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Our ambition - Contributing to a Nature Positive¹ ´Ú³Ü³Ù³Ü°ù±ð.Ìý

We endeavour to manage our impacts on nature, and to improve our resilience to environmental degradation.

We aim to mitigate nature loss and have made a series of commitments toÌýprotect, restore and replenish nature.

Our business operations, including conventional agricultural practices, rely on the use of natural resources, such as timber, soil and water.

Activities such as raw material sourcing, tobacco farming, and water withdrawals for agricultural activities and manufacturing can negatively impact the environment.

How we’ll get there

Our Group Environment Policy and Biodiversity Statement outlines our approach for mitigating our environmental impacts.

We manage the impacts of our activities and sites by implementing internal standards. These include our Soil and Groundwater Protection Standard, which provides guidance for preventing and managing contamination issues.Ìý

Our Water Security Standard provides water conservation guidance for operational sites and sets out actions for sites located in water-stressed regions. In our tobacco supply chain, our Biodiversity Operational Standard for Tobacco Farming (BOS) provides guidance for our Leaf supply chain.Ìý

Guidance includes forest and biodiversity management, natural ecosystems conversion, wood traceability, and integrated pest management, which supports the growth of healthy crops while minimising disruption to agricultural ecosystems.Ìý

To achieve our nature commitments, we have adopted the mitigation hierarchy, in line with the Science Based Targets Network’s (SBTN) AR³T framework². Implementing this approach supports targets of the Kunming-Montreal Global Biodiversity Framework (GBF3).

Find out more: Read more about our policies and procedures

Find out more:ÌýRead more about our Group Biodiversity Statement (242 kb)

1. AVOID

• Deforestation and conversion in our tobacco supply chain
• Deforestation in our pulp and paper supply chain
• The use of highly hazardous pesticides (HHPs)

2. REDUCE

• Use of agrochemicals where possible
• Water use across our direct operations and tobacco supply chain
• Water risks in our tobacco supply chain through active stewardship

3. RESTORE AND REGENERATE

• Our ambition is to implement regenerative agriculture practices, and restore nature through our Forest Positive target

4. TRANSFORM

• Embed nature policies, target plans and activities across our operations and supply chain

What we’re doing

In line with the SBTN’s mitigation hierarchy, addressing our impact across five different categories: avoid, reduce, regenerate, restore and transform.

Monitoring and managing compliance in our tobacco supply chain

In accordance with our Biodiversity Operational Standard for Tobacco Farming (BOS), our field technicians monitor directly contracted farmers to confirm that deforestation or conversion activities are not present.

Field technicians also monitor compliance by carrying out regular and unannounced farm visits. Where deforestation or conversion incidents are identified, we have a process in place for establishing remediation plans which involve restoring the impacted area where possible.

We ask our third-party suppliers to take equivalent steps.Ìý

In 2024, we monitored 100% of directly contracted farmers (approximately 90,500) for deforestation and natural ecosystem conversion.Ìý

We also trained our farmers and field technicians on best practices for resource preservation, such as the use of sustainable wood for tobacco curing, forest conservation biodiversity, integrated pest management and soil and water management. In 2024, 648,669 attendees were reported to have received training.¹

Partnerships to tackle deforestation and protect biodiversity

We support our directly contracted farmers through training and provide them with tree saplings as part of their sustainable fuel sources for tobacco curing, alongside biomass, sun and air curing. This initiative aims to prevent the harvesting of wood in a way that leads to deforestation of natural ecosystems.Ìý

In 2024, 44% of our directly contracted farmers used alternative biomass fuels for tobacco curing and third-party suppliers are asked to follow the same practices.

In 2023, we deployed Biodiversity Management Plans (BMPs) to mitigate risks on farms identified as 'priority' from our Biodiversity Risk Assessment (BRA). In 2024, our Field Technicians followed up on 96% of the open BMPs to monitor their implementation. These plans involve protecting and restoring natural forests and riverbank ecosystems, as well as creating and protecting habitats for pollinators and specific species.Ìý

In 2024, an additional BRA was conducted using the Biodiversity Risk Screening (BRiSK) toolkit, which incorporates 15 nature indicators. Farms identified as 'priority' within the geospatial assessment will be locally assessed during 2025, and where required, further BMPs will be implemented.

Soil management approach

GLAD develops integrated pest management strategies, focusing on disease-resistant tobacco and biological controls to reduce agrochemical use. Only agrochemicals that are compliant with local regulations and with the lowest possible toxicity according to WHO classification are used.Ìý

In 2024, 87% of tobacco hectares in our Thrive Supply Chain used best practice soil and water management practices and 94% of Thrive farmers¹ grew alternative crops such as rice, corn, vegetables, wheat, and soy alongside tobacco.Ìý

Crop rotation is a recognised best practice approach to improving soil fertility and conservation.

Responsible sourcing in our pulp and paper supply chain

When sourcing materials, we aim to only work with suppliers across our pulp and paper supply chain who can demonstrate low risk of deforestation. Our Supplier Code of Conduct (SCoC) applies to all our suppliers who are expected to supply materials that are Deforestation Free (DF).Ìý

Our approach is based on the internationally recognised Accountability Framework Initiative (AFi).Ìý

In 2024, we updated our approach to determine DF status for our pulp and paper supply chain, which consists of:

• Gathering information on suppliers, management systems, their performance, mill locations and volumes, and deforestation compliance;
• Assessing suppliers against internal criteria and international good practice; andÌý
• Identifying improvement actions to inform suppliers engagement scope and action plans.

In 2024, we assessed all in-scope pulp and paper materials and 86% were established as sourced with low risk of deforestation according to the following criteria:

• 7% of volume was classified as DF through chain of custody schemes providing full assurance.
• 28% of volume sourced from suppliers with a CDP Forest disclosure rating of 'A/A-' and 100% of volume was disclosed as DF.
• 51% of volume was traceable to a low-risk sourcing area.Ìý
• 0% of volume was traceable to production units monitored as DF.
• 14% of volume could not be assessed or did not have low risk of deforestation.

We continue to work with suppliers to achieve our target of a Deforestation Free pulp and paper supply chain by 2025.

Managing biodiversity in our direct operations

We aim to have a Biodiversity Operating Guide for our manufacturing sites in 2025.Ìý

The Guide will specify site-specific actions and contain criteria to determine which sites require a Biodiversity Action Plan.Ìý

For example, our Augustów site in Poland was identified as a high-priority in our 2023 Biodiversity Risk Assessment. Following an evaluation of biodiversity risks, site-specific biodiversity recommendations and action plans were developed.Ìý

We also developed a biodiversity training programme for managers in our Operations function.

Taskforce on Nature-Related Financial Disclosures (TNFD)

As part of our FY24 Combined Annual and Sustainability Report, we have included our TNFD disclosure with reference to following disclosure pillars:Ìý

• ³Ò´Ç±¹±ð°ù²Ô²¹²Ô³¦±ð,Ìý
• ³§³Ù°ù²¹³Ù±ð²µ²â,Ìý
• Risk and Impact management; and
• Metrics and Targets.

Assessing the water risks in our direct operations

In 2024, 76% of total water consumption was accounted for in our operations sites, and 24% in our offices, retail, R&D and other sites. We use the WRI Aqueduct Water Atlas to assess our operational exposure to water risks, incorporating additional factors such as flood risk, drought risk and water depletion.Ìý

The Atlas identified that 23 of our operations sites are in water stressed areas,1 accounting for 39% of our water withdrawn in 2024. These assessments guide our prioritisation of capital expenditure and resources to improve water management and recycling rates.Ìý

In 2024, we also identified and prioritised our top 10 water basins, through a prioritisation methodology that includes both stress and marine risk factors. Our priority basins will be used for action planning, resource allocation and capital expenditure prioritisation in the future. More details including the methodology can be found in our TNFD disclosure.

For example, the WaterHubâ„ Ìýin the U.S. (that will be operational in 2025), is located on a water-stressed site. The WaterHubâ„ Ìýis a major water recycling facility with a designed capacity of 200,000m.

Assessing our water risks in our tobacco supply chain

For our tobacco supply chain, our SCoC is complemented by our Leaf Supplier Manual (LSM), which includes guidelines for water protection planning and water extraction for irrigation. Through the Atlas, we monitor our tobacco sourcing locations that are in water-stressed areas.Ìý

In 2024, 20 of our tobacco sourcing locations – including Bangladesh, U.S., India and Türkiye – were in water-stressed areas. An estimated 21.9% of the tobacco we purchased came from water stressed areas. In these areas, we support our directly contracted farmers to grow the appropriate tobacco variety, introduce irrigation technology or optimise and reduce crop water usage. This is explained further in Climate.

Our third-party suppliers are also encouraged to support their contracted farmers with similar methods.

Find out more: For more performance metrics and operational data, refer to our Sustainability Performance Data Book.

Our water stewardship programmes

Direct Operations

Our water withdrawal and discharge guidelines and our Water Roadmap provide guidance for managing water use at our manufacturing sites and help assess water management systems in line with the Alliance for Water Stewardship (AWS) certification process.

In 2024, an additional eight sites in our direct operations were successfully AWS certified, bringing the total number of certified sites to 51 or 91% of our operations sites.Ìý

Additionally, 78% of our operations sites implemented both water efficiency and recycling activities, investing £3.9 million in capital expenditure.Ìý

We also achieved 27.5% of total water recycled in 2024, driven by our top performing sites in the U.S., Brazil, South Korea and Bangladesh.

Our Brazil site became the first Group site to achieve the AWS Standard certification with platinum status. It is the highest of three levels of certification available, indicating conformity with AWS’s additional Advanced Indicators.

Tobacco supply chain

We have developed a standardised methodology and protocol to measure water use on tobacco farms. The protocol aims to enhance the accuracy of water reporting and support a more accurate performance assessment of drip irrigation and other water-saving initiatives. Approximately 70% of tobacco hectares in our Thrive Supply Chain are grown using rainfall. Where rainfall is insufficient, farmers may use irrigation. In 2024, around 30.7% of the tobacco hectares in our Thrive Supply Chain used some form of irrigation systems.Ìý

At our GLAD centre in Brazil, research is conducted to reduce water usage in high-dependency regions and support engagement with local communities. Drip irrigation was introduced in eight countries, saving up to 50% more water in comparison to conventional irrigation practices. In 2024, land area using drip irrigation increased by 50% in Vietnam and 29% in Chile.Ìý

We have also adopted alternate furrow irrigation in Pakistan and Bangladesh. This practice saves up to an estimated 10% more water, compared to traditional furrow irrigation without negatively affecting the yield. In Mexico we observed a 10% reduction in water use compared to drip irrigation by installing real-time temperature, water and electric conductivity sensors.

Our CDP Publications:Ìý

As part of our commitment to transparency in Nature, we provide information to CDP - a global environmental impact non-profit organisation, through its reporting frameworks.

Our submissions are below:

2024
CDP Corporate Questionnaire – Forest and Water sections (3.0 mb)

2023Ìý
Water Stewardship (950 kb)
Forests (64 kb)

2022Ìý
Water Stewardship 2022 (725 kb)
Forests 2022 (490 kb)