bat sustainability report 2007 - Supply chain

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What’s the issue?

We supply over 180 markets through 47 factories in 40 countries and, in 2007, we sold 684 billion cigarettes. Our Group purchases some 460,000 tonnes of tobacco leaf a year from around 280,000 farmers, through 111 operational leaf suppliers. Around 80 per cent of it by volume is purchased from farmers and suppliers in emerging economies. As well as tobacco leaf, we purchase significant quantities of other raw materials to make our products, such as packaging, cigarette paper, filter materials, glues, inks and plug wraps.

In this section we cover our approach to working with our suppliers to manage the social, economic and environmental impacts within our supply chain. Elsewhere in the Report, we set out our work to address the impacts of our own operations on the natural environment, including our performance in key areas, the way we are addressing concerns about climate change and our efforts to mitigate our impacts on biodiversity.

Why is it important?

Stakeholders expect us to manage the social and environmental issues within our supply chain operations. The arguments for achieving environmental efficiencies to create economic savings are well established and, in addition, we believe improved sustainability in our supply chain can add value to our business that could result in competitive advantage.

Taking into account supply chain social and environmental issues will help us make better business decisions. We believe that by working closely with our suppliers and other stakeholders we can stimulate the development of more creative solutions.

What are we doing about it?

Our approach can be described under three themes – supplier standards, sustainable decisions and partnerships with stakeholders:

• We will improve and extend the reach of our supplier programmes;
    
• We will ‘build-in’ the ability to take social, environmental and economic issues into account in our supply chain decisions; 
    
• We will continue to develop our relationships with suppliers and other stakeholders to seek new ways of working.