analysis of major environmental impacts and strategies within the u.s. cigarette manufacturing...
TRANSCRIPT
Analysis of Major Environmental Impacts and Strategies Within the U.S. Cigarette Manufacturing Industry
TIMOTHY R. BELITZ
ADVISOR: DR. DEBORAH RIGLING-GALLAGHER, NICHOLAS SCHOOL OF THE ENVIRONMENT
ObjectiveConduct a comprehensive review of environmental performance, sustainability strategies, and practices of US cigarette manufacturers to enable continual improvement.
Methods
Used publically available literature on US cigarette manufacturers
Three facets of analysis:1. Comparative Review Environmental Performance,2. Examined Environmental Sustainability Strategies, and3. Reviewed Industry for Broad Inventory of Environmental
Sustainability Tactics.
Overview of US Cigarette Manufacturing
Major US Manufacturers• Altria - PMUSA• RAI –RJR Tobacco• Lorillard
Number of Employees
Facility Size (million sqft) Manufacturing Location
Annual Capacity (billion cigarettes)
PMUSA 2300 1.6 Richmond , VA 135RAI Tobacco 3900 2.1 Tobaccoville, NC 110SFNTC (RAI) 400 0.098 Oxford, NC 2.8Lorillard 2800 0.97 Greensboro, NC 50
Other Lorillard RJR Tobacco PMUSA
8 1429
49
2011 Market Share (%)
Industry Sustainability Reporting
2009 2010 2011 2012
239301
477
Newsweek US Green Ranking
Altria
RAI
Lorillard
Comparative Environmental Impact
2006 2007 2008 2009 2010
0
50
100
150
200
250
300
TRI Facility Score
PMUSA Lorillard RAI Tobaccoville RAI Santa Fe
Comparative Environmental ImpactThousands of Pounds Released
2006200720082009201020110
10000
20000
30000
40000
PMUSA RAI Tobaccovile Lorrilard Santa Fe
2006200720082009201020110
10000
20000
30000
40000Nicotine and Salts Ammonia
Altria RAI Altria RAI Altria RAI
0
200000
400000
600000
800000
1000000
CDP Fuel Breakdown of Energy Producing Fuels Used (MWh x 1000)
Distillate fuel oil No 2 Natural gas Bituminous coal
2009
2010 2011
Comparative Environmental Impact
Comparative Environmental Impact
20092010
2011
050,000
100,000150,000200,000250,000300,000
CDP Scope 1 & 2 Emission Intensity (Cigarettes Produced x 1000/ Emissions metric tonnes)
Altria RAI
Waste Disposed at
Landfills (millions of Pounds)
Total Waste (millions of Pounds) Percent Waste Recycled
2011 2010 2009 2011 2010 2009 2011 2010 2009
RAI 37 43 39 68 65 100 46% 34% 60%
Altria 26 38 28 292 125 133 91% 70% 79%
GRI Reported Data Non-Hazardous Waste Disposition
Comparative Environmental Impact
Analysis of Environmental Strategy
• Basis of Analysis–Measuring Environmental Strategy:
Construct Development, Reliability, and Validity -2011–Validated content analysis method–Designed to use publically available data–Organized into categories that demonstrate
a firm’s proactive environmental strategy
Analysis of Environmental Strategy
– Historical Orientation,CategoryTotal
Possible PMUSA RAIHistorical Orientation 4 3 3Network Embeddedness (a) Supply chain 4 1 1Network Embeddedness (b) Other Stakeholders 7 5 3Endowments 5 2 1Managerial Vision 4 3 0Top management Team Skills 4 4 4Human Resources 2 1 1Total 30 19 13
Industry Environmental Sustainability Tactics
• A broad collection of US/international cigarette manufacturers environmental sustainability tactics was developed while conducting this project.
• Over 140 examples of practices that are being used in 9 environmental sustainability practice areas.
Recommendations
1. Utilize their environmental sustainability information to its fullest. – Continue to improve quality and validation
2. Improve “Network Embeddedness” of the supply chain, government relationships, and volunteer programs.
3. Investigate niche market for organic, additive free, “green” cigarettes.
4. Investigate alternatives to fossil fuel power generation.
“There is no magic bullet – it’s about understanding what works best in a particular location.”
-Participant Comment in BAT CSR Report
Thank You