Difference between revisions of "British American Tobacco: Lobbying"

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From 1997 there have been several court cases and investigations in various parts of the world which have 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. A former BAT executive was found guilty by the Hong Kong High Court for his involvement in operations that smuggled cigarettes into China. {{ref|7}}
 
From 1997 there have been several court cases and investigations in various parts of the world which have 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. A former BAT executive was found guilty by the Hong Kong High Court for his involvement in operations that smuggled cigarettes into China. {{ref|7}}
  
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'''BAT face DTI investigation''' {{ref|8}}
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====BAT face DTI investigation====
  
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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]], UK trade and industry secretary, who threatened to use his powers under the Companies Act to instruct [[Department of Trade and Industry]] (DTI) inspectors to investigate allegations that BAT colluded in cigarette smuggling on an unprecedented scale. Also in that year the [[Commons Health Committee]] called for a DTI inquiry when it published a report expected to be highly critical of BAT.  
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BAT supplied huge numbers of cigarettes around the world knowing they would end up in the hands of smugglers. In early 2000, BAT came under fire from [[Stephen Byers]], UK Trade and Industry secretary, who threatened to use his powers under the Companies Act to instruct [[Department of Trade and Industry]] (DTI) inspectors to investigate allegations that BAT have colluded in cigarette smuggling on an unprecedented scale. The move was made in response to a Commons Health Select Committee report on the tobacco industry which was highly critical of the activities of BAT.
  
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[[Martin Broughton]], BAT's chairman, told the annual general meeting of BAT in London: "There is really no need for a DTI investigation." But [[Clive Bates]], director of [[Action on Smoking and Health]], said that BAT directors needed to be questioned under oath, stating that, "A DTI inquiry is needed to get to the truth of what really went on."
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Martin Broughton, £1.4m-a-year chairman of BAT, first ran into problems over smuggling allegations after The ''Guardian'' published documents exposing how BAT condoned tax evasion on a global scale in order to boost sales:
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:"According to the documents, BAT arranged to supply massive numbers of cigarettes to wholesalers and distributors, expecting that they would find their way into crooked hands and on to the black markets of developing countries after being smuggled across national borders, without duty being paid." {{ref|8}}
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A BAT spokesman said at the time: "If [a DTI investigation] is among the recommendations [made by the Select Commitee] then we do not believe it is either necessary nor appropriate." {{ref|9}} Tory ex-chancellor and ex-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." {{ref|10}} This is what you might expect from Clarke, who happens to be a non-executive deputy chairman at BAT, a role for which he is paid £150,000 a year plus £21,000 of benefits in kind. {{ref|11}}
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But [[Clive Bates]], director of [[Action on Smoking and Health]] (ASH), was happy with the proposed inquiry, stating that: "The great thing about a DTI inquiry is they can question employees, former employees and associates of BAT under oath. They will have no choice but to answer the allegations in detail." {{ref|12}}
 
   
 
   
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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.  
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Byers announced that he planned to instigate an inquiry under Section 432 of the 1985 Companies Act, which would allow files to be seized and BAT employees to be questioned under oath, followed by the publication of a comprehensive report. But after an intensive lobbying campaign by BAT the investigation was watered-down until Byers agreed to use Section 447 of the Act which -- crucially for BAT -- prohibits publication of a report.
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Chairman of BAT, Martin Broughton, was given access to Blair at a private breakfast, closely followed by a private meeting with secretary Byers himself. It was also revealed that two former senior DTI officials on BAT's payroll -- [[Nicola Shears]] and [[Ray Mingay]] -- were used to approach their former departmental colleagues to gain influence. Because of this dubious and perhaps fraudulent lobbying, Byers' plans for a rigorous inquiry were subverted, stopping the publication of a possibly highly damaging report. And so the DTI report was "buried" for close to four years, during which time Byers left his position. Finally, under the new Trade Secretary, Patricia Hewitt, and because of new Freedom of Information Act guidelines, officials were forced to make the watered-down report public, announcing that there was "insufficient evidence" for legal action against BAT.
  
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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.
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[[Ray Mingay]] was also mentioned in memo confirming actions points from a BAT meeting. Indeed, "M[artin] S[ummers] will ensure [[Ray Mingay]] speaks to DTI on day of announcement (if Inquiry launched) as to the protocols surrounding companies under investigation."<ref>British American Tabacco, [http://legacy.library.ucsf.edu/tid/yay44a99/pdf?search=%22shandwick%22 Action on Possible Announcement of DTI Inquiry ], 26 Sept 2000, accessed 19 Feb 2010</ref>
  
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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.
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As if further evidence of BAT hypocrisy was necessary, consider finally this quote from the company's own website:
 +
:"Globalisation has ... given rise to intense debate about power, responsibility, the role of governments and the role of companies ... We believe that multinational businesses must demonstrate they are operating responsibly and to be more accountable about their roles and responsibilities." {{ref|13}}
  
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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/]
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==External Links==
  
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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.
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*http://www.bat.com
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[[http://factsheets.globalink.org/en/smuggling.shtml]]
 
  
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==External Links==
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*http://www.burmacampaign.org.uk
  
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http://www.bat.com
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*http://www.bbc.co.uk
  
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http://www.burmacampaign.org.uk
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*http://www.guardian.co.uk
  
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http://www.bbc.co.uk
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*http://www.ash.org.uk/
  
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http://www.guardian.co.uk
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*http://factsheets.globalink.org/
  
 
==References==
 
==References==
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#{{note|5}} ibid.
 
#{{note|5}} ibid.
 
#{{note|6}} 'University in ethics row over tobacco money', BBC website, 05 Dec 2000, http://www.bbc.co.uk/nottingham/news/2000_12/05/tobacco.shtml
 
#{{note|6}} 'University in ethics row over tobacco money', BBC website, 05 Dec 2000, http://www.bbc.co.uk/nottingham/news/2000_12/05/tobacco.shtml
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#{{note|7}} See: http://factsheets.globalink.org/en/smuggling.shtml
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#{{note|7}} see http://factsheets.globalink.org/en/smuggling.shtml
 
#{{note|8}} 'Tobacco firm gained secret access to Blair', The ''Guardian'', 27 Oct 2004, http://www.guardian.co.uk/uk_news/story/0,3604,1336810,00.html
 
#{{note|8}} 'Tobacco firm gained secret access to Blair', The ''Guardian'', 27 Oct 2004, http://www.guardian.co.uk/uk_news/story/0,3604,1336810,00.html
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#{{note|09}} 'Tobacco firm faces DTI inquiry', The ''Guardian'', 12 June 2000, http://www.guardian.co.uk/bat/article/0,,330990,00.html
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#{{note|10}} 'Clarke rejects tobacco charges', BBC website, 27 Jun 2001, http://news.bbc.co.uk/1/hi/uk_politics/1409823.stm
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http://www.guardian.co.uk/bat/article/0,,191283,00.html
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#{{note|11}} 'Clarke pulls out of speech on tobacco', The ''Telegraph'', 03 Sep 2005, http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/09/03/ntory03.xml
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http://www.guardian.co.uk/bat/article/0,,330990,00.html
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#{{note|12}} 'Tobacco firm faces DTI inquiry', The ''Guardian'', 12 June 2000, http://www.guardian.co.uk/bat/article/0,,330990,00.html
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#{{note|13}} British American Tobacco website, 'Corporate Social Responsibility: Globalisation and Human Rights' section, http://www.bat.com/OneWeb/sites/uk__3mnfen.nsf/vwPagesWebLive/DO52AQH8?opendocument&SID=&DTC=&TMP=1
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==Notes==
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<references/>
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[[Category:Tobacco]][[Category:Tobacco Companies]][[Category: Lobbying]]

Latest revision as of 02:34, 6 March 2012

British American Tobacco

Lobbying

The ways in which companies influence governments is allegedly part of legitimate political process. The village of East Budleigh in Devon has been given funding from British American Tobacco (BAT) to erect a monument to Sir Walter Raleigh, who was born there. The funding from BAT for the statue has been secured by East Devon Tory MP Hugo Swire. Although this looks harmless enough, it could be argued that this deal leaves Mr. Swire politically indebted to the big tobacco firm and hence more open to being influenced further by them, perhaps in less innocuous ways. [1]

Early evidence of Blair sleaze

Allegations of sleaze and corruption become less easy to dismiss when evidence emerges that the lobbying process is corrupt and based on who has the greater ability to pay the greater sum. The Tony Blair government took power with a promise of getting tough on sleaze, making it all the more notable that only months into the Blair era the first evidence of cash being exchanged for a sympathetic ear emerged.

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 Labour Party had already accepted £1 million from Mr. Ecclestone to help with their successful election campaign, and were promised more in the future. Blair, after a meeting requested by the Formula One owner Ecclestone, wrote a letter to the Health Secretary the next day suggesting they look at a compromise for F1 Racing. 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." [2]

BAT and Burma

British American Tobacco were in breach of OECD (Organisation for Economic Co-operation and Development) guidelines for multi-national social corporate responsibility as a result of their joint venture with the ruthless military government in Burma. The International Union of Foodworkers (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." [3] 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.

John Jackson, director of the Burma Campaign UK, stated that "BAT are collaborating with a military dictatorship." [4] Workers are allegedly being paid "pennies" whilst helping to line the pockets of both the military dictatorship and BAT shareholders. After Burmese campaigners demanded that the company shut down the factory which BAT jointly owns with the Burmese government, a BAT spokeswoman responded: "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." [5]

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. [6]

Black markets and BAT

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 and end up on alternative markets in South and North America and across Asia.

From 1997 there have been several court cases and investigations in various parts of the world which have 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. A former BAT executive was found guilty by the Hong Kong High Court for his involvement in operations that smuggled cigarettes into China. [7]

BAT face DTI investigation

BAT supplied huge numbers of cigarettes around the world knowing they would end up in the hands of smugglers. In early 2000, BAT came under fire from Stephen Byers, UK Trade and Industry secretary, who threatened to use his powers under the Companies Act to instruct Department of Trade and Industry (DTI) inspectors to investigate allegations that BAT have colluded in cigarette smuggling on an unprecedented scale. The move was made in response to a Commons Health Select Committee report on the tobacco industry which was highly critical of the activities of BAT.

Martin Broughton, £1.4m-a-year chairman of BAT, first ran into problems over smuggling allegations after The Guardian published documents exposing how BAT condoned tax evasion on a global scale in order to boost sales:

"According to the documents, BAT arranged to supply massive numbers of cigarettes to wholesalers and distributors, expecting that they would find their way into crooked hands and on to the black markets of developing countries after being smuggled across national borders, without duty being paid." [8]

A BAT spokesman said at the time: "If [a DTI investigation] is among the recommendations [made by the Select Commitee] then we do not believe it is either necessary nor appropriate." [9] Tory ex-chancellor and ex-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." [10] This is what you might expect from Clarke, who happens to be a non-executive deputy chairman at BAT, a role for which he is paid £150,000 a year plus £21,000 of benefits in kind. [11]

But Clive Bates, director of Action on Smoking and Health (ASH), was happy with the proposed inquiry, stating that: "The great thing about a DTI inquiry is they can question employees, former employees and associates of BAT under oath. They will have no choice but to answer the allegations in detail." [12]

Byers announced that he planned to instigate an inquiry under Section 432 of the 1985 Companies Act, which would allow files to be seized and BAT employees to be questioned under oath, followed by the publication of a comprehensive report. But after an intensive lobbying campaign by BAT the investigation was watered-down until Byers agreed to use Section 447 of the Act which -- crucially for BAT -- prohibits publication of a report.

Chairman of BAT, Martin Broughton, was given access to Blair at a private breakfast, closely followed by a private meeting with secretary Byers himself. It was also revealed that two former senior DTI officials on BAT's payroll -- Nicola Shears and Ray Mingay -- were used to approach their former departmental colleagues to gain influence. Because of this dubious and perhaps fraudulent lobbying, Byers' plans for a rigorous inquiry were subverted, stopping the publication of a possibly highly damaging report. And so the DTI report was "buried" for close to four years, during which time Byers left his position. Finally, under the new Trade Secretary, Patricia Hewitt, and because of new Freedom of Information Act guidelines, officials were forced to make the watered-down report public, announcing that there was "insufficient evidence" for legal action against BAT.

Ray Mingay was also mentioned in memo confirming actions points from a BAT meeting. Indeed, "M[artin] S[ummers] will ensure Ray Mingay speaks to DTI on day of announcement (if Inquiry launched) as to the protocols surrounding companies under investigation."[1]

As if further evidence of BAT hypocrisy was necessary, consider finally this quote from the company's own website:

"Globalisation has ... given rise to intense debate about power, responsibility, the role of governments and the role of companies ... We believe that multinational businesses must demonstrate they are operating responsibly and to be more accountable about their roles and responsibilities." [13]

External Links

References

  1. ^ BBC website, 22 Feb 2005, http://www.bbc.co.uk/devon/news_features/2005/ralegh_statue.shtml
  2. ^ Tony Blair interviewed by John Humphrys for BBC's On The Record, 16 Nov 1997, http://www.bbc.co.uk/otr/intext/Blair16.11.97.html
  3. ^ 'BAT face DTI Investigation into Burma Factory', The Burma Campaign UK website, 01 Oct 2003, http://www.burmacampaign.org.uk/pm/more.php?id=103_0_1_0_M
  4. ^ 'Masks highlight Burma's plight', BBC website, 26 Mar 2003, http://news.bbc.co.uk/1/hi/england/2889275.stm
  5. ^ ibid.
  6. ^ 'University in ethics row over tobacco money', BBC website, 05 Dec 2000, http://www.bbc.co.uk/nottingham/news/2000_12/05/tobacco.shtml
  7. ^ see http://factsheets.globalink.org/en/smuggling.shtml
  8. ^ 'Tobacco firm gained secret access to Blair', The Guardian, 27 Oct 2004, http://www.guardian.co.uk/uk_news/story/0,3604,1336810,00.html
  9. ^ 'Tobacco firm faces DTI inquiry', The Guardian, 12 June 2000, http://www.guardian.co.uk/bat/article/0,,330990,00.html
  10. ^ 'Clarke rejects tobacco charges', BBC website, 27 Jun 2001, http://news.bbc.co.uk/1/hi/uk_politics/1409823.stm
  11. ^ 'Clarke pulls out of speech on tobacco', The Telegraph, 03 Sep 2005, http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/09/03/ntory03.xml
  12. ^ 'Tobacco firm faces DTI inquiry', The Guardian, 12 June 2000, http://www.guardian.co.uk/bat/article/0,,330990,00.html
  13. ^ British American Tobacco website, 'Corporate Social Responsibility: Globalisation and Human Rights' section, http://www.bat.com/OneWeb/sites/uk__3mnfen.nsf/vwPagesWebLive/DO52AQH8?opendocument&SID=&DTC=&TMP=1

Notes

  1. ↑ British American Tabacco, Action on Possible Announcement of DTI Inquiry , 26 Sept 2000, accessed 19 Feb 2010
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