When working in the area of strategic management, you will often be asked to look at what appears to be a strategic initiative on the part of another company and speculate as to what the strategy behind the initiative really is

Characterize Altria's commitment to the environment :

Altria's commitment towards protecting and conserving the environment, especially against its own operations such as those related to sourcing and manufacturing tobacco products for its Philip Morris division, is really commendable and one of the most prolific in the industry. Altria has set an example not only for other companies in the cigarette and tobacco companies worldwide but also for other big multinationals by maintaining highest standards with respect to conserving the environment against harmful practices. Further, the company is not only fulfilling its commitments towards the society by conserving the environment and preventing it from further degradation but also educating the users of the company's products and people in general to become more environment friendly.

Being a multinational company involved in a sensitive business like Tobacco, there are a host of environmental issues surrounding the company, especially its Philip Morris division. Issues such as ethical sourcing of tobacco leaf, disposal of cigarette litter, etc, adverse effect on environment due to growing of tobacco, pollution due to smoking etc. are constantly faced by the company. Some of the most important initiatives in order to resolve these issues with Philip Morris and other business division of the company are as follows:

The company has laid down strict guidelines with respect to sourcing and growing of tobacco by the suppliers in these countries. Further, Philip Morris is also committed with respect to the litter caused by smoking of its cigarettes and is making initiatives in this regard in the different countries where it sells its cigarettes.

The Kraft division of the company is also committed to the environment in its international operations as well.

One key focus of their environmental strategy is to further reduce the environmental impact of manufacturing operations worldwide. A team of dedicated professionals use recognized global standards to ensure that all facilities are meeting this commitment.

In 2000, they engaged third-party experts to evaluate their environmental management performance and compare it with recognized standards. These reviews helped them identify several important areas in which they are working to strengthen their performance:

Developing a systematic approach to moving beyond regulatory compliance
Expanding consideration of environmental issues along the supply and consumption chain

Improving integration of Kraft's environmental management systems into acquired businesses and adoption of best practices from their operations in a timely manner

The company tracks six key parameters on a global basis as Environmental Performance Indicators (EPIs):

? Water consumption
? Water discharge
? Energy usage
? Carbon dioxide emissions
? Solid waste generation
? Recycling rates

All these resolutions are very helpful in creating a positive image for the company and its business divisions in the long run and thus creating a favorable image in the eyes of its customers and stakeholders. Even though these initiatives appear costly at once, these are bound to be beneficial for the long run profits and revenues of the company.

Do you think this commitment will offset the environmental issues with the tobacco company?

Altria's commitment will definitely offset some of the environmental issues,if not all, associated with the company and especially with its Philip Morris division which operates in such an anti-environmental industry. It will enhance the corporate image of the company in the eyes of the society and public in general who will definitely appreciate the efforts made by the company with respect to protecting the environment. Even though the NGO's and other activists raising a voice against tobacco consumption and pollution caused by such industries will never be satisfied by efforts, such efforts will definitely make Altria stand apart within the industry and recognize it as a leader in environmental protection.

What are Altria's real strategic reasons for these environmental initiatives?

The real strategic reason behind such extensive environmental initiatives and increasing amount of time, effort and resources towards environmental protection is to enhance the corporate image in the eyes of numerous stakeholders, general public, society, consumers and government and bring long term prosperity and enhancement in revenues of the company in the long run due to such positive corporate image. For a tobacco company like Altria, it is very essential to offset the negative sentiments which exists in the eyes of the public due to the common belief that such companies always look to maximize their own profits and pay no attention to environment. Altria, via its sustained efforts in this regard, wants to set a benchmark for other companies not only in its own industry but other polluting industries as well that if an organization is committed, there is no way one cannot protect the environment and contribute towards its conservation, in spite of manufacturing such harmful products.

Even from a cost benefit analysis perspective, such investments in protection of environment will bring in tremendous goodwill and enhancement of revenues in the long run.