Memorandum submitted by Imperial Tobacco
Imperial Tobacco welcomes the opportunity to
contribute to the Joint Committee on Human Rights' inquiry into
business and human rights. This includes examination of the way
in which businesses can affect human rights both positively and
negatively; how business activities engage the relative responsibilities
of the UK Government and individual businesses; and whether the
existing UK regulatory, legal and voluntary framework provides
adequate guidance and clarity to business as well as adequate
protection to individual rights.
In response to the call for evidence, Imperial
Tobacco would like to offer insight into the approach that it
takes as a British-based company operating internationally. Hence,
this submission covers:
1. An introduction to Imperial Tobacco
2. Business and human rights
3. Human rights policy and management approach
4. Employment practices and labour rights
5. Working with business partners
6. Working with the community
7. Conclusions
1. INTRODUCTION
The Imperial Tobacco Group PLC ("Imperial
Tobacco" or "the Company") is a leading international
tobacco company which manufactures, markets, distributes and sells
a comprehensive range of cigarettes, tobaccos, cigars, rolling
papers and tubes. The Company has sales in over 160 countries
and employs around 40,000 people in 50 countries world-wide.
Imperial Tobacco Group has its headquarters in Bristol in the
UK.
Imperial Tobacco is committed to high standards
of corporate governance and business conduct and to operating
responsibly in line with its Business Principles, Code of Conduct,
policies and standards. This includes complying with all relevant
laws, regulations and voluntary agreements; managing social, environmental
and economic risks and opportunities; and responding to stakeholder
issues and external developments.
Further information is available at www.imperial-tobacco.com
and in the Company's Annual Report & Accounts and Corporate
Responsibility Reviews. These are available both online and in
printed copy.
2. BUSINESS AND
HUMAN RIGHTS
Imperial Tobacco agrees with the proposition
that the state has a duty to protect human rights, and welcomes
the recommendations of the UN Special Representative on Business
and Human Rights, Professor John Ruggie, that set out the three
core principles:
— The state's duty to protect against human
rights abuses by third parties including business;
— The corporate responsibility to respect
and promote the human rights of its employees, of the communities
in which it operates, and of its business partners; and
— The need for individuals to have access
to remedies for breaches of their human rights.
Imperial Tobacco aims to establish and maintain
effective risk assessment and management mechanisms based on the
universal Declaration of Human Rights.
As a UK PLC, the Company uses the guidance to
UK businesses on their human rights obligations as encompassed
by company and employment legislation. The Company supports the
International Labour Organization's (ILO) conventions that cover
freedom from discrimination, freedom from forced labour, freedom
of children from child labour, freedom of association and the
right to collective bargaining. It also uses recognised standards
and guidelines, such as those published by the Organisation for
Economic Co-operation and Development (OECD), the United Nations'
Global Compact and the Global Reporting Initiative, to help shape
its human rights-related policies.
3. HUMAN RIGHTS
POLICY
Imperial Tobacco is a British-based company
with employees in over 50 countries worldwide. Whilst the
governance of these countries varies, Imperial Tobacco's policy
is to respect and advance the fundamental human rights of individuals
across all the Group's operations and to influence its business
partners to do the same.
The consideration and management of aspects
of human rights are covered by various corporate policies, systems
and processes. These include employment policies and practices,
occupational health, safety and environmental management systems,
procurement processes and community investment activities. The
Company also has processes that consider human rights issues in
its product supply processes, market assessments and for potential
new investments or joint ventures.
A range of governance procedures is used to
monitor the effective application of internal controls across
Imperial Tobacco's business. These include independent reviews
by the Group Compliance Function together with self-assessment
of risks and relevant controls. Senior operational managers of
each business and function annually certify that effective systems
of internal control, in accordance with the Group's policies and
covering all business activities, have been maintained within
their area of responsibility.
Specialist audits and assessments support these
governance procedures. These include third-party audits of the
Company's performance against ISO 14001 for environmental
management and OHSAS 18001 for health and safety management.
Trained social auditors use the principles of SA 8000 as
a basis of evaluation for performance improvement purposes in
newly acquired operations in countries considered by the UK Foreign
and Commonwealth Office (FCO), US Office of Foreign Assets Control
(OFAC), or the FTSE4Good Policy Committee to be medium- to high-
risk in terms of human rights.
Periodic self-assessment questionnaires, submitted
via an internet-based non-financial reporting system, capture
information and performance measures from the Company's factories,
offices and markets. This assessment enables a better understanding
at corporate-level of local practices and helps managers to identify
improvements needed to align with corporate policies.
This management approach and performance is
reported in the Company's annual Corporate Responsibility Review,
and summarised in the Annual Report & Accounts. Independent
assurors verify the data and statements made, and benchmark activities
against the Global Reporting Initiative's guidelines.
4. EMPLOYMENT
PRACTICES AND
LABOUR RIGHTS
Imperial Tobacco's Business Principles and employment
policies set out a framework of practices to ensure employees
are treated with fairness, dignity and respect, as depicted in
universally accepted standards for human rights.
4.1 Employee engagement
Effective working relationship s with employees
and their representative organisations are an important element
of the way in which the Company conducts its business. Individuals'
rights to representation are respected and the Company uses a
range of engagement mechanisms in different locations. These include
formal trade unions and works councils, the European Employee
Forum, joint bargaining arrangements and collective agreements.
For example, in West Africa during the 2006 financial year,
the Company created a Common Collective Agreement concerning main
terms and conditions of employment for its subsidiaries in Senegal,
Ivory Coast, Burkina Faso and Mali.
4.2 Contracts of employment
Imperial Tobacco's policy is to provide all
employees with a written contract of employment in accordance
with relevant statutory requirements. The aim is to comply with
the appropriate employment legislation in each jurisdiction by
providing a contract that details the agreed employment terms
and conditions, with the rights and responsibilities of both parties
made clear and understandable. Grievance mechanisms are provided
to ensure that employees have access to established, formal procedures
through which they may have their complaint considered and addressed
consistently, fairly and within an appropriate time frame. Where
employees do not meet the standards of behaviour and job performance
expected of them, formally documented disciplinary procedures
are used to ensure that individuals are treated appropriately
and consistently.
4.3 Responsible restructuring
Working in a highly competitive environment,
the Company continues its drive to improve efficiency. This has
led to restructuring of various parts of the business and to some
factory closures. The aim is to manage these situations in a fair
and responsible manner and to support employees through any restructuring
programmes. The focus is on active consultation with employees
and their representatives and the incorporation within social
plans of measures and approaches to support early retirement,
voluntary severance, internal and external redeployment.
4.4 Equal opportunity and non-discrimination
Equal opportunity and non-discrimination are
important aspects of the Company's employment practices. The aim
is to ensure that no employee or job applicant receives less favourable
treatment than any other on the grounds of gender, race, disability,
marital status, nationality, ethnic or national origin, sexual
orientation, age or religious beliefs, or any basis which is not
related to their performance or their ability to carry out a job.
Human resource managers review local procedures to ensure that
direct or indirect discrimination does not take place. Areas reviewed
include recruitment and selection, remuneration, opportunities
for training and development, security of employment and conditions
of work. Employment agencies and other organisations involved
in the supply of employees to the Company are advised of the corporate
policy and local standards on equal opportunities. Grievance procedures
are in place to allow employees to challenge actions believed
to be discriminatory without threat of victimisation and retaliation.
4.5 Remuneration
The policy of Imperial Tobacco is to ensure
its employees are rewarded effectively in line with their contribution,
the Group's performance and the market. To comply with this policy,
local operations ensure remuneration is equitable with reference
to comparable roles within the relevant area of the Company, taking
into account the level of responsibility held and individual performance.
They also ensure remuneration is competitive in relation to the
appropriate external labour market.
4.6 Occupational health, safety and wellbeing
The occupational health, safety (OHS) and wellbeing
of employees and those working with the Company remain a high
priority. The aim is to reduce work-related injury and ill health
through risk management, employee training and co-operation, performance
reporting, audit and improvement planning. Central to OHS management
systems is a risk assessment philosophy that allows the Company
to identify risks, create improvement plans and implement management
controls to reduce or eliminate significant risks. A number of
risk management training tools and techniques are used, including
in those countries where the legal requirement for risk assessment
is less developed.
A range of performance measures and self-assessment
questionnaires are collated through the non-financial reporting
system. This information can be accessed and used at Group, function,
market and site level to monitor and improve performance. Key
accident categories are analysed and a training programme has
been developed to improve the quality of accident investigations
so that underlying causes can be identified. The aim is to stimulate
good-quality reporting, investigation and corrective action so
that such incidents provide a valuable learning opportunity.
The overall objective with regard to employee
wellbeing is to increase the awareness, identification and reporting
of occupational illness, so that incidents of work-related ill-health
and days lost through sickness can be reduced. The Company also
has more specific objectives in some countries where state health
and hygiene provisions are weak. Through a detailed audit and
review process health management systems, medical infrastructures
and surveillance systems in each of the countries of operation
are kept under review and local initiatives undertaken to make
lasting improvements to the quality of life of employees, their
families and their communities. These include provision of clean
water and sanitation facilities for farming communities close
to the Company's operations in Madagascar, and supporting malaria
prevention projects in Central and West Africa.
4.7 Elimination of child labour
As a responsible company Imperial Tobacco does
not condone the use of child labour, whether in its own operations
or in its supply chain. The Company is committed to working with
suppliers and appropriate bodies to support the progressive elimination
of any exploitation of children in the tobacco sector. Imperial
Tobacco is a Board member of the Elimination of Child Labour in
Tobacco (ECLT) Foundation. The ECLT was established in 2000 by
organisations representing tobacco workers, growers and manufacturers,
with support from the International Labour Organization. Through
the Foundation the Company aims to ensure that children are provided
with an upbringing that gives them the best chance in all aspects
of life. ECLT partnership projects are ongoing in Malawi, Tanzania,
Mozambique, Uganda, Zambia, Philippines and Kyrgyzstan. More information,
including progress updates on each of the projects, can be found
at www.eclt.org
4.8 Elimination of forced labour
Imperial Tobacco continues to support the ILO
core conventions on freedom from forced labour. The social assessments
described above use the principles of SA 8000 which include
the right to freedom from forced labour. The self-assessment questionnaire
on the Company's non-financial reporting system captures information
relating to employment practice policies and the local practices
in place.
5. WORKING WITH
BUSINESS PARTNERS
Imperial Tobacco is committed to working with
suppliers and appropriate organisations to encourage their compliance
with international labour standards. The majority of raw tobacco
used by Imperial Tobacco is purchased from third-party suppliers,
mainly through the leading international leaf supplying companies.
A small amount is purchased directly from the farmers, principally
in Madagascar, Morocco and Laos. The issues that need to be managed
within the tobacco supply chain are similar to those of other
agricultural industries, and include health and safety, child
or forced labour, lack of schooling, farmers' incomes, appropriate
use of plant protection products and environmental protection.
To assess standards in the tobacco supply chain
the Company operates the Social Responsibility in Tobacco Production
(SRiTP) programme. SRiTP consists of self-assessments, guidance,
audits and improvement plans that allow the evaluation and, where
necessary, improvement of performance. SRiTP places an emphasis
on continuous improvement and the ability of all parties to work
together to find solutions to social, environmental and economic
issues in the supply chain.
The Company's ISO 9001 supplier qualification
process includes social and environmental aspects. First-tier
suppliers complete an initial survey which asks questions about
their policies and procedures, their standards of business conduct
and their labour practices in line with the ILO core conventions.
They are also asked if they have procedures in place to evaluate
and select their suppliers or subcontractors, in an attempt to
encourage better standards further down the supply chain. The
supplier qualification process involves a phased cycle of on-site
audits to check against the supplier's self-assessment.
6. WORKING WITH
THE COMMUNITY
Imperial Tobacco has made significant progress
in advancing a strategic community investment portfolio that takes
account of international issues. This includes the use of the
UN Human Development Index and Millennium Development Goals to
identify issues of global importance and the geographic regions
where these are particularly relevant to the Company. For new
investments, fewer but more substantial initiatives are undertaken
that generally involve three to five-year pledges. A portion of
the Company's community investment budget is dispersed through
regional investment committees for the funding of local projects
favoured by employees that meet the UN goals.
The Company is increasingly involved in partnership
programmes with suppliers and non-governmental organisations in
tobacco growing communities to seek solutions to issues such as
child labour, poverty alleviation, climate change, environmental
protection and sustainable development. For example, projects
are in place in Malawi, Mozambique and Madagascar that protect
ancient forests from deforestation and develop practical solutions
for the use of wood for tobacco curing. Established initiatives
include the planting of woodlots and bamboo, the provision of
fuel-efficient ovens and curing barns, and model tobacco plantations
to demonstrate to farmers the benefits of good agricultural practice.
Other continuing and new projects involve working
with local authorities and NGOs to introduce new sources of rural
income through microfinance and investing in community-led developments
to improve quality of life in communities which are involved in
tobacco growing.
7. CONCLUSIONS
Imperial Tobacco believes that companies which
operate globally have a responsibility to maintain high standards
of respect for the promotion of human rights. These standards
should be consistent in every market, but must take into account
the social and cultural aspects that prevail locally.
April 2009
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