Planet under Pressure

tially the same – reduces the ability of
any sector of society to influence and
impact change in the right direction.
Last, PMI’s SoP points out how the enormous
business transformation it is undergoing
– creating a completely different
business model – requires strong support
from, and engagement with, all its stakeholders
(employees, customers, regulators,
public health community, supply chain,
civil society, and shareholders). In doing
so, it also explains its commitments and
how it intends to engage with stakeholders;
namely, it “asks the public health
community to scrutinize its smoke-free
products, to provide feedback for improvement
and to be open to considering
that PMI’s purpose aligns with the societal
goal to change the health trajectories of
the people who smoke.”
PMI was the first US-listed company to
publish an SoP and, notably, can serve
as a model for others to follow. The
process undertaken to produce its SoP
can inform other companies that wish to
define their full contributions to society
and their stakeholders.
A Statement of Purpose
Purpose in support of stakeholder
capitalism – a system in which corporations
are oriented to serve the interests
of all their stakeholders – has become
de rigueur in the corporate community.
Under this system, a company’s purpose
is to create long-term value and not only
maximize profits and enhance shareholder
value at the cost of other stakeholder
groups. Issues related to all stakeholders
will continue to gain prominence and
will not diminish in the future.
Today, with the planet under assault
from a pandemic that has delivered
the most profound economic pain since
the Great Depression, companies are
furloughing employees, paying dividends
to shareholders, and provoking
complaints from workers that they are
not adequately protected. Meanwhile,
in the run-up to the crisis, many companies
bought back shares and paid
dividends, rewarding shareholders
while leaving themselves with fewer
resources with which to aid workers when
disaster struck (“Big Business Pledged
Gentler Capitalism. It’s Not Happening
in a Pandemic.” New York Times, Peter S.
Goodman, April 13, 2020). These actions
expose the reality that the rhetoric of the
Business Roundtable has not altered the
decisive question of capitalism: Where
does the money go?
Much is being said about the need for
companies to rethink why they exist and
their business models. We need more
companies to join PMI in this mission.
The time has come for the board of
directors of every company to publish a
Statement of Purpose. Broad adoption is
a critical first step to creating a form of
capitalism that serves all stakeholders.
By itself, this is not enough. The SoP
must be accompanied by transparent
integrated reporting of progress.
Jennifer Motles is Director of
Social Impact & Sustainability at
Philip Morris Products S.A.
Dr. Robert Eccles was a tenured professor
and Professor of Management Practice at
Harvard Business School. He is the world’s
foremost expert on integrated reporting and
a leader on how companies and investors
can create sustainable strategies. Eccles is the
founding chairman of the Sustainability
Accounting Standards Board (SASB) and
one of the founders of the International
Integrated Reporting Council (IIRC).
Prof. Eccles is an advisor to PMI on matters
regarding sustainability, integrated
reporting, and engagement.
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 as well as of 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
US Food and Drug Administration
to Altria Group, Inc. for sale in the
United States 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-ofthe-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 heatnot-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 www.pmi.com and
www.pmiscience.com.
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