NORTH SOUTH UNIVERSITY

BRITISH AMERICAN TOBACCO

SUBMITTED TO:
Barrister Sarah Hassan
Lecturer
Department of Philosophy

SUBMITTED BY:
NAME ID
Nazam Bhuiyan Jim 1411922030
Md.Ashiqur Rahman Nabil 1230483620
Md. Siddiqur Rahman 1410751030
Shadman Ahmed 1421018030
Sujat Mohammed Hasan 1330426630

Barrister Sarah Hassan

Lecturer
Department of Philosophy

North South University

Dhaka, Bangladesh

Re: Submission of the report

Dear Miss,

With due respect, we are pleased to inform you that we have successfully completed the project
you had assigned to us for the PHI401 course for Fall, 2016.

We humbly request you to accept this report for your kind evaluation. We are immensely
thankful for the support we gained from you throughout the course and we hope that our
knowledge and understanding is portrayed through our report.

Regards,

Nazam Bhuiyan Jim

Md.Ashiqur Rahman Nabil
Md. Siddiqur Rahman
Shadman Ahmed
Sujat Mohammed Hasan

INTRODUCTION
British American Tobacco came into the market and went international over 100 years ago. They
now employ over 55,000 people and are the second largest stock market listed tobacco group in
the world. They are now operating in over 180 markets, positioned in all regions of the world.
Their vision is to achieve leadership of the global tobacco industry through strategies focused on
delivering growth, improving productivity, demonstrating responsibility and developing a
winning organization. They have proved that these are working well and they continue to build a
business that is sustainable and aim to create long term value for their shareholders.

COMPANY LOGISTICS

The company logistics are to improve fuel efficiency, which they are doing by using their trade
marketing and distribution that are responsible of delivering their products to retail customers.
Then they aim to reduce both environmental impacts and costs and they are pairing with their
logistics partner, DHL, piloting a number of initiatives including trialing an aerodynamic haulage
trailer and an energy and CO2e assessment for the logistics network operating to and from a
warehouse in the Netherlands, by which they have reduced CO2 emissions by 5.9%.In the future
they want to investigate route planning and changes to vehicle design to achieve further
reductions.

SOCIAL ACCOUNTING PROCESS

Social accounting, commonly used in business or corporate social responsibility is the process of
measuring, monitoring, and reporting to stakeholders the social and environmental effects of an
organizations actions.

BAT believes that a business must claim responsibility in everything it does; they say that
responsibility is a way of life for them. As a responsible Company, BAT Bangladesh believes that
the business has a key role to play in helping society to achieve the necessary sustainable balance
of economic growth, environmental protection and social progress and so they emphasize on
their sustainable agenda, focusing on three key areas: harm reduction, sustainable agriculture and
farmer livelihoods and corporate behavior. British American Tobacco is involved in various CSR
activities. For instance, in an agriculture-centric country like Bangladesh, BATbd remains
partners of the farming families and enhances their lives through related activities for social
change.

Afforestation: BAT Bangladeshs flagship CSR program:

BATs afforestation program was initiated in 1980 when a call of help was made by the forest
department on the private sector to support its endeavor to conserve the forests and this has
resulted in BAT contributing around 79.5 million saplings to the countrys afforestation initiative
in the last 34 years and getting the title of being the largest private sector driven afforestation
effort in Bangladesh for which they were awarded in 2014.

Safe drinking water: Bringing smiles to one hundred thousand people everyday

BAT Bangladesh stepped forward with a safe drinking water project, when the gravity of water
and sanitation was recognized in the context of the Millennium Development Goals after they
have been a part of the safe drinking water initiative, naming their initiative probaho, BAT
Bangladesh has successfully already installed 53 filtration plants to make water free from arsenic
and other harmful contents in arsenic prone areas in the country. All the 53 plants now purify
270,000 liters of drinking water, meeting the need of 135,000 people every day.

Solar home systems: Bringing ray of hope in rural communities

BAT is also highly involved in providing Solar Home Systems free of cost to rural communities
of the country which are currently out of electricity because of their contribution, named Deepto
meaning Light, now more than 8000 rural people are connected with electricity for the first
time. This has positively impacted so many lifes and will be remembered for their contribution
by bringing in a completely new dimension in the lives of people and progressing it with the
power of energy.

Apart from these BAT has been successful in exploring alternate fuel and has replaced almost
100% of fuel cured variety(FCV) with alternatives such as jute stick, paddy straw, rice husk,
industrial waste etc. these alternate fuel have increased in their use and has gotten popular in
many areas.
BAT has trained farmers on biodiversity as they understand their impact on biodiversity through
their business operations. It exhibits the extinct species and their inputs for conserving nature.

Integrated Pest Management Club:

Sharing their knowledge with farmers about the nonchemical alternatives to pest management
and safe use, the aim is to recued agrochemicals.

Green Manuring with Dhaincha:

BATB provides free seeds for plugging which are sowed in the fields and after these plants
known as sun hemp (Dhoincha) reaches a certain height they are ploughed and mixed with the
soil. This cultivation of sun hemp increases soils organic composition and is an ecofriendly
sustainable method of soil enrichment. Social contributions for farmers, Sanitation support
,monthly health checkups

SOCIAL ACCOUNTING PROCESS EFFECTIVENESS

Due to their business model BAT does have a disadvantage when it comes to social
accountability, it is meant to be as it is selling one of the greatest demerit good, which leads to
many illnesses and can be fatal as well. But that does not stop them from carrying out their
corporate social responsibility.
Operational cost savings:
BATs yield rates of return are increasing through cost savings and reduction of waste through
their investment in environmental and energy efficiency.
Enhanced reputation:
With a wide range of CSR activities BAT is able to prove their long sustainability power .They
have ensured the increase of their brand value through their improved reputation. It is vital for
such a company to try their best to have a good reputation as it is such a sensitive issue for them
with various kinds of pressure from all around.
Increased ability to recruit, develop and retain staff:
CSR activities help the workers working in the organization as well as they do not only feel a
part of a company producing harmful products but they have a scope to be proud of being
involved with a company with great CSR activities.
 Better relation with government:
BAT has been showing hard work in meeting social and environmental concerns which is
enabling them to have a good relation with the government which further helps them to be
protected by any negative actions or regulations by the authorities.
Learning and innovation:
Innovation and learning is strongly recognized as it leads to more success and survival of
companies. Through BATs social work they have successfully provided a wide range of learning
opportunities through their innovative ideas for a better future.
However, BAT is still criticized in many ways as they are after all doing environmental damage
caused by the toxic waste produced by the tobacco production. It is also said that many CSR
activities are just to bribe the Government and criticized for having low quality in their
manufacturing process .Therefore, even though they are doing good for the society they are still
criticized for having this as an act of decreasing criticism and to have the government off their
back.

STAKEHOLDER MANAGEMENT

Shareholder:
BAT stays in contact with shareholders through executive Directors. The Chairman contacts
major shareholders periodically and before the Annual General Meeting each year in order to
understand their views on the Company and to ensure that their views are communicated to the
Board as a whole. Besides this, the Senior Independent Director and the other Non-Executive
Directors are available to meet with major shareholders in order to understand their views and
any concerns they may have. The Board maintains a dialogue with shareholders directed towards
ensuring a mutual understanding of objectives.BAT believes in transparency across the whole
business so that shareholder participation is enhanced. Information about the Company is
available on this website and British American Tobacco offers all its shareholders the opportunity
to register to receive shareholder communications such as the Annual Report, Notice of
Meeting and related forms of proxy electronically via the internet.BAT has dividend mandate,
which means that shareholders get their dividends paid directly into their back account, making it
so convenient for them. This is also a 'greener' option as it reduces the number of cheque they
have to print.
Employees:
British American Tobacco states that it is very important for them to know how their employees
feel working with them. They have 44 cigarette factories in 39 countries, employing more than
55,000 people worldwide. Their workforce is strongly multi-cultural and have a developed
structure, with each local company having wide freedom of action and responsibility for its
operations. Decisions are made as close as possible to the local stakeholders of each business,
within a framework of principles, standards, policies, strategies and delegated authorities.
Providing a safe place to work, protecting their employees wellbeing and listening to their views
are also fundamental. Diversity matters a lot to the group as increasing societal expectations are
important for their reputation. BAT engages in their own tobacco leaf growing, working with
thousands of farmers internationally. They run leaf programs providing direct agronomy support
to farmers if it is not otherwise available, covering all aspects of crop production and
environmental best practice. Other than these BAT provides a range of benefits to their
employees such as pensions, company car, share schemes, salary sacrifice benefits i.e. A range of
free choice salary sacrifice benefits including holiday trading, dental cover and retail vouchers.
British American Tobacco uses objective instruments in determining the level and seniority of
roles within the business by means of a well-defined method of job evaluation, which defines
roles, scope and subsequent salary positions and ranges. They use remuneration and reward as an
active tool to build and maintain a high performance, highly motivated culture and all employees
are provided with clear information for each pay period, including any and all deductions from
their pay.
BAT wants to make sure that their employees are engaged and feels like a part of the business
and so to make that sure, every two years BAT conducts a survey known as Your Voice, to
measure employee satisfaction, advocacy and pride in the organization, it highlights the areas of
the business where they need to take action or address some employee concerns.BAT finds all
aspects of harassment and bullying unacceptable and are committed to removing any such
actions or attitudes in the workplace.

Apart from all the benefits and opportunities BAT provides their employees, many employees
have complained about too much over-time work as well as long working hours in general. And
they have also said that the aggressive competitive work environment turns people less humane
at times. Besides all these the social stigma of working with a tobacco company remains.
Consumers:

BAT target adults or people above the age of 18, BAT is very well known worldwide and one of
the reasons for that is their quality, they proudly supply the best superior quality to its consumers.
They have kept quality as their top priority and make significant investment into the
development of their products and packaging innovations, as well as into research and
development for less harmful alternatives to conventional cigarettes. They have strong brand
under it such as Dunhill, Lucky Strike, Kent, Pall Mall, Benson and Hedges, Gold Leaf,
Hollywood, offering different range of prices.BAT ensures that their consumers are fully aware
and informed about the choices they are making. They have laid out all the risks of consuming
their products in all their websites.BAT is trying to improve and be less harmful for their
consumers, they are waiting for opportunities and growth which requires understanding and
delivering enjoyable consumer moments. With their 20,000 or more trade marketing and
distribution staff their routes to market has allowed them to quickly fully meet consumer
demands. But, with great quality comes great price, BAT has been known for charging premium
pricing for most of its brands. BAT can easily be accused of overcharging consumers if we look
at the high rates of their profits.

Civil Society:

BAT has a Social Responsibility in Tobacco Production (SRTP) program which addresses
the social and environmental issues associated with growing and processing tobacco. The
program outlines expectations of good agricultural practice in and around the farm. These
combine viable tobacco production with positive environmental management.
SRTP has a specific focus on child labor. Through it they seek to understand what
children are doing and why and promote access to schooling and track efforts to address
vulnerability where appropriate. Apart from that BAT vows to investigate use of child
workers in its Bangladesh farms.
Biodiversity Partnership: BAT had a collaborated partnership with FFI, Tropical
Biological Association and Earth watch Institute. They have worked together since 2000
-2015.The aim of the partnership was to work on protecting biodiversity and ecosystem
services in agricultural landscapes, specifically in tobacco-growing and mixed
agricultural landscapes and the wider ecosystems on which they depend. These included
 1) Tobacco Growing Landscapes in the south of Brazil and 2) Watershed protection
in Indonesia.

History of the Partnership

The partnership started in 2001 and was in the normal initial stage of coming up with an
understanding between partners and goal setting with trust. The Partners delivered significant
conservation outcomes through their own initiatives as well as laying the groundwork for joint
projects, such as restoring natural forest from eucalyptus in Sri Lanka and sustainable forest
management in Uganda.

From 2006-2010, Partnership developed a program to embed biodiversity conservation

principles into their business operations and create a range of useful tools to drive change. The
Partnership continued to support important conservation projects around the world.

From 2011-2015 , the partnership had a sharper focus on the key issues relating to biodiversity
and ecosystem services in tobacco growing and mixed agricultural landscapes and the
ecosystems on which they depend and in 2015 the partnership was concluded after successful
collaboration. They are very proud of their work with the Earth watch Institute, Fauna & Flora
International and Tropical Biology Association. As a result of the Partnership, biodiversity
management has been embedded into their leaf operations and a number of projects continue to
thrive. They later had future plans to make a new holistic sustainable agriculture program that
would focus on supporting farmers and their livelihoods. This was going to be a much broader
program than had in the past, reflecting the vital role that farmers play as their valued business
partners.

Bangladesh: replenishing soil fertility: a research project to replenish soil by using

organic matter. They set out to improve the structure and fertility of the soil where
tobacco is grown by using organic composts made from natural waste materials. The
natural compost brought significant benefits, such as improved soil structure with
increased levels of nutrients. The soil is more productive for longer and also needs less
application of artificial fertilizers. As well as the environmental benefit, this means lower
costs for the farmer. The project has provided significant learning opportunities for
 farmers, enabling BAT Bangladesh to enhance the training and technical advice that it
provides to farmers.
BATN Foundation Donates Solar-powered Borehole to Enhance Agriculture:

The British American Tobacco Nigeria Foundation (BATNF) recently commissioned a new water
project in Akparabong Community, Ikom Local Government Area of Cross River State. The
project, which is in line with the governments efforts at bringing succor to rural communities
across Nigeria, is expected to avail residents of Akparabong steady access to potable water and
boost agricultural produce processing in the area. The water facility, which includes a 17,500
water-storage capacity tank, solar panels, a solar submersible pump, water management kiosk,
improved sewage management, among others, was hinged on the constructive dialogue with
various stakeholders in the community.

However, in 2011 according to some CSR reports BAT was criticized for funding a high-profile
campaign by the National Federation of Retail Newsagents against a government ban of cigarette
displays at the point of sale. British American Tobacco has come under fire for providing funding
for the campaign claimed that the action, if it was successful in its aim of considerably reducing
the sale of cigarettes, would put large numbers of small shopkeepers out of business. The NFRN
achieved a partial victory from its lobbying as smaller shops were exempted from the ban for 18
months. The revelation of the funding will cause embarrassment for the newsagents' federation,
which has been accused in the past of being a "puppet of the tobacco industry."
Government

BAT has historically enjoyed a monopoly position in Kenya where BAT adores extensive high
level political connections, including close relationships with successive Kenyan presidents.
Such associate seems to have been used to influence public policy. Health legislation has been
diluted and delayed and when a competitor emerged in the market, BAT used its contacts to have
the government pass legislation drafted by BAT that compelled farmers to sell tobacco to only
them rather than to its competitor.BAT was already paying

farmers less than any other African leafgrowing company, and the legislation

entrenched poor pay and a quasifeudal relationship. Company's public relation

responses to the threat of competition and the minister's public statements extolling the economic
importance of tobacco growing suggest that BAT has manipulated tobacco farming as a political
issue.

It was reported by BBC, after an investigation, that BAT paid bribes to government officials in a
bid to undermine the UNs global anti-smoking treaty.BBC Panorama have also reported by a
former worker of BAT from Africa that BAT had also bribed politicians. Which BAT has
repeatedly denied even after several more cases of lobbying, bribing and many more.

APPLICATION OF THEORIES

1. Even though BAT says they do not use child labor and highly promotes themselves as the
friend of the farmer they are criticized globally for the violation of both of these rights.
Especially, in Brazil it was found that they did not treat well to their farmers. Also there
are plenty of underage farmers in rural areas of Developing Countries. These violations
can be related to Theory of Justice.

2. BAT says they have better working environment than other organizations but in reality
their working environment is different. Many BAT employees complained that even
though their job was supposed to be 9-5, but they often had to work till 9-10 pm. This
violation can also be related to Theory of Justice

3. BAT says that nicotine is not the cause of smoking related diseases. This statement is
heavily disputed and marked as inaccurate by many health professionals. Because many
of the smokers fails (70%) to quit smoking on their first attempt, and most of them cannot
quit in multiple attempts. This can be related to Egoism.

4. Even though BAT says environmental, health and safety issues are their high priority and
they do plenty of activity on that note but on the other hand they keep promoting smoking
around the world which is direct opposite of what they say. Most importantly most of
their promotions does not specify how much smoking causes to a persons health or that
tobacco cultivation is damaging the environment. This can be related to Ethics of duty.

5. BAT has been part of many Public relation activities individually or combined with other
organizations just to change governance policies about smoking. It was found that they
 contributed on a fake campaign to undermine research on cancer. So, it is clear that BAT
is influencing others with money or other method just for their own interest. This can be
related to egoism.

For instance, if one particular theory, Egoism was adopted by BAT, they will keep bribing the
government and the landlords in higher prices if required. BAT is also known for employing the
brightest minds with lucrative salaries and perks so that they can serve BAT with innovative
ideas, strategies to capture the market, penetrate, the untapped portions etc. The farmers and
suppliers will still remain paid poorly though, as long as BAT can get their work done and get
high profits. BAT will keep luring the young generation specially teenagers into smoking their
cigarettes with newer promotional campaigns. Now that there is an increased number of female
smokers, they have more scopes to penetrate in the market. As there is downfall in smoking in
European region due to restrictions brought by local governments, they will focus on increasing
the number of smokers in regions like Asia where there is no or less restrictions from the
government. For them doing these will be morally right as long as they are pursuing either their
short-term desires or long-term interests.

RECOMMENDATION

1. BAT is infamous for undertaking indirect means of promotion to captivate the young
generation of Bangladesh and it starts right from the teenagers. BAT is well aware of their
potential market in the younger generation and they exploit the opportunities through
shadow marketing. Since BAT cant make advertisements or promote themselves openly
by any means, they show their interest in sponsoring different youth oriented events,
concerts etc where they put their stalls with attention drawing decorations. BAT also
organizes their own musical events every year where they only invite smokers who
consume different cigarette brands under BATs umbrella and the passes are totally free
of cost for them. This is how more people young and old are drawn into smoking rather
than taking a sensible decision. This is a direct violation of ethics and should be stopped
right away. BAT should focus on matured consumers who can make decisions for
themselves knowing the fatal health risks of smoking considering the product they are
selling. The governments intervention is much needed in this case.
 2. Farming tobacco is not a healthy affair itself. It is not only injurious for the farmers and
suppliers but it is also very harmful for the environment and the soil. BAT should
thoroughly reconsider and take necessary measures to make sure that the suppliers and
the farmers are leading a healthy life with all the necessities that ensures a better standard
of living. Along with improved salaries, they should be provided medical facilities for
them and their facilities.
3. BAT has continuously given fake promises of supplying samplings all over Bangladesh,
taking research works on harm reduction in hand, ensuring safe working environment
for their workers (especially farmers), and providing arsenic free water to the poverty
stricken regions of the country and what not. Their promises are never met. This needs to
change. Also as for the health issues, the fatal risks of smoking should be addressed by
BAT themselves. They need to advocate full-fledged that the only way to avoid the health
risks is to avoid/quit smoking. So that those who remain a smoker are aware and
responsible for themselves.
4. Every time the government decides to raise the cigarette prices up, BAT comes up with a
cheaper new brand of cigarette which obviously does not serve the purpose of raising the
market price as people would still be smoking large volumes. They should refrain
themselves from doing that.

REFERENCES

http://www.bat.com/groupfs/sites/BAT_89HK76.nsf/vwPagesWebLive/DO8D3EJL?opendocument

http://www.batbangladesh.com/group/sites/BAT_9T5FQ2.nsf/vwPagesWebLive/DO9T5K52

http://www.bat.com/group/sites/uk__9d9kcy.nsf/vwPagesWebLive/DO726NTL

http://www.assignmentpoint.com/business/management/evaluation-of-csr-activities-of-british-american-
tobacco.html

http://www.employeebenefits.co.uk/issues/march-2006/employer-profile-british-american-tobacco/

http://www.bat.com/group/sites/uk__9d9kcy.nsf/vwPagesWebLive/DO9EAMHQ/
$FILE/medMD9G7LVW.pdf

http://www.bat.com/shareholders

http://www.bat.com/group/sites/UK__9UANCV.nsf/vwPagesWebLive/DO9H5CHL?opendocument

https://www.theguardian.com/business/2015/nov/30/british-american-tobacco-bribing-panorama-smoking