Philip Morris

RATING

SECTOR

Tobacco

WEBSITE

CONTACT

Philip Morris International Inc.

120 Park Avenue

New York, NY 10017

United States

T: +1 917 663 2233

E: pmi.internet@pmi.com

STOCK EXCHANGE

LISTING

  • CDP A list 2018 Climate Change 
  • CDP Supplier engagement leader 2019
  • Equal Salary certified

EMPLOYEES

77 400 

CHIEF SUSTAINABILITY OFFICER

Huub Savelkouls

AWARDS

N/A

CONTENT SOURCE

FURTHER READING

Philip Morris International

SECTIONS :  Sustainability    Evaluation  •  Progress  •  Watch  •  Overview

Company Activity

Philip Morris International (PMI) is a leading international tobacco company engaged in the manufacture and sale of cigarettes, smoke-free products and associated electronic devices and accessories, and other nicotine-containing products in markets outside the U.S. PMI is building a future on a new category of smoke-free products that, while not risk-free, are a much better choice than continuing to smoke. PMI’s smoke-free IQOS product portfolio includes heated tobacco and nicotine-containing vapor products. 

Philip Morris International (PMI) is a leading international tobacco company engaged in the manufacture and sale of cigarettes, smoke-free products and associated electronic devices and accessories, and other nicotine-containing products in markets outside the U.S. PMI is building a future on a new category of smoke-free products that, while not risk-free, are a much better choice than continuing to smoke. PMI’s smoke-free IQOS product portfolio includes heated tobacco and nicotine-containing vapor products. 

According to PMI, their priority is to “attract, support and keep up with diverse and unique individuals”. Their “global workforce of more than 77,000 people” is “one of their greatest strengths and the key to the success as a company.” Their “employees speak more than 80 languages and come from all corners of the world.”

Philip Morris is dedicated to doing something very dramatic – they “want to replace cigarettes with smoke-free products as fast as possible.”

That’s why as stated, they “have more than 400 scientists, engineers, and technicians developing less harmful alternatives to cigarettes at their two research facilities in Switzerland and Singapore.”

It’s the biggest shift in their history. And it’s the right one for their consumers, their company, their shareholders, and society.

Company Sustainable Activity

HIGHLIGHTS

  • 36% Absolute CO2 emissions reduction from their own operations (scope 1 and 2) in 2018 versus their 2010 baseline
  • 26m additional trees planted by their suppliers and farmers in 2018
  • 93% Decrease in plastics content of IQOS device packaging by replacing plastic trays with wood pulp trays in 2018
  • 1st PMI factory AWS certified in Brazil in 2018

TARGETS :

→  REDUCING ENVIRONMENTAL FOOTPRINT 

  • 30% reduction of absolute CO2 emissions from their own operations (scope 1 and 2) by 2020, 40% by 2030, and 60% by 2040 versus 2010 baseline 
  • 100% share of electricity used in manufacturing from renewables by 2030, versus 2010 baseline 
  • 40% Reduction of absolute CO2 emissions from their operations and value chain (scope 1,2, and 3) by 2030 versus 2010 baseline 
  • 70% Reduction of flue-cuing GHG emissions by 2020, versus 2010 baseline 
  • 70% share of tobacco leaf purchased that is cured sustainably stheirced fuels by 2020 
  • Zero Coal used in tobacco curing by 2020 

→ BIODIVERSITY 

  • Zero Net deforestation of primary and high conservation value (HVC) forests associated with the tobacco supply chain by 2020
  • Zero Net deforestation of primary and HCV forests associated with the supply chain paper and board by 2022 
  • Zero Net deforestation of primary and HCV forests associated with the supply chain of other significant pulp-based product including cellulose acetate tow by 2025 
  • Zero Net deforestation of natural forest in the tobacco supply chain by 2025
  • Zero Net deforestation of natural forests in the paper and pulp-based products supply chains by 2030
  • Net positive impact on forests associated with the tobacco supply chain by 2025

→ MINIMIZING WASTE AND LITTERING 

  • All Manufacturing facilities with zero waste to landfill by 2022

→ MANAGING WATER 

  • 100%, all PMI manufacturing facilities will be certified to the Alliance for Water Stewardship (AWS) standard by 2025

Certificates

100% manufacturing facilities certified ISO 14001

Sustainable Development Goals

How company covers SDGs

SDG 3, 

→ Cigarette smoking causes serious disease. By replacing cigarettes with less harmful alternatives they can significantly reduce the negative impact of their products on individuals and society.

SDG 8,

→ they ensure good working conditions for all their employees and expect their suppliers to do the same for the benefit of over one million workers throughout their value chain.

SDG  12,

→ they improve the life-cycle impacts of their products – from reducing the environmental impacts of tobacco growing, to efficient low-carbon manufacturing, litter prevention and recycling programs.

SDG  13,

→ their energy-efficiency programs in their operations and their alternative curing fuels program in their tobacco leaf supply chain contribute to mitigating the risk of climate change

SDG 14, 

→ their Environmental Commitment (their Policy) governs their management approach to waste and water to ensure that all effluents released are within, or better than, levels required by regulations in the countries where they operate

And SDG 15

→ they are committed to protecting biodiversity, especially forested areas affected by their operations, particularly in the supply chain of tobacco leaf and paper-based packaging.

Secondary SDGs : 1, 2, 4, 5, 6, 7, 9, 10, 11, 16, and 17

Progress

→ REDUCING ENVIRONMENTAL FOOTPRINT  

  • Responding to climate change risk 
    • reduce carbon emission in operations (scope 1 and 2) and value chain (scope 3).
  • Reducing emissions in their manufacturing operations 
    • In 2018, they continued their “global program to implement energy-saving projects at every factory.” 
    • commissioned projects focused on energy-efficient buildings, fuel control in manufacturing, and LED lighting
    • Philippines in 2018: installed a solar photovoltaic plant to produce clean electricity, and in 
    • Mexico:built a new boiler house to use biomass instead of fossil fuels, which should both lead to an estimated annual emissions reduction of 5,000 tons of CO2e annually. 
  • Lowering carbon emissions from transport 
    • results from good vehicle maintenance, ongoing switch to hybrid and more fuel-efficient vehicles, and eco-driving behavior. 
  • Working with tobacco farmers to reduce emissions 
    • run 41 carbon reduction initiatives across their tobacco supply chain that focus on three strategic aspects: 
  1. Supporting the implementation by suppliers to plant trees in farmers’ communities, and commercial wood lots which are managed sustainably; 
  2. Improving the fuel efficiency of flue-curing barns; and 
  3. Switching from high-carbon or unsustainable fuels, such as coal, to sustainable wood staircase and a range of biomass products (wood pellets, agro-pellets, or other agricultural waste products.) 
  • More efficient curing 
    • About five kilograms of wood are needed to flue-cure one kilogram of Virginia tobacco, equivalent to about half a kilogram of wood per 200 cigarettes. 
    •  provide guidance and support to make them more fuel-efficient, focusing on better combustion efficiency, ventilation, and heating control. 
  • Sustainable and traceable curing fuels 
    • By 2020, 70% of the tobacco leaf they purchase is cured using renewable fuels that are fully traceable. 
    • In 2018, reached 46%, up from 36% in 2017
    • Farmers switch from coal to more sustainable fuels such as agricultural waste pellets.

BIODIVERSITY  

  • Firewood used for curing 
    • To prove that firewood is renewable and traceable, they use their Monitoring Framework, to verify the sustainability attributes of how their suppliers and their farmers are managing deforestation risks. 
  • Forest land clearance for tobacco growing 
  • Timber used for barn construction 
    • Their aim is to “ensure that the suppliers and farmers they work with plant more trees for barn construction than they cut by 2025.”
  • Deforestation risks in pulp, paper, and other supplies 
    • their approach towards their zero net deforestation goal is to: 
  1. Work with priority suppliers to assess their risk level and sustainability practices; 
  2. Deepen their assessment of the risk level for each supplier and compare suppliers, using a ratings scorecard; 

3 . Collect best practices and remediation actions, such as sustainable sourcing policies, improved traceability, increased share of certified materials, and upstream capacity building; and 

4 . Refine their corporate commitment relating to deforestation risk and learn from leading pulp and paper suppliers. 

  • Integrated Pest Management 
    • The IPM program has three main priorities: 
  1. Promote the use of less hazardous CPAs; 
  2. Reduce unnecessary use of CPAs; and 
  3. Ensure that CPAs are managed appropriately

→ MINIMIZING WASTE AND LITTERING 

  • Preventing littering 
    • they apply these in their approach to anti-littering: 
  1. Innovative approaches to promote awareness: Philip Morris works with local stakeholders in their markets to promote anti littering, using signs and other communication tools to encourage proper disposal behavior in littering “hotspots,” such as urban centers, beaches, parks, outdoor concerts, and events; 
  2. Enabling action by consumers: This means access to adequate waste receptacles such as ashtrays or bins with stubbing plates, or portable solutions, such as pocket ashtrays. Where adequate municipal collection equipment is not in place, PMI will work with stakeholders to identify improvements; and
  3. Enforcing anti-littering laws: While a producer cannot enforce regulations, they can raise consumer awareness on existing regulations and they can contribute to making littering socially unacceptable, an approach which can complement the work of authorities
  • The EU Single-Use Plastic Directive 
    • Lastly, the SUP Directive will mandate marking tobacco product packs to make smokers aware of the appropriate waste management options for the product and of the presence of plastics in the product. In parallel with that requirement, they are working to develop with impactful messages that will encourage their consumers to properly dispose of their products after use.
  • Addressing the waste of smoke-free products 
    • As they are “replacing cigarettes with smoke-free products, new challenges as opportunities arise.” A new challenge for them as a company relates to the recycling of electronics. Started selling in 2014 and that make up an increasingly important part of their revenues”
  • Heated tobacco units 
    • progress so far includes: 
  • A successful collection system of heated tobacco units at their offices in Switzerland; 
  • Testing consumer interest in the Greek market; this revealed that consumers are keen to participate when the collection system is convenient. In 2019, they will “pilot the collection system across the market; and 
  • further explored the technical feasibility of recycling heated tobacco units and, given the complexity of the logistics that would be involved,” 
  • investigate the economic feasibility of such a scheme. 
  • Electronic Waste
    • With regulations governing cross-border e-waste transportation, Philip Morris aim to ensure that their “recycling operations comply with those, and that their products contain no substances that would contravene rules on the transfrontier shipment of waste”
  • Life cycle assessment of their smoke-free product 
    •  By including sustainability considerations right from the design stage of the product, the devices’ carbon emissions per 1,000 use cycles they are reduced by 40% from previous versions
  • Reducing manufacturing waste that ends in landfill through recycling 
    • The vast majority of their factory waste, about 84%, was recycled. In absolute terms, total waste has decreased by 4% in 2018 to 134,367 tons, approximately 1% of which was hazardous waste. 

→ MANAGING WATER 

  • Towards water efficiency in manufacturing 
    • In 2017, they started to pilot the Alliance for Water Stewardship (AWS) Standard: AWS is a leading organization dedicated to better water catchment management. In March 2018, their pilot factory became the first factory in Brazil to be AWS certified, and they are expanding its application across their global operations. Throughout the rest of 2018, they started to implement the AWS Standard at a further five sites – in Italy, Portugal, Indonesia, Russia, and Turkey – as part of the program to certify all factories by 2025, with the first ten targeted by 2020.
  • Water use in tobacco agriculture 
    • In 2018, PMI sponsored ten solar-powered boreholes, the rehabilitation of hand pumps, sanitation facilities, concrete storage tanks, and rainwater harvesting systems, and they distributed household water treatment products and organized WASH training sessions in 15 villages. 

Philip Morris International is part of an industry (tobacco) that does a lot towards sustainability, but hurts the environment and human health in other ways as well. As they have said in the past, “Unsmoke the world,” Philip Morris International is trying to better the world by being different and delivering a smoke-free future. They managed to get all their manufacturing facilities ISO 14001 certified which reduces their environmental impact and in return, gets rewarded. Although they try to align with the UN 17 SDGs, they keep making the same mistake by promoting new products with no insurance that it will be a safer alternative for human health than cigarettes. This is misleading for the consumer with their intentions (cf lobbying and marketing).

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