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
DUBAI, UAE – [July, 2020] 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.
Philip Morris International: Delivering a Smoke-Free Future
Philip Morris International (PMI) is leading a transformation in the tobacco industry to create a smoke-free future and ultimately replace cigarettes with smoke-free products to the benefit of adults who would otherwise continue to smoke, society, the company and its shareholders. PMI is a leading international tobacco company engaged in the manufacture and sale of cigarettes, as well as smoke-free products and associated electronic devices and accessories, and other nicotine-containing products in markets outside the United States. In addition, PMI ships a version of its IQOS Platform 1 device and its consumables authorized by the U.S. Food and Drug Administration to Altria Group, Inc. for sale in the U.S. under license. PMI is building a future on a new category of smoke-free products that, while not risk-free, are a much better choice than continuing to smoke. Through multidisciplinary capabilities in product development, state-of-the-art facilities and scientific substantiation, PMI aims to ensure that its smoke-free products meet adult consumer preferences and rigorous regulatory requirements. PMI’s smoke-free IQOS product portfolio includes heat-not-burn and nicotine-containing vapor products. As of March 31, 2020, PMI estimates that approximately 10.6 million adult smokers around the world have already stopped smoking and switched to PMI’s heat-not-burn product, available for sale in 53 markets in key cities or nationwide under the IQOS brand. For more information, please visit http://www.pmi.com and www.pmiscience.com.