british american tobacco p.l.c. sustainability report 2009 - GRIs: Environmental performance

EN1 Materials used by weight or volume

* As leaf tonnage includes both unprocessed tonnage entering processing and processed leaf entering factories, leaf tonnage measured for environmental reporting purposes is typically higher than tonnage used to manufacture product.

The rise in leaf materials and the decrease in direct and indirect materials were both largely due to more detailed measurement of consumption and output at unit level.

EN2 Percentage of materials used that are recycled input materials

In 2009, 0.17 per cent of materials used were reported as recycled input materials, the same as 0.17 per cent in 2008. These are mostly reconstituted tobacco products, made from by-products of the manufacturing process.

EN3 Direct energy consumption by primary energy source

Direct energy includes both primary (e.g. natural gas for heating) and intermediate (e.g. electricity for lighting) energy used by Group companies (WBCSD scope 1 and 2).

The increase in total energy was largely due to more detailed measurement of both consumption and output at unit level, as well as a move to a more direct fleet distribution model.

EN4 Indirect energy consumption by primary source

Indirect energy is the energy required to produce and deliver purchased electricity. As it is a function of many components from each location around the world, which are dependent upon the individual energy efficiency of local providers, the change is difficult to analyse at a Group level.

EN5 Energy saved due to conservation and efficiency improvements

Centrally, we collect qualitative information on these activities. In 2009, we continued with energy conservation programmes, which include measuring and using alternative energy sources, including renewable fuels and fuels with a lower carbon footprint. However, in 2009 we have seen an increase in our total energy figures, which was largely due to more detailed measurement of both consumption and output at unit level.

EN6 Initiatives to provide energy-efficient or renewable energy-based products and services, and reductions in energy requirements as a result of these initiatives

We do not report on this indicator as we do not believe it is relevant to our business.

EN7 Initiatives to reduce indirect energy consumption and reductions achieved

In line with management measures such as restrictions on business travel, we are expanding the use of communications solutions, such as video teleconferencing facilities, which, over time, could lead to further reductions in business travel.

EN8 Total water withdrawal by source

Total water use in 2009 increased to 4.8 million cubic metres. Performance against the normalised output measure, cigarettes equivalent produced, has improved by 6.8 per cent. This was largely due to more detailed measurement of consumption and output at unit level.

EN9 Water sources significantly affected by withdrawal of water

This information is more relevant locally and we do not collate global data on it.

EN10 Percentage and total volume of water recycled and reused

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

Group companies own or lease 16,349 hectares of land (18,583 in 2008), of which 7,578 hectares (9,303 in 2008) is leased or owned by companies for conservation purposes.

The land reduction followed rationalisation of our business. In Ghana the selling of conservation land accounted for part of this reduction. During 2009, we continued to use biodiversity risk and opportunity assessments to identify and scope out threats to biodiversity. The three-phase assessment is a process requiring input from employees and other stakeholders including non-governmental organisations, local communities and universities. This leads to the development of corrective action plans as required.

EN12 Description of significant impacts of activities, products and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas

Working in partnership with three NGOs – Fauna & Flora International, The Tropical Biology Association and the Earthwatch Institute – we continue to develop our management of biodiversity issues, measuring our impacts, setting targets for tackling them and reporting on progress. These include targets to undertake biodiversity risk and opportunity assessments in all our leaf growing operations and produce corrective action plans by 2010, to provide biodiversity training for our key leaf and senior staff, and for directly contracted farmers in our supply chain to source less than 3 per cent of curing wood from natural forest by 2015.

During 2009, the British American Tobacco Biodiversity Partnership provided training at three regional biodiversity workshops. The aim of the workshops was to enable employees to identify and, where necessary, mitigate possible biodiversity risks associated with our operations. Following the workshops, individual businesses were tasked with conducting risk assessments and developing action plans to address any identified risks.

In 2008, the Partnership produced a report on global biodiversity risk mapping, identifying locations where risks to biodiversity are high, medium or low. Thirty three base maps of sites of biodiversity significance were produced for areas where the Group has leaf-growing operations, using internationally accepted designations (IUCN protected area categories, RAMSAR wetlands, Important Bird Areas, World Heritage Sites, Estimated Ranges of Endangered Great Apes, Conservation International Biodiversity Hotspots, IUCN Centres of Plant Diversity), and information on vegetation cover and water bodies.

Biodiversity risks were assessed at two levels:

• Country level assessments used indicators of biodiversity richness and threats; rates of habitat loss; socio-economic development; scale, recent history and projected changes in Group leaf operations; and level of reliance on wood fuel and wood from natural forests. 
• Operating area assessments involved overlaying leaf-growing areas on the base biodiversity maps to identify proximity to designated sites of biodiversity significance or water bodies. Scoring criteria were developed for each indicator and for aggregating scores into ‘high’, ‘medium’ and ‘low’ ratings.

The operating area assessments complement the country assessments, and cannot be merged.

A number of limitations apply to an assessment of this type. Nonetheless it may be used to identify issues to investigate in more detail at a local level and to help prioritise the undertaking of biodiversity risk and opportunity assessments (BROAs). The results have now been shared with our companies to assist them in preparing their own BROAs and associated action plans.

A Biodiversity Statement applies to all Group companies setting out our commitments for managing biodiversity. For more information on the Biodiversity Statement, please see EN14.

EN13 Habitats protected or restored

A number of the British American Tobacco Biodiversity Partnership projects focus primarily on the restoration or conservation of habitats. In 2009, the Partnership continued its work on native forest regeneration and management projects.

• Souza Cruz, our subsidiary in Brazil, is working with the Partnership to develop a feasible method on how to implement a green corridor in Parana state.
• Our company in Uganda is supporting Partnership work to bring native forest under sustainable management, through a programme of afforestation, education and alternative income generating activities. 
• The Partnership continues to support our companies in Chile and Sri Lanka to regenerate native forest from eucalypt plantations. Through engagement with local universities in both locations, local management plans on regeneration have been produced for company use. The methods employed in Sri Lanka for eucalypt control have been accepted for publication in the Ceylon Journal of Science. The Partnership aims to complete, by the end of 2010, a comparative case study which our companies may use as a guide for regeneration back to near natural forest from eucalypt.

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity

Our Biodiversity Statement sets out the Group’s position. It includes a requirement for our companies to undertake biodiversity risk assessments to help incorporate biodiversity impacts management into business planning. The following are included in the Statement, which is on the Biodiversity Partnership website www.batbiodiversity.org  and at www.bat.com/principles :

• We will always ensure that our business is in compliance with all international, national and local biodiversity regulations as a minimum requirement;
• In all geographical areas of our own business operations, and for potential areas of future operation, we commit to assessing our impacts, i.e. we will identify areas of high biodiversity value and understand our impacts on ecosystem services;
• These assessments and stakeholder engagements will lead to action plans to minimise, mitigate or offset our impacts, with effective monitoring mechanisms to ensure such action plans are implemented and progress is reported; and
• We will also take steps to share information with suppliers, assisting them in understanding and managing their impacts on biodiversity, hence minimising our impact throughout the supply chain, e.g. in the sourcing of leaf and packaging materials.

Since trialling the biodiversity risk and opportunity assessments (BROAs) in Uganda and Indonesia, the British American Tobacco Biodiversity Partnership has developed a resource package for BROAs, including training materials.

The training materials were used at three regional biodiversity assessment training workshops which took place in 2009 (see EN12). Three more countries have since undertaken a BROA in Kenya, Pakistan and Fiji.

The Biodiversity Partnership is currently in the process of providing feedback on this work and reviewing resulting corrective action plans. We are on track to meet our goal to carry out BROAs in all our leaf-growing operations by the end of 2010.

EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations by level of extinction risk

All Group companies are required to undertake a risk assessment to identify the presence of protected or sensitive areas, IUCN Red List species and any negative impacts due to company operations on the diversity of life and natural systems within the spheres of influence of company owned or leased tracts of land.

The process for assessing biodiversity risks and opportunities includes the use of reference materials containing information on sites of biodiversity significance including IUCN protected area categories, RAMSAR wetlands, Important Bird Areas, World Heritage Sites, Estimated Ranges of Endangered Great Apes, Conservation International Biodiversity Hotspots, IUCN Centres of Plant Diversity, and information on vegetation cover and water bodies.

The biodiversity risk and opportunity assessment (BROA) in Uganda covered threats to habitats in areas affected by operations and includes habitat conversion and wood collection by farming communities, including tobacco growers. The resulting corrective action plan focuses on habitat rather than species level. For more information, please see the Spotlight on Uganda in the Environment section of this Report.

The BROA in Indonesia identified no IUCN Red List species and national conservation list species with habitats in areas affected by operations. Tobacco-growing areas in Indonesia are embedded in intensively cultivated rice-growing agricultural landscapes and no specific impact of tobacco production was identified in relation to threatened species.

The BROA in Pakistan identified no specific risks to threatened IUCN Red List species.

We aim to carry out BROAs in all the areas where tobacco leaf is grown for us by the end of 2010. For more information, please see the Environment section of this Report.

EN16 Total direct and indirect greenhouse gas emissions by weight

We report all greenhouse gases in CO2 equivalent. The source is primarily energy used and waste to landfill which produces methane. Emissions of CH4, N2O, HFCs, PFCs and SF6 are currently estimated as less than 0.002 per cent; therefore we consider them as insignificant and do not include them in our figures. The increase in total energy was due to more detailed measurement of both energy consumption and output at unit level.

EN17 Other relevant indirect greenhouse gas emissions by weight

*The 2008 total figure previously published of 1,850,333 has been rebased to 1,518,198, as a result of the assessment by Energy for Sustainable Development. For more information on this assessment, please see the Supply chain section of this Report.

We purchase tobacco from farmers and dealers. The curing of some types of tobacco by farmers using wood fuel results in greenhouse gas emissions. If the air curing method used by some farmers is also included, then this figure would be 4.3 metric tonnes.

The 2009 change reflects the continuous adjustments in our global sourcing. Differing curing practices influence the volume of estimated CO2 equivalent to varying degrees.

EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved

Our greenhouse gas emissions are represented by CO2 equivalent derived from our energy use and waste sent to landfill.

We have energy conservation initiatives in place across much of our operations. In 2009, we began to establish a global energy strategy. We reviewed attitudes to energy and current energy saving practices across the Group, in order to compare ourselves with other large organisations. From this we established our current position and developed a programme aligned with good practice.

Within this review, we collaborated with an energy consultancy to complete two pilots of our energy assessment approach at our manufacturing sites in Germany and South Africa. We plan to carry out full-site energy assessments in three further sites during 2010 and to extend the assessment programme to our Trade Marketing & Distribution teams and Operations functions. We will develop a global energy reduction plan for our manufacturing sites in 2010, to be delivered in phases across the business. It will incorporate regular milestones towards our long term CO2 reduction targets.

In 2009, we have seen an improvement in our normalised energy and CO2 measures, this is largely due to more detailed measurement of both consumption and output at unit level, which also allowed for more targeted efficiency improvements.

For more information, please see the Environment section of this Report.

EN19 Emissions of ozone-depleting substances by weight

We do not report this data as emissions of CH4, N2O, HFCs, PFCs and SF6 are estimated to be insignificant, currently less than 0.002 per cent.

EN20 NOx, SOx and other significant air emissions by type and weight

We do not currently report other greenhouse gas data, such as NOx and SOx emissions, as this is not collected at a global level.

EN21 Total water discharge by quality and destination

While there is detailed information about the quality, treatment and destination of waste water at a local level, we no longer consolidate this detail at Group level. 

The 2009 changes were largely due to more detailed measurement at unit level. Water discharge is affected by local conditions and the reuse of water for irrigation of lawns and gardens around facilities. This year we ceased collection of storm water figures as this was rain water calculated by only a few sites. On one site where other water was included it is now added to total water withdrawn.

Within our industry, unplanned discharges of water are unusual. We track reports of unplanned water discharge by our companies and will report on any incidents where there has been a breach of local regulation.

EN22 Total weight of waste by type and disposal method

The 2009 changes were largely related to more detailed measurement at unit level. We approach waste as another raw material and we recycle or reuse it within our business or that of others. We aim to reduce our waste to landfill towards our 2012 goal of 0.022 tonnes per million cigarettes equivalent, 12 per cent lower than our 2007 baseline, and to recycle at least 75 per cent of our waste each year.

EN23 Total number and volume of significant spills

We had no significant spills in 2009.

EN24 Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally

We do not report on this indicator as we do not believe it is relevant to our business.

EN25 Identity, size, protected status and biodiversity value of water bodies and related habitats significantly affected by the reporting organisation’s discharges of water and runoff

No such impacts have been reported as a result of our companies’ activities. Biodiversity risk and opportunity assessments continue around the Group to help identify any sensitive areas affected by our operations (see EN15). This activity is part of the work of the British American Tobacco Biodiversity Partnership.

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

Building on the use of life cycle analysis principles, we have introduced a Sustainable Business Assessment Tool which is built into our design process. Further use of this tool is being established across the business and includes collaboration with upstream and downstream supply partners. The Sustainable Business Assessment Tool is used to provide environmental, economic and societal impact information to support business decisions.

For more information, please see the Supply chain section of this Report and PR7.

EN27 Percentage of products sold and their packaging materials that are reclaimed by category

Approximately 50 per cent by weight of our products is normally consumed. The amount of product actually reclaimed is not measured as it is not within our control.

EN28 Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations

£ equivalent based on the same average currency conversion rates as used for the Group Income Statement in the Annual Report 2009 .

Group companies reported two instances of fines in 2009 for environmental non-compliance. Our business in Romania was fined £1,300 for breaches of the permitted levels of contaminants in waste water, and our business in Hungary was fined £432 for failing to make daily measurements of waste.

EN29 Significant environmental impacts of transporting products and other goods and materials used for the organisation’s operations, and transporting members of the workforce

The increase in freight is largely due to changes in factory footprint, distribution patterns and more detailed measurement at unit level. Business travel has decreased primarily as a result of a revised business travel policy.

EN30 Total environmental protection expenditures and investments by type

£ equivalent based on the same average currency conversion rates as used for the Group Income Statement in the Annual Report 2009 .

Our global reporting systems are integrated for Environmental, Occupational Health and Safety related expenditures. 2009 capital expenditure is mainly investment in environmental and safety technical control solutions. There were two fines in 2009 of £1,300 and £432 (see EN28).