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  • Writer's pictureBMJ Indonesia

Commercial Director & ESG Lead

Towards a Greener Future: Exploring Sustainability Solutions in the Tobacco Industry

Let’s understand the difference between Sustainability and ESG. ‘ESG and Sustainability’, they both focus on ensuring that businesses and organizations operate in a way that considers broader social and environmental impacts, but they encompass slightly different aspects. In summary, ESG and Sustainability are related and often used together;

  • ESG is a specific framework of measures and/ or policies for assessing certain aspects of a company's performance.

  • Sustainability is a broader concept that includes ESG considerations but also extends to economic viability and refers to the ability of an organization to operate in a way that meets the needs of the present without compromising the ability of future generations.

Sustainability means the avoidance of the depletion of natural resources in order to maintain an ecological balance.

There is ‘no silver bullet’, i.e. no one thing to achieving sustainability. There is, however, a program of collaboration, change, willingness, commitment and investment, that an organization needs to take. Achieving sustainability is journey and not a one-time fix. Sustainability is ultimately about continuous improvement and taking steps to minimize negative externalities associated with products, operations and value chain, while sizing opportunities to make a positive contribution to society.

For any tobacco company, to credibly speak about sustainability, the purpose can be none other than to replace tobacco products with better alternatives for smokers, society and the environment.

Environmental Conservation Decarbonisation. Is it a Race to achieve Net Zero emission? The Paris Agreement which came into force in 2016 (7 years ago) is, a legally binding international treaty on climate change, and it states that:

  • The overarching goal is to hold (maintain) “the increase in the global average temperature to well below 2°C above pre-industrial levels”.

  • And pursue all efforts “to limit the temperature increase to 1.5°C above pre-industrial levels.”

Given the unprecedented devastation that we all witnessed with our changing climate condition over the past 2-5 years… then I will let you decide if there is a race to achieve Net Zero emission .. personally I would say YES, it is a Race and a Must for the environment.

Circling back to the Title - Exploring Sustainability Solutions in the Tobacco Industry, I am not highlighting one Sustainable Solution as I believe that most companies are already applying so many of different bespoke solutions… BUT what I am highlighting is that… Fundamentally the ‘key solution’ on driving ‘Sustainability’, is getting on board with the program.

  • This is both a commitment and a journey of discovery and change.

  • And it will be probably the biggest change management program any company has ever embarked on in their history.

The Tobacco Industry or the multinational tobacco companies are not just committed…

  • They are leading and driving change across the industry.

  • Driving Change within their companies, and also driving change through the value chain (Direct & Indirect Supplies).

  • They have recognized that to achieve their Targets they also need to collaborate, help and share best practice through the value chain.

  • Without a combined effort the (The brand Owners) and us (Direct Suppliers or Indirect Suppliers) collectively will not achieve the targets.

So, when reviewing Sustainability, we see distinctly 4 buckets that need to be focused on.

CLIMATE; BIODIVERSITY & AFFORESTATION; SOCIAL & WATER STEWARDSHIP; CIRCULARITY - INNOVATION

Learnings can be drawn from the work and support coming from the Multinational Tobacco Companies.

  • Integrated Annual reporting - This is no longer about a separate activity; Sustainability is part of their companies’ DNA and seen as a business driver.

  • Organisation Design – Dedicated resource teams

  • Focus - Subject matter experts

  • Best practices sharing

  • Value chain collaboration (Network Support Structure)

  • Tier 1 and Tier 2 supplier selection – Emission based via Procurement.

  • Etc, Etc…

So, when reviewing Environmental Sustainability, we see distinctly 4 buckets that need to be focused on.

CLIMATE - Greenhouse Gas Protocol - Scope 1, 2, & 3

Scope 3: Emissions that are not produced by the company itself, but by those that it’s indirectly responsible for up and down its value chain.

  • Without doubt the hardest and most significant of these is Scope 3

  • Our belief is that Scope 3 will represent +40% of any company’s emission disclosure.

  • Therefore, it is the value chain’s LCA (Co2E values) that is key to tackling a significant impact and reduction program of Carbon emissions (you, me, them etc).


BIODIVERSITY & AFFORESTATION

· Protect; Restore; Promote sustainable use


SOCIAL and WATER STEWARDSHIP

  • Promotes Responsible Use, Treatment, and the Return of water.

  • Sustainable water management helps society adapt to climate change by building resilience, protecting health, and saving lives.

  • It mitigates climate change by protecting ecosystems and reducing carbon emissions from water and sanitation transportation and treatment.


CIRCULARITY via INNOVATION

Driving a zero-waste economy

  1. Replace all single-use plastic; use of less plastic; plastics can still be used providing its bio-degradable.

  2. Creating less waste and recycling more, with zero landfill.

  3. Developing smarter products that are more environmentally friendly when disposed of.


INNOVATION and low-carbon investment are key enablers for net zero. Business must harness the opportunity in order to harvest the decarburization and wider economic benefits of net zero.


We know the industry cannot succeed in the long term without making the business more sustainable, and sustainability cannot be achieved without transformation.



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