British American Tobacco: Lobbying

BAT Lobbying

When we look at companies and how they influence governments we can see that this is allegedly a legitimate political process. The village of East Budleigh Devon has been given funding from BAT to erect a monument to Sir Walter Raleigh who was born there. The funding for the statue has been secured by East Devon Tory MP Hugo Swire from British American Tobacco. Although this looks harmless enough we can clearly see that it will do the MP Hugo Swire no harm in the future. BBC Devon News 22nd February 2005. http://www.bbc.co.uk/devon/news_features/2005/ralegh_statue.shtml

   First evidence of Blair sleaze

When it becomes clear that the lobbying process is corrupt and based on who has the greater ability to pay the greater sum then the allegations of sleaze and corruption are evident. The Tony Blair government took power with a promise of getting tough on sleaze so when one of the first examples of cash for a sympathetic ear to emerge from the Blair era was exposed we all sat up and took note. The “Bernie Ecclestone affair” as it became known exposed the trail of political interference used by tobacco companies through sponsorship in sport and their links to government. It followed an EU directive that no tobacco advertising should be used in connection with sport. The Blair government had already accepted a million pounds from Mr Ecclestone post- election to help with their successful election campaign and were promised more in the future. Blair, after a meeting requested by the F1 owner Ecclestone wrote a letter to the Health Secretary the next day suggesting they look at a compromise for F1. Subsequently it was announced that Formula One would have an exemption overriding the EU directive. To Iain Duncan Smith, the media and the British public this was unacceptable although Blair stated “there was no appearance of a conflict of interest”. (BBC, On the Record, Tony Blair Interview, BBC-1 16.11.97) http://www.bbc.co.uk/otr/intext/Blair16.11.97.html

BAT face DTI investigation British American Tobacco were in breach of OACD guidelines for multi-national social corporate responsibility as a result of their joint venture with the ruthless military Government in Burma. IUF state that by being in a joint venture with the Burmese dictatorship, “BAT is in breach of Article II of the Guidelines, specifically sections stating that enterprises should contribute to economic, social and environmental progress, respect human rights of those affected by their activities, and encourage business partners, including suppliers and sub-contractors, to apply principles of corporate conduct compatible with the Guidelines” in July 2003 the British government called on BAT to pull out of Burma. The BAT response was only that it would consider the request. 01.10.03 http://www.burmacampaign.org.uk/pm/more.php?id=103_0_1_0_M

After Burma’s campaigners demanded that the company shuts down the factory in Burma which it jointly owns with the country's military dictatorship. a BAT spokesman said the firm respected the concerns of protesters but it was not willing to take on a "role of international diplomacy". A Burmese exile in UK stated "BAT is collaborating with a military dictatorship." Workers are allegedly being paid starvation wages helping to fund a military dictatorship and BAT shareholders. Even so a BAT spokeswoman said: "We understand and greatly respect concerns about human rights. While we are willing to discuss these issues open-mindedly with stakeholders, we do not believe businesses should take on the role of international diplomacy and that companies do not and should not have a mandate to step into areas of political authority." http://news.bbc.co.uk/1/hi/england/2889275.stm Hypocritically BAT are happy to provide funding to promote their ethical reputation. The University of Nottingham has agreed to establish an international centre for corporate social responsibility at its Business School in return for a £3.8 million sponsorship from British American Tobacco. http://www.bbc.co.uk/nottingham/news/2000_12/05/tobacco.shtml

  Black markets and BAT

In direct abuse of nation state law around the world BAT black marketing is a growing market for them. As nations try to discourage smoking by increasing tax and restricting imports BAT subvert controls by turning a blind eye to the growing Black Market in cigarettes that are sold to wholesalers that end up on alternative markets in South and North America and across Asia.

From 1987 there have been several court cases and investigations into BAT throughout the world which accused the tobacco industry of illegal supply and the smuggling of cigarettes or at least being aware of the unlawful destination of their tobacco products. For instance a former BAT executive was found guilty by the Hong Kong's High Court for his involvement in operations that smuggled cigarettes into China. http://factsheets.globalink.org/en/smuggling.shtml BAT supplied huge numbers of cigarettes around the world knowing they would end up in the hands of smugglers. In 2004 BAT came under fire from Stephen Byers, trade and industry secretary, who threatened to use his powers under the companies act by instructing the DTI inspectors to look into the allegations colluding in cigarette smuggling on an unprecedented scale and of corrupt practice. Furthermore in that year The Commons Health Committee called for a DTI inquiry when it published a report expected to be highly critical of BAT.

Martin Broughton, BAT's chairman told the annual general meeting of BAT in London: "There is really no need for a DTI investigation".  Alternatively Clive Bates, director of Action on Smoking and Health, said “directors needed to be questioned under oath. “A DTI inquiry is needed to get to the truth of what really went on." 

Mr Broughton refused to allow specific questions about smuggling from the documents to Keith Dunt, BAT's finance director at the enquiry. Tory ex-chancellor and health secretary Kenneth Clarke also defended the company. Although the MP for Rushcliffe has acknowledged the dangers of smoking to health, he is actively involved in BAT's work. Mr Clarke on the BAT website describes the firm as "one of the most advanced and responsible British companies I have come across.". This is what you would expect from an £100,000 a year employees of BAT who has had connections with the company for many years.

In March 2004, Trade secretary Steven Byers made it known that he planned to instigate an inquiry under section 432 of the Companies Act, which would allow files to be seized, employees to be questioned on oath and permit Mr. Byers to publish the report. But after strong-hand lobbying the investigation was watered down and a 437 section of the act which does not require public report was advised.

British American Tobacco head, Martin Broughton, was given access to Blair at a private breakfast, with a following private meeting with secretary Byers.  It is also understood that former senior Department of Trade and Industry (DTI) officials on BAT's payroll were also used to approach their former departmental colleagues to gain influence. Subsequent to this dubious perhaps fraudulent lobbying, Byers own plan for a rigorous inquiry, diverting the publishing of a possibly highly damaging report.  A was dropped, a secret report was promised but under a subsequent new minister it was released under the freedom of information act and was to be deemed insignificant by government. (Guardian, Oct 27 2004.Tobacco firm gained secret access to Blair)
In the Global world of industry we constantly hear of corporate wrong doing but the lengths that the BAT Company goes to can be astonishing. After looking at the evidence we consider a quote from the BAT web pages, “Globalisation has given rise to concerns about power, responsibility, the role of governments and the role of companies. Multinational businesses must demonstrate they are operating responsibly, and work to be more accountable about their roles and responsibilities.”05.04.06 http://www.bat.com/OneWeb/sites/uk__3mnfen.nsf/vwPagesWebLiveText/ 

In the near future there will be further strong lobbying by the tobacco industry and BAT global governments are pushing for labelling of cigarettes so that they can be tract more easily to combat tax fraud and a solution to smuggling. In the UK the strong labelling is hoped to be accompanied by photograph of deceased organs in graphic colour. All others and more BAT will fight tooth and nail and as demonstrated with disregard for corporate responsibility. http://factsheets.globalink.org/en/smuggling.shtml