths of each one and what they bring to the partnership.

The performance of food companies also depends on the prosperity of agriculture. Lorenzo Mendoza knows this and so Empresas Polar has established agricultural research centers. “We have some very successful models in Venezuela,” he said. He promotes the use of local seeds among groups of producers and commits himself to buying their products at fair prices, because he finds that the yields from local primary products are higher than those from imported ones. “I would, a thousand times, rather buy local corn than imported corn. That’s because the levels of productivity that I have with grains, of white Venezuelan corn for example, are far superior to those of corn imported from the American Sun Belt, or from Canada or Europe. He thinks that with the support of the private sector, the rural areas can become a competitive tool.

Lorenzo Mendoza was born in 1965, and is very aware that people of his generation are starting to assume the presidencies of the largest Latin American companies. He believes the new leaders have good academic educations, are transparent and understand the need to be competitive. “They don’t depend only on their family names.” Mendoza Giménez’s academic – he is a MIT graduate – and business achievements provide a good example of the truth in this observation.


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