11995 KEY AREA PAPER: CORPORATE AFFAIRS
L Corporate Image
2. External Relations
3- ,,fedia
4. Marketing Restrictions
5- Packaging
6. Pressure Groups
7. Communication and Co-operation
8. Training and Development of Corporate Affkirs
Staff
9 National Manufacturers Associations
10. Internal Communications
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BATCo document for Province of BritiSh Columbia 23
April 1999


K.- Y AREA PAPER CORPORA TE AFFAIRS
CORPORATE INIAGE
BACKGROUND
A compan~s corporate image is a valuable asset.
From a commercial perspective, the
benefiES of a good image and reputation within
local and national communities are
becoming Increasingly apparent. The products ofa
company with a good corporate
Imaize are cften more attractive to consumers.
Access can be easier to decision makers
and opinion forTrers, me company can become more
attractive in terms ofrecruitment
and it Is more dinFcil, for legislators to enact
harsh regulations affecting companies
which have :he su-,port of local and national
communities.
With the c~anizlnw?olitical climate, there are
increasing opportunities for international
businesses in many new markets around the world. A
strong corporate image can
assis: wiuh -.he tx.:o-r of products and setting
up joint ventures in new countnes.
International :--mcanies and industnes are often
critic:'5ed for their activities and
beh3'-'ICUr ill mar.:.-'oar-s of the world. Much
of,,he criticism is politically motivated,
d to the firee enterprise system. Critics argue
that the
by mcse oppose
interts's and cb~ie=ves of international business
are incompatible with the interests and
,vell-be;ng ofnaz:cral zommuni,:es
%Vhilz this :s -ior -:--e. these Views receive
wide coverage and have a considerable
numcerofsubsc"bers They are certainly used by the
anEi-smoking lobby to attack
both :he zo~acc-- :,-.dustry and companies in the
~AT group.
A eood cor-;crae :rnage and reputation is judged
on many factors including financial
pertor-nanct, cor7-crar.- behaviour and ethical
practices, community involvement and
conEr-.'--utior. and -nvironmental a~areress and
sensitivity
rr is -here.;ore imporzant that operating
companies implement programmes to develop
and promci.- a acca ccrporace image for themselves
and the group and that all steps
are :aken zo ensure -hat the company enjoys a good
corporate reputation
POLIC1'
Comcanies shou[Z' ~a,,e a co-ordinated programme
to establish and maintain their
ccr-,crate ir-.32e 2n-- reputation.
As par: of :or-.or3Ee image programmes, companies
should associate themselves
with British-Ame:-can Tobacco Company on
stationery, including the BATCo logo, in
accordance ,itri z6e corporate identity
guidelines. General communications should
refer to beinst par-. afzhe BAT group. e.g., total
group volume should be quoted rather
7 .
than BATCo s and group operations should refer to
North America, all ofEurope and
Latin America. al:6oueh reference should not be
made to BAT Industries as such. The
genenc term BAT ~,id be the communication
reference-
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BATCO document for Province of BritiSh Columbia 23
April 1999


KEY AREA PAPER CORPORA7FAFFAIRS
Corporate image/reputation should be assessed
regularly and programmes adjusted to
take account of changing opinions and attitudes.
OBJECTIVES
The overall objective of corporate
image/reputation programmes should be to achieve
the highest reputation xithin the industry sector
among key target audiences to ensure
community support for the company's business
objectives and activities and to assist in
gaining competitive advantage.
BAT should be positioned as the pacesetter in the
following areas-
Financial management and profit performance
Ethical standards
Marketing standards and practices
Product quality
Customer relations
Environmerirai practices
Employment practices
Community contn'--ution
Corporate identification
Programmes and action should address.
Financial standing - to ensure :hat: the company
is able to maxirr~se the
benefits and the commercial advantage offinancial
crediblUry through
favourabie baril,_ng terms, preferred terms with
suppliers, etc; government
recognises the economic contribution and views of
the company when
determining policy- the company enjoys a fair
share price
Ethical standards - to ensure that: the group's
strict standards regarding
obser,,anc-- oFlocal la's and customs, payments
oftaxes and charges are
observed-, zhat proper and fair relationships are
observed with distributors,
suppliers, t-armers. etc and in the conduct of
relations with elected and
government offic;als
Marketing standards and practices - to ensure that
the company's code of
marketing practice is observed and that the
company operates with~in local laws
and volunrar; aereements.
Product quality - to ensure that the company is
able to gain competitive
advantaize through the marketing ofsuperior
quality products and that all
communications material is ofthe highest quality
standards.
Customer relations - to ensure that customer
enquiries are handled efficiendy
and quickly and -.hat the company demonstrates
care and concern to achieve
customer satisrac:ion. (_7
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BATCo document for Province of BritiSh Columbia 23
April 1999


IKEY AREA PAPER CORPORA TFAFFAIRS
Environmental Practices - to ensure that strict
standards are observed in
relation to disposal ofwaste, recycfing,
utilisation oflocal resources and other
issues, set out separately in BArs environmental
policy and that due
recognition is sought on appropriate occasions
Employment practices - to ensure strict observance
and due recognition of
employment policies and car-'itions and safety
standards and that management
quality and employee op por-,~.:.-.i ties are
communicated and understood
Community contribution - to ensure that community
programmes respond to
the needs and aspirations of:ocal and national
communities and are relevant to
local development needs. P.:gTammes should be
selected from one ofthe
following four areas so that BAT is recognised as
a consistent supporter or
specific initiatives:
health
environment
culture
business deveioprr.,---
Corpornte identification - :-, ensure that all
visual ideritification such as logo,
letterhead and stationery, siz7:age. vehicles
comply with BAT's corporate
identity rules to achieve cons:siert corporate
identification. Where
appropnate, companies shc~:'.~ seek a associate
the company with the brands.
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BATCo document for Province of British Columbia 23
April 1999


KEY AREA PAPER CORPORATE AFFAIRS
EXTERINAL RELAMNS
BACKGROUND
The free enterprise system is now a world wide
phenomenon, however that freedom is
qualified and under great pressure. Increasingly,
communities are demanding that
international corporations justify their franchise
to do business. Companies such as
BATCo must not onlv be good world citizens, thev
must demonstrate and communi=e
that this is so
POLJCY
It is BATCo policy that systemaric pro-active
programmes of regular contact with
government officials, politicians and ministers on
ma-,,.-.-s of mutual interest be pursued.
Contact programmes should also be carried out with
ippropriate international bodies,
such as the World Bank- and World Trade
Organisaticri. Audiences should be made
aware cf the company's positive contribution to
the national economy. Assistance will
not be forthcoming if a company approaches a
potent;31 helper only when problems
arise, Systematic contact should also be
maintained %,.ith other key audiences whose
goodwill and co-operation can help companies
achie-.e their business objectives. These
groups can include, for example, employees,
suppliers. customersismokers, the trade,
local community leaders, leaders of the financial
sector, compedtion, politicians, the
public, tobacco growers, advertising agencies and
busmess leaders.
Steps should be taken to ensure that non-executive
directors are Ziven the opportunity
to play a full and appropriate role in
relationships with government and other
appropriate audiences.
This policy should be read in conjunction with the
Key -Area Paper on Smolcing and
Health - Communication.
OBJEC=
The objective of eaernal relations' activity is to
ensur.- -,hat the U1 support of key
audiences is enlisted. In this way a company will
heic ~iself to sharpen its competitive
edize and maintain the &eedom to conduct its
business :n a responsible manner.
BATCo's business contributions and practices
should '--e recognised to be of a high
standard and not open to criticism.
BATCo document for Province of British Columbia 23
April 1999


KEY AREA PAPER CORPORA TE AFFAIRS
THE MIEDIA
BACKGROUND
As major employers and contributors to the
economy, BATCo companies and
operations are the subject of legitimate interest
by the media. Dealing with -,he media
can have a significant impact on the company's
business. Relations-ViEh press, radio and
.ele%ision are an important means of devel
re-.utation and -nishandled
oping corporate
can have a significant negative impact on the
company.
I>OLICY
It is BATCo's policy to be open and honest in all
its dealings -.kith the media and to
conduct sysrematz .c, pro-active media relations
programmes to promote :~-e company as
a res-consible business. Media relafions'plans
should be developed and rev'sed annually,
to inc:ude key journalists to contact, subjects
and messages to cornmunicar.- and
programmes For regular contact.
Companies should nominate a media spokesman who
should . eceive re;,--!a- issues and
mecia training and is the only person in the
company, apart from :~,e No 1. who is
authorised to talk to the media.
When company spokesmen are dealing with commercial
issues affecting the!ocal
business, information made available should be
cleared with the No 1. When providing
commercial and financial information, close
attention should be -.aid to Icc:!l laws, stock
exchange rules, etc.
Opporrunifies for general comment on all smoking
issues should be caremill- reviewed
and pursued if it is considered that the company's
views can be adequately
This should be with the agreement of the No 1.
When discussing any smc.,:,-ig and
health issues. spokesmen should be aware of
product liability implications =d scientific
accuracy and should fully understand the company's
stance.
Corporate Affairs Department~ 21ifillbank, should
be kept informed of sienh-'cant media
contact and coverage which may have international
or damaizine local im;ac. and should
be :cnsulted if there is any doubt about handling
any specific contac-s.
OBJECTIVES
Media relations programmes should contribute to
the achievement of cor-,orae
objectives by ensuring that the company is well
known and highly mizarded b, its key
audiences.
A more detailed paper - Guidelines for Dealing
with the Media - has beencirculated by
ComoraEe Affairs Department, Millbank.
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BATCo document for Province of BritiSh Columbia 23
April 1999


IKE Y AREA PAPER CORPORA TE AFFAIRS
MARKETING RESTRICTIONS
BACKGROUND
In response to recommendations from WHO and a
number of international pressure
groups, govemments are introducing a wide range of
restrictions on marketing activities
relating to tobacco. These include restrictions or
bans on advertising in some or all
media, on brand sponsorship, particularly
ofsports, and on trademark diversification
activities. It is often stated that such
restrictions are aimed at che'protec-,ion' ofyoung
people from the influence oftobacco advertising
and sponsorship. However, major
studies and experiences In various markets clearly
demonstrate that advertising or
sponsorship is not significant in influencing
young people to begin smoking, or that
advertising or sponsorship bans have any
demonstrable effect on the overall
consumption of tobacco.
POLICY
1 : Is BATCo policy to protect marketing freedoms
in all instances Wherever possible,
.ie2otiatedvoluntarv codes are to be preferred to
legislation, and companies should
consider adopting such codes throughout the
industry in their country, where they do
7 ~ot already exist, in the hope of pre-erripting
legislation-
OBTECTn'ES
To preserve -he night of companies to advertise
and market -,he!r products within scic;aDy
acceptable standards and practices.
To preserve their ability to inform their
consumers ofproduc-, developments and
mricivations.
To ensure :hat companies ire able to compete and
'Increase their market share.
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BATCo document for Province of BritiSh Columbia 23
April 1999


KEY AREA PAPER CORPORATE AFFAIRS
PACK-kGl',,'G
BACKGROUND
For many years, health warnings have appeared on
cigarette packets in some markets
and in others they have not. In pa:-,icular,
health warnings have been required by
governments in most OECD nations and it is the
perception ofthe company that, in
these countries at least, there is a community
expectation that all cigarette packets
should contain a warning ofsomekind. As a
responsible manufacturer, BATCo believes
it should respond to those expec-.ailons and apply
a health warning to all products it
makes.
Moves have also been made in scme markets -o Force
manufacturers to se!l cigarettes in
plain or veneric packs.
In many countiries neafth wam;ngs are also
inc!uded in advertising either as a result of
legislation or-Mciustry agreement.
POLICY
1 : is BATCo policy to comply %7-.:~ any national
requirement to place health wamings an
cigarette packaging and in advemsiniz.
In most cases warnings are requirtd by government
and should therefore contain an
attribution to the szovernment.
In cases where there is no requiremerit or
agreement, health warTtings should be included
on packaging but not in adver-tisina (guidelines
for the application ofhealth warnings
where no government requiremenc -Xists are
circulated separately).
Pic,oriai warning5, and those occ,--,,ing a major
pack face or faces (fronE and back) or a
disproportionately larqe area of ad, ertising
space, should be resisted, as should moves
to plain cr generic packs. Every ;!~Fbr should ~e
made to protect the integrity of the
company's packs and trade marks
OBJ'E=,-ES
To minimise the damaee to the Grcuo's most
valuable assets. trade marks. nack desiizns,
To neutralise t'he controversv ove7 pack warning
labels,
To mLnimise the disruption to ad,er-fising
communications.
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13 ATCo document for Province of BritiSh Columbia
23 April 1999


KE Y A RF-4 PA PER CORPORA TE AFFAIRS
PRESSURE GROUPS
BACKGROUND
Intemational issues 'including tobacco, have
become politicised such that pressure
groups are sometimes regarded as political
groupings. Many are well established,
employing ffull time staff. A bureaucracy has
arisen with an international career structure
znd world -,;,ride information networks. It is
most important that the professional nature
of pressure groups and their motivations be fully
understood. Because of its business,
size and international character, BAT is a special
target.
The key strategy ofanti-tobacco pressure groups is
to persuade governments to
introduce legislation to ban advertising, reduce
-ar/nicotine levels, increase taxation. to
ban smoking in public and to force crop
substitution. By these means pressure groups
hope to ac.-~ieve their objective of eliminating
tobacco smoking.
Most anti-tobacco pressure groups are linked with
the MiO and affiliated agencies.
They include :he International Union Against
Cancer (UICC), the International
Organisat:cn of Consumer Umons (IOCM, Acnon on
Smoking and Health (ASH) and
many cther3, ,ho are either regional or narion3l.
Companies should be aware that pressure group
campaigns will often include:
public meetings
ann-cobacco media acivlt~
defacement oC advert i sem ents
'smears against individual tobacco company
executives
action at company AGMs
acrempts to influence company shareholders
lobbying politicians
POLICY
BATCo policy is to pre-empt the attacks of
adversaries through a review of plans and
allegations or.pressure groups and to engage them
when it is in the interests ofthe
operating company to do so. Where an attack is
directed specifically at BATCo, the
operating company should co-ordinate and lead the
defence of the company. Otherwise
pressure groups should be dealt %kith via the
national manufacturers' association, but if
necessar-y, the operating company can lake a
leading role.
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To further business objectives by the continued
det5ence and protection ofthe companyjs
interests and reputation
To ensure ' balance and fairness to the debate. U7
BATCo document for Province of BritiSh Columbia 23
April 1999


KEY AREA PAPER CORPORA 7E AFFAIRS
CO.NMUNICATION AND CO-OPERATION
BACKGROUND
The issues affecting the international tobacco
business are now globalised. The global
anti-tobacco policies of the WHO and its executive
ancillaries are being implemented on
a regional basis. The WHO activity is
adn-driistered from regional centres in New Delhi,
Manila, Brazzaville, Washington DC, Copenhagen and
Alexandria. Over the next few
years, the regional structure of the industry's
opponents is expected to be strengthened.
Regional trading blocks exist in some parts of the
world and necessitate a regional
approach to public issues management.
In the BATCo group, companies have considerable
experience in dealing with WHO's
smoking and health strategies, and also with
criticism of international businesses.
POLICY
A regional as well as an ~nterriational view
should be taken of the issues affecting a
company's business. The strategies of WHO and
pressure groups should be moriitored.
Strategies on smoking issues adopted by BATCo
companies should be mindful of other
regional activities. Knowledge and experience
should be efficiently communicated
among BATCo companies within the region and to
Millbank so that all can benefit.
Regional issues and communications should be
managed through the Public Affairs
managers inthe Cor
porareAjazrs department. &fillbank_
OBJECTIVE
To maxirn~ise communication and cooperation on
public issues amongst companies and
business units in re~tions covered by RBUs.
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BATCo document for Province of BritiSh Columbia 23
April 1999


I KEY AREA PAPER CORPORA TE AFFAIRS
TRAEVING AND DEVELOPMENT OF CORPORATE AFFAMS
STA.FF
BACKGROUND
The effectiveness of an operating company's
Corporate Affiirs Department rests upon
the professional competence ofstaff. In a
worldwide group such as BATCo, special
efforts must be made to establish uniformly high
standards ofprofessional practice.
POLICY
It is essential that the head of corporate affairs
function be aware of the company's
policies, plans, directions and any developmenrs,
to be able to operate effectively and
provide informed advice to the company.
It Is policy that the corporate affairs
s:afftraining agenda be based on the technical
sUls
outlined in the PACE appraisal sys:zrn and the
Corporaie,~~fairs training jyllahus now
adopted by the BA TCo Board
The professional development ofc.-morate affairs
and public relations staffshould be
through external training programmes, but where
these are not available, staffshould be
assisted by in-company training, by co-operative
programmes with companies in the
same re2ion and with Corporate Affz~iis
Department, NUlbank.
OBSECTIVES
To ensure the highest standing of the company
within its local enviro=ert.
The objective of staff training is to ensure that
high professional standards are
maintained. In this way the company will be able
to communicate effectively with and
enlist the support ofthose groups and individuals
who can heip it maintain its
ccrnmercial freedoms.
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BATCo document for Province of BritiSh Columbia 23
April 1999


KEY AREA PAPER CORPORATE AFFAIRS
NATIONAL,MA.NUFACTL-RERS'ASSOCLATIONS
BACKGROUND
It is a recognition of the important economic
position often held by the tobacco industxy
that governments wfli usuaUy wish to keep closely
in touch. Governments will normaUy
prefer to do so via an organisation which can
represent the interests ofall naticral
tobacco manufacturers. Such N' NW can also help
companies by providing a source of
industry information and agreed views on
non-competitive issues for the media and the
public.
POLICY
It is BATCo's policy that wherever possible, the
views of a national tobacco industry
should be projected co-operatively through a
national manufacturers' association.
On some occasions, the outcome ofcertain ke~:,
issues can result in COMperitive
advantage for one member ofan N1,L4 over another.
BATCo companies should be
aware of3uch issues andpursue strategies that
ensure that the competitive advantage
'falls in BA Ts,favour-
Where there is insufficient industry
representa::ori to form an NMTA, the BATCo
company irselfshould be prepared to represent an
industry view.
NMVLA.s should be adequately staffed and funded.
They should establish appropriate
policies and measurable objectives. Effectiveness
should be audited and reviewed
regularly.
OBJECTIVE
To ensure that the industry presents strong,
consistent and ur~ified views to its audiences
on non-compefitive tobacco issues- This uniry
\,bill give strength to the industry's case
and so help create favourable conditions for the
responsible conduct ofbusiness.
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BATCo document for Province of BritiSh Columbia 23
April 1999


KEY AREA PAPER CORPORA TE AFFAIRS
INTERNAL COMMUNICATIONS
BACKGROUND
Research clearly demonstrates that companies with
clear policies and effective systems
for internal communications are more likely to be
successful.
POLIC-Y
It is the companys policy to be open and honest in
all its deafings ,.ith employees,
involving them in business decisions and providing
regular and relevant information
about the company.
The company -ecog-nises that managers are the main
channel ofinformation and will
carry responsibility for the quality and
timeliness of lnfc,=, afiori
The company underakes that it will endea-vour to
ensure tha, Teopie hear news first
official[v, rather than through the grapevine.
Communication is more than imparting information
so managers will also'walk the job'.
The company rtcognises that communication is as
much listemng as it is talking and will
ensure that wherever possible, communication wid
be "ace-to-r,ace. It will also provide a
mechanism to enable staFto have questions and
concerns addressed in a t;me!y ay.
The company xill provide communications training
and de,~eiccpment for employees.
All managers and super,,isors will be appraised on
their communications skills and
activ~ities.
The company %vIll endeavour -,o adopt best
professional prac:.'ces and methods of
communication.
OBSECTI'VES
To increase un~erszanding olfhe company's plans
and bLS'ness decisions
To ensure peop!e have all the information they
need to do the:r Jobs.
To help individuals feel ;nvolved.
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BATCo document for Province of BritiSh Columbia 23
April 1999