British American Tobacco - Responding to the COVID-19 pandemic

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Responding to the COVID-19 pandemic

As the global COVID-19 pandemic continues to evolve, so does the Group’s response. We remain fully committed to supporting all our stakeholders throughout the pandemic and have responded rapidly to the evolving situation, taking action to protect their interests.

Keeping the Group operating in a time of crisis

The COVID-19 pandemic continues to impact the lives of many people around the world, with temporary restrictions and lockdowns across many countries leading to changes in consumer behaviour and in our operating environments. The Group continues to navigate the challenges associated with the pandemic with effective crisis management and risk management processes in place, and remains a financially resilient business. Our Board has maintained close oversight of the Group’s response to the impact of COVID-19 throughout this period. The Group remains financially robust, with the 65% dividend pay-out ratio of long-term earnings maintained. This demonstrates the confidence in the Group’s ability to continue to navigate COVID-19 with the associated macro- and socio-economic challenges and uncertainty this international crisis brings.

Looking after our people

Throughout the pandemic, we have prioritised the health and wellbeing of our people. We have not furloughed any staff or utilised any government schemes (or subsidies) as a result of the pandemic, other than in respect of the deferral of tax instalment payments, largely in the U.S. in 2020. We continue to strictly adhere to guidance from governments and public health authorities, as well as our own health and safety risk assessments, to ensure that our workplaces are COVID-19 secure.

Our digital transformation has enabled us to continue to utilise remote home working when needed, ensuring all employees and customers stay connected, while continuing to invest in the development of new capabilities through virtual training programmes. In many parts of the world, including our global headquarters in the UK, we have introduced a hybrid working model as appropriate and as the local regulations allow. We have implemented COVID-19-secure workplace measures for employees who have returned to their workplace. These include regular cleaning and sanitising, temperature checkpoints and COVID-19 testing.

For all employees, we are also making sure they are aware of the extensive wellbeing support available to them, including:

  • Online medical consultations;
  • Counselling services; and
  • Mental health support.

Vaccine development

In December 2020 an initial New Drug Application for our COVID candidate vaccine was approved by the U.S. Food and Drug Administration (FDA) and we progressed into a Phase 1 study. This study has now been fully recruited and remains ongoing. We expect data to be available during Q1 of 2022 and will determine next steps based on these data, but also the rapidly evolving COVID-19 and treatment landscape. In addition to the ongoing clinical studies, further pre-clinical work was also completed which reinforced the potential of the plant-based platform. The team successfully produced 19 different monoclonal antibodies that met pharmaceutical requirements in about 10 days, demonstrating the flexibility, consistency and speed of the plant-based system to produce clinical-quality antibodies. To accelerate the research, development and production of novel treatments, BAT launched KBio Holdings Limited (KBio) in January 2022. The company has been created to leverage the existing and extensive plant-based technology capabilities of BAT and Kentucky BioProcessing Inc (KBP), the existing BAT-owned U.S. plant biologics organisation.

Testing and logistical support

The forms of direct support we have deployed to address the global impact of COVID-19 have continued to evolve.

We have:

  • Provided personal protective equipment and other essential items to communities in which we operate;
  • Loaned testing equipment to the UK Government;
  • Provided access to 3D printers to help produce protective face shields; and – Donated to many funds around the world focusing on supporting local COVID-19 responses.

Supporting our suppliers and communities

Protecting the communities where we operate is an important pillar of our response to the pandemic. We have harnessed our strengths in science, engineering and logistics to support national responses to COVID-19. We have distributed thousands of items of PPE, sanitation kits, food and other essential items to our contracted farmers and their communities. We have also leveraged our existing farmer communication channels, including mobile apps, web portals, local media spots, videos and fact sheets, to rapidly deploy essential COVID-19 information, often to remote rural communities. Some tobacco growing communities may be particularly vulnerable to both the virus and the economic implications of a global pandemic. We are taking great care that we don’t increase the immediate vulnerability of these communities and are committed to supporting them during the inevitable economic recovery that will follow.