IMPROVE THE QUALITY OF LIFE OF PEOPLE IN OUR SUPPLY CHAIN
Eradicate systemic child labor in our tobacco supply chain.
Ensure all contracted tobacco farmers make a living income, and partner with our direct suppliers to promote a living wage for their workers.
The right thing to do
Promoting and adhering to sustainable business practices helps safeguard human rights, improve labor conditions, protect workers’ health and safety, tackle social inequalities, and alleviate poverty.
The business case
Caring for the quality of life of the people in our supply chain is consistent with our business purpose and way of working, and is a major predictor of our long-term success.
2021 performance highlights
- 94 percent of contracted tobacco farmers systematically monitored for adherence to PMI’s Agricultural Labor Practices (ALP) Code
- 2,530 field technicians monitored the implementation of the ALP Code
- 67 percent of contracted farmers supplying tobacco to PMI make a living income
- 87 percent of contracted farmers who have access to water in 2021 (Estimated data based on surveys that indicated that the farmer has an improved source within 1 km. Data exclude China.)
- 100 percent of contracted farmers and farmworkers have access to personal protective equipment
ALP Step Change Guiding Principles
Good Agricultural Practices (GAP)
Responsible Sourcing Principles
Our Commitment to Human Rights
Over the past ten years we have gained valuable expertise in tackling social challenges in our tobacco supply chain, and understand the power of building lasting capabilities and fair remuneration to address many inequalities. As our company continues to transform, so does our supply chain and with this come new challenges and opportunities.
During 2022, we will craft a strategy that can comprehensively address this new context, including the specific challenges of the electronic supply chain that are still somewhat new to our industry. Building on a wealth of experience that we have acquired by working over many years and across multiple geographies on living income programs, we will seek to expand our impact more broadly in our supply chain.
We are aware that this will require strong engagement with our suppliers, with our business partners, with others in the private sector as well as strong collaboration with specialized organizations, academics, and governments. With better visibility of the issues we are trying to solve, with quality data and with robust partnerships, we will be able to develop a social sustainability strategy in our value chain that is leading and innovative, and that supports the very purpose of our company transformation.
In summary, we will work to make sure that our transformation, strategy, and plans are viable, sustainable, and create systemic net positive impact.
Massimo Andolina, Senior Vice President, Operations
Our aspiration is to ensure that farmers and other workers in our supply chain enjoy a decent standard of living. The challenges we face as we work to establish a concrete strategy include lack of transparency related to policies, practices, and concrete data on issues related to living wage. Nevertheless, we are determined to build a robust strategy that can pave the way to access meaningful information with which we will be able to craft engagement plans and programs that are able to respond to the pressing need of expanding our ambitions to impact and improve the quality of life of people in our supply chain.
In 2022, we will also update our Commitment to Human Rights and upgrade our Responsible Sourcing Principles to integrate new trends, external requirements, our latest sustainability materiality assessment, and refreshed corporate priorities. Diversity and inclusion together with equitable livelihoods will be among the new areas of focus.
Marcel Jacobs, Director, Social Sustainability Operations
Our intention is to champion the adoption of living income and high labor standards in the tobacco supply chain and we will continue developing and implementing sound programs that can do that. We will also continue to closely monitor labor practices and address incidents raised, with a view to eradicating systemic child labor by 2025.
A key focus in 2022 will be to continue promoting the payment of at least the minimum legal wage to farmworkers and ensure basic access to water to contracted farmers. We will keep seeking ways to strengthen our monitoring and remediation systems and plan to conduct external verification in priority markets.
In 2022, we plan to strengthen our approach by covering the full life cycle of tobacco production, including both the field and processing stages, and focusing on the tobacco we purchase and use in our products. We expect this enhanced approach to generate positive impact by influencing our partners who operate in tobacco growing countries to accelerate actions and sustainably address ESG challenges.
We will continue monitoring and having visibility on the wider tobacco farming communities, collecting the insights needed to continue supporting farmers through tailored initiatives, strengthening remediation programs for the issues identified, and ultimately contributing to the improvement of farmers’ livelihoods.
Pedro Braga, Vice President, Leaf
This online content about our Integrated Report should be read in conjunction with PMI’s 2021 Integrated Report. The information and data presented here cover the 2021 calendar year or reflect status at December 31, 2021, worldwide, unless otherwise indicated. Where not specified, data come from PMI estimates. Please also refer to 'This report at a glance' on page 5 of the 2021 Integrated Report for more information. Aspirational targets and goals do not constitute financial projections, and achievement of future results is subject to risks, uncertainties and inaccurate assumptions, as outlined in our forward-looking and cautionary statements on page 252. In the 2021 Integrated Report and in related communications, the terms “materiality,” “material,” and similar terms, when used in the context of economic, environmental, and social topics, are defined in the referenced sustainability standards and are not meant to correspond to the concept of materiality under the U.S. securities laws and/or disclosures required by the U.S. Securities and Exchange Commission.