1. Analysis of Major Environmental Impacts and Strategies Within the U.S. Cigarette Manufacturing Industry TIMOTHY R. BELITZ ADVISOR: DR. DEBORAH RIGLING-GALLAGHER, NICHOLAS SCHOOL OF THE ENVIRONMENT

2. Objective Conduct a comprehensive review of environmental performance, sustainability strategies, and practices of US cigarette manufacturers to enable continual improvement.

3. Methods Used publically available literature on US cigarette manufacturers Three facets of analysis: 1.Comparative Review Environmental Performance, 2.Examined Environmental Sustainability Strategies, and 3.Reviewed Industry for Broad Inventory of Environmental Sustainability Tactics.

4. Overview of US Cigarette Manufacturing Major US Manufacturers Altria - PMUSA RAI –RJR Tobacco Lorillard Number of Employees Facility Size (million sqft)Manufacturing Location Annual Capacity (billion cigarettes) PMUSA23001.6Richmond, VA135 RAI Tobacco39002.1Tobaccoville, NC110 SFNTC (RAI)4000.098Oxford, NC2.8 Lorillard28000.97Greensboro, NC50

5. Industry Sustainability Reporting

6. Comparative Environmental Impact

7. Thousands of Pounds Released Nicotine and Salts Ammonia

8. Comparative Environmental Impact

10. Waste Disposed at Landfills (millions of Pounds) Total Waste (millions of Pounds)Percent Waste Recycled 201120102009201120102009201120102009 RAI374339686510046%34%60% Altria26382829212513391%70%79% GRI Reported Data Non-Hazardous Waste Disposition Comparative Environmental Impact

11. Analysis of Environmental Strategy Basis of Analysis – Measuring Environmental Strategy: Construct Development, Reliability, and Validity -2011 – Validated content analysis method – Designed to use publically available data – Organized into categories that demonstrate a firm’s proactive environmental strategy

12. Analysis of Environmental Strategy – Historical Orientation, Category Total PossiblePMUSARAI Historical Orientation 4 33 Network Embeddedness (a) Supply chain 4 11 Network Embeddedness (b) Other Stakeholders 7 53 Endowments 5 21 Managerial Vision 4 30 Top management Team Skills 4 44 Human Resources 2 11 Total 30 1913

13. Industry Environmental Sustainability Tactics A broad collection of US/international cigarette manufacturers environmental sustainability tactics was developed while conducting this project. Over 140 examples of practices that are being used in 9 environmental sustainability practice areas.

14. Recommendations 1.Utilize their environmental sustainability information to its fullest. – Continue to improve quality and validation 2.Improve “Network Embeddedness” of the supply chain, government relationships, and volunteer programs. 3.Investigate niche market for organic, additive free, “green” cigarettes. 4.Investigate alternatives to fossil fuel power generation. “There is no magic bullet – it’s about understanding what works best in a particular location.” -Participant Comment in BAT CSR Report

15. Thank You