Environment

A sustainable approach to environmental stewardship

We align our environmental and energy management systems with relevant international standards (namely IS0 14001 and ISO 50001) and have also developed the JT Green System (a simplified environmental management system) to promote a sustainable approach to environmental management in our smaller and less complex operations.

Recent revisions to ISO 14001:2015 have required ongoing actions during 2017, including aligning our environmental management systems with these updates. We also started to integrate energy management into our existing management systems.

Going forward, we will continue to explore how we can better integrate our environmental and energy management systems with other business considerations, such as Quality, Occupational Health and Safety, and other operations. While this presents challenges, it also brings with it opportunities. We are piloting the approach to developing an integrated quality, environment, health and safety management system at our Leaf factory in Malawi. We will use the insights gained from this process to help other factories build more efficient and integrated management systems.

JT Group long-term environment plan 2020

JT Group long-term environment plan 2020

ISO 14001 Certification

We use ISO14001 as the framework for our environmental management systems to manage significant environmental aspects. We have this KPI to track the proportion of our cigarette and tobacco related factories that are certified to ISO14001. We have a target to achieve 100% ISO14001 certification of those factories by 2020. Data for current and past certification of our factories can be found under 'Environmental Data'.

Environmental management

GHG Emissions

GHG Emissions

Keeping a cap on greenhouse gas emissions

Climate change remains the most important environmental challenge of our times. For the JT Group, and particularly for our tobacco business, climate change can directly affect the supply of key raw materials, including tobacco and many of the production materials used across our supply chain.

It is, therefore, critical that we reduce fossil fuel energy use and greenhouse gas (GHG) emissions for the benefit of the planet, and of our business.

GHG emissions in our operations

The JT Group remains committed to cutting its GHG emissions, notably through focusing on energy reduction, and increasing the proportion of renewable energy that we use.

We have reduced absolute GHG emissions between 2009 and 2017 by 21.2%, achieving the target set out in the JT Group Long-Term Environment Plan 2020*1. This was achieved through a number of initiatives, one of them being the use of renewable energy. GHG emissions relate to both Scope 1 emissions (those for which we are directly responsible), and Scope 2 emissions (those related to energy supplied by third parties). We are still working hard to meet our 2020 emissions intensity target. To achieve this, we have set a goal to improve our overall emissions efficiency by a further 5%, during the period 2018-2020.

Planning and Promoting Emission Reduction

As part of our efforts to tackle GHG emissions, we have established a cross-functional team for renewable energy, allowing for a more coherent approach towards renewable energy and emissions reduction. To help compare various GHG reduction projects, in terms of anticipated emissions reduction, the cost of that reduction, and also project payback, we have adopted a tailored MACC*2 tool. This helps us better plan and prioritize projects and focus our GHG reduction efforts. Our new Environment Plan will include revised emission targets in line with science-based approaches, taking into account the Paris Agreement on climate change.

We are pleased that more and more of our factories and offices now purchase or generate energy from renewable sources.

Examples of renewable energy purchased: Sweden, Romania, Germany, Canada, Switzerland, Poland

Examples of renewable energy generated on-site: Brazil, Turkey, Jordan, Nigeria, The Netherlands.

The majority of our factories continue to implement energy reduction opportunities. One impressive example of this is our factory in Malawi, which achieved an almost 65% reduction in electricity consumption from 2015 to 2017.

In 2017, our factory in Tainan (Taiwan) became the first JTI factory to be awarded a Leadership in Energy and Environmental Design (LEED) Certificate from Green Business Certification Inc. (GBCI®). This represents official recognition of our leadership in energy and environmental building design, and an acknowledgement of efforts made in the areas of energy and water efficiency and innovation, amongst others.

For more details about GHG emissions in our operations, please refer to the latest Sustainability Report FY2017.

Water and waste

Water

Water is a fundamental resource for the JT Group and, in particular, for our processed food business. Water is also a risk factor within our operations. Water-related issues, such as availability, quality, flooding, drought, and how water is regulated, represent potential risks to our business.

We take steps to ensure effective water management. We do this by ensuring our business units set annual withdrawal targets and by undertaking water risk assessments in our factories. We have a target to complete our water risk assessments at all of our manufacturing sites by 2020. By the end of 2017, we had completed water risk assessments at 40 of our factories (56%).

As part of our new Environment Plan we are committing to context-based water targets for relevant parts of our business.

Recent water-related improvement projects include water recovery and recycling at our factories in Turkey, Jordan, and Russia, and improved wastewater treatment at two of our Russian factories.

Recognized for Environmental Leadership

  • In 2017, we achieved Leadership status in both CDP Climate Change and CDP Water. In addition, we invited 47 of our suppliers to disclose information about climate change and water management through the CDP Supply Chain Program. We recognized World Water Day 2017 with a seminar at our Geneva headquarters, where we showcased our approach to water management and water-related community projects in Malawi, Ethiopia, and Bangladesh.

    Going forward, we will be further investigating the potential environmental impacts, including water-related issues, in our Reduced-Risk Products supply chain.

  • water withdrawal

Waste

Waste management is a key component of both our current and new Environment Plans. Across the company we apply a ‘Reduce, Reuse, Recycle’ philosophy approach to waste management. We believe that, if waste is reduced, resources can be reduced, and so can costs to the business. Our factories develop targets for reducing waste, and increasing the proportion of waste recycled.

  • We experienced an unexpected challenge in 2017 resulting from an unintended consequence of legislation: one of our European factories was faced with increased recycling targets, leading to more waste being diverted for recycling instead of being reused. This increased the overall quantity of waste generated, and resulted in higher costs.

    waste generation

  • We are also seeking ways to better manage electronic and electrical waste within our Reduced-Risk Products supply chain. To address this, we are developing guidance around improved waste management in this area. Turn to page 23 to read more about environmental practices for our Reduced-Risk Products.

    breakdown of waste generated in 2017

Biodiversity

Responsible management of biodiversity within our operations supports the long-term viability of our business, whilst protecting the environment.

Biodiversity

Embedding biodiversity considerations into internal management processes and strategic decision making is fundamental to our business. This involves assessing our dependence and impact on biodiversity and natural resources and identifying how we utilize and manage these. We then deploy appropriate responses, such as good agricultural practices, initiatives on soil management, sustainable wood and water conservation, and natural forest restoration.

In 2017, we launched our project on nature restoration in Brazil. This was in collaboration with the Society for Wildlife Research and Environmental Education, and approved by the National Bank for Social Economic Development. Over the next five years, the project aims to restore 335 ha of Permanent Protection Areas at our integrated tobacco farms as well as in Flona de Irati, a National Forestry Reserve; seedling planting has already started in this area. The project will contribute to environmental conservation in Brazil, increase our efforts in protecting biodiversity, and impact positively on our farmer communities.

Our Miombo Woodland Project in Zambia is an initiative for the sustainable management of Miombo woodland. It includes, amongst other things, the conservation of wood, rehabilitation of existing woodland areas, and empowerment of communities to use these resources sustainably. Achievements from the first phase of the project, completed in 2017, include a baseline study, engagement with local communities and local authorities, and training on sustainable bee keeping, use of efficient cook stoves, and improved land management.

To improve farm productivity and reduce farming costs, we invest in innovation. This includes partnering with leading international academic institutions and non-governmental organizations. Our Agronomy, Development, Extension, and Training (ADET) centers in Brazil and Zambia carry out research into topics that ultimately enhance returns for farmers in the long term. We have recently developed a protocol to help farmers establish an inventory of biodiversity and how to monitor it. This enables farmers to implement action plans for environmental restoration in relation to native vegetation, water, soil, fauna, and climate.

Environment data

Some of our environment data has been externally verified.

Environment data verification statement

1. Energy

Energy Consumption
(Terajoules)
2009 2010 2011 2012 2013 2014 2015 2016 2017
Fossil fuels purchased and consumed 6,244 6,170 6,163 6,242 5,978 5,738 5,457 5,683 5,539
Electricity (nonrenewable) purchased 3,988 3,893 3,442 3,442 3,339 3,299 3,113 2,769 2,693
Steam / heating / cooling and other energy (nonrenewable) purchased 61 66 73 86 99 95 90 64 39
Total renewable energy purchased or generated 807 918 1,007 1,029 741 741 747 945 1,109
Total energy sold (124) (128) (122) (120) (118) (109) (105) (107) (112)
Total 10,977 10,919 10,563 10,679 10,040 9,764 9,303 9,353 9,269
Energy Consumption Breakdown (Terajoules) 2015 2016 2017
A. Non-renewable fuel consumed 5,436 5,683 5,539
B. Renewable fuel consumed 606 669 680
C. Electricity, heating, cooling and steam purchased for consumption 3,364 3,107 3,157
D. Self-generated electricity, heating, cooling and steam 2 2 4
E. Electricity, heating, cooling and steam sold (105) (107) (112)
Total (A+B+C+D-E) 9,303 9,353 9,269

2. GHG

GHG emissions
(1,000 tons CO2e)
2009 2010 2011 2012 2013 2014 2015 2016 2017
CO2 381 379 377 380 364 348 329 335 327
HFCs 23 24 25 22 25 27 27 33 28
Total (Scope1) 404 403 402 402 389 376 355 369 355
Scope2 476 466 417 423 408 401 380 349 339
Total (Scope1+2) 880 869 819 825 796 777 736 718 694
                   
Purchased goods and services - - 4,306 4,717 4,703 4,377 4,028 4,207 3,742
Capital goods - - 318 435 457 403 382 349 413
Fuel-and-energy-related activities
(not included in Scope 1 or 2)
- - 110 111 107 106 103 97 100
Upstream transportation and distribution - - 367 357 354 342 290 334 345
Waste generated in operations - - 27 26 24 21 19 18 18
Business travel - - 258 275 268 245 257 265 275
Employee commuting - - 38 38 37 40 37 36 39
Upstream leased assets - - 0 1 1 1 0 0 1
Downstream transportation and distribution - - 319 330 334 345 305 264 300
Processing of sold products - - 7 6 5 3 2 2 2
Use of sold products - - 28 29 29 31 32 33 43
End of life treatment of sold products - - 56 71 66 69 63 57 60
Downstream leased assets - - 0 0 0 0 0 0 0
Franchises - - 2 2 2 1 1 1 1
Total (Scope3) - - 5,837 6,397 6,386 5,983 5,519 5,663 5,338
GHG emissions intensity for tobacco business (Scope1+2)
(tons CO2e per million cigarettes equivalent)
2009 2010 2011 2012 2013 2014 2015 2016 2017
0.78 0.80 0.74 0.75 0.73 0.72 0.67 0.66 0.64

3. Water

Water withdrawal
(1,000 m³)
2009 2010 2011 2012 2013 2014 2015 2016 2017
12,958 12,677 11,615 11,510 10,783 10,560 9,936 9,900 9,735
Water withdrawal by source (1,000 m³) 2015 2016 2017
Fresh surface water 1,398 1,575 1,466
Brackish surface water/seawater 0 0 0
Rainwater 46 47 53
Groundwater 5,318 5,351 5,226
Produced/process water 0 0 0
Municipal supply 3,174 2,927 2,991
Wastewater from another organization 0 0 0
Total 9,936 9,900 9,735
Water discharge by destination (1,000 m³) 2015 2016 2017
Fresh surface water 2,328 2,326 2,349
Brackish surface water/seawater 0 0 0
Groundwater 1 1 1
Municipal/industrial treatment plant 3,044 2,824 2,909
Wastewater for another organization 0 0 0
Total 5,373 5,152 5,259

4. Waste

Waste generation
(1,000 tons)
2009 2010 2011 2012 2013 2014 2015 2016 2017
145 134 125 127 118 119 119 114 114
Waste generation breakdown (%) 2015 2016 2017
Recycling 76% 77% 78%
Recovery 8% 8% 7%
Disposal 16% 15% 16%

5. ISO14001 certified (Scope: Cigarette and tobacco-related factories (including Group factories))

FY2017

  Total factory Certified factory Certified%
JT 10 10 100%
JTI 33 23 70%
Total 43 33 77%

FY2016

  Total factory Certified factory Certified%
JT 10 10 100%
JTI 30 22 73%
Total 40 32 80%

FY2015

  Total factory Certified factory Certified%
JT 11 11 100%
JTI 30 23 77%
Total 41 34 83%

FY2014

  Total factory Certified factory Certified%
JT 17 17 100%
JTI 30 22 73%
Total 47 39 83%

The calculation methodology and scope are available in a Basis of Reporting.

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