Transforming for good

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Philip Morris Malaysia (PMM) has redesigned its environmental, social, and governance (ESG) framework recognizing two distinct forms of issues: Those that relate to our products (what we produce), and those related to our business operations (how we produce).

Addressing the social impact generated by our products is at the core of our strategy. The biggest and most pressing negative externality we aim to address is the health impacts of cigarette smoking. PMI is the only international tobacco company that has committed to the ambition of going completely smoke-free as soon as possible by encouraging all adult smokers who do not quit to switch to better alternatives than continued smoking.

PMM wants to take an initial and key steer towards a smoke-free future primarily through its leading heat-not-burn (HNB) product that does not burn tobacco, so there is no smoke and no ash. Therefore, it emits significantly lower levels of harmful chemicals compared with cigarettes.

While nicotine is addictive and not risk-free, it is not the primary cause of smoking-related diseases. Rather, it is the harmful chemicals found in cigarette smoke and mostly generated by the burning of tobacco.

“Quitting remains the best thing a smoker can do for his/her health. Eliminating combustion from nicotine and non-nicotine-containing products is the best way to provide those who continue smoking with better alternatives for their health. Thanks to rapid advances in science and technology, and a strong commitment of the company, these products are now a reality.”

In fact, PMM established its transformation goal as early as 2016. “We announced our new purposes that year: To deliver a smoke-free future by focusing our resources on developing, scientifically substantiating, and responsibly commercialising smoke-free products that are less harmful than smoking. And with the aim of allowing them to completely replace cigarettes as soon as possible.”

Another issue that PMM identified pertaining to its products is that of cigarette butt littering. While many consumers dispose of their waste properly, too much waste ends up in the environment. We seek to help change behaviours to prevent cigarette butt littering and encourage proper waste disposal.

So, PMM ran a pilot project that installed around 200 cigarette butt canisters across the country targeting tourist locations near beaches as well some urban areas.

“As a result, we are able to identify littering hotspots and assess ways to empower consumers to do the right thing. The data collected through these bins provide us with information on which methods are best for littering prevention. It also provides insight on the mentality of people who litter, according to location.”

“This is a big deal when considering that it helps alleviate cellulose acetate, fine paper, and smoke residue from being littered on the ground and surrounding environment. This project is about habit change, to encourage habits amongst smokers to avoid littering on the floor and seeking locations where they can safely throw away their cigarette butt litter.”

PMM is currently expanding the project to solve the littering issue more efficiently, focusing on prevention and driving behaviour change.

PMM believes small habit changes, encouraged by its project, will go a long way in improving the country’s environment’s cleanliness as well as avoiding the marginalisation of smokers, which only perpetuate their habits.

“While we will continue to expand our efforts to prevent cigarette butt littering, it is important to note that the consumption and post-consumption behaviours related to our smoke-free products differ drastically from cigarette consumption.”

Unlike cigarettes, heated tobacco units (HTU) do not need to be stubbed out after use, and they contain no smelly smoke residues, which makes them easier to keep until proper disposal and therefore less likely to be littered.

In 2020, PMI ran a survey in Lithuania to complement past studies in Greece, Italy, and Japan to measure the proportion of HTUs versus cigarette butts found on the ground concluding that a heated tobacco unit is on average three times less likely to be littered than a cigarette butt.

Quitting remains the best thing a smoker can do for his/her health. Eliminating combustion from nicotine and non-nicotine-containing products is the best way to provide those who continue smoking with better alternatives for their health. Thanks to rapid advances in science and technology, and a strong commitment of the company, these products are now a reality.”

Building a green supply chain

Across its business operations, PMM aims to make sustainability a priority through the reduction of plastics and a commitment to carbon neutrality in our direct operations by 2025, and net zero greenhouse gas emissions across the whole value chain by 2040.

“From our office pantry all the way to our method of transport, sustainability has shaped the way we approach ordinary day-to-day habits,” the company points out.

As easy as it may sound, redesigning PMM’s ESG framework and putting all its plans into action is no small feat. The company is disrupting its traditional business from the inside out and is leading the industry in an unprecedented transformation.

“Even in the launch of these transformation products, we are continuing to ask how they can be properly disposed of, reused, and repurposed.”

Talent retention, which can be achieved through healthy communication with employees and creating a good environment for staff, is another key area the company’s ESG framework wants to further improve.

“We have seen time and again proof that the more a company focuses on the welfare of its workers, the more productive and efficient the outcomes produced can be. In fact, even creativity is linked to the ability of a company to be inclusive and diverse.

“These elements are key for innovations to thrive, problem-solving to take place, and good day-to-day working relationships, which will allow us to get up in the morning feeling excited going to work. In the end, all of this contributes to our continuing success.”

An initiative that is very much welcomed by employees is the option for 4.5-day work weeks offered by the company, which aims to enable employees to strike a better balance between their personal life and working life.

In addition to only working half the day on Fridays, PMM’s employees are also offered the flexibility to choose the specific schedule they work- outside of a few core hours- based on their availability, preference of customers, traffic conditions, needs of their family, and other factors.

Such a policy was co-created based on employees’ feedback collected through numerous group discussions. PMM’s employees at different life stages and career stages participated in these discussions to ensure that the company captured everyone’s opinions and needs.

“The policy has helped us all to better organise our lives and maximise job satisfaction.”

Last but not least, the company’s ESG framework also highlights the importance of governance-related topics, which cannot be overstated.

“As it shows, our company’s policies, rules, and procedures define our ability to implement sound strategies that successfully address environmental and social issues,” says PMM.

Moving forward, PMM wants to remain focused on shaping a smoke-free future for the world, which is attainable. The benefits it can bring to the people who would otherwise continue to smoke, and hence to global public health are significant.

“However, this ambition will be achieved more rapidly if all stakeholders play their role. Governments and civil society can maximise the opportunity offered by innovation and science by encouraging smokers to switch to smoke-free alternatives, subject to proper government oversight and regulators, are part of a sound tobacco policy.”