Sustainability at Scale - A Tobacco Giant’s Success Story

Dive into the success story of a Tobacco giant, exploring how traceability solutions revolutionized their supply chain, reduced environmental impact, and set new standards for responsible practices. 

tobacco traceability, tobacco supply chain

In today’s global landscape, businesses are confronted with a multitude of challenges, from the impacts of climate change to resource constraints, population growth, and shifting demographics. Businesses need to acknowledge their duty to actively participate in the creation of an environmentally conscious, socially inclusive, and well-governed society.  

Commitment to transforming into a more ESG-compliant business environment is unwavering. Sustainable strategy is the key to long-term value creation. Recognizing the interests and societal needs of stakeholders, fostering a sustainable, resilient economy and fostering collaborative initiatives to contribute to the realization of the United Nations Sustainable Development Goals (SDGs) are imperative for businesses. 

Cultivating a future where every leaf signifies sustainability, and the program is a commitment to responsible practices and a greener planet. 

The Sustainable Tobacco Program (STP)

Sustainable tobacco production refers to the effective cultivation of high-quality tobacco while minimizing adverse environmental effects, and simultaneously enhancing the socioeconomic well-being of individuals and communities in the tobacco production regions. It is a collective effort within the industry, involving collaboration among various manufacturers to amalgamate optimal practices, fostering ongoing enhancements. 

The Sustainable Tobacco Production initiative plays a pivotal role in establishing benchmarks for agricultural practices, environmental stewardship, and addressing crucial social and human rights concerns. 

The program framework comprises four essential pillars: Crop, Environment, People, and Facilities. Additionally, it includes overarching Governance, which encompasses the necessary management processes required for the effective implementation of Sustainable Tobacco Production (STP). 

Why do major tobacco giants need to adhere to STP?

Participation in the Sustainable Tobacco Program allows major tobacco companies to address environmental, social, and regulatory challenges while meeting the expectations of a more conscious consumer base, ultimately contributing to a more sustainable, responsible and export-ready industry. 

All leaf suppliers to BAT are required to participate in the STP program. Through participation, suppliers gain the opportunity to continually enhance their practices by adhering to STP Guiding Principles, ensuring sustainable interactions with the tobacco farmers they engage with, and fostering positive relationships with various stakeholders. These stakeholders include, but are not limited to, employees, governments, and local communities. Participation in the STP program is a mandatory condition for supplying tobacco to BAT( British American Tobacco), and the outlined requirements must be met for inclusion in the program.

4300
Farmers
1900
Farm Plots
14000
Acres of area

How does STP work?

The Sustainable Tobacco Program outlines essential criteria for contract farmers and promotes ongoing enhancement by employing a comprehensive assessment system that incorporates self-evaluation and external evaluations. By fostering collaborative discussions across industries and recognizing optimal approaches the program aims to ensure a supply of tobacco leaf that not only addresses environmental sustainability issues but also elevates labour standards. 

The implementation of Sustainable Tobacco Programs follows a structured approach with industries collaborating to develop sustainability standards and criteria that are applicable to tobacco cultivation. These standards cover environmental sustainability, labour practices and responsible tobacco farming.  

  • Companies contract with tobacco farmers and communicate the requirements and expectations set up by STP. These include adherence to sustainability standards and responsible farming practices.  
  • To ensure compliance with STP criteria, companies implement monitoring systems which involve use of technology such as mobile apps to track farming practices and environmental impact.  
  • Third party verification and audits are also conducted to confirm the compliance to standards. 
  •  To ensure clear communication, the contractual agreements between the company and the farmers are often translated into local languages to overcome language barriers.  
  • These agreements ensure effective implementation of Good Agriculture Practices (GAP)and safeguarding farm workers through Agriculture labour Practices (ALP) 
  • Companies also closely work with farmers through Field Technicians and Area Managers to encourage continuous improvement. 

 

Challenges in STP Implementation

  • Stringent Standards 

STP defines stringent standards for environmental sustainability and labour practices. Companies need to ensure that the contracted farmers meet these standards. 

  • Contractual Agreements 

Negotiating and maintaining contractual agreements with farmers that reflect STP criteria can be complex and needs to be clear and transparent. 

  • Digital solutions 

Implementing and use of digital solutions like mobile apps can be a technological challenge. 

  • Farm Monitoring 

Deploying field technicians to monitor and manage program implementation entails the necessity of resources and training and there is a need to invest in tracking systems to assess progress. 

  • Verification ready 

Ensuring compliance and third-party verification can be resource intensive and time consuming. 

  • Language barriers 

Creating agreements in local language enables effective implementation. 

  • Scaling Coverage 

Digitization is imperative to include all contracted farmers

Traceability Solutions from TraceX

Traceability solutions serve as a powerful tool to ensure compliance with sustainable tobacco programs by providing a transparent, accountable, and efficient means of monitoring and managing the entire supply chain. This not only helps in meeting the specific requirements of the program but also contributes to building trust with consumers and other stakeholders. 

Traceability solutions offer valuable tools for tracking, verifying, and reporting on sustainability practices. By promoting data accuracy, transparency, and efficient data sharing, traceability solutions can play a pivotal role in addressing the challenges associated with implementing sustainability programs. 

tobacco traceability, tobacco supply chain

Access Control

Multiple levels of federated hierarchy is created to manage farmer, field technicians and other persona for access control. 

Role Management

Application functionalities are provided to the different roles which could be the Area manager and the Field Technician. 

Crop and Variety Creation

Tobacco has multiple varieties which are configured along with multiple grades. 

Farmer Onboarding

Farmer Registration begins with creating farmer profiles with ID proof, bank details and other information. 

Agreement Creation

Agreements are created with individual farmers. Field technicians will have the ability to input new farmer data. Field technicians work with farmers to create a crop agreement for the active crop year along with key data points.

Input Distribution

There will be a provision to create input inventory which is then distributed to agreement of respective farmers. The inputs could be seeds, fertilizers, pesticides, chemicals and packing materials. 

Nursery Workflow

Field Technician creates agreements with farmers who would do nursery activities for seeds to saplings conversion. Farm plots are geo-mapped. Crop variety is added with growing area, sowing date and expected sapling harvest. This sapling is sold to the Leaf Tobacco farmer who also has an agreement. 

Grower Management

All the activities of the nursery farmer and leaf tobacco farmer are tracked on the mobile app. The field technician updates crop activities and survey details for individual farmers. 

Leaf Tobacco Farmer Workflow

The agreements are created for the crop year with the concerned farmers. Geo-mapping of farm plots is carried out. Crop variety details are added with growing area, sowing date and expected harvest. Planting activities like Seedbed management, ALP, Transplanting, CPA, Early field activities, Topping, Curing, harvest, Bulking, Bailing and Marketing are updated. 

GMS surveys are updated. 

Farmer Ledger

Farmer ledger provides crop year wise record of all farmers transaction between the organization and individual farmer. 

Win-Win for Tobacco Companies and TraceX

The tobacco leaf supply chain centres around the crucial role of farmers. Farm level traceability and centralized management system for the supply chain ensures a responsive, streamlined and dependable supply of top-notch tobacco leaf to fulfil consumer needs. It also contributes to the sustainability of rural communities and agriculture.This collaboration between tech providers and tobacco giants contributes to a more sustainable and responsible industry. 

Tracex solutions contribute to the adoption of best practices in planting, soil conservation, pest management, and water sustainability. This system guarantees full traceability of tobacco to the farm level, providing verified records that attest to the rigorous adherence to high social and environmental standards, including health, safety, and human rights. Overall, Tracex facilitates compliance with sustainability goals, fostering trust and accountability throughout the entire supply chain. 

This partnership has demonstrated the powerful impact that technology can have on the agriculture industry and its ability to drive sustainable change and benefit farmers and communities around the world.

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