Dedication

He gave us a world full of challenges,

And gave us ambition to try

A World that holds marvelous secrets,

And mind that would ask why.

He gave us a world bright with beauty,

And gave us awareness to see

A world where we all could be different,

And hearts that would seek harmony.

He gave us His guidance; He gave us his strength,

He gave us His infinite love

To help us in making our wonderful world

More and more like His world up above.

ACKNOWLEDGEMENT

First of all, I would like to thank Allah Almighty, who

gave me the strength and knowledge, and enabled

me to complete my project on time despite of my

incapability. I would also like to thank my great

teacher Mr. Saeed Ahmed Choudhry for his

practical guidance & feed back that highlighted my

way to successful accomplishment of this project. I

would also like to admire my parents who provided

me with the time, support, and inspiration needed to

complete this project.

Abstract

As student of masters in business administration (MBA), in my course of

management, Our respected teacher Sir Saeed Ahmed Choudhry has given me a project

which is about “Social Responsibilities Of a Manager And Have These

Responsibilities Changed Over the Time Period”…For this project, I have consulted

different articles in global and Pakistan’s perspective that how concept of social

responsibility emerged in business sector and its importance in it.

Then I have chosen Pakistan Tobacco Company, a major player in tobacco

industry by keeping thousands of people employed; and by contributing to the annual

GDP of Pakistan through the large amount of taxes paid on cigarette manufacturing and

sales. By having the mission of being the “first choice for everyone,” PTC is obviously

portraying itself as a very focused, determined and goal-oriented company. Its objectives

are not only related to sales and profits, but are also reflective of the excellent corporate

culture and the high level of ethical responsibility that the company takes on.

Then from facts and figures and data through internet and PTC, I have analyzed

that how PTC is paying its primary attention towards social welfare and retaining its

image. On the basis of this, I have critically analyzed this company regarding its social

concern and also given recommendations for it.

Table of ContentsCORPORATE SOCIAL RESPONSIBILITY:.................................................................................5

Introduction:....................................................................................................................5What is CSR?...................................................................................................................5THE EMERGENCE OF CORPORATE SOCIAL RESPONSIBILITY (CSR):............5Social responsibility of Business / Management:............................................................6

c) Government...........................................................................................................7A. Responsibilities towards employee:......................................................................7B. Responsibilities towards customers:.....................................................................7C. Responsibilities towards government:..................................................................7D. Responsibilities towards society as a whole:........................................................8

Importance of CSR in Business:......................................................................................8Have Social Responsibilities of Managers Changed Over Time Period?.....................10Traditional view of Social responsibility:......................................................................11Modern view of social responsibility:...........................................................................12

Remarks:....................................................................................................................13Corporate social responsibility in Tobacco Industry:....................................................14

Pakistan Tobacco Company............................................................................................................16Introduction:..................................................................................................................16History of Pakistan Tobacco Company:........................................................................16Mission statement of Pakistan Tobacco Company:.......................................................17Corporate Structure of PTC:..........................................................................................18Business Principles:.......................................................................................................19Principal Line of Business:............................................................................................20Location:........................................................................................................................22

PAKISTAN TOBACCO COMPANY AND CORPORATE SOCIAL RESPONSIBILITY.........23Main Projects of PTC Regarding CSR:.........................................................................24PTC Launches Report on Social Responsibility:...........................................................28Data Collection Method:................................................................................................30SWOT ANALYSIS OF PAKISTAN TOBACCO COMPANY:..................................31RECOMMENDATIONS:..............................................................................................34CONCLUSION:............................................................................................................36References:....................................................................................................................37Appendix........................................................................................................................38

CORPORATE SOCIAL RESPONSIBILITY:

Introduction:None of our institutions exists by itself and is an end in itself. Every

one is an organ of society and exists for the sake of society. Business is no exception.

Free enterprise cannot be justified as being good for business. It can be justified only as

being good for society and here comes the concept of corporate social responsibility

(CSR).

What is CSR?CSR is a concept that frequently overlaps with similar approaches such as

corporate sustainability, corporate sustainable development, corporate responsibility, and

corporate citizenship. CSR also frequently involves creating innovative and proactive

solutions to societal and environmental challenges. The way businesses engage/involve

the shareholders, employees, customers, suppliers, governments, non-governmental

organizations, international organizations, and other stakeholders is usually a key feature

of the concept.

THE EMERGENCE OF CORPORATE SOCIAL RESPONSIBILITY (CSR):

Corporate Social Responsibility (CSR) today is a hot issue in all companies and

CEOs like talking about what their company gives back to society. With the

understanding that businesses play a key role on job and wealth creation in society, CSR

is generally understood to be the way a company achieves a balance or integration of

economic, environmental, and social imperatives while at the same time addressing

shareholder and stakeholder expectations. CSR is generally seen as the business

contribution to sustainable development that has been defined as "development that meets

the needs of the present without compromising the ability of future generations to meet

their own needs".

CSR commitments and activities typically address aspects of a firm's behavior

(including its policies and practices) with respect to such key elements as; health and

safety, environmental protection, human rights, human resource management practices,

corporate governance, community development, and consumer protection, labor

protection, supplier relations, business ethics, and stakeholder rights.

As a significant issue for most businesses, it may be attributable to the expectation

in developed countries for organizations to engage with society beyond the boundaries of

their commercial interests. Businesses are now required to answer questions posed by

more conscientious and environmentally aware consumers living in an environment of

instant information dissemination, particularly in the form of virtually ubiquitous media

such as the internet and 24/7 global news channels.

Social responsibility of Business / Management:

Companies have realized that socially responsible business practices not only

benefit their employees but also the greater community at large. Social responsibility

reshapes the way business should be done, both for profit and when not-for-profit.

Social responsibilities of business are different for different sections of society,

which include responsibilities towards.

a) Employees

b) Consumers

c) Government

d) Society as a whole

A. Responsibilities towards employee:

Fair wages and regular payment

Good working condition and safety

Reasonable working standard and forms

Labor welfare service like health, education, recreation and accommodation

Training and promotion

Recognition and respect for hard work, honesty, sincerity and loyalty

Efficiency of redressing employee grievance.

B. Responsibilities towards customers:

Providing goods and services at a reasonable price.

Supply goods and services of promised quality, durability and services.

Supply social harmless product.

Offering an efficient consumer redress mechanism.

Resisting profiteering and black marketing.

Improving product quality towards R & D

C. Responsibilities towards government:

Regular payment of taxes

Resisting bribing bureaucrats and administrators.

Cooperating with Government in up gradation of environment.

Cooperating with Government in up keeping of social value.

D. Responsibilities towards society as a whole:

Prevention of environment pollution.

Preservation of ethical and moral values.

Making provision of health education and cultural services.

Minimizing ecological imbalance.

Importance of CSR in Business:

Change in public expectations

The needs of today’s consumers have changed, resulting in a change in their expectations of

businesses. Since businesses owe their profits to society, they have to therefore respond to the

needs of society.

Business is a part of society

Society and business are benefited when there is a symbiotic relationship between the two.

Society gains through economic development and the provision of employment opportunities;

and business benefits through the workforce and consumers provided by society.

Avoiding intervention by government

By being socially responsible, organizations attract less attention from regulatory agencies. This

gives them greater freedom and flexibility in their operations.

Balance of responsibility and power

Businesses have considerable power and authority. The exercise of this power should be

accompanied by a corresponding amount of responsibility.

Impact of internal activities of the organization on the external environment

Most firms are open systems, i.e., they interact with the external environment. The internal

activities of such firms have an impact on the external environment. To avoid a negative impact

on the external environment, firms should be socially responsible.

Protecting shareholder interests

By being socially involved, a company can improve its image and thus protect its shareholders’

interests.

New avenues to create profits

Social responsibility involves the conservation of natural resources. Conservation can be

beneficial for firms. Items that had been considered waste earlier (for example, empty soft drink

cans) can be recycled and profitably used again.

Favorable public image

Through social involvement, a firm can create a favorable public image for itself and endear itself

to society. By so doing, a firm can attract customers, employees, and investors.

Endeavor to find new solutions

Businesses have a history of coming up with innovative ideas. Therefore, they are likely to come

up with solutions for social problems, which other institutions were unable to tackle.

Best use of resources of a business

Businesses should make optimum use of the skills and talent of its managerial personnel as well

as its capital resources to produce good quality products and services. By so doing, the business

will be able to fulfill their obligations toward society.

Prevention is better than cure

It is in the interests of business organizations to prevent social problems. Instead of allowing

large-scale unemployment to lead to social unrest (which will harm business interests), businesses

can be sources of employment for eligible youth.

Have Social Responsibilities of Managers Changed Over Time Period?

Within the world of business, the main “responsibility” for corporations has historically

been to make money and increase shareholder value. In other words, corporate financial

responsibility has been the bottom line driving force.

In 1970, Milton Friedman argued strenuously that the social responsibility of business is,

above all, to increase profits. In an article for The New York Times Magazine, he pointed

out that without profit there are no wages paid and no enterprise with a surplus to offer

anyone. But today, many business leaders and activists alike would counter that

companies have a responsibility to support various constituencies by being good

corporate citizens--and even that such support will ultimately benefit the business and its

investors.

http://www.entrepreneur.com/tradejournals/article/188744123.html

In the last decade, a movement defining broader corporate responsibilities – for

the environment, for local communities, for working conditions, and for ethical practices

has gathered momentum and taken hold. This new driving force is known as corporate

social responsibility (CSR). CSR is often also described as the corporate “triple bottom

line” the totality of the corporation’s financial, social, and environmental performance in

conducting its business. Today, more and more companies are realizing that in order to

stay productive, competitive and relevant in a rapidly changing business world, they have

to become socially responsible. In the last decade, globalization has blurred national

borders, and technology has accelerated time and masked distance. Given this sea change

in the corporate environment, companies want to increase their ability to manage their

profits and risks, and to protect the reputation of their brands. Because of globalization,

there is also fierce competition for skilled employees, investors, and consumer loyalty.

How a company relates with its workers, its host communities and the marketplace can

greatly contribute to the sustainability of its business success.

Over the past twenty years managers of publicly quoted companies, especially

large ones, have been under pressure on two fronts. On one side they are urged by

increasingly active and interventionist investors to devote themselves single-mindedly to

maximizing shareholder value; if they do not, they are liable to be replaced by managers

who are more attentive to shareholders' needs. On the other side managers are facing calls

from a variety of external groups, including non-governmental organizations (NGOs) to

conduct their affairs in a more socially responsible way.

Traditional view of Social responsibility:

It was believed that if the firm or company is satisfying the need or wants of

its customers in a competitive manner and fulfilling the purpose of its existence

then it is socially responsible. In other words if the company is using the resources in an

efficient manner and providing goods and services at the prices that the customers are

willing to pay, it means that it is fulfilling its objective and earning a profit. In doing so

the company creates jobs, provide income to them and increase the wealth of the society

as a whole. So the social responsibility and successful marketplace performance was

considered to be one and same thing.

Changing Views:

Although not everyone accepted the notion that business was solely an economic

institution with only economic responsibilities, it does seem that this view of the

corporation has been the prevailing view in our society. And as long as the system

worked well enough for most people, there were not likely to be any serious questions

raised about the social performance of business outside the marketplace context.

It was the concern with social responsibilities that began to raise serious questions about

this view of the corporation and its responsibilities to society.

The problems that social-responsibility advocates addressed, such as pollution and

unsafe workplaces, were in large part created by the drive for efficiency in the

marketplace. Thus it began to be argued that there was a divergence between the

performance of business in the marketplace and the social aspects of business behavior.

Many began to believe that cleaning up pollution, providing safer workplaces, producing

products that were safe to use, promoting equal opportunity, and attempting to eliminate

poverty in our society had something to do with promoting human welfare and creating

the "good life" in our society. Yet business was causing some of these problems and

perpetuating others in its quest for an efficient allocation of resources.

For example, by economizing in the use of resources and disposing of its waste

material as cheaply as possible, business was causing some serious pollution problems

regarding air quality and poisoning of drinking water. By always hiring the best qualified

person for a job opening, business was helping to perpetuate the effects of discrimination

against minorities and women.

It was at these points of intersection between the economic performances of

business and changing social values of society that questions about corporate

responsibility began to arise. Business increasingly came to be viewed as a social as well

as economic institution that had social impacts needing the consideration of management.

Modern view of social responsibility:

Now CSR (corporate social responsibility) is considered obligation to:

Customers

Employees,

Shareholders

Communities,

Ecological considerations

Its mean company have to consider all these obligation kept in mind and work for

their betterment. Second thing is that CSR linked with sustainable development, which

argues that firm have not only take decision on profits and dividends but they also

participate in immediate and long-term social and environmental consequences of

their activities.

Remarks:

So from the above discussion we can say that social responsibilities of managers

or companies have been changed with the passage of time. They have come to realize that

in this new era of competitive business environment, they cannot compete just by

concerning to their shareholders for profit motives, but they have to be socially

responsible and contributing towards it if they want to survive. If businessmen discharge

their responsibility towards society sincerely, it will improve the social climate of the

country and the business community will also be benefited. Businessmen are customers

also, so if they preserve the interests of their customers, they help to preserve their own

interest. If they pay taxes in time and keep their employees satisfied, they will help to

raise the general standard of living. The purchasing power of people will go up and

company will be able to make higher profits. If they voluntarily assume their social

responsibilities, it will reduce the pressure for and incidence of state regulations and they

will be equally benefited.

Corporate social responsibility in Tobacco Industry:

Corporate Social Responsibility (CSR) promotes the view that “firms should

strive to make a profit, obey the law, be ethical, and be a good corporate citizen. Tobacco

companies maintain CSR programs in an effort to counter negative attention regarding

their deadly business. By donating funds to noble causes, the perception of tobacco

companies by the public improves. Tobacco companies, however, are not like other

companies. Tobacco is the only consumer product that kills one-half of its users when

used as directed. Tobacco company internal documents reveal the true goals of industry-

sponsored programs. These programs:

Serve the industry’s political interests by preventing effective tobacco control

Legislation. Marginalize public health advocates.

Preserve the industry’s access to youth.

Create allies and preserve influence for the industry among policymaking

regulatory bodies.

Defuse opposition from parents and educators.

Bolster industry credibility.

The tobacco industry attempts to improve its public image as a responsible

corporation mostly through:

a) Philanthropy:

Increasingly, consumers, employees and managers expect companies to go

beyond their traditional role of selling their product for a profit. Tobacco

companies engage in philanthropic activity, aiming to improve their public image

as contributors to the greater societal good. Some companies have even set up

philanthropic foundations to fund their efforts. The tobacco industry engages in

philanthropic activities in areas such as career development, community level

development projects, child labor issues and poverty alleviation. These types of activities

present an ethical conflict between marketing corporate social responsibility and selling a

product that harms or kills when used as intended.

http://www.who.int/entity/tobacco/communications/CSR_report.pdf.

b) Youth smoking prevention:

One area where nearly every major tobacco company invests publicity efforts to

improve their corporate image is the development and promotion of ineffective youth

smoking prevention programs. While these programs are created to appear to dissuade or

prevent young people from smoking, in fact the effect is often the contrary. By portraying

smoking as an adult activity, these programs increase the appeal of cigarettes for

adolescents. Tactically, these programs serve the purpose of creating the appearance that

tobacco companies are proposing solutions for the problems they create.

c) Education:

Another field where several tobacco companies have focused their CSR activities

is education, often in the form of grants, scholarships, professorships and even the

creation of an entire school.

d) Health:

Perhaps most remarkable, and most cynical, are those tobacco industry-sponsored

programs that aspire to public health goals. For instance, BAT Bangladesh extended their

support to Shandhani Andhatyamochan (Blindness Relief) Lottery organized by

Shandhani National Eye Donation Society by purchasing a large quantity

of lottery tickets and making a donation to the Shandhani National Eye Donation Society,

handing over a cheque at a public ceremony held the BAT factory in Dhaka.

The Daily Star (Bangladesh), 30 October 2002, http://www.dailystarnews.com/200210/30/n2103006.htm#BODY4

More and more tobacco companies are using CSR to transform their corporate

identity to include a great amount of responsibility. In doing so these companies

claim to feel responsible for informing their customers about responsible use of smoking.

So, CSR practically has the same effects as advertisements, because it sheds a positive

light on a brand or product. That is why CSR can also be seen as an expression of

marketing for tobacco industry and their corporate social responsibility programs are a

strategy to help boost their profits and improve their image.

Pakistan Tobacco Company

Introduction:Pakistan Tobacco Company Limited (PTC) is a part of British American Tobacco

- the world's most international tobacco group - with brands sold in 180 markets around

the world. Pakistan Tobacco's operations in Pakistan began in 1947, making it one of

Pakistan's first foreign investments.

Pakistan Tobacco Company is the first-multinational company of Pakistan and

recently completed 54 years of its operations in the country. It employs over 100,000

people, and is one of the top 5 FMCG trade-marketing companies in the world.

History of Pakistan Tobacco Company:

From being the first multinational to set up its business in Pakistan in 1947 and

beginning operations out of a warehouse near Karachi Port, PTC has come a long way.

From a single factory operation to a company, which is involved in every aspect of

cigarette production, from tobacco cultivation to packaging, PTC has evolved and grown

with Pakistan. However, what is significant about these fifty-seven years is the effort that

PTC has demonstrated in the development of the country. By being instrumental in the

campaign for modern agricultural and industrial practices, it has helped in the

development and progress of the agricultural & industrial sector in the country.

It has been supporting & contributing to various causes of national interest. Educating

growers in the latest techniques and technology in agriculture, afforestation and free

health care in designated areas are but a few examples.

Through these fifty-seven years, its continuous investment in people, brands,

technology, innovation and the communities in which it operates has borne fruit in many

ways and to mention just a few; it is deemed as a partner of choice by many, its

Environmental, Health & Safety standards are a source of inspiration for local companies,

its Industrial Relations practices have led and influenced local practices, and as a result of

all these, company’s managers are highly valued and sought after people in the Pakistani

corporate world based on the training and exposure company gives them from very early

on in their careers.

Mission statement of Pakistan Tobacco Company:

Corporate Structure of PTC:

Business Principles:PTC follows three fundamental business principles:

1. Mutual Benefit

2. Responsible Product Stewardship

3. Good corporate Conduct

Each Principle is supported by a series of core Beliefs, which are explained below:

Mutual Benefit:

The principle of mutual benefit is the basis on which PTC builds its relationship

with its stakeholders. It is primarily in business to build long-term shareholder value and

it believes the best way to do this to understand and take account of the needs and desires

of all its stakeholders.

Core Beliefs:

Creating long term shareholder value

Engaging constructively with its stakeholders

Creating inspiring work environment of its people

Adding value to the communities in which it operates

Ensuring that suppliers and other business partners have the

opportunity to

benefit from relationship with it.

Responsible product stewardship:

The principle of responsible stewardship is the basis on which PTC meets

consumer demand for legal product that, put simply, is cause of serious disease.

Therefore, its products and brands should be developed, manufactured and marketed in a

responsible manner. It aspires to develop tobacco products with critical mass appeal that

will, overtime, be recognized by scientific and regulatory authorities as posing

substantially reduced risks to health.

Core Beliefs:

Provision of accurate, clear health messages about risks of tobacco

consumption.

Reduction of the health impact of tobacco consumption whilst respecting

the right of informed adults to choose the products they prefer.

Continued availability of relevant and meaningful information about its

products.

Underage people should not consume tobacco.

Responsible marketing of its brands and products and directed at adult

consumer.

Appropriate taxation of tobacco products and elimination of illicit trade.

Regulation that balances the interests of all sections of society, including

tobacco consumers and the tobacco industry.

Approach public smoking in a way that balances the interest of smokers

and nonsmokers.

Good Corporate Conduct:

The principle of Good Corporate Conduct is the basis on which all PTC business

is managed. Business success brings with it an obligation for high standards of behavior

and integrity in everything it does and wherever it operates. These standards are not

compromised for the sake of results.

Core Beliefs:

PTC business upholds high standards of behavior and integrity

High standards of corporate social responsibility to be promoted within the

tobacco industry

Universally recognized fundamental human rights to be respected.

Tobacco industry to have a voice in the formation of government policies

affecting it.

Achieving world class standards of environmental performance

Principal Line of Business:The company produces high quality tobacco products to meet the diverse

preferences of millions of consumers, and it works in all areas of the business - from seed

to smoke. The company provides a number of reputed brands like:

Benson & Hedges:

In 1873, Richard Benson & William Hedges started a partnership in London.

From the very start, the idea was to make Benson & Hedges a style statement, which is

why the business started from London’s fashionable West End. PTC launched Benson &

Hedges in Pakistan in March 2003. Made with the finest hand picked golden Virginia

tobacco from across three continents, the brand is packed with perfection to seal its

freshness.

John Player Gold Leaf:

The story of John Player Gold Leaf has to start from the story of its founder,

John Player. An enterprising businessman, John Player started a small tobacco selling

business in 1877 and turned it into a thriving cigarette company, John Player and Sons.

Capstan:

Has a rich heritage, originating in Britain in the 19th century. The brand was

created under the auspices of W.D. & H.O. WILLS at Bristol and London.

Gold Flake:

Like many of PTC brands, also boasts its origins at W.D. & H.O. WILLS where

it was a premium brand around the end of the 19th century. Launched in 1982, in a 'soft

cup' packaging, the brand took off when it was repositioned in the value for money

segment and later a 'hinge lid' variant was introduced in 2000.

Wills: Takes its name from the heritage of one of the original Imperial Tobacco

Company families: the Wills Brothers of London.  

Embassy:

Third leading volume brand in Pakistan is most popular in the Punjab where it

enjoys a leading position due to its equity and loyalty.

Location: Registered Office:

Pakistan Tobacco Company Limited

Dubai Plaza, Plot No. 5

Street 20, Salman Market, F-11/2

P.O. Box 2549

Islamabad-44000

Telephone: +92 (51) 2083200, 2083201

Fax: +92 (51) 2111913

Web: www.ptc.com.pk

Regional Sales Offices:

North Punjab & N.W.F.P.

House # 57-A/6, Satellite Town

Rawalpindi

Telephone: +92 (51) 4582390-91

PAKISTAN TOBACCO COMPANY AND CORPORATE SOCIAL RESPONSIBILITY

Pakistan Tobacco Company aims to demonstrate responsible corporate conduct

across all aspects of its operations. It abides by this philosophy each step of the

way: from appropriate marketing and consumer information to supporting sensible

tobacco regulation; from respecting workplace human rights and reducing its

environmental impacts to contributing to local communities. Company seeks to work

continuously to engage with its stakeholders, to balance its views and to align its

business decision-making with reasonable societal expectations of a modern tobacco

group.

That is why PTC has been at the forefront of CSR subsequent to its initiatives of:

Afforestation Mobile free dispensaries

Eye care via Layton Rehmutullah Benevolent Trust

Learning Resource Center,

Non formal education through the NGO Adult basic education society

Supporting citizen’s foundation to prove educational facilities for the children

Installation of water filtration units

Rehabilitation of earth quack affectees’ in Battagram, inaugurated in September

2006

Project to combat the spread of viral hepatitis in northern areas in November 2006

It recognizes that CSR presents particular challenges for a tobacco company.

Tobacco products pose real risks to health and raise important questions about how best

to define responsible product stewardship. Company therefore believes that for its

business, the only meaningful approach to CSR is one based squarely on its products, on

the issues around it and on ways of responding to sometimes strongly held views of its

stakeholders.

Main Projects of PTC Regarding CSR:

1. Afforestation:

Pakistan Tobacco Company is already recognized for its work in afforestation and

currently is planting four million trees on average per year. Under this program, it has

planted over 52 million trees since the project started in 1981. PTC is also looking into

the possibility of expanding this activity throughout Pakistan instead of concentrating

only in NWFP. Clearly, its agricultural infrastructure is strongest where it works with its

growers and therefore focuses on afforestation will be where it has the appropriate

resources to support it. Considering the fact that only four percent of Pakistan's land mass

is covered by forest (whereas ideally it should be at least twenty percent), PTC has

instituted probably the largest private sector reforestation program in Pakistan.( See

apendix3)

http://www.ptc.com.pk/OneWeb/sites/PAK_62VKZB.nsf/vwPagesWebLive/DO64KC2G?opendocument&SID=&DTC=&TMP=1

2. Mobile Doctor Program:

PTC dedicated Mobile Doctors team takes pride in providing health care in areas

where there are no medical facilities. Since the early 80’s it has been running a mobile

doctors program. The program has been growing over the years and it now has 9 mobile

medical units in its leaf region and at its factories. These provide free medical check-ups

and diabetic screening as well as eye care and general health advice in areas around its

factories and the leaf growing regions, which have poor medical facilities. On an average,

PTC aims to provide medical assistance to some 3000 people per month. This facility has

also been used extensively during natural calamities such as floods, earthquakes and

drought.

 http://www.ptc.com.pk/OneWeb/sites/PAK_62VKZB.nsf/vwPagesWebLive/DO64KBXM?opendocument&SID=&DTC=&TMP=1

3. Youth Smoking Prevention:

PTC strongly believes that children should not smoke, and smoking should only

be for adults who understand the risks associated with it.

British American Tobacco Group companies support and run programs

worldwide tackling underage smoking. Due to concerns expressed on youth smoking,

Pakistan Tobacco Company has taken initiatives on several fronts such as voluntary

withdrawal from electronic media, prohibiting the use of celebrities in marketing material

and embedding a robust marketing code; the International Marketing Standards (IMS).

PTC was the first company to pilot a retailer education program in 1999 and continue to

do so. Additionally, all its packs and advertising materials have a voluntary inscription

with the legend ‘under-age sale prohibited.’ Company supported the government in

raising the minimum age limit from sixteen to eighteen through recent tobacco

legislation. (See appendix 6)

4. Education Programs:

Education programs aim to give young people ‘life skills’ to deal with the many

challenges they face during adolescence, including peer pressure to smoke. Such

programs are amongst the initiatives that British American Tobacco Group companies

worldwide sponsor and support to help convince young people not to smoke. PTC is

willing to work with the Ministry of Education/Health to develop educational modules

for incorporation in the national curricula, but the program content is best left to experts

and its delivery to teachers or youth leaders.

 http://www.ptc.com.pk/OneWeb/sites/PAK_62VKZB.nsf/vwPagesWebLive/DO64KBU9?opendocument&SID=&DTC=&TMP=1

5. LEARNING RESOURCE CENTRE:

Keeping in mind the need to invest in education & the non-availability of quality

institutes, the company has established free Learning Resource Centers (LRC) in its Leaf

Areas in the Punjab (Gujarat), and the NWFP (Mansehra, Yar Hussein, & Bunair).

In addition, since it lacks separate institutes for women, the LRC at Adam Zai in the

vicinity of its factory in Akora Khattak was set up to provide opportunities to the local

women. The major objective was to give access to IT education free of cost to its

stakeholder’s families. It was also agreed to use these centers in the future for imparting

vocational training & generating health & hygiene awareness. The relevant Government

authorities approve PTC LRCs. Currently, PTC has seven LRCs at its factories and in the

Leaf growing areas. These centers provide state-of-the-art IT skills to the children of its

employees and to the members of its community. (See appendix 3)

The benefits that will be derived from the program can be summarized below:

Contribute in the development of skilled resources in the country

Help participants to obtain employment

Generate Technology Awareness

Bridge the Information Gap by providing access to the world of Internet

Help women in getting training/awareness, as there are no separate centers for

women in remote areas

Provide a forum to discuss & resolve issues

Bring people with diverse interests and backgrounds together to a common forum

http://www.ptc.com.pk/OneWeb/sites/PAK_62VKZB.nsf/vwPagesWebLive/

DO64KC67? opendocument&SID=&DTC=&TMP=1

6. Tobacco fields and prosperity:

Pakistan Tobacco Company growers are amongst the most progressive in the

country, benefiting from its constant support and guidance. The Company spent

approximately Rs. 1 Billion on tobacco purchases last year in the NWFP over a short

period of eight to ten weeks. Its Akora Khattak Factory paid over Rs. 4 Billion in 2003 in

its various tax obligations.

Its farmers are considered by it to be one of its most important stakeholders. As

part of an economy highly dependant on its agriculture sector, Pakistan Tobacco

Company takes great pride in making a positive difference to the lives of those that work

there. To improve the conditions of trade for the farmers, the Company has recently

launched a fully integrated, electronic system of leaf purchasing called BAT Leaf.. The

system allows for efficient purchasing during the buying season. The farmer thus gets

prompt compensation.

7. PTC Free Medical Camps in Swat:

Pakistan Tobacco Company (PTC) organized a free medical camp in Leaf Depot

Khawazakhela, Swat. Tehsil Nazim Mata Abdul Jabar Khan was chief guest on the

occasion. Those present were Regional Manager Pakistan Tobacco Company Javed

Khan, doctors and a large number of elite of the area. More than 1200 patients, including

400 females were provided free medical cover in the camp and were given free quality

medicines.

About 100 eye patients were also examined and provided with free eye medicines.

In collaboration with the Merck Pakistan (Ltd), more than 200 locals were examined for

diabetics and free medicines were provided to them as well. Besides the free medical

camp a health awareness program was also arranged.

8. Environment, Health & Safety (EH&S):

Being fully alive to its role as a responsible corporate citizen, PTC has

implemented a well structured EH&S program in addition to embedding internationally

recognized best practices. PTC is committed to ensure that it nurture an environment

where its employees and surrounding communities are safe from any hazards that may

affect their health and minimize the impact of its operation on biodiversity. PTC’s

commitment to EH&S was further strengthened during 2006 as PTC achieved

significant improvements on the EH&S road map. Both its production facilities were

rectified with ISO 14001 earning the “Evergreen” status. PTC has consistently sustained

its accreditation in last seven surveillance audits with zero major and minor points. PTC’s

efforts has further been sustained with National Forum for Environment & Health

awarding PTC the Annual Environment Excellence award on “Health, Safety and

Environment” for second consecutive year in 2006.

Through out the company’s history, it has maintained a strong stance on corporate

and social responsibility, it strongly believes in building effective and constructive

partnership with communities by helping address various EH&S issues. In this regard it

has formulated its policy whose main features are:

Provide and maintain a safe and healthy working environment including use of

cleaner technologies and safe systems of work for all its employees and

noncompany personnel on the company premises.

Pay due regard to all impact of its activities on the physical environment.

Comply with all applicable National laws and regulations and BAT policy

pertaining to Environment Health and Safety.

Establish procedures to regularly assess and reviewing the EH&S impact of its

present and future and seek continuous improvement to its EH&S performance.

Adopt a pro-active role to continually identify cost-effective measure, which it

can take to reduce pollution, safeguard the health and safety of its employees,

non-company personnel on company premises, the neighboring communities and

the physical environment.

PTC Launches Report on Social Responsibility:

PTC recognizes that CSR presents particular challenges for a tobacco company

because tobacco products pose real risks to health and raise important questions about

how best to define responsible product stewardship. It therefore believes that for its

business, the only meaningful approach to CSR is one based squarely on its products, on

the issues around them and on ways of responding to sometimes strongly held views of

its stakeholders. So PTC took the step of formalizing its CSR and its corporate social

investment initiatives in a report called a Social Report.

All major business companies should review their operation from Corporate

Social Responsibility (CSR) perspectives and take necessary measures to protect the

rights of stakeholders, was the theme for Pakistan Tobacco Company’s (PTC) social

report titled ‘Business with responsibility’.

Social Reporting is a relatively new discipline that, put simply, is the process of

listening and responding to stakeholders. It is not merely a report that is produced

annually, but a process to ensure that companies are behaving in line with society's

reasonable expectations. Social reporting is about providing an accurate and transparent

account of the company’s operations; providing a platform for communicating concerns

and through stakeholder dialogue an early warning system about issue-awareness and the

management of social issues. Social Reporting has proven to be an effective mechanism

to objectively and robustly address society's needs while embedding the idea of

engagement into all areas of business.

Social Reporting is a new business practice for the Pakistan Tobacco Company

(PTC) that will allow PTC to have its social performance externally and objectively

audited to international standards. Social reporting will enable PTC to engage with its

stakeholders directly and/or indirectly over issues that surround the business in an

accountable and transparent manner. The social reporting exercise will offer PTC an

opportunity to try and meet reasonable stakeholder expectations. In return stakeholders

will have an opportunity to discuss key issues and influence PTC decisions and policies

in the future. This process will allow PTC to make decisions based on the social

implications of their business and not financial considerations alone. So by producing the

Company's first Social Report, Pakistan Tobacco Company has attempted to engage

constructively with its stakeholders.

Data Collection Method:

The method for data collection is central theme of the study. No study is

completed without using the scientific and systematic ways to get latest knowledge about

the study. So the methodology for data collection about my project is based on the

traditional categories:

1. Primary Data Collection

2. Secondary Data Collection.

1. Primary Data Collection:

In primary data collection I used the techniques of: Personal observation.

I also used unstructured interview technique when I faced any

problem during work.

2. Secondary Data Collection:

In secondary data collection method I got information from: Annual reports of different years.

Brochures from the company

PTC website

Different articles and journals about the company from

internet and newspaper.

SWOT ANALYSIS OF PAKISTAN TOBACCO COMPANY:

An analysis indicating towards the organizations strengths, weaknesses,

opportunities and threat is termed as SWOT Analysis. Such an analysis is very important

for the management in retaining the strength, overcoming the weaknesses, capitalizing

over the emerging market opportunities, and carving ways to successfully tackle with the

threats and ultimately converting them in the strengths for the organization. This analysis

provides information that is helpful in matching the firm's resources and capabilities to

the competitive environment in which it operates.

Following is the swot analysis of PTC:

Strengths:

In the analysis of the Strengths of the company we focused on the competencies

of the PTC.

1. PTC is leading and dynamic tobacco company.

2. The organization has strong ethical values and an ethical mission

statement.

3. Experienced, highly competent and diverse work force workforce

dedicated to mission of the company.

4. Offers superior quality brands helping the company in carving out an

image for itself both in the market and in the hearts of the consumers thus

winning the trust of both.

5. Excellent corporate culture, which is more growth, oriented.

6. Strong community partnerships/collaboration.

7. Continuous Quality Improvement promotes teamwork.

8. Increased community responsibility for service delivery.

9. High quality social work programs.

10. Major contributor to numerous causes such as forestation campaign, free

mobile dispensaries, training schools and the company’s concern for the eco

system.

11. Compliance with the regulations of the government and regular payment

of taxes has earned the company the respect of all and sundry.

12. Major contributor to the national revenue of the state.

Weaknesses:

1. Failure of PTC to file a strong case against lower quality brands whose

producers do not pay any tax to the government and yet have maintained a

prominent presence in the market.

2. Cigarette being a controversial product convincing the consumer to prefer

PTC’s brands to competitors because of the quality of their constituents has

become an uphill task.

3. For gaining an edge over the competitors and in a bid to live up to its

image in the market much of PTC’s operations are highly costly. So financial

resources are being extravagantly used.

4. Cutting back on such cost may be difficult, because of which in recent

years the company has done extensive across the board retrenchment.

5. Multiple funding streams also can lead to lack of coordination.

Opportunities:

1. Advanced technologies are available to foster more effective human

resources and social welfare activities.

2. Availability of information about best practices in social welfare.

3. Can go to each community for resources that they can bring to the table.

4. Increase of the experience in the cooperation and the establishment of a

strategy of common development.

5. Since PTC has already captured a major share of the local market in it’s

pocket, which has been ensured by the availability of their brands in virtually

every shop all over the country, so it appears less likely that any big attractive

opportunity would be missed by it. PTC will assess the prospects and will avail it

as and when as it presents itself.

6. Due to its image, it has an opportunity to expand its social welfare

programs internationally.

Threats:

1. Tobacco being a controversial product, governments enforces

strict regulatory measures from time to time to discourage its mass production,

which is also a genuine threat for the company.

2. Who knows if the market for tobacco will grow and stay in favor

with customers, or whether another type of leisure activity will replace tobacco in

the future?

3. Development of managerial competence in social workers.

4. Competitors with more social welfare programs can also affect its

image.

5. The law and order situation has been precarious, culminating in

the bombing at the Marriott hotel, which led to collateral damage to our Head

Office in Islamabad.

6. The general security situation in the country continued to

deteriorate in 2008 and it was especially difficult in the tobacco growing areas of

NWFP.

7. In a future scenario there is a great likelihood of a possible

confrontation between anti-smoking campaigners and tobacco produce

8. The growing health hazards such as cancer and ailment of the

heart and their attribution to smoking may also create a potential threatening

situation for the company.

9. Changing Optimization techniques not only to ensure capacity

enhancement but also to adhere to international Environment, Health and Safety

standards.

RECOMMENDATIONS:

On the basis of facts and figures and keen observation, following are the

recommendations that we put in front of the company so that company can improve:

1. PTC should increase best practice sharing within its system to enhance the

transfer and scaling of the most efficient and innovative initiatives.

2. It should integrate company’s values into key people programs, from

hiring, to training, to career development.

3. It should continue to enhance its employment value proposition to drive

employee engagement in the company’s value added social programs.

4. The company must have periodic meetings in which it should allow the

staff members and executives all over the country to share their views about

company’s responsibility towards community. Then on the basis of their mutual

understanding, policies regarding more welfare programs should be formulated.

5. In spite of different social welfare activities, consumers are unaware

regarding the activities run by PTC. Most of people ask in which social welfare

activities this company involves? We recommend the company should position

itself as socially responsible company and be closer in the consumers mind and

before starting of any activity consumers must be aware of it.

6. Company must focus in creating awareness regarding their social welfare

7. activities among masses. For this it must run the campaigns and arrange

more seminars.

8. Most of the consumers are willing to pay more if the company indulges

itself in social welfare activities, but they are ready to contribute less than one

rupee. Therefore, we recommend that company must focus on the quality of their

brands and with this company must involve itself in social welfare activities.

9. It should continue to enhance children’s well being through programs and

initiatives that provide “fun with a purpose”.

10. It should increase credibility, as tobacco companies’ partner with parent

groups to roll out specially their youth smoking prevention programs.

11. PTC must initiate a vigorous campaign for curbing the growing menace of

smuggling of foreign cigarettes into the local market. And since NWFP has the

notorious reputation for being the hub of smuggled and contra banned goods in

the country as most of smuggled brands sneak into the country through Afghan

border therefore, it is incumbent on officials at the Area Sales Office to go out of

the way in a bid to put an end to this trade.

12. PTC being a major contributor to the national revenue must safeguard its

interests in the face of the threats posed by the aforementioned factors. In this

regard the company must advocate a strong case against all those entities engaged

in the same trade but operating through illicit means.

CONCLUSION:

In conclusion we must say, social responsibility is one of the most important

factors for any company in today’s corporate business environment. Companies are

investing their billions of dollars for the social marketing. The basic aim beside

this activity is to present itself a socially responsible company among masses and

to differentiate itself from those of competitors. The only profit generation by selling its

products and services is not an important job for today’s corporate level businesses. Now,

companies are more socially responsible than ever. There is increasing focus on both the

private and public sectors to be proactive in the area of CSR. CSR usually focuses on one

or more elements such as environmental protection, health and safety, corporate

governance, human resource management practices, human rights, community

development and consumer protection. Nowadays the companies have to keep in view

the social benefits as well. They have to keep in mind the well being of the Stakeholders

as also issues like the safeguarding of the Environment. These activities are constantly

under the microscope of the society.

Pakistan Tobacco Company also indulged itself in social causes. The company is

involved in anti smoking policy for under ages, building schools in far areas,

plantation and women training programs. The basic aim behind is to minimize its

negative image of being a non cooperative and dangerous company for the citizens.

PTC acts responsibly and respectfully towards the people and authorities in

different societies and aims to contribute to social and economic development. It gives its

employees reasons to be proud of the way PTC demonstrates Corporate Responsibility.

This is the essence of its commitment to Corporate Responsibility.

References:1. www.ptc.com.pk

2. The News

3. Annual Reports 2007 and 2008 of PTC