Respecting and recognising fundamental freedoms
We are fully committed to respecting the rights of our employees, the people we work with and the communities in which we operate, across both our supply chain and our own operations.
We have had a long-standing commitment to respect fundamental human rights, as affirmed by the Universal Declaration of Human Rights.
Agricultural supply chains and global business operations by their nature can present significant rights risks. We operate in challenging and diverse environments around the world, which makes human rights management a key issue.
That’s why we welcome the UN Guiding Principles on Business and Human Rights (UNGPs), and legislation such as the UK Modern Slavery Act , as they clearly articulate the expectations placed on businesses today, as well as providing a roadmap for them to follow and be held account to.
We recognise that, like all businesses, we run the risk of being exposed to modern slavery either within our own operations or those of our extended supply chain. This encompasses slavery, servitude, forced and compulsory labour and human trafficking, which affects some of the world’s most vulnerable individuals and groups, often through exploitation by criminal gangs.
We publish our Modern Slavery Statement each year, in accordance with the UK Modern Slavery Act, detailing the steps taken by BAT plc and subsidiary Group companies to prevent modern slavery and human trafficking in our business and supply chains.
We have an integrated approach to human rights management that covers our own operations and our supply chain, which we continue to strengthen to further align with the UNGPs. This began in 2012, with a review of our existing policies and approach to human rights management, informed by an independently facilitated stakeholder dialogue
As a result, in 2014, we incorporated our Human Rights Policy into our Standards of Business Conduct (SoBC)– the core policy document that Group employees must confirm compliance with. In early 2016, we complemented this with the introduction of our our Supplier Code of Conduct which defines the minimum standards expected of all our suppliers worldwide, including the respect of human rights. The Code was updated in 2018 to include additional human rights provisions for responsible sourcing of conflict minerals, and minimum standards for wages, benefits and working hours.
Our due diligence processes enable us to monitor the effectiveness of, and compliance with, our policy commitments, as well as to identify, prevent and mitigate human rights risks, impacts and abuses.
Because of the nature of agricultural supply chains, the area of greatest risk for human rights abuses is, arguably, in our tobacco leaf supply chain. We have extensive due diligence in place for all our tobacco leaf operations and third-party suppliers, including the industry-wide Sustainable Tobacco Programme and systematic farm monitoring of our directly contacted farmers.
See Human rights and child labour in tobacco growing for more details.
We assess non-agricultural suppliers annually through our supply chain due diligence (SCDD) programme, overseen by a cross-functional governance committee. Each supplier’s risk exposure is considered, and we then prioritise the highest risk for third-party on-site audits.
The audits are conducted by Intertek – a highly respected global auditing company – and include criteria on forced labour, child labour, wages and hours, health and safety, environment and management systems. If any issues are identified, suppliers are required to implement corrective actions. Intertek verifies they have done so either through a desktop review, for moderate issues, or a follow-up audit for more serious issues.
In 2018, a total of 88 suppliers in 29 countries underwent Intertek audits. By the end of the year, 75% of corrective actions had been fully completed and verified by Intertek.
Due to the nature of our business and robust Group-wide oversight and control, human rights risks in our own business operations are substantially avoided. The risks that do exist are also mitigated as a result of robust policies, practices, compliance and governance procedures in place across all our Group companies.
However, we recognise the need to continually work to ensure these are effectively applied and to carefully monitor the situation in countries where local circumstances may mean a greater exposure to human rights risks, such as where regulation or enforcement is weak, or there are high levels of corruption, criminality or unrest.
It is a specific requirement of our key business controls, which apply to all Group companies, for human rights risk assessments and risk mitigation action plans to be in place in high-risk countries and for processes to be in place to demonstrate that human rights are managed effectively in the workplace and supply chain. All BAT operations are required to report compliance against the controls annually.
We use independent human rights indices to assess the Group’s risk exposure in all the countries where we operate, which is reviewed by our Board Audit Committee. Each operation based in a high-risk country completes an assessment to confirm compliance with Group policies, standards and controls, and provides details of any additional local measures in place to enhance human rights management. The Audit Committee and Regional Audit and CSR Committees (RACCs) then review the compliance status for each operation and, if any areas for improvement are identified, request actions to be taken, with defined timescales.
In 2018, our operations in 26 countries were identified as high-risk and underwent assessments and Board and regional level governance reviews.
We encourage anyone working for, or with, the Group to raise concerns or grievances through our Speak Up channels. These independently managed channels are available online, by text and telephone hotlines, 24 hours a day, seven days a week and in multiple local languages. They can be used in confidence (and anonymously, if they prefer to do so), without fear of reprisal. We promote Speak Up through regular staff training and communications, and details are communicated to suppliers via our Supplier Code of Conduct.
We thoroughly investigate all reported issues and allegations and strong action is taken where required. Information on compliance and reported incidents is gathered at a global level and reported through the year to the RACCs, and quarterly to the Board Audit Committee.
In 2018, we also ran an informal, targeted Speak Up survey, which showed strong employee awareness – over 92% believed that reported SoBC breaches are investigated fully and objectively, and almost all respondents indicated they felt able to raise concerns without fear of reprisals.
In 2018, over 26,000 employees completed our Standards of Business Conduct (SoBC) e-learning and assessment covering key policy areas. Our remaining employees, who don’t have easy online access, received face-to-face training.
By early 2018, all 1,000+ Procurement and Legal and External Affairs managers completed comprehensive human rights e-learning, covering areas such as child labour and modern slavery. The training is now mandatory for new joiners to both functions.
In addition, we delivered training, awareness raising and capacity building on human rights and child and forced labour-related issues to over 134,000 farmers and rural community members in 2018.