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  • BAT Appoints CFO

    BAT Appoints CFO

    Image: tonsnoei

    Soraya Benchikh has been appointed to the role of chief financial officer and executive director at BAT. She will join the boards from May 1, 2024, succeeding Javed Iqbal, who will continue to serve as interim finance director until April 30, 2024.

    Benchikh has been president of Europe at Diageo since January 2023, having joined Diageo in July 2020 as managing director for Northern Europe. Benchikh previously spent 20 years at BAT, where she served as president of BAT France, area director for East and Southern Africa and regional finance director for Europe. Earlier in her career, Benchikh worked in finance roles at General Electric and Gillette.

    “I am pleased to welcome Soraya as chief financial officer and to the board,” said BAT chair Luc Jobin in a statement. “She brings a wealth of leadership experience and commercial acumen from across both finance and commercial roles. Soraya’s excellent track record in different geographies and in-depth understanding of the sector make her ideally suited for the role.”

    “I am delighted to welcome Soraya to the management board as our new chief financial officer,” said BAT CEO Tadeu Marroco. “Her extensive senior leadership and financial experience from a range of international fast-moving consumer goods companies represents a great addition to our leadership team. I am grateful to Javed for his continued contribution as interim finance director in addition to his ongoing role as director, digital and information.

    “Following the recent appointment of Dr. Cora Koppe-Stahrenberg as chief people officer, Soraya’s appointment is also a further important step toward building a modern organization. I very much look forward to working with Soraya as we continue our transformation.”

    “I am excited to rejoin the leadership of BAT as chief financial officer and executive director and share their passion for the transformation strategy,” said Benchikh. “I am looking forward to working with my new colleagues, the leadership team, Tadeu and the board and leverage my recent experience within broader FMCG to provide an external lens and support their efforts to accelerate BAT’s strategy to build ‘A Better Tomorrow.’”

  • BAT Taps Arvato for German Vape Logistics

    BAT Taps Arvato for German Vape Logistics

    BAT Germany has selected Arvato as its logistics and fulfillment partner for its e-commerce operations encompassing e-cigarettes and heated tobacco products.

    Since the end of June, BAT Germany online orders have been processed centrally from the site in Marienfeld, Guetersloh district. At this site, Arvato, a leading supply chain and e-commerce service provider, operates a state-of-the-art distribution center spanning approximately 32,000 square meters, serving multiple clients in the technology sector, according to the American Journal of Transportation (AJOT).

    The comprehensive logistics services provided for BAT Germany at the facility encompass goods receipt, storage, order picking, packing, and shipping, as well as returns management.

    “BAT’s goal in awarding the e-commerce logistics contract was to guarantee the most efficient and fastest delivery service for its customers. Our customer-centric approach allowed us to accommodate BAT’s specific processes and requirements,” says Thomas Becker, executive vice president at Arvato.

    The logistics service provider commits to delivering within a 48-hour timeframe. To optimize warehouse operations for efficiency and speed, Arvato heavily integrates automation technology. Automated carton setup and closure processes significantly enhance the speed of operation. Moreover, product information is automatically included with orders through flyer dispensers.

    “With its experienced team, Arvato provided us with very flexible and reliable support in setting up our logistics and distribution concept,” confirms Robert Juhnke, distribution manager at BAT Germany. “Even throughout the offer and final negotiation phase, the collaboration has been exceptionally cooperative.”

    Sustainability is a growing trend in the vaping industry. Arvato is dedicated to doing its part, according to the AJOT story. In an effort to reduce plastic waste, the company adopted wet adhesive tape made from recycled paper, resulting in the annual saving of approximately 16 tons of plastic, as an alternative to polypropylene adhesive tape. Arvato’s approach to optimizing shipment sizing and processing minimizes the consumption of packaging materials.

  • BAT Uses Rooibos Tea in Heat Sticks

    BAT Uses Rooibos Tea in Heat Sticks

    Image: rtvistlive

    BAT has begun selling heat sticks made from nicotine-infused substances such as rooibos tea to counter an incoming EU ban on flavored heated-tobacco products, according to Reuters.

    Health experts have warned that the safety of the new products is unclear.

    BAT has launched heat sticks containing nicotine-infused rooibos tea rather than tobacco in nine European markets, including Germany and Greece. The company plans to roll the product out globally.

    BAT stated that the move will provide “adult nicotine users and smokers with the widest possible range of reduced-risk products.”

    “Anything that burns or is vaporized … and inhaled into the lungs, probably will cause some effects,” said Erikas Simonavicius, a research associate at King’s College London, of the unknown risk factors of the tea-infused heat sticks. Tobacco companies have not yet published any research showing the health implications of rooibos or other zero-tobacco heat sticks, said Simonavicius.

    BAT is the first big tobacco company to publicly state what its zero-tobacco sticks are made from. The company declined to comment on whether it had conducted research on the health implications of the product.

    Sales of herbal tobacco-heating products have been growing in Europe.

    Philip Morris International plans to roll out a zero-tobacco stick later this year, according to statements made during the company’s investor day in September. PMI declined to comment on what the product is made from or its health implications.

    According to Jacek Olczak, PMI CEO, the company’s product could avoid the regulatory scrutiny of tobacco products.

    According to BAT, its new zero-tobacco heat sticks are not subject to EU tobacco rules, meaning the company can sell its sticks in flavors even after a ban on flavored heated-tobacco products is implemented later this month.

    “The obvious advantage these new products should provide is a way to keep menthol and flavor varieties on the EU market,” said Owen Bennett, a Jefferies analyst.

    Experts do not think the regulatory advantages will last long, however, according to Bennett and Phil Gorham, senior equity analyst at Morningstar.

    “The next generation of regulation is going to target nicotine,” Gorham said.

  • BAT Appoints Chief People Officer

    BAT Appoints Chief People Officer

    Image: tomertu

    BAT has appointed Cora Koppe-Stahrenberg to the new role of chief people officer. She will join the BAT management board on Nov. 1, 2023.

    Bringing critical experiences from other sectors and industries, Koppe-Stahrenberg was most recently global head of human resources of Fresenius Medical Care, a publicly listed global healthcare company with over 125,000 employees. While at Fresenius Medical Care, Koppe-Stahrenberg established a new global HR function and implemented a global people strategy, which focused on the creation of a collaborative and empowering culture delivered through a number of change initiatives. Previously, Koppe-Stahrenberg held various international senior HR positions at Marsh and McLennan Companies, Emirates Investment Authority and General Electric.

    “I am delighted to welcome Cora to the management board,” said BAT CEO Tadeu Marroco in a statement. “This is a significant management team enhancing appointment for BAT. Culture and collaboration are at the heart of my leadership agenda; Cora shares these values and will play a key role in the group’s transformation to build ‘A Better Tomorrow.’ I have no doubt that Cora will bring a fresh perspective having worked internationally in multiple sectors outside our industry and will bring new insights and capability to our management team.

    “I look forward to working with Cora to deliver a winning culture and a dynamic, modern BAT.”

    The chief people officer will report to the chief executive.

  • Kenya Wants to Ban BAT Nicotine Pouches

    Kenya Wants to Ban BAT Nicotine Pouches

    Image: Tobacco Reporter archive

    Kenyan legislators are urging the government to ban the sale of BAT’s nicotine pouches Velo and Lyft, reports 2Firsts.

    Health Minister Susan Nakhumicha was questioned about the products during a parliamentary address.

    The Kenyan Tobacco Control Act (KTCA) states that all packaging of nicotine pouches and tobacco products must contain warnings in English and Kiswahili. Sabina Chege, Member of Parliament, showed two boxes of Velo nicotine pouches, which only displayed a reminder that Velo contains nicotine, which can be addictive. The argument by experts is that nicotine also poses serious health risks.

    Allowing import and sale of the pouches could jeopardize the well-being of Kenyan youth, according to Chege. In response, Nakhumicha suggested the formation of a technical team to investigate the KTCA and make recommendations.

  • BAT Adds Murray Kessler to Board

    BAT Adds Murray Kessler to Board

    Image: Rawpixel.com

    Murray S. Kessler will join the board of BAT as an independent nonexecutive director and member of the nominations and remuneration committees with effect from Nov. 6, 2023.

    Murray previously held several senior positions, including chief executive, president and board member of Perrigo; president, chief executive officer and chairman of the board of Lorillard Tobacco Co.; vice chair of Altria Group; and president, chief executive officer and chairman of the board of UST. Prior to joining UST, Murray had a 12-year career with Campbell Soup Company, having served as vice president of sales and marketing, general manager of the Swanson division of Campbell Soup and other leadership roles. 

    Commenting on the appointment, Luc Jobin, chair of the board, said: “I am pleased to welcome Murray Kessler to our board. Murray has extensive leadership experience in growing consumer product companies and managing regulated businesses, and I am looking forward to his contribution as we accelerate our strategy to build ‘A Better Tomorrow.’”

  • BAT Outlines Five-Step Vapor Rules Plan

    BAT Outlines Five-Step Vapor Rules Plan

    BAT has released a blueprint for how regulators and governments could better regulate vapor products and help smokers switch to less risky products.

    During DTNF 2023, held from Sept 18-20 in Seoul, BAT’s global head of business communications, Jonathan Atwood, told attendees how BAT’s five-step plan for regulation could support achieving the right balance between harm reduction and the unintended consequences of access, including underage use.

    Speaking on behalf of Kingsley Wheaton, BAT’s chief strategy & growth officer, Atwood said that reckless players in the market need to be penalized when they do not abide by the rules. He said the five suggestions are the areas that regulators should explore and establish “smart regulation” that is right for their market.

    “First, on-device technology and functionality: vapor products should be accessible only to adults. Both underage prevention and restriction is crucial. On-device technology, when applied and enforced across entire markets, could help in this regard.

    “Second, more recognition is needed that flavors are an important driver of adoption for smokers seeking alternatives. However, flavors in vapor products should not particularly appeal to anyone underage.

    “Third is at the manufacturing and import level: ensuring that non-compliant products cannot reach the market in the first place.

    “Fourth, where no restrictions exist already, regulators may want to look at who should be able to sell vapor products and where. Reasonable safeguards at the point-of-sale would help ensure these products are sold only to adult consumers. Solutions such as retail licensing and facial recognition technologies should be seriously considered.

    “Lastly, enforcement and penalties: governments must wield their power and ensure consumers are purchasing legitimate products. Such measures should be rigorously enforced and those who fail to comply should face meaningful sanctions.”

    Atwood said BAT was calling upon governments, regulators, and industry peers to rally towards a sustainable and progressive environment in which vaping products are sold and marketed responsibly.

  • BAT Sells Russian Business

    BAT Sells Russian Business

    Image: Tobacco Reporter archive

    BAT has formally entered into an agreement to sell its Russian and Belarusian businesses.

    The buyer is a consortium led by members of BAT Russia’s management team, which, upon completion, will wholly own both businesses. Post completion, these businesses will be known as the ITMS Group.

    “Throughout the transfer process, one of BAT’s key priorities has been the interests of its colleagues in Russia and Belarus,” BAT wrote in a statement. “As part of the agreement, their employment terms will remain comparable to their existing BAT terms for at least two years post-completion.”

    BAT anticipates that the transaction will complete within the next month once certain conditions have been satisfied. Upon completion, BAT will no longer have a presence in Russia or Belarus and will receive no financial gain from ongoing sales in these markets.

    BAT remains confident of delivering its full-year guidance as set out at its half-year results on July 26, 2023.

    BAT’s operations in Russia include a head office in Moscow, 75 regional offices and a manufacturing facility in St. Petersburg. BAT also has an office in Belarus.

    On June 30, 2023, on a constant currency basis, Russia and Belarus accounted for approximately 2.7 percent of group revenue and approximately 2.5 percent of group adjusted profit from operations.

    BAT’s decision to sell its Russian business is a response to Moscow’s military invasion of Ukraine.

  • BAT Opens Innovation Hub in Italy

    BAT Opens Innovation Hub in Italy

    Image: BAT

    BAT opened a new innovation hub in Trieste, Italy. The innovation hub cost €500 million ($548 million) over five years.

    The Hub incorporates laboratories, production offices, technical rooms and 12 production lines for new category products, making BAT the first company in the tobacco industry to distribute a full range of new category products in Italy.

    The site also contains a digital boutique and innovation lab, focusing on digital transformation, sustainability and open innovation through external collaborations and partnerships.

    The new complex was completed in 21 months and has been designed according to the most advanced sustainability criteria. It uses 100 percent energy from renewable sources and aims to achieve carbon neutrality certification by the beginning of 2024.

    A photovoltaic array and biomass plant will produce much of the complex’s energy needs, with the remaining energy purchased from certified sustainable providers.

    It is estimated that the innovation hub will create 2,700 future jobs—600 jobs directly and a further 2,100 jobs in the local and national economy and supply chain. BAT Italy already works with around 400 companies in its agricultural supply chain, employing more than 6,000 people.

    “The completion of the Trieste innovation hub marks a milestone in BAT’s global strategy for innovation and sustainability. I am proud that BAT is the first company in the industry to distribute its full range of new category products. The hub represents a significant contribution to the country’s employment and economic growth,” said Fabio de Petris, CEO of BAT Italy.

  • BAT Changes Management Board

    BAT Changes Management Board

    Image: Tobacco Reporter archive

    Following the appointment of Tadeu Marroco as CEO on May 15, 2023, BAT has announced changes to its management board. According to BAT, the new structure, roles and composition of the management board will support Tadeu’s commitment to a sharpened focus on improved execution and operational excellence; enhanced capabilities critical to BAT’s strategic development and transformation; and a progressive and agile organization with a collaborative and inclusive culture.

    This refreshed management board structure is critical to my commitment to build a progressive and agile organization with a collaborative and inclusive culture, enabling simultaneous performance and transformation.

    Tadeu Marroco, CEO, BAT

    Johan Vandermeulen will be appointed to the new role of chief operating officer, reporting to the CEO, effective July 1, 2023. This role will be accountable for driving business performance, operational excellence and best-in-class execution, with a focus on both short-term and sustainable delivery. Reporting to Vandermeulen will be David Waterfield, promoted to the management board as president and CEO of Reynolds American Inc. effective July 1, 2023; Fred Monteiro (director of Americas and Europe) and Michael Dijanosic (director of Asia-Pacific, the Middle East and Africa); Zafar Khan (director of operations) and Javed Iqbal (director of digital and information). Iqbal also currently serves as interim finance director.

    Kingsley Wheaton will be appointed to the new role of chief strategy and growth officer, reporting to the CEO, effective Sept. 1, 2023. This role will be accountable for continued strategic development and delivery of sharper consumer focus through an integrated approach to brands together with shaping enablers for long-term sustainable growth and driving the company’s robust ESG agenda. Reporting to Wheaton will be Luciano Comin, appointed to the new role of marketing director of combustibles and new categories effective July 1, 2023—this role will be accountable for a more integrated approach to insights, innovation, brand-building, consumer experience and activation and revenue growth management across the combustibles and new categories portfolios; Paul McCrory, promoted to the management board to the new role of director of corporate and regulatory affairs effective Sept. 1, 2023—this role will be accountable for shaping regulatory strategy and leading regulatory engagement to secure sustainable access to markets and categories; and James Barrett, promoted to the management board to the new role of director of business development effective Sept. 1, 2023—this role will be accountable for strategy development, M&A, the Wellbeing and Stimulation portfolio and BAT’s venturing unit, Btomorrow Ventures; James Murphy, director of research and science, and Jerome Abelman, director of legal affairs and general counsel, continue in their roles reporting directly to the CEO.

    Guy Meldrum, currently president and CEO of Reynolds American Inc., and Paul Lageweg, currently director of new categories, will step down from their roles and from the management board effective June 30, 2023, and will facilitate a transition with their successors.

    Hae In Kim will step down from the management board effective June 30, 2023, to take up the role of strategic talent director, reporting to the CEO. As an integral part of her responsibilities in this leadership role working alongside the board and the management board, Kim will oversee the execution of several key projects as part of BAT’s talent agenda.

    The existing roles of chief transformation officer, chief growth officer, director of new categories and director of combustibles will be removed from the management board as their accountabilities transfer within the new structure.

    A comprehensive process is underway to identify and appoint the successors for the roles of finance director and director of talent, culture and inclusion, reporting to the CEO.

    “This refreshed management board structure is critical to my commitment to build a progressive and agile organization with a collaborative and inclusive culture, enabling simultaneous performance and transformation,” said Marroco in a statement. “To that end, I am delighted to be welcoming David, Paul and James to the management board. They are all highly collaborative leaders who have the depth of experience to enable the continued strategic and cultural transformation of BAT.

    “I would like to thank Guy for his significant contribution across many markets and geographies over the last two decades and Paul for his role in helping to create a new category business that continues to drive BAT’s transformation. I also look forward to working with Hae In as strategic talent director.”