2020 Sustainability Report – Rothmans, Benson & Hedges Inc

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2020 Sustainability Report Toward a smoke-free future Rothmans, Benson & Hedges Inc. 2020 Sustainability Report 2

Table of contents

Letter from our Managing Director 4

Approach to sustainability 5

Creating a smoke-free future 7

Operating with excellence 10

Caring for people 12

Protecting the environment 16

Change is underway at Rothmans, Benson & Hedges Key goals 19 Inc. (RBH). We are transforming our company, our products and our place in society. In this report, we share our vision and strategies for creating a smoke-free Canada and being a leader in the reduced-risk product space – along with our approaches to managing key environmental, social and governance topics.

This report is published for the purpose of providing general information about Rothmans, Benson & Hedges Inc. The purpose of this report is not for advertising or marketing; it is for use by scientists, the public health and regulatory communities, and other stakeholders with an interest in tobacco policy. The material in this report should not be regarded as an offer to sell, or a solicitation of an offer to buy, any product of RBH. Such products are sold only in compliance with the laws of the particular jurisdictions in which they are sold.

Letter from Director Approach to sustainability Creating a smoke-free future Operating with excellence Caring for people Protecting the environment Key goals Rothmans, Benson & Hedges Inc. 2020 Sustainability Report 3

RBH, a subsidiary of Philip Morris International Inc. (PMI), is one of Canada’s leading tobacco companies. We are also spearheading the Unsmoke Canada conversation and helping Canadians go smoke-free.

780 31% 2019 economic employees of employees impact across Canada are women, and $180 million spent on 37% local goods and services of these women $120 million paid in 5 hold management positions employee wages and offices benefits

$1 million invested in employee training Manufacturing plant 250 Over $200 million paid in Quebec City toward federal and vehicles provincial taxes We work with ≈ 8B 150 cigarettes farmers produced in 2020 in Canada

Letter from our Managing Director

to Unsmoke Canada by 2035, by which we mean to move Canada to a smoke-free future and to stop selling cigarettes. We haven’t talked much about Our message on smoking is clear: if you don’t smoke, don’t start. If you smoke, quit. If you these things publicly before – and don’t quit, change. And our parent company, PMI, is investing billions of dollars in research we want to fix that, recognizing and development to create innovative products that help adults who won’t quit that transparency and dialogue smoking to switch to alternatives.

The best option is to always quit nicotine are critical for building trust and and tobacco use altogether, but smokers who choose not to quit should also be aware that fostering the change we envision.” alternatives exist. It is important to remember that these alternatives are not without risk. In this report, you’ll learn about some of our Thank you for taking the time to read our I am pleased to introduce RBH’s first They still contain nicotine and are addictive. other priorities as well, which relate to how sustainability report. We’re eager to have sustainability report. As a tobacco company, But, for adult smokers who would otherwise we conduct our business, how we support conversations with Canadians about creating we recognize that a report from us may continue to smoke, smoke-free alternatives our employees and communities, and actions a smoke-free future, and we hope this report be greeted with skepticism – and that’s provide an option that does not involve we’re taking to reduce our environmental gets the discussion going. While RBH has understandable – but we’re in a much combustion – or “burning” – like smoking a footprint. We haven’t talked much about contributed to the problem of smoking, different place than we were just four years cigarette does. This eliminates the inhalation these things publicly before – and we want we now have the means, resources and ago and we want to engage with Canadians on of smoke and, as a result, has the potential to fix that, recognizing that transparency and commitment to drive meaningful change. topics that matter deeply to us and to them. to significantly reduce the levels of harmful dialogue are critical for building trust and But we need governments, consumers and or potentially harmful chemicals caused fostering the change we envision. Canadians at large to join us. It goes without saying that the first and by by combustion. far the most significant of these topics is I’d also like to take this opportunity to Thank you, cigarette smoking and its negative impacts Here in Canada, RBH is tackling the issue of recognize publicly our own employees. Our on human health. It may surprise you to smoking on multiple fronts, which I encourage ability to achieve our Unsmoke vision depends learn that we’re staking our future on you to read about on page 5. These activities on their skills, dedication and relentless getting out of cigarettes, for the good of are at the heart of our corporate strategy and efforts, and they are rising to every challenge. Peter Luongo society and of our business. Our vision is sit atop our sustainability priorities. We cannot thank them enough. Managing Director Rothmans, Benson & Hedges Inc.

Approach to sustainability

RBH’s vision to Unsmoke Canada The exercise helped us clarify priorities by 2035 is core to our strategy. and develop the pillars of our sustainability strategy. Our next step is to establish goals We know it is the right thing to against which we will then track and report do, and technology now makes publicly on progress. it possible. We are committed Within each pillar, tier 1 topics are those to setting ambitious goals, deemed to be most important to RBH’s working hard to reach them and sustainability as identified through our communicating our progress. assessment. For these topics, we will consider the commitments, goals and management To ensure that our sustainability work aligns approaches needed to mobilize our people with societal expectations and focuses and partners, and achieve meaningful impact. where we can have the greatest impact, we Tier 2 topics are important to us and managed conducted a materiality assessment in 2019. in the regular course of our business. Of Based on the approach proposed by the Global these topics, inclusion and diversity, illicit Reporting Initiative (GRI), an independent tobacco trade, policy influence, community organization that helps businesses engagement, emissions and energy, and water communicate their impact on critical stewardship are discussed in this report. sustainability issues, our assessment involved: Implementation of RBH’s sustainability • identifying topics based on prior strategy and performance is led by RBH’s assessments and peer reporting Director of External Affairs, Jeff Gaulin, • prioritizing topics based on stakeholder and his team, who reports to our Managing insights gathered through an online survey Director. In 2021, we plan to create and follow-up telephone interviews with a corporate Sustainability Committee select participants responsible for establishing, integrating and reporting on our sustainability goals and key • validating priorities and identifying performance indicators. key metrics, governance and reporting considerations

RBH sustainability pillars Stakeholder engagement

Stakeholder engagement is critical to STRATEGIC PILLARS TIER 1 TOPICS TIER 2 TOPICS achieving our vision of a smoke-free Canada. We need governments, health care Creating professionals, the scientific community, a smoke-free industry stakeholders, consumers and their Public health loved ones, plus the general public to be future Smoke-free products involved – and we engage regularly with all of these groups. Putting an end to smoking in Canada As part of our sustainability materiality assessment, we engaged with 59 internal and 69 external stakeholders in 2019. Responsible marketing and sales Operating These included RBH employees as well as with Responsible research and Illicit tobacco trade commercial customers, suppliers, community/ development civil society organizations, business excellence Policy influence Bribery, corruption and anti- associations, academia, sustainability Taxation consultants/experts, and provincial and Transforming Being a responsible business and competition corporate citizen municipal government representatives. for a Human rights sustainable Also in 2019, we stepped up our engagement with Indigenous communities. RBH joined smoke-free the Canadian Council for Aboriginal future Fair working conditions Business to identify and pursue meaningful Caring for Inclusion and diversity people Fair pay economic partnerships that can create Talent attraction and retention and support jobs, training and education Employee engagement Community engagement opportunities for Indigenous people. In line Helping our employees and Health, safety and well-being with the recommendations of the Truth and communities thrive Reconciliation Commission of Canada, we introduced education for our management and staff on the history of Indigenous peoples. Protecting Jeff Gaulin, RBH’s Director of External Affairs, Sustainable packaging also delivered opening remarks to the first-of- the its-kind Indigenous Harm Reduction Forum in Waste management Emissions and energy environment Calgary in November. His speech is posted to Water stewardship our website. In 2021, we will explore further Taking action to minimize our environmental footprint educational and job opportunities for current and potential Indigenous employees.

Creating a smoke- free future

We recognize that cigarette smoking causes serious diseases and that the best way to avoid the harms of smoking is either never to start or to quit. Despite the health risks, there are still more than 4.5 million people who smoke regularly in Canada. The World Health Organization expects that more than one billion people around the globe will still be smoking in 2025 – about the same number of people smoking cigarettes today (this is explained by an overall decline in smoking prevalence, paired with global population growth).

This is a problem. And it’s why we see offering smoke-free alternatives to adult smokers as a sensible, complementary addition to existing tobacco control strategies. Given the number of smokers who will continue to smoke cigarettes, it makes sense to offer them alternatives if technology makes it possible, and if such products can be made available – broadly and affordably – so that change can be within reach.

Toward a smoke-free future Smoke-free alternatives technicians, to create a range of new smoke- thereby eliminating combustion and smoke. free alternatives to cigarettes. While not risk-free, the heated tobacco Our vision is to Unsmoke Canada by 2035, Just as technology is revolutionizing the way technology does deliver the nicotine, tobacco The best option is always to quit nicotine and by which we mean putting an end to smoking we live, breakthroughs in heated tobacco taste and ritual that smokers seek. in Canada. Toward this vision, we encourage products and vaping offer unprecedented tobacco use altogether, but smokers who Canadians to abstain from all forms of opportunities to help adult smokers leave choose not to quit should also be aware that We aim to continue expanding our portfolio tobacco and nicotine entirely; to quit fully if cigarettes behind. alternatives exist. The first of these products of smoke-free alternatives so that Canadian they do smoke; and to change if they won’t to have been launched by RBH in Canada is adult smokers who want to quit have the best Since 2008, PMI has invested about quit. As governments put most of their efforts an electronic device that heats tobacco at a options and the latest technology available C$6 billion, and employed more than into abstinence and cessation programs, most much lower temperature than cigarettes, to them. 400 world-class scientists, engineers and of our focus is on helping today’s smokers transition to a smoke-free future.

We’re going about this by: The difference between combustible cigarettes, e-vapor products (also known as e-cigarettes), and heated tobacco products

• offering adult smokers innovative, smoke- HEATED free alternatives to cigarettes, which have TOBACCO been developed by PMI, our parent company

• engaging with Canadians who are open to a conversation about the role tobacco and Heats nicotine can play in the future of a smoke- tobacco without free Canada burning CIGARETTES • sharing the scientific evidence and findings of PMI’s research facility with the public health community in Canada to inform them Contains real Smoke-free tobacco electronic on the science of smoke-free products device • engaging with legislators and regulators to ensure that policy and regulation keep NICOTINE pace with the latest science and technology related to tobacco and nicotine use in Canada Burns Heats liquid tobacco nicotine

Releases smoke No and ash tobacco

E-VAPOR

Powered by science In 2020, the scientific engagement team Advocating for change At the same time, we believe that changes in hosted its second annual Indigenous Harm legislation could help Canada become smoke- Rigorous, robust and transparent science Reduction Forum, with 370 health care Policy and regulations on tobacco and free faster – most notably by differentiating is at the core of the development and professionals registering for this virtual event, nicotine products have been crucial for between reduced-risk products and assessment of our smoke-free products. We including participants from around the world. reducing smoking levels and lowering rates cigarettes, and by giving adult smokers better understand that the credibility of our science of smoking-related death and disease in access to information about the alternatives is fundamental to the acceptance of our Canada – and for preventing access to these to smoking to help them quit or switch. offerings and have adopted a step-by-step #UnsmokeCanada products by underage Canadians. approach inspired by long-held practices To this end, we are actively involved RBH supports the Government of Canada’s of the pharmaceutical industry and in line Unsmoke.ca is our website for engaging with community, business and research goal of reducing smoking to 5% of the with draft guidance from the U.S. Food and Canadians in efforts to achieve a smoke-free organizations across Canada on research population by 2035; in fact, with the right Drug Administration. Canada. It’s part of a data-driven supporter and advocacy. policies, we believe it can go down to zero. engagement program that connects us with Scientific research is conducted by PMI, and segments of the population most open to our scientific engagement team engages productive conversations about the role regularly with scientists involved in similar tobacco and nicotine can play in the future research in Canada and has locally initiated of a smoke-free Canada. In the 12 months research projects underway. following Unsmoke Canada’s May 2019 The team also meets with public health launch, we reached more than five million professionals to discuss the science behind Canadians online. Our goals our smoke-free products. Continuing • Generate societal demand for change in the way reduced-risk products medical education (CME) sessions have been are treated and communicated in the Canadian market so that by 2022 delivered across the country. Of participants we can create a favourable, differentiated regulatory and fiscal system who completed a survey following our 2019 across Canada to enable rapid market transition from cigarettes to CME sessions: smoke-free products for existing adult smokers. • 90% wanted further engagement with RBH • Conduct Canadian scientific research on smoke-free alternatives and requested scientific research updates in 2021. through in-clinic visits, the CME process or electronically • Offer formal accredited continuing medical education programs for pharmacists and medical doctors by 2025. • 84% said they had poor knowledge of nicotine science and requested more • With the help of government regulators and society, strive to stop selling information cigarettes by 2035.

Operating with excellence

We strive to be recognized as the responsible leader in our industry. This means not only running a strong and efficient business, but also upholding high ethical standards, complying with all laws and regulations that apply to us, making sure our products are commercialized responsibly, and maintaining a respectful, inclusive and safe workplace.

We know that honouring these fundamental commitments to society, consumers and one another is indispensable in securing a prosperous future for our company.

Ethics and integrity RBH’s Ethics and Compliance Head helps targeting only adults who smoke or have The World Health Organization estimates promote and ensure consistency between converted to smoke-free products. This is that illicit trade accounts for as much as 10% PMI’s Guidebook for Success is also RBH’s what we say and what we do, in keeping in line with PMI’s global goals to have more of global cigarette consumption. In Canada, an code of conduct, outlining our employees’ with our commitments and values of than 90% of Youth Access Prevention (YAP) estimated six billion cigarettes are sold on the legal and ethical responsibilities. Its honesty, respect and fairness. Her specific programs in place in markets representing contraband market every year, with annual tax supporting Principles & Practices provide responsibilities include providing ethics over 90% of PMI’s total shipment volume losses of about $2 billion. Most of this activity guidance on how to conduct our day-to-day and compliance advice, training and by 2020, and have 100% of the electronic is in Ontario, where an estimated $1.1 billion business activities with integrity. Where communications to build understanding and smoke-free devices equipped with age in tax revenues is lost for both federal and Principles & Practices differ from Canadian commitment; assessing potential conflicts of verification technology by 2023. provincial governments. requirements, we always follow the higher interest; helping us identify risks and develop Following PMI’s global responsible While our illicit trade prevention team standard. Among our key commitments: mitigation plans; and following up on employee marketing practices, all of our marketing increasingly focuses on reduced-risk reports of ethics or compliance concerns. Responsible marketing and sales: We market and sales activities reflect our prohibition of products to support our initiatives and Investigations for suspected misconduct are and sell our products responsibly, and only to practices that target minors or non-smokers. ensure a smooth transition to a smoke-free completed following PMI standards. adult smokers (see below). Advertising and consumables packaging for future, it’s also important to support law Anti-bribery and corruption: We have consumers have health warnings, even if the enforcement agencies in their fight against zero tolerance for bribery, which undermines law does not require them. contraband tobacco. the rule of law and debilitates the well-being of 2019 performance Given the complexity of the regulations that Before beginning any contraband tobacco- society, and have put in place strict guidelines In 2019, 1,061 RBH employees and apply to our industry, all marketing goes related investigation, we make our intentions to ensure that bribery and corruption are third parties participated in at least through an internal consultation process known to the relevant provincial law never considered in our business. one ethics and compliance training involving people from our legal, marketing enforcement agencies. All data from our Lobbying: We adhere to applicable lobbying session. Eighteen reports of suspected and sales, and external affairs departments. investigations are shared with the government and advocacy regulations in every jurisdiction misconduct were received, 72% of This internal co-operation is essential for and law enforcement agencies, and any where we actively lobby government officials. which related to workplace integrity promoting business goals while respecting the intelligence related to contraband tobacco that concerns. None of the substantiated limits on what we can do. we do not directly investigate is also passed on Workplace integrity: We make all concerns resulted in a material to relevant law enforcement agencies. employment-related decisions based on merit; consequence for our company. Other partners in the fight against contraband we do not tolerate harassment; and we make Illicit trade workplace safety a priority. tobacco are retail associations, Crime The illicit tobacco trade provides a cheap Stoppers, the National Coalition Against Acting on concerns: Employees are and unregulated supply of tobacco products, Contraband Tobacco and the Canadian encouraged to speak up when something can Responsible marketing which undermines efforts to reduce smoking Association of Chiefs of Police. be improved or is wrong. The many avenues and sales prevalence, damages legitimate businesses, for reporting suspected misconduct include stimulates organized crime and reduces a third-party operated compliance helpline, Tobacco products create health risks to government tax revenue. Illicit cigarettes may available online or by phone 24/7 (in all consumers, and we take great care to market contain other chemicals or additives that are languages spoken at PMI), which can be and sell our products responsibly – complying uncontrolled by Health Canada. used anonymously. with all applicable Canadian legislation and

Caring for people

RBH’s success is inextricably linked to the futures of those around us. When our employees can fulfill their potential and our communities are thriving, we’re better able to create economic, social and environmental value.

Our efforts in the workplace earned us a place among Canada’s Top Employers in 2018, 2019 and 2020. We were also recognized as one of Greater Toronto’s Top Employers in 2016 and 2017. In our communities, much of our work is behind the scenes, given that we legally cannot advertise our involvement or name the organizations we support. But that has not stopped us from doing what is important to our employees, what our society needs to thrive and prosper, and what we consider to be part of our commitment as a responsible business.

People and culture Health and safety: We have a strong safety Training and development: We offer a culture at our Quebec manufacturing plant, wide variety of technical and leadership A principal aim of PMI is to provide Our company’s ongoing transformation which includes pre-shift risk analyses, quick training, including an online learning a decent livelihood to all contracted has prompted us to change the way we’re risk prediction tools for non-routine activities, platform that enables our people to develop farmers in its tobacco supply chain. organized, how work is defined and allocated, and a behavioural observation system their capabilities and skills in an easy-to- This has been a focus since we and how performance is measured. We aim involving all plant employees. access way. introduced our Agricultural Labour to strengthen our inclusive culture and boost Practices (ALP) program in 2011. how everyone contributes their personal Pay and benefits: RBH earned EQUAL- Recognition: RBH award programs are We are committed to the following best – through attitudes, behaviours and SALARY certification in 2019, and again in designed to recognize employees who have set of targets to improve the socio- employment practices that value, respect and 2020, for its compensation practices. This truly made a difference in embodying the economic well-being of tobacco- accommodate differences; promote listening globally recognized certification verifies pillars of our organizational culture (consumer farming communities: and learning from others; and create space for that we pay our male and female employees at the core, forward leaning, disruptive constructive disagreement. equally for equal work. Our benefits program innovator, meaning creator and people • 100% of contracted farmers includes flexible benefits, and pension and activator) and in creating business impact. supplying tobacco to PMI to make To track how well we’re doing, we measure saving plans, and supports a healthy lifestyle a living income by 2025; employee engagement quarterly. Results are and work–life balance. closely monitored and used to create action • zero child labour in our tobacco plans addressing key issues. Here are some of supply chain by 2025; the key attributes of our culture: • 100% of tobacco farmworkers to be paid at least the minimum legal wage by 2022;

• 100% of tobacco farmworkers to be provided with safe and adequate Smoke-free culture accommodation by the end of certification 2020; and

RBH achieved smoke-free culture • 100% of farmers and workers to certification through TUV Austria in have access to personal protective 2020, becoming the first company equipment (PPE) for the application in Canada to do so. To be certified, of crop protection agents (CPA) organizations must show that they have and prevention of green tobacco a plan to support, implement, monitor, sickness (GTS) by the end of 2020. continuously improve and encourage the establishment of a smoke-free culture at their workplace.

Inclusion and diversity

Our inclusion and diversity (I&D) activities focus on awareness, education and inspiration across five I&D priorities. We are also committed to being inclusive to those with disabilities and we adhere to the Accessibility for Ontarians with Disabilities Act guidelines.

Race and ethnicity Women Lesbian, gay, bisexual, transgender, Mental health and well-being Parents@PMI Our Black, Latino and Indigenous (BLI) In our male-dominated industry, we’re queer or questioning and two-spirit Mental health and well-being is In a difficult year for parents employee resource group focuses working hard to hire and advance (LGBTQ2+) a top priority, especially during balancing work and young families, on increasing cultural awareness, women. We have a tailored training We partner closely with the global these challenging times. We offer we organized webinars on coping providing professional development program for female talent, provide PMI employee resource group numerous resources to employees, with anxiety and returning to school, opportunities and increasing the gender-balanced shortlists to our called Stripes, which works toward including access to the LifeSpeak as well as offering online educational representation of BLI communities hiring managers and showcase female inclusivity of LGBTQ2+ communities. well-being platform and our resources for parents. at RBH. In 2020, we ran four Black employees in our employer branding Leading up to Pride month in 2020, Employee and Family Assistance Lives Matter informational sessions initiatives. We recently started weekly we held a series of virtual events, Program. During October’s Mental and marked National Aboriginal employee discussion sessions on which included bringing in LGBTQ2+ Health Marathon, experts offered Day with an Indigenous celebration women’s issues and topics. At year- guest speakers. advice for navigating the pandemic. at which guest speakers discussed end 2020, women represented 40% Indigenous issues in Canada. of our executive leadership team.

Community giving

Through donations and employee volunteering, we join community partners in tackling social and environmental challenges. RBH provided Giving Back grants to 13 food banks and In 2019, we introduced our Giving Back program, which provides grants of up to $25,000 to grassroots non-profit community organizations working to help women, families, groups working in the areas of education, the environment or community development. Charities are invited to apply LGBTQ2+ communities, people with physical/mental for a grant, and the RBH Giving Back Committee, composed of employees from across our organization, reviews the disabilities and the environment in 2020. We also gave applications and selects recipients. We establish close relationships with recipient groups and require them to report extra funding to local women’s shelters in Toronto and back to us on the results of their work, as a way of measuring our community impact. Calgary and to food banks in Vancouver and Quebec City in the early stages of the pandemic. We also encourage RBH employees to volunteer in their communities. Each person is granted one paid volunteer leave day per year, and they can earn up to four additional volunteer days off to match other volunteering they may do on their own time.

With the COVID-19 pandemic uprooting lives in 2020, we felt it was important to take extra steps to keep our employees safe and ease their stress as best we could. Right from the start, our office-based employees were asked to work from home and all business travel was suspended. Beyond that:

• Additional personal days were granted to our Quebec plant employees, and to temporary staff and contractors, to accommodate their personal situations.

• Employees were able to use money in their company- paid personal spending account to cover home office costs that would make their working space more comfortable and ergonomically sound.

• Summer Fridays (during which the workday ends at 1:00 p.m.) started one month earlier and ended one month later than normal.

• Employees were given additional flexibility in their work schedule to take care of themselves and their families.

• Hourly paid union employees and salaried and temporary fixed-term contract employees who were required to work in our facilities, in the field or offices during the lockdown as part of our business continuity plan were given a one-time discretionary gift.

• We extended our Employee and Family Assistance Program support to our temporary employees.

Protecting the environment

We recognize that cigarettes have the potential to harm not only individuals but also the world around us. Our actions to minimize the environmental impact of our products and operations are part of PMI’s global efforts to be carbon neutral by 2030 and reflect our desire to make a positive impact in Canada.

Our top priority is tackling cigarette butt littering. With an estimated 8,000 tonnes of cigarette butts discarded annually in Canada1, making them one of the most littered items, we have a deep sense of responsibility to move the needle in this area.

1 Zero Waste Canada: https://zerowastecanada.ca/tag/cigarette-litter

Waste management Innovations in recycling

RBH aims to be the Canadian steward of We see recycling of cigarette butts and heated our products. We believe it is crucial both tobacco units as another way of fulfilling our RBH employee volunteers have to prevent the leakage of waste into the product stewardship role. To this end, we set planted almost 1,300 trees in environment – especially plastics, which are up a three-year recycling program, which will Montreal, Quebec City and Markham, present in cigarette butts and heated tobacco start in 2021. Ontario. Our focus has been on units – and to combat the pollution of our revitalizing the environment around The organic components (ash, tobacco and land and seas caused by littering. industrial areas, restoring land and paper) will be separated and sent to compost, beautifying city streets. Changing the habit of littering requires action while the plastic filters will be shredded across three areas: awareness, disposal and mixed with other recycled materials to infrastructure and social enforcement. While produce usable materials, such as desk chairs. most of the components in a cigarette butt In 2020, we also surveyed consumers of are biodegradable, we can collectively all do our smoke-free products to find out how better to keep butts from our streets and they would like to recycle their heatsticks waterways. We partner with community (specially designed tobacco sticks used with organizations to raise consumer awareness of our heated tobacco devices). Based on the the issue of littering in general – and cigarette favourable response, we plan to launch a butt littering in particular – and to encourage heatsticks recycling program in the Greater the use of waste receptacles. Toronto Area in 2021. Included in the With the launch of the Unsmoke Canada survey findings: campaign in 2019, we hosted cigarette butt • 88% of respondents said they would recycle cleanup days, which saw RBH employees their heatsticks if a program was available sweep Canadian streets clear of cigarette butts. In year one, the program provided more • 67% of respondents said they’d like a than $50,000 to 17 groups. recycling program in which we provide a bag that they fill up with used heatsticks and then mail back to us 2020 Unsmoke Canada • 64% of respondents said they would like to Cleanups return the sticks to local vendors, such as convenience stores 11,443 cleanups

283,977 volunteers

427,122 volunteer hours

468,074 kg of litter cleaned up

Energy, water and waste Our goal of reducing water consumption by 40% from 2019 to year-end 2022 is proving RBH’s Quebec manufacturing plant has to be a challenge and forcing us to rethink and been in operation for more than 120 years change the way we work. and has been certified to the ISO 14001 environmental management and ISO 45000 Waste: Wherever possible, we try to eliminate (formerly OHSAS 18001) occupational waste at the source, rather than having health and safety management standards to manage it after the fact. When waste is since 2012. The plant produces conventional generated, we look to divert it from landfill cigarettes and fine cut product (loose-leaf through recycling, reuse and other options. tobacco used in homemade products) for the We recently found a company to compost Canadian market. tobacco dust, and we have begun shipping non-recyclable waste to a local incinerator Energy: Total energy consumption at the where it is used to produce energy. plant declined by more than 30% from 2010 to 2019, driven by process changes and ongoing investments in energy-efficient equipment and lighting. Robust resource management programs have enabled RBH to 2022 reduce greenhouse gas emissions by more manufacturing than 23% since 2010. plant goals* As we work toward PMI and government carbon reduction goals, we continue to replace older equipment. In 2020, we 40% reduction in total installed an electric boiler to replace an old energy use natural gas boiler and take over the main steam production. 40% reduction in total Water: Total water consumption declined water use by 84% from 2010 to 2019 – equivalent to 1.2 million cubic metres of water since 2010, or enough to fill the Rogers Centre (formerly 20% reduction in waste SkyDome) in Toronto about three quarters of the way up. The main contributor to this Zero waste to landfill reduction was the installation of a closed loop heating and cooling system with an * From 2019 to year-end 2022. energy exchanger.

Key goals

Creating a smoke-free future Protecting the environment

• With the help of government regulators and • Collect more than five million pounds of litter by society, strive to stop selling cigarettes by 2035. 2025. This goal aligns with a global goal PMI has set, to reduce the plastic litter from products • Conduct Canadian scientific research on smoke- by 50% by 2025, implement ambitious cigarette free alternatives in 2021. butt anti-littering programs, and implement • Offer formal accredited continuing medical eco-design and circular economy concepts for education programs for pharmacists and medical our smoke-free products and our packaging. doctors by 2025. • Plant 10,000 trees by 2030.

• Organize at least 10 community impact events per year by 2025.

• Reduce total energy and water use at the Quebec manufacturing plant by 40% from 2019 to year-end 2022.

• Achieve zero waste to landfill from the Quebec manufacturing plant by 2022.

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Contact: Rothmans, Benson & Hedges Inc. 1500 Don Mills Road, North York, ON M3B 3L1 416-442-3594 [email protected]