OVERVIEW

Tobacco is an agricultural crop which, like other farmed goods, faces a number of social and environmental issues. A sustainable supply of tobacco means good agricultural practices being upheld by our suppliers and farmers at all times. All of our tobacco suppliers are required to participate in our Sustainable Tobacco Programme (STP) which is one of our key platforms to ensure our minimum standards are met in the growing and processing of tobacco. We take pride in driving supply chain standards and we are committed to purchasing tobacco from socially and environmentally responsible suppliers.

 

WHY IS IT IMPORTANT?

It is important for us to know that the standards we expect in terms of quality, labour practices and environmental concern are being adhered to by the suppliers from whom we source tobacco. This has a direct financial impact to the business and has the potential to make a significant impact on our business sustainability.

We source tobacco from all around the world including Brazil, India, China and Sub-Saharan Africa. Approximately 95% of our supply is through third party tobacco suppliers. The tobacco supply chain varies from country to county. For example in Sub-Saharan Africa there are tens of thousands of smallholder farmers, compared with the USA where there are large commercial tobacco farms. Despite these differences we apply the STP globally and expect standards to be implemented and aspired to throughout the various geographies and situational contexts.

We also work in all areas of tobacco leaf research, aiming to improve resistance to plant disease and leaf quality amongst other areas. Please see our Science website for more information.

 

WHAT ARE WE DOING ABOUT IT?

We use the information provided through the STP to inform our supplier ratings, focus interventions, enrich supplier dialogue and enable our Leaf Sustainability team to work more effectively to support our suppliers.

We seek to drive continuous improvements through: the STP framework which helps suppliers generate their own action plans; the capabilities that our suppliers build particularly with their Leaf Technicians who support the farmers directly; knowledge sharing facilitated by AB Sustain; leaf partnership investments; and the work of our own Leaf Sustainability Team.

Through the STP, we have determined a baseline performance which is our minimum acceptable standard. If a supplier fails to meet the minimum performance requirements, our preference is to work with them to understand when and how the supplier will reach the standards.

The STP performance score is part of our formal supplier relationship management and it forms part of the suppliers’ ratings that we determine along with quality, cost and value. The better a supplier’s score, the more likely they are to receive repeat business. As a result of our commitment to purchase tobacco from socially and environmentally responsible suppliers, we will cease to purchase from any suppliers who persistently fail to achieve our required performance standards; however our preference is to partner and enable improvement.

 

WHAT ARE THE KEY ISSUES?

CHILD LABOUR

Is unacceptable and we make every effort to stop it happening in our supply chain.

FARMER WELFARE AND LIVELIHOODS

We're partnering with our suppliers to focus support in farming communities.

FORESTRY

We work with suppliers and local community groups to support wood sustainability projects.

FARMER WELFARE AND LIVELIHOODS

Through our leaf partnership projects we are targeting our support to communities in tobacco-growing countries identified as having the most need. We focus our projects on enhancing tobacco farmer productivity, income, reducing labour requirements and improving farming inputs.

This is important in securing quality tobacco supplies for our business and at the same time providing farmers with better incomes, higher standards of living and also mitigating the potential risk of child labour.

We also help address welfare issues such as food security with farmers through the application of good agricultural practices and specific interventions to better enable people to afford food, make land more productive and encourage farmers to grow a range of food crops.

FORESTRY

We use wood in tobacco production, either as a fuel in the curing of tobacco or as construction material when building barns for the processing of tobacco. The issue of deforestation is most relevant to us in Africa, where we work with suppliers and communities to collectively address the issue. We operate a programme that planted 1.1 million trees in 2018 and aims to achieve wood sustainability for our farmers in Africa by 2022. With a sustainable supply of wood, farmers are able to use wood in the tobacco curing process without damaging the local environment.

We are also financially supporting national forestry programmes in Tanzania, Mozambique, Zimbabwe and Malawi, promoting the value of trees to farmers. In addition to the environmental benefits of our forestry programme, there are also economic benefits for farmers in labour savings and the reduced cost of wood and transport.

Our afforestation programme also considers the issue of biodiversity. Where possible, we encourage the planting of trees which encourages the development of local insect and bird populations. These projects improve wildlife habitats and food sources for a number of animal species. Furthermore, The Sustainable Tobacco Programme (STP), which all our tobacco leaf suppliers are required to participate in, encourages suppliers to gather data on areas of biodiversity value in and around the tobacco growing areas to create and implement a biodiversity management programme. This involves mapping of areas of high biodiversity value, such as ponds, watercourses and woodland that may be affected by tobacco production.

Since 2012, we have funded the construction of over 5,000 energy efficient tobacco-curing barns. These barns can use up to 30% less wood fuel compared to standard curing barns.

We disclose additional information on our approach to managing forestry issues through the CDP Forestry submission, please see environmental performance for more information.

APPROACH

Our sustainability strategy is integral to the long-term success of our business and underpins our drive to create shared value for our stakeholders.

CASE STUDIES

Our case studies showcase our progress against our sustainability strategy.

PERFORMANCE

See the progress we’ve made against our key performance indicators during 2018.