Case Study

Implementing supply chain due diligence with JTI

Overview

Japan Tobacco International (JTI) initially engaged twentyfifty in 2014 to support the implementation of its farm labour standard for its third party owned supply chain, comprising 30 suppliers, sourcing leaf from more than 400,000 farmers in 30 countries.

The goal of the program was to increase understanding of current practices and to put into place a continuous improvement process to be able to demonstrate measurable change in good agricultural labour practices.

The program has since expanded to encompass supply chain due diligence in alignment with the UN Guiding Principles on Business and Human Rights and also includes JTI directly-contracted growers in vertically integrated operations.

Key success factors

Stakeholder engagement

 

Leadership
of Change

The challenge

JTI has a vision for a responsible, sustainable and transparent supply chain and wishes to ensure it is  operating in line with UN Guiding Principles and meeting stakeholder expectations.  Challenges included the scale of the supply chain and also a knowledge gap where some third party suppliers did not fully understand their responsibilities in ensuring human rights in their own supply base.  There was also a need to develop both a fit-for-purpose reporting process and a system that enabled monitoring of the whole leaf supply base, while defining and tracking of a few key performance indicators.

Our approach

Our initial approach was to set principles around how to engage with suppliers that included ‘building on what is already in place’, and ’listening’.  Human Rights Due Diligence (HRDD) language was adapted to develop simple messaging on labour practices that the industry was familiar and comfortable with.  We mapped the whole supply base and used external and internal factors to look at the risk profile relating to countries and suppliers, enabling appropriate action plans to be developed across the supply chain.

We developed the program strategy and its implementation plan; built support, agreed action plans and tracked progress with suppliers​; developed metrics, a reporting process and data recording, integration and visualization requirements - and then ran bespoke engagement programs in priority countries.

Results

We engaged the vast majority of suppliers, totalling around 400,000 smallholder farmers across 30 countries.  The program has demonstrated that, over time, supplier engagement can work well through a thoughtful, questioning and respectful approach.  This has led to open and honest conversations which have enabled JTI to support their suppliers to resolve issues rather than ignore them.  Feedback from suppliers has been excellent and they are now proactive in seeking support and guidance.

This approach has helped JTI shape their contribution to the evolution of a sustainable tobacco program, attracting industry-wide participation, with focus on sustainability and developed around a supply chain due diligence process.

“twentyfifty has approached this work in thoughtful, collaborative and pragmatic ways. Working in partnership, they have helped us continuously to improve our supply chain and set the example in human rights due diligence with smallholder farmers.”

Vuk Pribic, Leaf Supply Chain Due Diligence Director, JTI

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