Sustainable Future
Building a Sustainable Future is about seeking to actively encourage adult consumers away from cigarettes and to smokeless alternatives sustainably, responsibly and with integrity.
Science will be a primary driver of our efforts, supported by more active external engagement and regulatory focus, while embedding sustainability across our organisation.
Tobacco Harm Reduction Acceptance
Our ambition is to reduce the health impact of our business, and this is front and centre of our corporate vision to create A Better Tomorrow鈩� by Building a Smokeless World. This approach is underpinned by Tobacco Harm Reduction (THR), which we believe is one of the greatest public health opportunities for global society today.
Shaping the Landscape
For adult smokers who would otherwise continue to smoke, a choice of alternative smokeless products to completely switch to is important.
Societal sentiment towards nicotine is also crucial in THR. Particularly as a common misconception is that nicotine, as a substance, is the cause of smoking-related diseases. However, the primary cause of such diseases is not exposure to nicotine, but the toxicants released by the burning of tobacco.
Message from our Chief Corporate Officer
As we transform our business, we remain steadfast in our purpose of building A Better Tomorrow鈩�.
Our Sustainability Strategy
In order to better address our material sustainability topics^ and continue delivering value to our stakeholders, we have refined our Group sustainability strategy.
By engaging with a cross-section of stakeholder groups, we have gained a better understanding of our challenges and opportunities, resulting in the identification of the five strategic impact areas, outlined below.
These areas are supported by external reporting, stakeholder engagement and responsible business practices, guiding our future sustainability targets and ambitions.
Our strategy reflects what's important to our employees, consumers, communities, investors, suppliers, and business partners.
In my career at BAT, one constant truth has emerged: our markets serve as the backbone of our business.
It is their collective effort that drives the Group's achievements, and that is why this year's sustainability report highlights the global challenges businesses like ours face, and the actions we are taking to address them.
The following section evidences the local actions shared by practitioners across our markets, and provides an overview of our ambitions, impact, and performance at the Group level.
We hope this overview demonstrates the Group鈥檚 efforts towards making a meaningful impact.
Donato Del Vecchio
鈥�Chief Sustainability Officer
Note:
^ Although financial materiality has been considered in the development of our Double Materiality Assessment (DMA), our DMA and any conclusions in this document as to the materiality or significance of sustainability matters do not imply that all topics discussed there in are financially material to our business taken as a whole, and such topics may not significantly alter the total mix of information available about 听our securities.
Our Sustainability Strategy focuses on five areas:
We believe that progressive, evidence-based regulation 鈥� supported by meaningful enforcement 鈥� is the key to reducing smoking rates.
We seek to engage with public health authorities and regulators, to support the development of policies and strategies that balance Tobacco Harm Reduction objectives with key concerns, such as underage access, environmental impacts and product safety.
Launched Omni鈩�, our evidence-based manifesto for change, which captures our commitment and progress towards creating A Better Tomorrow鈩� by Building a Smokeless World.
Updated our Responsible Marketing Principles (RMP) to reflect regulatory developments, our product portfolio and stakeholder expectations.
Underlined our position on underage access, product safety and regulatory enforcement through the publication of our 鈥楥ommitment to Responsible Vaping Products鈥�1.
We also continue to engage suppliers through our supplier enablement programme to tackle Scope 3 GHG emissions.
In line with our climate transition efforts, we continue to focus on responsible sourcing practices and innovative product design to reduce our carbon footprint.
Progressed towards our Scope 1 and 2 emission reduction targets. Energy reduction initiatives and increasing the use of renewable fuels resulted in a 42.6% reduction in these emissions versus our 2020 baseline.
Reduced our total Scope 3 GHG emissions by 11% year-on-year. 23.5% of our suppliers of purchased goods and services by spend have now set Science Based Targets, an 8.5 percentage points increase versus 2023.
Submitted our Net Zero Greenhouse Gas (GHG) emissions targets for validation to the Science Based Targets initiative (SBTi), in line with our climate transition efforts.
Adoption of technology in agriculture is a core part of our nature strategy.
We are investing in AI-driven tools to accelerate the analysis of agricultural data, to help farmers increase yields, reduce costs and minimise their environmental impact.
Introduced a satellite monitoring system in Brazil to detect potential deforestation or conversion cases by tracking forest cover changes over time.
Developed a regenerative agriculture framework which will be piloted in 2025. The framework includes a methodology for assessing and prioritising local risks and the monitoring of progress on the regeneration of the farmland ecosystem.
Achieved our 2025 target for reduction in water withdrawn in 2023, two years ahead of schedule. We continue to work on maintaining this target, achieving a 47.4% reduction in 2024 (versus our 2017 baseline).
Our focus is on prioritising the use of materials that are sustainably produced and have a lower carbon footprint.
Our corporate venturing arm, Btomorrow Ventures (BTV), actively scouts for and collaborates with startups to identify sustainable materials as well as solutions for waste reduction and resource recovery.
We intend to design our product portfolio with circularity in mind and educate our consumers on its value.
Introduced and began testing a set of ecodesign principles, which will provide insights to support the reduction of our environmental impacts across the product life cycle.
Launched in France, Ireland, Denmark, Sweden and the UK, two variants of Velo cans that were certified by the International Sustainability and Carbon Certification (ISCC), for using bio-plastic or Post-Consumer Resin (PCR) plastic through a mass-balance approach2.
Partnered with a waste management company to pilot a collection and recycling programme in Nottinghamshire in the UK for used vapour products.
We support our farmers to enhance their livelihoods and build resilience, while keeping in mind our ambition to transition to a Smokeless World.
We seek to responsibly source materials and respect the rights of our communities.
Our direct employees are an integral part of our communities. We continue to build on our culture so that everyone feels welcome and valued for their unique contribution at work.
Revised our living income methodology to better represent living costs in rural areas and are in the process of co-creating action plans with suppliers to target key income drivers for farmers.
In response to our growing electronics supply chain, we continue to work with the Responsible Business Alliance (RBA) as a Supporter Member. This gives us access to the Responsible Mineral Initiative and RBA-approved auditors who conduct on-site labour audits of our suppliers.
Maintained our year-on-year consistency in compensating men and women within 1% of one another, as well as Ethnically Diverse3 and Non-ethnically Diverse3 groups within 1% of one another for performing the same work or work of equal value.
Notes:
- Commitment to Responsible Vaping Products
- 鈥楳ass-balance' is a principle that matches inputs (such as plastic waste) with outputs from a recycling or production process, to determine the recycled content ().
- See note 3 on p.111 of the Annual Report and Form 20-F 2024 for the definitions of Ethnically Diverse and Non-ethnically Diverse for the purposes of our International Pay Equity Analysis.
Chart notes:
- In 2024, we enhanced our reporting methodology by increasing the use of data obtained from consumer panels compared to estimations. In the prior year (2023) we reported 23.9 million consumers. The restated value is 25.5 million consumers. Refer to the 糖心视频'Reporting Criteria' for our full methodology: bat.com/reporting.
- Compared to a 2020 baseline. Our near-term 2030 science-based targets comprise a 50% reduction in Scope 1 and 2 GHG emissions. The Scope 3 Industrial (non-FLAG) GHG emissions target includes purchased goods and services, upstream transportation and distribution, use of sold products, and end-of-life treatment of sold products. The Scope 3 FLAG GHG emissions target includes FLAG emissions and removals. Combined, these targets comprised 77% of Scope 3 emissions in 2020. Due to the complexity of consolidating Scope 3 data from our suppliers and value chain, we report Scope 3 data one year behind other metrics. Refer to the 糖心视频'Reporting Criteria' for our full methodology: bat.com/reporting.
- Our ambitions cover all tobacco we purchase for our products (鈥榯obacco supply chain鈥�); which is used in our combustibles, Traditional Oral and Heated Products. Our metrics, however, derive data from our annual Thrive assessment, which includes our directly contracted farmers and those of our third-party suppliers, which represented over 93% of the tobacco we purchased by volume in 2024 (鈥楾hrive Supply Chain鈥�).