Climate change is one of the greatest global challenges we face today. Addressing its impacts requires governments, businesses and individuals to all take responsibility. Climate change could affect many aspects of our business, including the availability of tobacco leaf, water, energy and other raw materials. It is a long-term phenomenon and tackling it will require longer-term planning than is common in business.
While this creates a challenge, it also presents an opportunity for us: if we consider a longer timeframe in our decision making, we can take steps today that will set us up to be more competitive in the future.
We have set targets for our key environmental issues, including long-term reduction targets for our carbon dioxide equivalent (CO2e) emissions. Against our 2000 baseline of 1.38 tonnes per million cigarettes equivalent, we aim to reduce CO2e emissions by 50 per cent by 2030 and 80 per cent by 2050. Our CO2e data includes other greenhouse gases, such as methane from landfill.
Our approach is to assess and reduce our environmental impacts by increasing efficiency in our operations and making smarter choices in our supply chain. You can read about some examples in the supply chain section.
To reduce our carbon footprint, we address our energy use, our waste to landfill and our business travel. We are also beginning to explore opportunities for generating and purchasing renewable energy. The challenge is in identifying when, where and what renewable energy sources will become economically viable, so we also intend to research low-carbon fuel options to deploy in the interim.
We have an additional focus on using water responsibly and are adopting innovative technologies in water stressed areas to help protect water resources for local communities. Life cycle analysis data helps us to understand our water use and we have started to identify the parts of our business where the risks posed by water scarcity are greatest.
Performance against our key environmental measures of energy use, CO2e, water use and waste can be seen in the Environmental performance data charts. In 2010, we saw an improvement in our waste measures and exceeded our 2012 water use target.
Despite dramatic weather patterns witnessed in 2010, there was a decrease in our absolute energy consumption by 1.5 per cent driven primarily by various energy reduction programmes and site rationalisation. This also resulted in a decrease in CO2e. However, our overall energy use per million cigarettes equivalent increased due to a reduction in production volume. Over recent years we have exceeded our 75 per cent recycling target and have now increased it to aim to recycle at least 85 per cent of our waste.
Our initiatives to raise environmental awareness among our employees include a programme encouraging them to reduce their carbon footprints at home. In 2010, the pilot at our headquarters in the UK was extended to include reductions at work and we also started a roll-out across our companies. Those companies that already have their own employee environmental programmes are aligning them with elements of the central programme.
To further develop our employees’ Environment, Health & Safety (EHS) skills and knowledge, in 2011 we plan to develop an EHS training academy.
We recognise the need to deepen our understanding of the long-term challenges and opportunities that climate change presents for us. We are developing tools and processes to address key long-term risks associated with our environmental impacts, which you can read more about in the supply chain section.
Measuring progress year-on-year does not always give us an accurate picture of trends or results from new initiatives. We are developing five-year milestones as our preferred way to monitor progress towards our 2030 and 2050 CO2e targets. These will include milestones for the Group and for individual regions and functions.
We are holding a series of stakeholder dialogue sessions on different aspects of climate change: water availability and management, carbon pricing and renewable energy.
The first session was held in 2010 and focused on the challenges posed by water availability and the techniques required to address these issues.
The session included presentations from external experts, plenary discussions and group work to identify key risks and responses. The overriding messages from the day, which will inform our approach to water management, were:
- The challenges posed by water availability are significant and immediate, and can only be addressed in partnership with other stakeholders.
- Measurement of water use and its impact on available resources is vital to any accurate assessment of performance and risk mapping, and needs to be communicated in a way that is meaningful and understandable.
- Short-term financial measures are inadequate to assess strategies to address water availability.
To share some of the key learnings from this dialogue, we have published a summary, which can be found at www.bat.com/stakeholder .
Climate change and the environment: what's next?
In 2011, we will review our reporting scope and methodology for our Environment, Health & Safety systems and set five-year milestones to monitor progress towards our 2030 and 2050 CO2e targets. We will also develop new goals for our energy, water and waste measures. We will carry out a water footprint analysis to better understand the risks and opportunities that changes in water availability could present for us. Further stakeholder dialogue sessions will build our understanding of the long-term challenges and opportunities that climate change presents for our business.