CLIMATE AND ENERGY
We are not an energy intensive company however we acknowledge our global reach and influence in addressing concerns over climate change. Disruption in climate and energy has the potential to impact our business across the value chain, from crop production to manufacturing and distribution.
In line with the recommendations from the Taskforce on Climate related Financial Disclosure (TCFD) we have begun exploring what different scenarios of increasing global temperatures would mean to our business across our value chain. The results of this work, along with our recent LCA, have supported the development of our refocused environmental strategy and our long-term targets.
Changes in weather systems such as rising temperatures and increases in average rainfall, frequency of heavy rainfall and hurricanes are considered to be a risk for our business. We monitor this risk and put in place intervention or mitigation measures where necessary. One example of how a climatic event has impacted our business occurred in January 2020. Our operations in Madagascar received extremely heavy rainfall, with 50% of expected seasons rainfall in five days, resulting in extensive flooding on the small-holder farms and our commercial operations. Following a detailed assessment a three-year investment plan was approved by the Executive Committee to strengthen the infrastructure of the site.
We work with our tobacco suppliers, to provide farmers with advice and tools to protect their crop against the changing elements. This includes vegetative methods, such as the use of grasses like vetiver which are extremely effective barriers to prevent soil erosion. These simple solutions can have a huge impact on crop protection from flooding and erosion. See case studies for more information.
We reduce our direct impacts through energy efficiency and carbon emissions management. We reduce our indirect impacts and realise opportunities by working with our suppliers, who disclose how they are managing their climate and water related risks and opportunities and provide data to help inform and improve our scope 3 performance.
Where appropriate we have invested in renewable energy, understanding that solar, wind and geothermal generated energy can provide benefits in terms of reducing our greenhouse gas emissions, energy security, cost stabilisation and protection against energy price volatilities.
We have energy saving projects at several sites, including the USA, Morocco, Poland, Russia and Spain and continue to assess opportunities at our higher-energy consuming manufacturing sites. We also have renewable energy sources at our factories in Laos (hydropower) and the Netherlands (thermal).
In 2020, we have worked closely with our procurement teams to investigate how we can increase the amount of direct energy we procure from renewable sources across the business. This is an ongoing project and we hope to report on the outcomes in 2021.