Publicity Traded
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Company Overview

BAT is one of the leading tobacco manufacturers with sales in over 180 markets around the world. While cigarette volume sales declined by 9.4% between 2017 and 2019, the company continues to earn 88.9% of its revenues from high-risk product sales. BAT offers the widest range of reduced-risk products in the industry, with brands in each product category recognized in the index scope. Most of the company’s reduced-risk products, including cartridges and heated tobacco, have registered double-digit growth, albeit starting from a relatively lower base. BAT increasingly directs R&D and capital expenditures to developing reduced-risk products but nonetheless closed the biggest high-risk product motivated M&A deal in 2017, acquiring the remaining shares in Reynolds for GBP41.8 billion.

Stance on Harm Reduction

BAT states its objective is “to build ‘A Better Tomorrow’ by reducing the health impact of our business through offering a greater choice of enjoyable and less risky products for our consumers. Our ambition is to increasingly transition our revenues from cigarettes to non-combustible products over time.” This is supported with two key targets: “increasing our consumers of non-combustible products to 50 million by 2030,” and to “achieve at least GBP5 billion from New Categories revenue in 2023/2024.” However, BAT does not commit to phase out high-risk products. Instead, it continues to position them at the core of its business, arguing that revenue from continued sales will help fund development of reduced-risk alternatives.

Notable Performance


Strategy and Management

BAT has made a specific commitment to tobacco harm reduction supported by timebound targets to grow reduced-risk product customers and revenues.

Product Sales

BAT has started to shift its sales balance toward reduced-risk products, but the overall percentage remains limited to 5% of total net value sales.

Capital Allocation

BAT’s capital expenditure and R&D investments are heavily concentrated on supporting reduced-risk product development, but the company’s purchase of Reynolds American Inc also underscores its continuing focus on high-risk products.

Product Offer

BAT is expanding its offer of reduced-risk products and reaching multiple international markets, including those in low-medium income countries such as Kenya and Pakistan.


BAT has a separate youth access prevention policy and is transparent in monitoring and disclosing its own internal violations. It also uses external auditors to assess its compliance with the policy.

Lobbying and Advocacy

BAT’s code of conduct includes specific guidance for public policy engagement and lobbying. The company also details its policy positions.

Net Value Sales

In 2019
High-Risk Products
Reduced-Risk Products

Products Offered

In 2019
High-Risk Products
Reduced-Risk Products

Capital and R&D Investment

Over 2017-2019
High-Risk Products
Reduced-Risk Products

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