New research by members of the University of Bath’s Tobacco Control Research Group (TCRG) looks at how independent companies who supply the tobacco industry report their tobacco activities. These companies span a range of industries, including machinery, chemicals, paper and finance.
Analysis of the annual reports and websites of these companies indicates that they are often not transparent about their involvement with the tobacco industry. This contrasts with the accentuated claims made by many of these companies regarding their sustainability and ethical credentials.
Potential stakeholders’ and customers’ perceptions of association with the tobacco industry could be damaging to a company, perhaps prompting reticence. This lack of transparency could therefore be misleading the public.
Fred Dunwoodie Stirton, lead author of the paper, notes:
While the actions of transnational tobacco companies are relatively well-known, there is not much research on the activities of the many independent companies that supply the tobacco industry. We think this is a first of its kind piece of research and hope it inspires further scrutiny on the supply side of the tobacco epidemic.
The report includes an in-depth exploration of seven companies to summarise the strategies they use to downplay their tobacco links. These include:
- displaying ESG credentials more prominently than their tobacco industry involvement;
- making no mention of tobacco industry work;
- not being transparent about the scale of their tobacco involvement; and
- using obscure language to describe tobacco supply chain involvement.
Currently, companies listed on some stock exchanges are required to report their sustainability and ethical credentials as part of environmental, social, and governance (ESG) reporting. However, companies are not required to report tobacco supply chain activities as part of ESG reporting, so investors may be unaware of these activities. This, therefore, calls into question the authenticity and transparency of ESG reporting overall.
Michael Bloomfield, the senior author, comments:
It should be easier for the public to know whether a company contributes to the supply of tobacco products, the only legal consumer product that kills one in two of its users if used as intended, especially when that company is promoting itself as an ethical organisation. As a first step, it should be a requirement for companies listing on a public exchange to reveal that they supply the industry, so investors and customers can know where their money is going.
This research is based on information found in the Tobacco Supply Chain Database. You can access the database here. You can find out more about the global tobacco supply chain here. You can find more information about the role of independent companies in the global tobacco supply chain here.
Rosemary Hiscock, lead researcher on the supply chain database and one of the paper’s authors, adds:
Many of the companies we included in this study make billions of dollars a year. So if their involvement with the tobacco industry only comprises a small part of their work, that can still be a very substantial contribution to the supply of tobacco products, the only legal products that kill one in two of their customers if used as intended. That such contributions are not being openly reported is concerning. Ethical investment funds should reject firms which have any association with the tobacco supply chain even if it is under 5%.