Tobacco CSR Strategy
Corporate social responsibility (CSR) refers to voluntary corporate action that claims to act in the public interest by prioritising social goals rather than being solely profit-driven.1 However, unhealthy commodities industries (tobacco, gambling, alcohol, unhealthy food and beverage) and other socially-harmful industries (e.g. oil and gas, chemical) use CSR to set their own minimum standards for social performance, enabling them to externalise their costs onto societies and consumers and further corporate goals while passing themselves off as socially responsible.23 Often, though, this is mainly a public relations exercise, without any real changes in business practices. The World Health Organization (WHO) defines CSR measures in the context of the tobacco industry as the promotion of “voluntary measures as an effective way to address tobacco control and create an illusion of being a ‘changed’ company and to establish partnerships with health interests”.4 See also WHO Definitions of Tobacco Industry Tactics.
The tobacco industry is not alone in its strategic use of CSR, of course. CSR has been pioneered over the last two decades by the oil, chemical and tobacco industries. For example, oil companies have been presenting themselves as environmentally friendly and transparent, leading to an accusation of “greenwashing“, which is defined in the dictionary as “disinformation disseminated by an organisation so as to present an environmentally responsible image”.5
By the late 1990s, after suffering significant defeat in the courts costing them billions as a result of the Master Settlement Agreement, the tobacco industry started to increase its use of CSR policies to enhance its reputation. Since then, CSR has been used strategically to try and prevent effective government regulation to reduce tobacco consumption.2 Tobacco companies have attempted to avoid legislative regulation by offering voluntary forms of corporate governance instead.
Public relations companies and accountancy firms, such as KPMG, have an important role in advising and developing CSR strategies. These exercises are cynically motivated: previously secret documents from the tobacco archives illustrate how the tobacco industry was advised to use dialogue to break the “confrontational postures” of special interest groups.6 In 2000, for example, John Sharkey, who had worked in the tobacco industry for 20 years including for British American Tobacco (BAT), Philip Morris International (PMI) and Japan Tobacco International (JTI), advised his industry colleagues that the tobacco industry “must be seen to be listening, must be seen to be trying to fix things, and above all must engage in continuous dialogue. Continuous dialogue makes outright opposition much less easy or, at least, seem much less sensible and more political”.7
Research by the Tobacco Control Research Group (TCRG) at the University of Bath has also shown, from analysis of BAT and Philip Morris leaked documents, that the tobacco industry uses a wide range of CSR tactics to:2
- broker access to public officials
- influence policy preparation
- break up opposing political coalitions
- rebuild the company’s reputation for instance:
- as a provider of reliable information
- as a platform of voluntary regulation
For more examples, see a list of pages in the category CSR Strategy.
Although CSR is an increasingly important tool for companies to use to improve their image, there is no widely agreed framework for CSR which specifies minimum standards of social performance.289 This creates an opportunity for a company to present itself as socially responsible, regardless of social, health and environmental harms it may perpetrate. This ambiguity has allowed tobacco companies to develop CSR programmes even though tobacco use is the world’s leading cause of preventable death. Tobacco-related deaths are projected to rise to 8.3 million people in 2030 (from 5.4 million in 2005) as the activities of multinational tobacco companies spread the smoking epidemic to developing countries.2
In places where tobacco companies are not permitted to advertise or promote their products by law, engaging in CSR activities offers an important alternative route to reach various audiences. NCD Alliance and SPECTRUM, two research and advocacy bodies on noncommunicable diseases, allege that “social responsibility programmes are shaped by promotional priorities and constitute a specific form of marketing”.3 However, such activities could well be in violation of World Health Organization Framework Convention on Tobacco Control (WHO FCTC).10
The Guidelines to Article 5.3 of the Convention are quite specific on this point, and state the following:11
- The tobacco industry conducts activities described as socially responsible to distance its image from the lethal nature of the product it produces and sells or to interfere with the setting and implementation of public health policies. Activities that are described as “socially responsible” by the tobacco industry, aiming at the promotion of tobacco consumption, is a marketing as well as a public relations strategy that falls within the Convention’s definition of advertising, promotion and sponsorship.
- The corporate social responsibility of the tobacco industry is, according to WHO, an inherent contradiction, as industry’s core functions are in conflict with the goals of public health policies with respect to tobacco control.
And under ”Recommendations” it says:11
- 1 Parties should ensure that all branches of government and the public are informed and made aware of the true purpose and scope of activities described as socially responsible performed by the tobacco industry.
- 2 Parties should not endorse, support, form partnerships with or participate in activities of the tobacco industry described as socially responsible.
- 3 Parties should not allow public disclosure by the tobacco industry or any other person acting on its behalf of activities described as socially responsible or of the expenditures made for these activities, except when legally required to report on such expenditures, such as in an annual report.
The negative effects of CSR must be assessed in direct relationship to the core aims that guide CSR programme development by tobacco companies: increased self-regulation, increased market exposure, and ultimately, increased sales. The broader social impact of tobacco industry CSR programmes can therefore be tied to the harms of tobacco products
CSR as a Tobacco Industry Strategy
CSR has been used as an effective political strategy by tobacco companies to build support for policy positions that favour tobacco industry interests and to weaken opposition. CSR also serves to facilitate access to policymakers, enhance companies’ reputations as a source of credible information and disincentivize evidence-based tobacco control interventions.12
As part of its public relations, CSR and related corporate social investment (CSI) programmes, the tobacco industry has a long history of making philanthropic donations.
For example, one undated internal Philip Morris document records that the company has concentrated on supporting projects in three areas: the arts, higher education, and hunger and nutrition. It noted that “since 1958, Philip Morris has been among the strongest corporate supporters of the arts”.13 In the late 1990s, for example, the company announced a US$100 million donation to fight hunger.14
Collectively, the top four transnational tobacco companies contribute millions in annual funding to charities, too. In 2018 alone, the Altria Group, parent company of Marlboro distributor and manufacturer Philip Morris USA, donated US$5.6 million to environmental sustainability organisations. Other notable organisations included in the company’s corporate charitable giving disclosure included the Smithsonian Institute-owned National Museum of African American History & Culture, Gay Pride Virginia, Boys and Girls Clubs of America and the American Red Cross.15 JTI reports on its website that it spent more than US$53 million on “investments in the community” in 2018.16
In 2020, BAT rebranded across its corporate website and publications, using the slogan, “A Better Tomorrow” and a rainbow-colour scheme. Accompanying the rebrand, BAT launched its “Environmental, Social and Governance” (ESG) framework, which included the stated goals of “reducing the health impact of [its] business” (harms of tobacco products), “excellence in environmental management”, “delivering a positive social impact” (supply chain) and “robust corporate governance”.17 PMI, JTI and Imperial Brands also publish reports that detail their sustainability, corporate governance and harm reduction strategies.
- You can read more about BAT’s rebrand and how it aligns with its next generation products (NGP) strategy at Next Generation Products: British American Tobacco.
The tobacco industry also uses CSR to improve its reputation, image and credibility;18 present tobacco companies as “good corporate citizens”; increase profits; and prevent health policy and general tobacco control regulation implementation.19 CSR enables tobacco companies to mitigate reputational and regulatory risks as well as gain a “competitive advantage” over other brands.20 We can see TTCs working to create CSR “niches” around child labour (JTI), sustainability (PMI), and the environment (BAT).
As one example of how the tobacco industry uses CSR to benefit its reputation, Japan Tobacco International (JTI) made a US$300,000 donation to health facilities and schools in Zambia in June 2020 during the COVID-19 pandemic. While this donation represents a tiny fraction of JTI’s annual profit, it provided a large reputation benefit for the company in the region when the Nkeyama District Commissioner praised JTI as “an all-weather partner to various government ministries…through its Corporate Social Responsibility”.321
In a September 2020 report by NCD Alliance and Spectrum on the use of CSR by unhealthy commodities industries, the authors commented:
“This strategy of strategic consistency by unhealthy commodities industries in utilising the context of COVID-19 to advance long established goals, signalling virtue by visibly contributing to relief efforts while continuing to promote products and practice that harm health and fuel the [noncommunicable disease] epidemic, is echoed in reports into corporate behaviors across other sectors.”
In the context of issues such as child labour and modern slavery, academics such as Michael Bloomfield (University of Bath) and Genevieve LeBaron (University of Sheffield) have asserted that the cynical motivation for CSR to protect reputation and mitigate risk facilitate “business as usual” obscures “the structural inequalities under which exploitation takes place”.2223
In specific reference to the tobacco industry, tobacco control expert Gary Fooks (ex-TCRG) and TCRG colleagues argue that CSR also improves the industry’s reputation as a source of credible information while making “fundamental changes” to companies’ processes and social activities unnecessary.224
An important aspect of tobacco industry CSR and reputation management is providing endowments and other funding to universities across the world. This serves to not only legitimise the tobacco company and, in some cases, provide free advertising through the inclusion of company names on endowed positions and buildings, but also allows the industry to influence research. More about this specific CSR tactic can be found on our CSR: Education page.
CSR achieves more for tobacco companies than just image or reputation management: it also helps the industry secure access to policymakers and therefore increase its chance of influencing the policy and political agenda. CSR is used to promote dialogue with policymakers, influence the priorities of elected and public officials, advocate for modes of voluntary regulation over external/government regulation and build trust of public-private partnership with industry.
In the example of British American Tobacco (BAT) in the UK, the company historically used its CSR programme as the basis for requesting meetings with reluctant government officials and create “common ground” between officials and industry programme leads.12 In June 2020, the CSR manager of PMI’s Indonesian affiliate, Sampoerna, wrote to the Regent of Kabupaten Karangase, Bali, urging the local government to rollback restrictions on outdoor tobacco advertising. The executive opened the letter by reminding of the company’s CSR program in the regency: “please let us thank to [the regent] for your support to PT HM Sampoerna Tbk. (Sampoerna), regarding our company’s operations and our collaboration in the environmental-community social responsibility (CSR) program in Karangasem Regency”.25
Use of this tactic is not confined to the large transnational tobacco companies. At the time of the COVID-19 pandemic, a large smokeless tobacco (STL) manufacturer in India, Dharmpal Satyapal (DS) Ltd, submitted an affidavit against public interest litigation filed to reinstate a COVID-19 ban of STL manufacturing and sales in Uttar Pradesh, India. In the affidavit, DS referenced its donations to the Prime Minister’s CARES fund and other COVID-19 CSR activity to strengthen its argument against any STL ban.26
Importantly, creating a diverse portfolio of CSR projects in a variety of sectors helps proliferate access points across different responsibilities of government (e.g. agriculture, industries, environment). Jeffrey Drope from the American Cancer Society has commented that “the greater the presence of TTCs along the supply chain…the greater the opportunity to influence the policy landscape in favour of their policy preferences”.27
It is generally more difficult for corporations to influence officials when they are well-informed. It is also likely that CSR influence will be greater in contexts where governments that have been historically accommodating of the tobacco industry and where the health and economic impacts of TI-backed policies are not well-understood.2 The risk of enabling tobacco industry interference increases as new access points are established; departments other than health have relatively little experience of dealing with the tobacco industry, its past and present conduct and core business.
Imperial Tobacco (now Imperial Brands), for instance, was one of the founders of a campaign set up to encourage individuals, companies and local groups to clean up after themselves. McDonald’s and Wrigley (fast food and chewing gum) were also involved in “Love Where You Live“. The fact that this campaign was set up by three major waste and litter producers could be construed as “greenwashing“. The UK government was involved as a partner in the project until 2015.
When asked in 2020 about its ability to make the tobacco industry take responsibility for post-consumer waste, the government minister responsible stated that waste tobacco filters were “not included in [its] list priorities”. Instead, it said, “progress on the industry’s voluntary approach to litter reduction will be monitored”, and specifically pointed to the partnership between the tobacco industry and Keep Britain Tidy as an example.28 This partnership is an example of the tobacco industry using CSR on a topic other than health as an effective strategy to promote voluntary self-regulation in place of policy intervention. More information can be found on our page CSR: Imperial and Love Where You Live.
Imperial Brands, alongside British American Tobacco (BAT) and Japan Tobacco International (JTI), is also an associate member of the All-Party Parliamentary Corporate Responsibility Group (APCRG), which includes members of the UK Parliament.29 APCRG is supported by Business in the Community,30 a charity that as historically worked in close partnership with the industry and received funding from BAT. The APCRG gives tobacco companies direct access to the UK government, which contradicts Article 5.3 of the WHO FCTC.
Previous work by the TCRG has outlined how CSR is used as a platform for “stakeholder management” using “techniques of neutralization” which are used to “justify, excuse, or in some way rationalize behaviour that flouts social norms”.2
One of tobacco companies’ primary interests in CSR resides in its potential to reduce policy support for regulatory change. Because CSR reporting exists outside of formalised policymaking structures, companies can make arguments based on CSR without having to engage with evidence-based arguments from public health professionals and policymakers.
Companies also use CSR to help employees manage their impressions, as contributing to tobacco-related illness and death, to others outside the workplace.2 Image 1 shows a screengrab from an internal Philip Morris Limited (PMI UK) server of an employee voluntary leave day scheme introduced in September 2020
By asserting that its primary goal is economic success, justified by the benefit brought to countries in which it operates, a company can morally justify CSR and use it politically to align the views of external stakeholders with its own agenda. In the context of the US, public health and tobacco control researchers Laura Tesler and Ruth Malone identify CSR as a covert, “tax-deductible form of lobbying”.32
Philanthropy is also used to fracture opposition in a “divide and conquer” strategy: the tobacco industry does this effectively within the field of public health using strategic CSR.32 The formation of the Foundation for a Smoke-Free World by PMI is one prominent example of this strategy, as well as Project Sunrise.
Source: Tobacco Tactic (6 Sept 2021) 2018 © All Rights Reserved.