Materiality

A key element of the Global Reporting Initiative’s G4 Guidelines is for organisations to identify, prioritise and focus on the most material issues and decide which indicators they report against by performing a materiality test.

Identifying our sustainability priorities

Our Group Sustainability Agenda is developed through a detailed materiality process, which we conduct every three years, to identify the issues that have the greatest significance to our business and our stakeholders.

Our last detailed materiality assessment took place in 2014 and involved a three-stage process:

The first stage involved inputs from a wide variety of external stakeholders, utilising a number of different sources, including interviews with key opinion leaders in different geographies, stakeholder perception research, stakeholder dialogue, peer benchmarking, a global media review and consumer focus groups. The external insights sought were complemented by an extensive period of internal consultation with senior management.

In the second stage, all the different issues raised through the external stakeholder and internal consultation were refined by mapping them onto the matrix below, with each one positioned according to its level of concern to stakeholders and its current or potential impact on the Group.

In the third stage, this refined issues matrix was presented for comment at a stakeholder dialogue session with sustainability opinion leaders, NGOs and civil society, academic and research bodies, peer companies in challenging sectors, and specialist consultancies.

The result was the identification of the three strategic focus areas of our Sustainability Agenda, which are covered in our Sustainability Report : Harm Reduction, Sustainable Agriculture and Farmer Livelihoods, and Corporate Behaviour. Other issues continue to be important business priorities and are covered in our Annual Report  and on our www.bat.com  website.

We plan to undertake a new, detailed materiality assessment in 2017.

materiality - Current or potential impact on the Group

Material issues covered in our
sustainability reporting

Other business priorities Covered in our Annual Report
and at www.bat.com

No action / not reported

Current or potential impact on the Group

Level of interest to stakeholders

Material issues

covered in our sustainability reporting

Harm reduction
  • Understanding the relative risks of different products
  • Developing and commercialising alternative Next Generation Products (NGPs)
  • Product quality and safety standards
  • Scientific research
  • Regulation of new products
  • Responsible marketing
  • Addressing key concerns about NGPs
Sustainable agriculture and farmer livelihoods
  • Our tobacco leaf supply chain
  • Supplier standards
  • Enhancing farmer livelihoods
  • Child labour and human rights
Corporate behaviour
  • Policies, principles and standards
  • Corporate governance, oversight and monitoring
  • Anti-bribery and corruption
  • Tackling the illegal tobacco trade
  • Marketing responsibly
  • Preventing youth smoking
  • Regulatory engagement
  • Tax transparency
  • Human rights
  • Diversity
  • Health & safety
  • Environmental impacts

Other business priorities

covered in our Annual Report and at www.bat.com

  • Principal Group risk factors
  • Executive remuneration
  • Regulatory positions
  • Retailer relationships
  • Non-agricultural supply chain
  • Corporate social investment

GRI G4 materiality

In 2014, we conducted a detailed analysis of the G4 aspects and mapped them against the key areas of our sustainability agenda. As part of this process we discussed and agreed the boundaries for each aspect, and identified the material indicators we are able to report against. The outputs of this process can be found in our GRI Index.

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