The Curious Case of Tobacco Companies and Eco Prizes

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What the hell is going on in the cozy world of Sustainable Development Inc.?

Introductory note by E. Britton of 18 July 2012 - http://www.facebook.com/SDES.MasterClass

Read on here, but first a quote from this analysis to which you may wish to give somethought: "This brings us to another question. Why does the UN, the World Bank or even

the WHO continue to partner and recognize perverse industries like tobacco companies?

The answer is simply money. Starved of public financing, the UN agencies rely upon

voluntary contributions like donors, private philanthropies and companies. Private

funds are earmarked for specific purposes, thus circumventing ethical control. In the

1970s, such donations constituted a small proportion of the UNs budget. By 2008, it

comprised more than 70%. For the WHO this is nearly 80%, as public health agenda get

shaped by private interests. The distortion in priorities is clear."


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The article:

The curious case of tobacco companies and eco prizes

Pranay Lal| Agency: DNA | Monday, July 16, 2012

Source: http://www.dnaindia.com/analysis/column_the-curious-case-of-tobacco-companies-and-eco-prizes_1715496

Late last month, on the sidelines of the Rio+20 conference, Indias largest cigarette maker, ITC

(formerly Indian Tobacco Company) received the World Business Council for Sustainable

Developments highest prize for improving the environment and removing poverty. In tow were

the UNDPs administrator and former New Zealand prime minister, Helen Clark, and the topexecutive of the UN Global Compact. The award is possibly the biggest travesty of justice even

by the UN and the World Banks weak ethical standards. Heres why.

ITC is primarily a cigarette maker and tobacco trader, even though it would like to claim that it isa diversified company selling soap, biscuits and hospitality. It started exactly 100 years ago in

Bihar and migrated to Andhra Pradesh to grow tobacco and make cigarettes.

Growing tobacco and making cigarettes is toxic to the environment. It needs to clear forests and

fields to grow tobacco, requires chemicals to ensure that the tobacco plant is free of pathogens,and trees to be hacked to cure the tobacco (one kilogram of tobacco needs roughly eight kilos of

dry fuel wood), add more than 4000 undisclosed chemicals to make the cigarette addictive, andtop this with glossy packaging of paper, cardboard and plastic, which we see littered on the

streets and choking waterways. In addition, ITCs factories have over-extracted water andpolluted rivers. In April 2011, for example, desperate farmers of Bhadrachalam and Irivendi

villages had to go to court when the district collector could not stop ITCs factory from over-extracting water from a drying Godavari. In a nutshell, this is the lifecycle of a cigarette.

Imagine cutting down dry forests of central India to fuel an addiction! Organisations that conduct

ITCs environmental diligence do not use the full historical environmental cost of their business.They use an annual energy and input-output analysis and this makes them look good. Even this,

however, is not the full impact of ITCs business.

Smoking kills more than one million adults prematurely in India. ITCs cigarettes have been amajor contributor, both directly for its smokers and those exposed to its smoke, and also to the

youth, many of whom who are poor and aspire to smoke its cigarettes. Smoking also is a leadingcause of poverty. One study using government data suggests that direct expenditure on tobacco

by households can potentially impoverish nearly 15 million Indians annually.

Another study has found that treating just four major tobacco-related diseases account for 4.7%

of Indias national healthcare expenditure. This will grow in the future as more youth will take tosmoking cigarettes.
http://www.dnaindia.com/authors/pranay-lalhttp://www.dnaindia.com/authors/pranay-lalhttp://www.dnaindia.com/authors/pranay-lal


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The lifecycle also explains ITCs logical extension into its business of paper (and, therefore, alsomaking notebooks), e-choupal (to reduce its procurement cost), among others. ITC has used its

tobacco profits to diversify into related and, increasingly, unrelated fields like fatty foods andeven tried tying up with alcohol companies in the 1990s. Like tobacco companies around the

world, ITC supports environmental NGOs like WWF and TERI, sits on influential boards and

even runs a hospital in Kolkata! Much as ITC would like to change its name and get into newbusinesses, it remains primarily a cigarette maker. Even after 50 years since its first non-tobaccoventure, it gets more than 60% of its profits from cigarettes.

This brings us to another question. Why does the UN, the World Bank or even the WHO continue

to partner and recognise perverse industries like tobacco companies?

The answer is simplymoney. Starved of public financing, the UN agencies rely upon

voluntary contributions like donors, private philanthropies and companies. Private funds areearmarked for specific purposes, thus circumventing ethical control. In the 1970s, such donations

constituted a small proportion of the UNs budget. By 2008, it comprised more than 70%. For the

WHO this is nearly 80%, as public health agenda get shaped by private interests.

The distortion in priorities is clear. The WHO allocates funds based on mortality around the

world. Extra-budgetary funds, however, are invested in special focus areas. In its 2004-05 budget,91% of extra-budgetary funds were earmarked for diseases that account for just 8% of global

mortality. Tobacco, the leading cause of death (more than AIDS, TB and malaria combined) isallocated an incalculable fraction.

Companies like ITC have made the most of the UNs desperation. IFC and the UNs Global

Compact have exclusion criteria that prevent seven sin sectors (tobacco is accorded the highestrank followed by arms trade, pornography, among others). Yet these companies not only

participate but also get rewarded for their contribution to society by them.

In 2009, the Global Compact reluctantly recognized WHOs fight against tobacco but expressed

its inability to exclude tobacco companies from its membership, and states so in its Tobacco

Company Policy. The UN Compact has as members ITC and Brazils largest tobacco producer

Souza Cruz.

What is tragic is that Helen Clark, a responsible prime minister and wife of a respected publichealth expert could not have given this award in New Zealand or any other developed country.

WBCSD is a curious club of organisations ranging from the most wanted corporate criminals(Dow Chemicals) to good Samaritans (Infosys).

Through this award at Rio+20, the UN has compromised the efforts to fight environmental

degradation, public health and the MDGs. It is time we excluded tobacco companies like ITCfrom civic engagements and development processes, and stop recognising them as model.

The writer is technical advisor (tobacco control), the Union Southeast Asia

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The Curious Case of Tobacco Companies and Eco Prizes