Climate Change Data

Environmental Metrics

ESG Focus Areas

• Responsible Sourcing
• Environmental Protection
• Governance
• Social Responsibility
• Reduce Harm of Tobacco Products
• Prevent Underage Use
• Support Our People & Communities

Environmental Achievements

• 100% of planned Good Agricultural Practices (GAP) assessments of domestic tobacco growers completed.
• More than 90% of Altria’s leaf suppliers participated in the Sustainable Tobacco Program (STP) self-assessment.

Social Achievements

• ~99% of contractually obligated stores verified to have required underage access prevention signage.
• Approximately 65,000 stores participated in age-validation technology incentive program (47% of PM USA cigarette volume and 58% of e-vapor category volume).
• 100% of Altria’s contracted growers received GAP training in 2020.
• Altria awarded funding to 7 universities, supporting over 30 research projects, 10 graduate students, 9 extension/outreach programs, and approximately 65 undergraduates.

Governance Achievements

• Improved spending and sourcing-related analytics to proactively identify and manage risks.
• Continued monitoring of contract compliance and supplier management infrastructure to proactively identify and manage risks.
• Expanded assessment of cyber-security risks associated with suppliers.
• Leveraged technology solutions to simplify, standardize and improve visibility and controls in purchasing process.
• Continued updating of business continuity plans for critical goods and services.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacts on supply chains and business continuity.
• Natural disasters and cyberattacks.
• Limited qualified suppliers for tobacco product materials.
• Underage access to tobacco products.

Mitigation Strategies

• Implemented plans to minimize business disruptions.
• Provided resources to growers to reduce risk and monitor COVID-19 impacts.
• Secured enough PPE materials to protect employees and suppliers.
• Onboarded 16 new supplier partners to procure PPE.
• Established enhanced infrastructure to identify emerging risk areas and mitigate risks.
• Implemented enhanced business continuity plans.
• Rerouted deliveries and adjusted plans with suppliers.
• Established enhanced infrastructure to identify emerging risk areas, mitigate those risks, and implement enhanced business continuity plans.
• Developed new supply chain for Helix Innovations’ tobacco leaf-free nicotine pouches.
• Utilized Altria Group Distribution Company’s (AGDC) sales network and distribution expertise.
• Implemented remote work and virtual engagement with trade partners.
• Cautious and methodical approach to “Return to Retail” with safety precautions.

Supply Chain Management

Supplier Audits: One direct packaging and product materials supplier audit conducted in 2020 (using SMETA methodology).

Responsible Procurement

• Supplier Code of Conduct.
• Third-party assessments and audits.
• Risk-based approach to due diligence.
• Corrective action plans for audit findings.
• CDP Climate Change questionnaire for key suppliers.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, SASB

Awards & Recognition

• Southern Trade Association’s “Vendor of the Year” award.

Environmental Metrics

ESG Focus Areas

• Protect the Environment
• Drive Responsibility Through Our Value Chain
• Reduce Harm of Tobacco Products
• Prevent Underage Use
• Support Our People & Communities

Environmental Achievements

• Released 1st TCFD report; Signed a renewable VPPA to accelerate progress toward 100% renewable electricity by 2030; Double ‘A’ CDP Climate & Water rating for the 2nd consecutive year

Social Achievements

• Launched a $250,000 Stronger Together challenge to support industry-led, sustainable efforts toward inclusion, diversity, and equity; Granted $25.2 million to positive youth development organizations; Visits to QuitAssist increased by 138% in 2021 vs 2020; Created a new 5-year community impact plan and contributed approximately $61 million to local and national nonprofit organizations

Governance Achievements

• Reviewed annual incentive compensation plan to assess whether employees were adequately incentivized to achieve responsibility focus area goals; Enhanced governance of ESG reporting by implementing a process for data and disclosure review, substantiation, and reporting

Climate Goals & Targets

Environmental Challenges

• Climate change presents global risk; effects of companies’ products on the environment (climate change, water quality, cigarette butt litter); effects of changes in nature on companies and associated business risks; evolving expectations and regulations associated with climate change and waste

Mitigation Strategies

• Examined climate-related risks and opportunities through climate-related scenario analysis included in TCFD report; Developed integrated environmental solutions across the enterprise (product innovation, packaging, policy advocacy); additional stakeholder research to guide reporting of decision-useful data; conducting additional stakeholder research to guide our reporting of decision-useful data in line with stakeholder expectations

Supply Chain Management

Responsible Procurement

• Supplier code of conduct
• Supplier engagement on Scope 3 emissions
• Grower sustainability
• Human rights
• Supplier diversity

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Awards & Recognition

• The Civic 50
• Double ‘A’ rating for tackling climate change and protecting water security
• Perfect score of 100 in Human Rights Campaign's 2021 Corporate Equality Index
• 4th ranked and named as a “Trendsetter” among the S&P 500 on the Center for Political Accountability Zicklin Index
• Best-of-the-Best Corporations for diversity and inclusion
• Chamber RVA’s Young Professionals Workplace Award
• Great Place to Work-Certified company
• 2021 Outstanding Corporation of the Year Award
• Forbes Green Growth 50 list

Environmental Metrics

ESG Focus Areas

• Protect the Environment
• Drive Responsibility Through Our Value Chain
• Reduce Harm of Tobacco Products
• Prevent Underage Use
• Support Our People & Communities
• Engage & Lead Responsibly

Environmental Achievements

• Signed first Virtual Power Purchase Agreement for energy from a Texas wind farm, expected to achieve 100% renewable electricity by 2030 ahead of schedule.
• Improved CDP ratings for climate change (A-), water security (A-), and deforestation (B).

Social Achievements

• Achieved several Inclusion & Diversity Aiming Points; 21% of vice president-level and 26% of director-level employees were people of color; women represented 34% of vice president-level and 41% of director-level roles.
• Contributed approximately $57.5 million to local and national nonprofits; engaged 62% of eligible employees in community activities.
• on! nicotine pouches grew retail share to 5%, a 2.4 share point increase.

Governance Achievements

• Strengthened responsibility governance structure and processes; Board of Directors assigned accountability to committees; executive leadership team provides centralized oversight; steering committees for each focus area provide oversight of progress toward 2025 goals.
• Improved ESG reporting processes for data and disclosure review, substantiation, and reporting; implemented improved processes for data and disclosure review, substantiation and reporting.
• Announced 2028 Enterprise Goals, including financial metrics, smoke-free volume and revenue targets, and plans to incorporate these goals into executive compensation (pending NJOY acquisition).

Climate Goals & Targets

Environmental Challenges

• Changes in the regulatory environment and rising standards from the Science Based Targets initiative led to reassessment of priorities.
• SEC's proposed rule on climate-related disclosures and extended producer responsibility legislation influenced pausing some initiatives.
• Need for employee upskilling and connection to responsibility work.
• Demographic disparities in adoption of smoke-free products and understanding of relative product harms and nicotine risks.

Mitigation Strategies

• Strengthened responsibility governance structure and processes.
• Launched employee training course, "Tying it All Together: Corporate Responsibility, ESG and You."
• Working to integrate responsibility considerations into enterprise systems and processes (e.g., environmental considerations into product and packaging development).
• Conducting an equity and civil rights assessment in response to shareholder proposal.
• Simplified responsibility reporting and clarified 2025 goals.

Supply Chain Management

Supplier Audits: 100% of top-tier suppliers using supply chain mapping risk monitoring technology

Responsible Procurement

• Supplier Code of Conduct
• Supplier meetings
• Assessments, audits and surveys
• GAP Connections (GAPC) Certification Program (100% contracted tobacco grower participation)
• Sustainable Tobacco Program (100% global leaf supplier participation)

Climate-Related Risks & Opportunities

Transition Risks

• Emerging regulation and legislation on environmental disclosures and product/packaging impact (recyclability, sustainable materials, consumer waste).

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Sustainable Products & Innovation

• Smoke-free alternatives

Awards & Recognition

• National Business Inclusion Consortium's Best-of-the-Best Corporations for Inclusion
• Points of Light's Civic 50
• Minority Corporate Counsel Association's Employer of Choice
• Human Rights Campaign's Corporate Equality Index (perfect score)
• Center for Political Accountability's CPA-Zicklin Index (5th among Russell 1000)
• WBENC's America’s Top Corporations: Resiliency Edition
• CDP's Supplier Engagement Leaderboard
• Fortune and Great Place to Work's Best Workplaces in Manufacturing & Production (#6)
• Great Place to Work-Certified™ company
• Association for Talent Development (ATD) BEST Award