British American Tobacco 2008 Sustainability Report

1.1 Thesis Statement

Using British American Tobacco’s 2008 Sustainability Report as an example, I wish to conduct a theoretical discussion on whether it is ethical to carry out sustainability and CSR reporting when your product is of a controversial nature and if such a report in theory could have an effect on BAT’s business performance?

1.2 Theoretical Framework

To answer this thesis statement, theoretical knowledge is presented and applied to BAT’s sustainability report. This knowledge consists of theories and concepts from the field of public relations, semiotics and theory of scientific methods. Stakeholder theory will be applied in order to identify the key stakeholder, whom the BAT sustainability report concerns, in order to discuss the relationship between BAT and its stakeholder and how this affects BAT’s CSR reporting. By applying theory of scientific method and cultural theory it is possible to indentify the current context and environment in which BAT operates. Moreover, by using semiotics, one is able to gain an understanding of the communicative value of the CSR report, and thus better understand the concerns key stakeholders have towards the ethical value of BAT’s sustainability report.
Further theories and concepts from secondary data, hereunder Tench and Yeomans’ book ‘Exploring Public Relations’ will be used as it provides a more general background and understanding of the field Public Relations. The book offers historical aspects on corporate social responsibility, future trends for corporate social responsibility as well as stakeholder theory.
Moreover, secondary data has been collected from articles and databases in order to obtain more knowledge on the context and nature of CSR. Specifically, articles on the ethical issues of CSR have been key to answer the thesis statement. The theory will help elaborate on the discussion and thus provide the necessary background in order to answer the thesis statement.

1.3 Methodology

The background for this thesis began with the idea that the concept of CSR was presented as a positive PR strategy chosen by many companies and that it is likely to influence business performance, particularly the financial performance. Hence, I started doing research on some of the ethical issues that I thought might come about when corporations initiate these kinds of CSR initiatives. Moreover, the rising awareness on the mortality caused by smoking and second-hand smoking made me think of the tobacco companies and whether they were conducting any kind of CSR to prevent the rising pressure on the tobacco industry and its lethal products. Yach et al. state that, “The social, financial and legal pressure on the tobacco industry is increasing through heightened public awareness, released internal documents showing questionable ethical behaviour…” (Yach et al. 2001, p.193). This leads to an examination of BAT’s Sustainability Report 2008 (App. 2). Moreover, reports from WHO, were criticising the tobacco industry for initiating reports, and BAT was particularly exposed in one of WHO’s reports (App. 1). Hence, it was an obvious choice to use BAT as an example for a theoretical discussion on the ethical issues of CSR reporting and engaging in sustainability practices. BAT has been accredited by Dow Jones Sustainability Index (DJSI) for their sustainability report, which in itself is an interesting perspective that I thought may increase the company’s business performance. Being recognised by larger indexes would in my mind call for a competitive advantage towards gaining more shareholders, thereby increasing investments in BAT and moreover, it should increase the trust of shareholders. The general perception of CSR and sustainability is that it creates value and adds to the transparency and trustworthiness of corporations. However, given BAT’s product, it seemed like an interesting case to investigate further. There were only limited articles discussing the tobacco industry and its CSR and sustainability reporting. This appears strange as there is a growing focus on smoking and the health risks associated with its consumption, as noted above. The growing ban on public smoking in Europe and developed countries, made me question the legitimacy accrediting indexes such as the DJSI and Business in the Community UK add to BAT. From an ethical point of view, it gives rise to scepticism and opens for discussion.

1.3.1 Theory of Scientific Method – Kuhn’s Paradigms

The issues are then discussed and should be understood within the theory of scientific method, using Kuhn’s paradigms. Kuhn’s paradigms are the point of departure keeping the discussion within a theoretical framework that ratifies the existence of CSR and sustainability reporting as a concept. As Chalmer notes, “…concepts derive their meaning at least in part from the role they play in a theory…”(Chalmers, 1999, p.106). Thus, the concept of CSR and sustainability are valid as long as they play a theoretical role in the paradigm of business and economics. However, if the use of Kuhn’s paradigms are to add to the understanding of this thesis, it is important to understand the picture of Kuhn’s scientific progress which can be described through the following never-ending scheme: pre-science – normal science – crisis – revolution – new normal science – new crisis etc. (Chalmers, 1999). Chalmers defines the paradigm as such, “A paradigm is made up of general theoretical assumptions and law and the techniques for their application that the members of a particular scientific community adopt.” (Chalmers, 1999, p.108). Thus, one must view the CSR and sustainability paradigm and its application in accordance with that of the business community, to better understand the intended meaning of this thesis. With the theory of Kuhn’s never ending scheme and his paradigms, this thesis argues that the CSR and sustainability paradigm due to its existing nature is situated in the crisis-stage of the scheme. This crisis may lead to a revolution of the existing paradigm. Thus, the discussion in this thesis should be understood from this scientific methodological approach.

1.3.2 Brief Overview of Thesis Structure

The first part of the thesis focuses on BAT and its stakeholders, with a primary focus on the WHO as a key stakeholder to BAT and one that can influence their CSR initiatives. It is necessary to understand the stakeholder relationship in the field of CSR and sustainability, as these reports are primarily made for and in collaboration with the stakeholders of the corporation. Since, WHO and BAT are two players of conflicting interests, it is important to look at their influences on each other when discussing the ethical issues that rise from BAT’s sustainability reporting.
The second part, is a discussion that follows the ethical issues that have been raised in the first part. Finally, a discussion of the previous findings will help to conclude on the thesis statement. Hence, a greater understanding of the ethical issues linked to CSR and sustainability reporting that exist for corporations such as BAT will be understood. Furthermore, the future complexities that follow from such reports should be recognised with the notion that the transparency and explicitness of the reports should be a main focus that is possibly solved through better stakeholder engagement. Moreover, a discussion whether or not there is a business performance benefit from engaging in CSR will help conclude on the thesis statement.