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INTEGRATED REPORT 2019

We believe diverse and inclusive workforces make businesses and society stronger, boosting innovation, creativity, responsiveness to change, performance, and employee motivation and engagement.


Performance metrics

Topic description

At PMI, diversity is defined broadly and includes gender and gender identity, ethnicity, nationality, age, sexual orientation, religious background, physical ability, thinking styles, points of view, education, technical skills, life experiences, and more. Inclusion is the set of behaviors that welcomes and embraces diversity, enabling each person to bring the full range of their background, experience, and perspective to work. We intentionally foster an inclusive and diverse working environment, ensuring fair treatment and nondiscrimination. 

Why it is important to us and our stakeholders

From a societal perspective, diversity and inclusion are a mark of equity and openness. Inclusion is at the heart of the UN’s 2030 Agenda for Sustainable Development, with its ambition to “leave no one behind.”

People are central to the PMI value creation model, and their equitable treatment is part of the company’s license to operate and key to upholding fair working conditions. Our workforce comprises more than 125 nationalities, and 41.7 percent of our employees are women. Maximizing the potential of the diversity of our employees brings a rich contribution to us and our stakeholders. It is always important, but especially in times of change when diverse perspectives and problem-solving skills are even more vital. We know, too, that diversity in management leads to better executive decisions and risk assessment. 

 

Achieving our aims

PMI’s goal is to uphold an inclusive environment in which all employees feel respected, supported, and engaged – and thus able to perform at their best. We are committed to improving the workplace by fostering an inclusive culture and enhancing our diversity. A critical first step is achieving a better gender balance in management. We continue to focus on our target of 40 percent of management positions to be held by women by 2022.

Our aim:

>40%
of management positions held by women in 2022

 

The commitment to diversity is driven from the top. The Board of Directors’ Compensation and Leadership Development Committee oversees PMI’s response to the risk that we may be unable to attract and retain the necessary talent with the right degree of diversity, experience, and skills to achieve our ongoing business transformation. Improvements are measured, and progress against targets is reported. Executive compensation is guided by strategic initiatives that include new ways of working and fostering diversity, notably to expedite progress toward being a consumer-centric company.

In early 2020, the new position of Chief Diversity Officer was created within our Company Management team, reporting directly to our CEO. Our focus on diversity and inclusion cascades through our business functions and markets, and extends to suppliers, tobacco farmers, and growers through our Responsible Sourcing Principles and Agricultural Labor Practices. Our global EQUAL-SALARY certification – received in 2019 – provides stakeholders and our own management with clear measures of our commitment to equal pay. Alongside programs on equal pay. we also have policies and guidance on flexible working arrangements and parental support. 

D&I office employees

Progress in 2019

In 2019, we cascaded our global commitment to diversity and inclusion to the regional and local levels. We communicated our achievements and shared our learnings with multiple stakeholders to push the agenda further across the organization. 

PMI’s strong commitment to diversity and inclusion, where all feel welcome and supported, was recognized as a key strength in the Human Rights Impact Assessments performed in Mexico and the Philippines. Read more about this topic here

 

India: A gender jump

In 2015, our affiliate in India (IPM India Wholesale Trading Private Limited) began a program to improve gender balance. At the time, 10 percent of management roles were held by women. The global PMI target is 40 percent by 2022, so IPM’s Managing Director and Head of People & Culture set to work on making a radical culture change. IPM took a holistic approach to making an impact on the various employee life-cycle touchpoints from a gender-equality perspective. Starting at the recruitment stage, hiring partners and people managers were regularly sensitized to the inherent issues, an interview guide was shared with managers to help them assess candidates using inclusion parameters, and human resources team members were involved in the interviewing process to drive objective assessment of behavioral skills. 

Simultaneously, inside the organization, a strong talent management system supported the integration and fair development of talent. As part of these improvements, approximately 20 percent of IPM’s workforce was moved across functions, out of which approximately 40 percent were women employees. IPM also looked at overseas assignments and, as appropriate, promoted women to department leadership roles. To further embed inclusion and diversity within the organizational culture, a number of trainings and workshops were delivered to IPM’s management team on topics such as unconscious bias. Additionally, flexible work arrangements such as remote work, half-day leaves, and flexi-timings were instituted to promote a better work-life balance. By the end of 2019, the gender balance at IPM had improved to women holding 30 percent of management roles, and the organization is on target to reach 40 percent by 2022. Furthermore, 25 percent of top leadership roles are now held by women. Much of the success is due to improvements in how we recruit talent in India, as well as a better understanding of how to avoid unconscious bias and how to recognize talent already in the business. 


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Next steps

We will build off our global EQUAL-SALARY certification as we continue to close our gender leadership gap to achieve equal representation of women and men in recruitment and advancement. To tailor further actions, we are analyzing differences in engagement levels among our employees by gender, age, and geography. We will track progress over time through our global engagement survey. 

Dialogue and engagement play a vital role in promoting positive employee relations, fostering goodwill, enabling change, and building trust. We will continue to expand and refine our stakeholder engagement, talent development, and internal communications programs as we work toward becoming a fully inclusive, fair, and diverse company.

This online supplement to our integrated report should be read in conjunction with PMI’s Integrated Report 2019. The information and data presented in this online supplement cover the 2019 calendar year or reflect status at December 31, 2019, worldwide, unless otherwise indicated. Where not specified, data come from PMI estimates. See About this online supplement 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.

 

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Health, safety, and well-being at work

To PMI, this topic means promoting a safe and healthy working environment that protects the physical and mental well-being of all involved.

Fair working conditions

For PMI, fair working conditions are defined as conducting effective labor relations through ongoing engagement and social dialogue, promoting freedom of association and the right to collective bargaining.

Talent attraction, retention, and employability

Attracting, retaining, and developing employees is increasingly important in a time of demographic shifts, disruptions in the world of work, and business transformation.

Community support

Supporting the communities in which we operate primarily means contributing to local development through community investments, charitable contributions, and employee volunteerism.

Diverse and inclusive working environment

We intentionally foster an inclusive and diverse working environment, ensuring fair treatment and nondiscrimination.