Philip Morris International Publishes Its First Integrated Report Demonstrating Strong Progress Towards Smoke-Free Future
The company's ambition is to switch more than 40 million adult smokers to its smoke-free products by 2025
Philip Morris International (PMI), the global leader in scientifically substantiated smoke-free innovations, has published its first Integrated Report, a comprehensive overview of the company’s environmental, social, and governance (ESG) performance and progress toward delivering a smoke-free future.
PMI’s Integrated Report 2019 demonstrates the role of the organization's strategy, governance, and performance in the creation of value over the short, medium, and long terms. Further, the report highlights PMI’s progress in various key ESG areas, while setting new and ambitious targets for 2025 — including the ambition to switch more than 40 million adult smokers to its smoke-free products by 2025, with half of the total to come from non-OECD countries.
The Integrated Report also highlights sustainability topics, including the health impacts of PMI’s products, an aspect often not captured by external ESG assessments. The report describes how PMI is working to reduce the harm caused by tobacco use by replacing combustible products with scientifically substantiated reduced-risk alternatives.
PMI’s evolution from sustainability reporting to integrated reporting helps investors make the connection between product-focused sustainability initiatives, which form the core of its ESG strategy and financial performance over time.
“Clarity of purpose is essential for the internal alignment of any company. Since we announced our smoke-free commitment in 2016, we have made enormous progress in terms of organizational capabilities, the integration of sustainability into every aspect of our transformation, and our business,” said André Calantzopoulos, Chief Executive Officer, PMI.
Tarkan Demirbas, Area Vice President Middle East at Philip Morris International, said: “Our first Integrated Report provides a holistic overview of PMI’s significant progress towards a smoke-free future, measured in metrics that go beyond financial disclosures. We are all aware that the biggest positive impact our company can have on society is to replace cigarettes with less harmful alternatives and it is at the core of our corporate strategy. With this report we want to emphasize that sustainability strategy is corporate strategy and ESG issues are our business issues. “
Highlights of PMI’s progress towards a world without cigarettes include:
- Significant resources shifted toward delivering a smoke-free future, with 98 percent of total R&D expenditure and 71 percent of total commercial expenditure directed toward smoke-free products in 2019.
- PMI’s smoke-free product net revenues reached 18.7 percent of total net revenues in 2019; by 2025 the company aspires to have 38 to 42 percent of total net revenues coming from smoke-free products.
- At year-end 2019, an estimated 9.7 million users worldwide have stopped smoking and switched to PMI’s heat-not-burn smoke-free product IQOS, compared to 6.6 million in 2018.
Download the full Integrated Report 2019 at PMI.com/IntegratedReport2019. Additional information on the company’s sustainable actions, aspirational targets, and commitments are available on PMI.com/Sustainability.
