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Report Resources

Stakeholder Engagement & Materiality

Stakeholders and Transforming Tobacco

RAI’s sustainability initiatives and commitment to transformation have evolved over time. In 2004, RAI launched a dialogue process to regularly and systematically engage with our stakeholders. Led by a third-party engagement specialist, the dialogue process provides RAI and its subsidiaries insight into stakeholder perceptions, expectations and valuable feedback on our companies. The recurring topics discussed have become the catalyst for our ongoing sustainability strategy and led to the creation of the RAI Guiding Principles and Beliefs and our Transforming Tobacco vision.

Ongoing stakeholder engagement and analysis of our companies’ impacts across our value chain have identified three material areas of focus: Youth Tobacco Prevention, Tobacco Harm Reduction and Commercial Integrity. Our work on these issues enhances our long-term economic, social and environmental sustainability and supports our strategy to transform tobacco. RAI and its subsidiaries incorporate our Transforming Tobacco vision into our decisions, integrating stakeholder expectations into our strategy.

Material Topics

Ongoing Engagement

Our stakeholder engagement process continues and is an important tool in identifying, prioritizing and managing sustainability issues. As such, we regularly interact with a variety of stakeholders. Key components of our engagement processes include:

Legislative and Regulatory Engagement: RAI Services staff and representatives regularly meet with legislators and regulatory agencies with oversight of our industry to discuss issues related to our businesses and the tobacco industry. We believe it is important that we share with them significant commercial events that support our Transforming Tobacco vision, and we want to understand their positions on key issues. We annually report corporate political contributions in the Governance section of RAI’s website.

Stakeholder Dialogues: To date, RAI companies have conducted 58 formal, third-party facilitated stakeholder engagements, including three in 2015. The conversations are focused on gaining insights and building strategic partnerships.

Association Engagement: Through our association memberships, we participate in discussions about industry and scientific issues, provide education and work together toward mutual goals. Currently, RAI and its subsidiaries play an active role in the following organizations, along with many other national, state and regional groups:

  • National Conference of State Legislatures (NCSL);
  • Carolina Farm Stewardship Association (CFSA) (life member);
  • National Association of Tobacco Outlets (NATO);
  • Farm Labor Practices Group (FLPG) (founding member);
  • National Association of Convenience Stores (NACS);
  • National Foundation for Women Legislators (NFWL); and
  • Cooperation Centre for Scientific Research Relative to Tobacco (CORESTA).
RAI and its subsidiaries will continue to evolve our vision to lead the industry as we continually engage with diverse stakeholder groups. Together, we will Transform Tobacco.

Our Stakeholders

  • Community groups;
  • Environmental advocacy groups;
  • Health policy groups;
  • Public health officials;
  • Legislators, regulators and other
    government offices;
  • Investors;
  • Adult tobacco consumers;
  • Trade customers;
  • Educational groups;
  • Tobacco growers;
  • Suppliers; and
  • Employees.

Supplier Engagement: RAI’s operating companies engaged a third party to evaluate cradle-to-gate environmental impacts within the supply chain, from operations processes all the way through the distribution network to retail stores.

Completed in 2015, this analysis found that a majority of the companies’ environmental impacts occur in the supply chain, in particular in the farming of tobacco leaf by our contracted growers and suppliers. These results caused us to refine our definition of material topics, breaking our leaf supply chain into its own topic—Responsible Agriculture. This enables us to better address the material environmental and social issues specific to tobacco farming, and the management of environmental, social and governance (ESG) topics across our entire supply chain. Breaking out leaf supply chain also aligns more closely with the way these areas of focus are managed for our operating companies.

The results of the environmental materiality assessment and stakeholder feedback received through the dialogue process have also helped to guide our new environmental goals, and allow our operating companies to identify and prioritize initiatives based on their impact and ROI. Read more about our environmental goals and actions.

By committing time, energy and resources to the principles that drive the three pillars, we continue to transform the tobacco industry and achieve sustainable growth for RAI’s shareholders, employees and other stakeholders.