A sustainable approach
We have a long and proud history of sustainability achievements, but today we are transitioning from being a business where sustainability has always been important to one where it is front and centre in all that we do.
The Sustainable Future pillar of our refreshed corporate strategy re-emphasises our overarching goal of creating A Better Tomorrow™. Science will continue to be a primary driver of our efforts. We will support the science behind smokeless products through more active external engagement, including with regulators. We will work to provide more consumers around the world with access to smokeless products. Of course, further embedding sustainability and integrity into all of our activities will continue to be a priority.
Our sustainability priorities
Our strategic purpose is to create A Better Tomorrow™ by Building a Smokeless World.
Over the last 10 years, we have developed and deployed a portfolio of reduced-risk products*† , tailored to meet the evolving preferences of adult consumers.
Our Sustainability strategy focuses on four cross-cutting Sustainability Priorities:
- Responsible Leadership in New Categories;
- Create Positive Value in Agriculture;
- Deliver Net Zero GHG Emissions Across our Value Chain; and
A Trusted Organisation, Operating with Integrity. Through these priorities, we believe we can make a real difference for consumers and other stakeholders across our business and value chain, and for the wider society.
As the world around us evolves, so too will our approach to sustainability. We will continue to challenge ourselves to take a forward-looking approach to our products, our governance, our stakeholder engagement, our goals and targets, and our reporting.
Our four cross-cutting focus areas broadly encompass our material sustainability topics – as defined by our 2023-updated DMA.
They are grounded in our everyday business and are key elements of how we interact with our consumers, suppliers and value chain partners, employees, investors and other stakeholders.
We will continue to work in partnership with all our stakeholders to deliver against our Sustainability Priorities.
The diagram below sets out our sustainability strategy focuses on four cross-cutting Sustainability Priorities in full and you will be able to read more about the agenda and our progress against it in our BAT Combined Annual and Sustainability Report 2023 (8.0 mb).
Our four Sustainability Priorities
We aim to address Harm Reduction and contribute to Building a Smokeless World by setting industry standards for the development, manufacture, circularity and marketing of New Category products.
Key areas and initiatives
- Continuing investments and innovations to reduce the health impacts of our products
- Improving circularity to reduce the environmental impact of our product portfolio
- Responsible sourcing and marketing standards
By leveraging our agricultural sourcing model – directly contracting with more than 91,000 farmers, who delivered c. 73% of the tobacco volume we purchased in 2023 – we seek to deliver a positive impact in our agricultural supply chain, particularly with respect to social and environmental issues.
Key areas and initiatives
- Positively addressing Human Rights matters and Farmer Livelihoods
- Demonstrating leadership in and a positive impact on Biodiversity
- Responsibility addressing other relevant topics, such as water
We aim to reduce Scope 1 and 2 GHG emissions by 50% and Scope 3 GHG emissions by 50% by 2030 (vs a 2020 baseline1 ) and to reach Net Zero GHG emissions across our value chain by 2050 at the latest. We recognise that our business and wider society relies on natural resources which will be impacted by the effects of climate change, and that we must work to adapt to those effects.
Key areas and initiatives
- Decarbonising our own operations (Scope 1 and 2 GHG emissions)
- Decarbonising our value chain (Scope 3 GHG emissions)
- 'Carbon Smart' farming in our agricultural supply chain (Scope 3 GHG emissions)
Note:
1. Compared to a 2020 baseline. Our near-term 2030 science-based targets comprise a 50% reduction in Scope 1 and 2 and 50% reduction in Scope 3 GHG emissions. Scope 3 emissions target includes purchased goods and services, upstream transportation and distribution, use of sold products and end-of-life treatment of sold products, which collectively comprised >90% of Scope 3 emissions in 2020.
We are committed to always operating to the highest standards and in full adherence to our Standards of Business Conduct (SoBC). We are working to create and maintain a culture where our people are proud of the role they play in driving our transformation.
Key areas and initiatives
- An ethical, trusted and respected company and culture
- Attracting, developing and retaining a talented, diverse workforce
- Zero tolerance towards health and safety and business conduct incidents
Progress in 2023
Responsible Leadership in New Categories
- Our cross-sectional studies demonstrated a reduction*† in biomarkers associated with negative health impacts for those who switch from cigarettes to Velo or Vuse as compared to continued smoking
- 28.2% reduction in waste generated, vs 2017 baseline, achieving our 25% reduction target two years early
- 94% of packaging was reusable, recyclable or compostable
- Initiated a project to review and refresh our International Marketing Principles (IMP) and supporting guidelines
Create Positive Value in Agriculture
- We implement sustainable agricultural practices and support farmer livelihoods through monitoring and sharing best practices
- 10 Human Rights Impact Assessments (HRIA) conducted by year-end 2023
- 39.2% reduction in water withdrawn in our direct operations, vs 2017 baseline; achieving our 35% reduction target two years early. Our goal is to support water resource availability in the catchments where our operations are located
- 93.3% of farmers in our Thrive Supply Chain reported to be also growing other crops
A Trusted Organisation, Operating with Integrity
- iCommit training to drive IMP and UAP compliance incorporated into the onboarding process for all new employees
- Lowest Total Recorded Incident Rate for accidents in BAT’s global historical data
- Updated our SoBC Assurance Procedure so that all cases are triaged and assigned accordingly.
- Set a new ambition for 40% of our Management Board members globally to be ethnically diverse by 2027
- 100% of key leadership teams have at least a 50% spread of distinct nationalities across our management employees
Deliver Net Zero Emissions Across our Value Chain
- 33.1% reduction in total Scope 1 and 2 (market based) CO2e emissions vs our 2020 baseline
- 10 Golden Rules Programme developed to standardise how we run operational sites in the most energy efficient way
- Invested £24m in capital expenditure to support emissions reductions and energy efficiency initiatives
- 600+ suppliers invited to provide data through the CDP Supply Chain Programme in 2023
Notes:
* Based on the weight of evidence and assuming a complete switch from cigarette smoking. These products are not risk free and are addictive.
† Our Vapour product Vuse (including Alto, Solo, Ciro and Vibe), and certain products, including Velo, Grizzly, Kodiak, and Camel Snus, which are sold in the U.S., are subject to FDA regulation and no reduced-risk claims will be made as to these products without agency clearance
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