Trying
to smoke out critics
By John Breusch
It is an understatement to say that the tobacco industry suffers
from an image problem.
So when Ceylon
Tobacco Company (CTC) this week embarked on its latest initiative
to project itself as a good corporate citizen, it called on the
full might of its public relations arsenal.
To the theme
music from "Mission Impossible," the mandatory corporate
video kicked off with images of vandalised cigarette shops before
switching to pictures of smiling CTC workers, a rock climber scaling
an impossible peak, and the sounds of "Reach" - Gloria
Estefan's theme song from the 1996 Atlanta Olympics.
The symbolism
was hopefully lost on few of those enjoying the free drinks, food
and cigarettes on the 36th floor of the World Trade Centre.
As dance music
and swirling spotlights transformed the room into a nightclub, an
announcer introduced CTC managing director Fred Combe with so much
enthusiasm that some guests would have been excused for expecting
British soccer superstar David Beckham to step onto the podium.
What announcement
could possibly generate so much excitement? The answer was CTC's
inaugural Social Report, an audited and immaculately prepared document
that details the company's efforts to be socially responsible and
to listen to its stakeholders.
Handed out to
the crowd by models in slinky black dresses, the report is the first
of its kind to be prepared by a Sri Lankan company. It is also the
first to be launched by CTC's 17 billion pound parent, British American
Tobacco (BAT), in any of the 190 countries in which it operates.
BAT subsidiaries
will release 12 more social reports this year. BAT's regional director
for South Asia, Brendan Brady, gave two reasons for the company's
decision to embark on such a massive exercise.
One was that
companies are now under more public scrutiny than ever, creating
a demand for greater transparency. The other reason was more specific
to BAT's industry.
"We market
a product that is controversial; it comes with risks," Brady
said.
"We are open about what the risks are and our customers understand
them."
Companies across all sectors are increasingly coming under criticism
from the public and community groups for chasing profits to the
detriment of society.
But for cigarette manufacturers, public scrutiny and resentment
are nothing new.
The tobacco industry faces a simple problem: it produces a product
that can kill people.
For years, the
industry denied a string of accusations levelled against it: that
cigarettes cause major health problems, including lung cancer; that
smoking is harmful to those who "passively" inhale cigarette
fumes; that nicotine is addictive; and that the industry has deliberately
targeted the youth market.
But as a result
of some public pressure and some massive lawsuits, it has been forced
to come clean on many of these accusations. Not only has the prospect
of crippling court awards increased, but tobacco companies have
to survive in a regulatory environment that increasingly outlaws
marketing. However, the industry refuses to lie down. Instead, it
has gone on the offensive - the public relations offensive.
And as this
week's launch of the 2001 Social Report shows, it is prepared to
spend a lot of money in the process. The report, entitled "Looking
Beyond," is drenched with words like "transparency,"
"responsibility" and "accountability".
"As a responsible company it is imperative that we act responsibly,"
it says at one point.
"CTC is
prepared to face the implications of acting in such a responsible
manner."
CTC invited 84 stakeholders to its "dialogue sessions"
and 51 turned up.
The anti-smoking lobby, though invited, was not among them.
Among those
who did show, 30 percent were "valued business partners"
of CTC, 12 percent were consumers and 8 percent non-government organisations
(NGOs).
At the sessions, 220 expectations of CTC were raised and the company
responded to every one.
Throughout the
report, it answers its critics: it does not market to minors and
that it actively campaigns to discourage under-age smoking; it does
not engage actors, role models and celebrities to subversively market
their product by smoking; it provides customers with complete information
about the health effects of smoking, allowing them to make an informed
choice.
It also described
the ways in which the company acts as a good corporate citizen:
self-regulation; superior worker conditions; environmental responsibility;
community programmes; and sponsorship. Will the anti-smoking lobby
be convinced?
Judging by their non-attendance, it seems unlikely.
Super cracker from Munchee
Ceylon Biscuits Ltd, the manufacturers of renowned Munchee Biscuits,
has launched yet another innovative product to the market - The
"Super Cream Cracker".
The launch event, called "Super Sangeeth" was held earlier
this month at the Chandra Silva Stadium at Rajagiriya in the form
of a musical extravaganza that brought together superstars, celebrities
and the general public for an evening of music and festivity.
Simultaneously
on the same evening the Munchee "Super Cream Cracker' was launched
at the Thopawewa Ground in Polonnaruwa before a gathering of about
40,000 people.
The universal
cracker, loved by people of all ages, has now got even better thanks
to Munchee's innovative product development, a company statement
said. The "Munchee Super Cream Cracker" is crunchier and
crispier than conventional crackers. It is also more nutritious
being enriched with vitamins A, B, B3, B5, B6, B12, D, E and K7.
Business
Standard on the newsstands
The Business Standard, said by the publisher to be Sri Lanka's first
business newspaper, was launched at a gala ceremony on June 7 with
the first issue of the paper also coming out on this day.
A broadsheet
newspaper with 12 pages, the new paper will be published ever Friday.
In addition to developments in the business field, the newspaper
covers related aspects including finance, banking, stocks, the economy
and politics.
The Business
Standard is published by Seico Publications (Pvt) Ltd and its chairman
is Sumith Ekanayake, a Sri Lankan businessman based in Japan. He
has other business ventures as well in Sri Lanka and abroad. The
paper's managing editor is veteran journalist Lakshman Jayawardene
while the editor is Gamini Abeywardene, an experienced business
journalist. Dalton de Silva, a former Reuters' bureau chief in Colombo
and veteran in the media field, is the associate editor.
Seylan
Merchant Bank launches Fortune 2002
Seylan Merchant Bank (SMB) plans to increase its client base by
attracting new investments over the next seven months, with an exciting
new campaign branded 'Fortune 2002'.
The bank said
over 500 prizes would be on offer through this campaign to investors
from June to December 2002. 'Fortune 2002' is modelled on the successful
'Fortune 2001' campaign of Seylan Merchant Bank but carries significant
improvements to its predecessor, SMB Assistant General Manager,
Treasury, Janaka Grero said.
The Fortune 2002 campaign will be more focused, concentrating mainly
on broadbasing the SMB customer base.
The minimum
investment amount has been reduced to Rs. 5,000 from Rs. 10,000,
in the hope of attracting more small investors, he said. The first
prize at the grand draw is a Honda Civic car worth Rs. 1.2 million.
Other prizes include motorbikes, colour televisions, refrigerators,
washing machines and VCD players.
The prizes at
the monthly draws held at selected branches include sovereign gold
coins and half sovereign gold coins.
NDB
Bank declares branch strategy
NDB opened its first branch at Navam Mawatha on June 12 - next door
to its sister company, the National Development Bank.
It was declared
open by NDB Bank chairman S.K. Wickremesinghe along with NDB's Director/General
Manager Nihal Welikala and NDB Bank's CEO, Eran Wickramaratne.
NDB Bank began
operations in October last year, with the acquisition of the Sri
Lankan branch of ABN AMRO Bank. The new entity inherited ABN's customer
base of private sector corporates and high net-worth individuals,
its experienced and customer-focused team of bankers, and well established
banking policies and practices.
"We are
committed to investing in new technology and multiple delivery channels
to build up the infrastructure we need to provide customers with
the best service levels.
The Navam Mawatha branch is the first of several branches the bank
intends to open during the course of this year.
These branches
will be complemented by ATM's and phone banking and, in the future,
Internet banking facilities as well," said NDB Bank CEO Wickramaratne.
Freight
forwarders want end to monopoly
Freight forwarders have called for an end to the national carrier,
SriLankan Airlines', monopoly on cargo handling.
"It is
high time, the government gave self-handling permission to other
airlines, which would be a step towards Sri Lanka becoming a regional
hub, Diren Hallock, President of the Federation of Asia Pacific
Air Cargo Associations, told "The Sunday Times Business".
Sri Lanka has
all the potential, compared with other countries in the region,
to become a cargo hub within the next few years because of its suitable
location, he said.
The government needs to urgently implement plans to develop airport
infrastructure to be able to compete with other hubs, Hallock said.
Hallock also said that in many developed countries in the region,
such as Dubai and Singapore, 98 percent of ground handling was done
electronically.
"Therefore,
to achieve regional hub status, we have to change our present manual
system to an electronic handling system to compete with those countries,"
he said.
The air cargo industry had almost totally recovered from the impact
of the terrorist attacks using jetliners in the United States last
year, he said.
Hallock earlier
told the 29th Executive Council Meeting of the Federation of Asia
Pacific Air Cargo Associations held last week that the industry
needs more smaller Sri Lanka-based freighter carriers serving regional
routes.
"Permission
for an alternative cargo ground handling agent to operate at the
Katunayake International Airport should be given soon," he
said. "Such permission should be expressly on the basis of
abilities to demonstrate cargo control backed with a minimum investment
of not less that Rs. 50 million," he said. A separate apron
area dedicated entirely for freighter aircraft, which is in close
proximity to the air cargo agents' terminal, was also required,
he said.
JKH
seeks to expand overseas
John Keells Holdings is looking to diversify further to reduce its
reliance on the local economy and on cyclical businesses such as
plantations and tourism.
The company
reported group net profits plunged by 30 percent to Rs. 543 million
in the year ended March 31, 2002 because of its core business being
affected by what chairman Vivendra Lintotawela called "testing
conditions".
The downturn
would have been worse if not for a strong recovery in the last quarter
of the financial year, he said in the annual report to shareholders.
"The past year's results clearly highlight the over-reliance
of our company on the fortunes of the Sri Lanka economy, and in
particular, on the more economically sensitive or cyclical industries
such as plantations and tourism," he said. "While we have
already taken measures during the last two years to address these
issues, we will be prioritising the need to enhance our overseas
exposure and pursue new, less cyclical businesses locally,"
he added.
JKH is evaluating
potential hotel investments in Goa, India while its flagship soft
drink, Elephant Ginger Beer, continued to sell well in Australia,
India and Thailand, he said.
During the next
year, the firm will be looking to further expand its food and beverage
businesses in India, particularly in processed meat products and
carbonated soft drinks. The planned launch of branded value added
teas is another major initiative aimed at increasing revenue from
overseas, Lintotawela said.
Trade
chamber sets up policy support unit
The Federation of Chambers of Commerce and Industry of Sri Lanka
(FCCISL) with the help of the US-based Centre for International
Private Enterprise (CIPE) has set up a Policy Support Unit (PSU)
to address private sector-related issues.
"The PSU
would be a dedicated and exclusive unit to facilitate private sector
policy advocacy," said Macky Hashim, FCCISL president. He made
these observations when an agreement between FCCISL and the CIPE
was signed for this purpose. Hashim and John Callebaut, senior programme
officer, CIPE, signed the MoU.
The Sri Lankan private sector is currently facing a number of challenges,
apart from the effects of global competition, like internal challenges
due to the political and economic environment prevailing in the
country.
Hashim said
the impact of policy related issues could be implemented through
a process of policy dialogue. It is important to create an environment
where the private sector could get involved in a long term policy
dialogue with the government in order to boost private sector-led
economic growth in the industry, he added.
The FCCISL plays
a major role in articulating the macro policies necessary for overall
private sector development, FCCISL General Secretary Samantha Abeywickrama
said.
The PSU is expected
to strengthen the economic research and lobbying capacities, he
said. Its main objectives are to identify issues constraining the
development of the private sector and prepare memoranda for representation
to the government and multilateral aid agencies.
The FCCISL will
also be monitoring and analysing current economic development in
the country and abroad to provide private sector corporates with
information required for their business planning, he said.
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