Ethical Issues

1. Introduction

For most successful companies the external demands are increasing. It was not so long ago that businesses only focus was economic growth, however, today's society is demanding much more from businesses. Society is looking at not only if a company makes money but how it contributes to society. Society is insisting that companies change their focus to incorporate social, cultural and ethical responsibilities. British American Tobacco has done just that and the subsequent addresses these changes.

2. Brief History on British American Tobacco (BAT)

British American Tobacco is the world's second largest tobacco international tobacco company. An American tobacco entrepreneur, James Buchanan ("Buck") Duke formed a conglomerate of leading American companies. The British American tobacco companies countered this take-over and formed Imperial Tobacco. In 1902 (they celebrated their centenary year in 2002) these companies came to an agreement and united to form British American Tobacco and now have its headquarters in London. BAT support more than ten (10) million jobs worldwide and operates in twenty-four (24) countries, in each region of the world, American Pacific, Asia-Pacific, Latin American and Caribbean, Europe and Africa and Middle East.

3. Social Issues at BAT

BAT's nature of business is very controversial. Social issues play at the vanguard of their very existence and to demonstrate responsible corporate conduct, BAT has begun to tackle some of the following social issues and adapted policies to assist:

 Underage Smoking Prevention Issue - cease advertising tobacco products to minors.

 Underage Smoking Prevention (USP) Policy Adapted Ð'- they have decided the best ways to deal with this problem is to prevent children from obtaining tobacco products and discourage them from wanting to smoke. BAT did this by supporting more than 130 programmes in over 70 countries and targeted three main areas:

Ð'* Advertising Ð'- BAT has been involved with many advertising campaigns in their group of companies and has been promoting the message that youth should not smoke. One such campaign was done in 2002 the West Indian Tobacco Company (Witco); an associate company of BAT which is located in Trinidad. Witco began working on an Underage Smoking Prevention campaign with the theme "Think for Yourself". It consisted of the tag line "Think twice- Can't vote don't Smoke." This media campaign consisted of full-page press add, a catchy radio jingle and four 30 second radio and television commercials. This campaign was proven to be a success; it was judged the best campaign in the Public Service category by the Advertising Agencies Association of Trinidad and Tobago. (Social Report 2004/2005, West Indian Tobacco, pg 27)

Ð'* Retail Access Prevention Ð'- They focused programmes on restricting the sale of tobacco products to minors at the point of sale. This entailed teaching retailers about relevant laws and ways to preventing sales to minors.

Ð'* Education Ð'- They developed programmes that focused on risk behaviour, such as resisting negative peer pressure. They assisted educators, parents and children on how to avoid those behaviours.

 Marketing Issue - tobacco products should be marketed responsibly and directed to adult consumers.

 Marketing Practices Adapted - Marketing is a very important role in the world of business organizations. A strong customer focus and marketing strategies are crucial for the success of any organisation. However, because of the controversial nature of their business, BAT must pay particular attention to their marketing strategies. They are mandated by law to target specific markets and as a result BAT, with two other tobacco companies developed the first tobacco International Marketing Standards, these standards are applied to all of BAT's operating companies. following are the policies that were implemented:

Ð'* All marketing campaigns should be directed at adults, it should not appeal to youth or suggest that smoking enhances sporting, social, sexual or professional success

Ð'* In some associated companies, BAT has ceased advertising their brands on television, some print and radio.

Ð'* They have also ensured that no billboard is located within 100m of any school institution (which is attended primarily by underage children).

Ð'* In some companies they have increased the size of the health warning beyond what is required by law and these warnings now cover 15% of the branded area.

Ð'* Market on a one to one basis, which is by text messaging, thereby ensuring their products are marketed to adults.

Ð'* No advertisements shall be placed in any printed publication unless there is reason to believe that 75% of the readers are adults.

 Health Issue - report publicly accurate information relating to the ingredients of their products that have probable adverse health effects.

"British American Tobacco recognises that along with the pleasures of smoking there are real risks of serious diseases such as lung cancer, respiratory disease and heart disease. We also recognise that for many people, smoking is difficult to quit." (Dr. Chris Proctor, Head of Science and Regulation, British American Tobacco, http://www.bat.com/). Statements similar to this are the main reasons for health policies adapted throughout BAT and its subsidiary companies. The company needs to demonstrate that they are aware of the health risks associated with their product; however they have adapted policies to deal with these risks:

 Health Policies Adapted

Ð'* BAT has