Tobacco Industry: Where Business Meets

Tobacco Industry: Where Business Meets Ethics

Whether they like to puff up each night before bed, live in the smoking section, and have a jeweled case for their cigarettes, or they walk out of their way to avoid the smoker in the parking lot and would rather sleep in a hotel lobby than a room filled with the stench of smoke, people have an opinion about smoking. Economically, the tobacco industry is one of the largest in the United States, with a history as American as Uncle Sam's. Just as America's citizens and visitors have come to associate the country with Indiana's wide corn fields and the brown cotton pants of the South, tobacco once was both the cash crop and cash itself of the United States. New Englanders and early English explorers praised its medicinal benefits. Native Americans used it in healing and ritual. Far from the cash crop that sustained the fledgling colonies, tobacco forged its way into American expansionism, where cowboys chewed it in the form of snuff. As the years progressed, the use of tobacco in cigarette form as seen as "cool." One can hardly forget the scene in Titanic where Rose slips a cigarette into her dainty cigarette holder, which she holds with gloved hands, and takes a puff, only to have it promptly snatched away and snuffed out by her domineering fiance, Cal. Not only was smoking cool, but it was also the mark of independence. But as the years wore on, the medical profession began to realize just how far from medicinal tobacco actually was. As the studies linking cigarette smoking to disease continued, the tobacco industry was punished. Soon, legislation regarding the tobacco industry's marketing audiences was passed, stockholders rallied about immoral behavior, and the tobacco industry was forced to change its behavior. But just like any multi-million dollar industry, tobacco fought back. Despite the wide acknowledgement of the harms of chewing tobacco and cigarette smoke, the tobacco industry continues to be monumental, even today. Although the smoking rate in the United States has decreased largely in the last few years. Smoking oversees has continued to take off. The tobacco company has even been responsible for a variety of innovations, it's latest -- Snus, the smokeless, chewless tobacco. Regardless of its successes, however, the tobacco industry still treads lightly when it comes to ethics. In many ways, the industry has signaled itself as being one of the most unethical in the world. By examining the tobacco industry -- it's history, it's makeup, it's ethical considerations, and it's ecological and social issues -- one can better make a judgment about it's social responsibility against its accomplishments.

I. History

Far from the European settlers who would become addicted to its relaxing properties and social connotations, the tobacco industry began around 1 B.C. when Native Americans began to use the plant in religious ceremonies and as a medicine (Randall 1999). Ironically, the tobacco plant, Nivotiana, was lauded throughout history as an herb with excellent medicinal properties. This was especially true in pre-Columbian America, where most species of the plant grow natively. The discovery of tobacco was linked with a voyage important to Americans in the late 1400s -- Columbus' exploration of what would quickly become the new world. When Columbus and his sailors noted natives smoking the plant's dried leaves through pipes with holes for nostrils, he found that that the people participated in this event for ceremonially, pleasure, and for their health. In fact, Native Americans used the substance to brush their teeth, to relieve headaches and other pains, treat colds, and minimize gland swelling. It was not long after Columbus's journey that the trend began to erupt all over Europe. European explorers and missionaries even wrote treatises on the use of the plant for medicinal purposes (Charlton 2004).

While Columbus's discovery of the plant's uses resulted in the herb becoming a major part of European life, this was even more so for the early American colonists. In fact, tobacco became a major contributor to social culture as well as economic sustainability. Before the United States became the United States, tobacco was there, the funds from its sales eventually paving the way for wars and reconstruction. In fact, tobacco was the first crop grown in a commercial capacity in North America; it was the main source of funds for the famous first colonial settlement in Jamestown, Virginia ("From the First to the Last Ash" nd). Soon, the tobacco industry began to make itself known as one of the most important, if not the most important, in the colonies and, after the Revolutionary War, the United States of America. In fact, along with other cash crops, tobacco was a major contributor to the funding for the Revolutionary War ("From the First to the Last Ash" nd). In 1847, just fourteen years before the civil war, the renowned Phillip Morris Company was established, selling Turkish cigarettes. In 1875, ten years after the war that ravaged the American South, an important producer of tobacco, R.J. Reynolds Tobacco Company first began production. Like the use of the tobacco plant had in the colonial days, the use of cigarettes quickly became standard among most Americans. Similarly, chewing tobacco became popular with Western expansionists, drawing on the stereotypical image of a cowboy with a mouth full of snuff. During the late 1800s and early 1900s the demand for cigarettes began to push tobacco into a growing industry. World War One marked an era of cigarette normalization, as soldiers began adopting a greater affinity of the habit. During World War Two, however, the habit was strengthened by the inclusion of cigarettes in a soldier's rations, along with their daily food supply (Randall 1999).

Although even in the early days of tobacco use, objectors launched campaigns against the practice, arguing that tobacco had dangerous properties that could damage a person's health and even result in their death. In the 1960s, this campaign resulted in a removal of cigarette television ads from stations in Great Britain, the introduction of the surgeon general's warning, and worldwide awareness efforts. In the 1970s, television ads were removed from the United States' channels, while smoking became politically incorrect (Randall 1999). Regardless of the information campaign, the tobacco industry continued to climb in sales and presence in the United States and all over the world. Marlboro is the world's largest brand of cigarettes, and tobacco continues to be grown as a cash crop today (Randall 1999).

II. Corporate Stakeholders and Response to Their Issues

Although American history has established the tobacco industry as one of its most prominent, the corporate stakes regarding the industry include a component that many corporations do not have to consider -- health issues. In fact, ethical issues are one of the primary reasons why would-be stockholders do not choose to invest in the tobacco industry. According to Crosby, some religious groups shy away from holding stocks in corporations that have to do with a variety of "sinful" activities, such as drinking alcohol, gambling, and, of course, the use of tobacco (2000). The religious groups refuse to purchase shares in such companies because they believe the substances or activities are "harmful" and "can be addictive" (2000). But for groups that do not hold such objections, safety is still a major issue for most stakeholders, especially those from religious environments. In fact, Crosby points out that some Christian institutions have purchased stock in such corporations in order to air their issues at stakeholders meetings. Corporate stakeholder safety issues include limiting the amount of tar and nicotine in cigarettes, obtaining warning labels for developing country cigarette sales, modifying advertising as not to court the younger generations, and cigarette smuggling, as well as other issues. As far as the tobacco industry's response to these issues, Crosby recounts that the religious shareholders have "had slight success among tobacco companies," but have made a larger impact on other corporations, those who were "quietly benefiting" from their business dealings with the tobacco industry (Crosby 2000). But according to Social Funds, a web site devoted to "socially responsible investing," socially responsible shareholders in tobacco industries made quite an impact on the companies in the year 2000. For example, Phillip Morris, probably the world's most recognizable tobacco company, agreed to place warning labels on its products throughout the world, even where they are not legally required. Other resolutions among tobacco companies resulted in a change in placement, as shareholders contended the products were too easily shoplifted by teenagers, and mandated advertisement changes that, among other things, redirected the way cigarettes were being marketed to certain ethnic groups, as claims of racism had arisen ("Shareholders Take on" 2000).

Although the ethical battles that plagued the tobacco industry during the late 1990s and upwards have slowed as of late, safety is still a primary concern among shareholders. While some recommend that now is a good time to buy, at least for certain companies' shares, the issue of safety and legislation is still the primary one among tobacco industry shareholders. Although it is expected to die in Congress -- and President Bush has promised a veto if it does not -- a bill is currently circulating that would allow the FDA to control cigarette contents ("Reynolds American" 2008). If this bill were to pass, and the likelihood of it doing so is much greater with a Democratic congress and president, it could mean the perpetual death of the tobacco industry. Thus, these issues continue to be primary as shareholders determine if and when to buy.

III. International Ethics

Once a symbol of American life and a major contributor to Revolutionary War funds, tobacco quickly found itself unwanted by many vocal United States' citizens once its harmful health effects became known. Since the late 1990s, the issue of international ethics has been of prominence in the discussions regarding the tobacco industry. As outraged Americans began to restrict the tobacco industry's options for marketing due to an increased concern over health issues and minor's access to the products, the tobacco industry began expanding its horizons with a primary goal of developing countries. In fact, tobacco companies now grow the plant in Africa, South America, India, Pakistan, the Philippines, Greece Thailand, and the Dominican Republic, with fifty percent of all tobacco sales going to Asian countries ("From the First to the Last Ash" nd). According to the Food and Agricultural Administration of the United Nations, developing countries' use of tobacco is expected to increase, in opposition to the Western statistics, which show tobacco use declining ("Higher World Tobacco Use" 2004). Because the cost of operation is low in developing countries, tobacco companies have relocated tobacco production to these countries, resulting in higher amount of smokers in the developing countries. In fact, according to the Food and Agricultural Administration of the United Nations, developing countries are expected to continue cigarette production. Some suggest that this is because of their small production rate, a suggestion that is most likely sound ("Higher World Tobacco Use" 2004).

While most would agree that it is not ethical for the developing world to serve as a police force for the developing world, some suggest that the tobacco company's expansion into the developing world is less than ethical itself. These people would most likely suggest that the lure of growing tobacco for economic benefit has caused members of developing countries to compromise their health. Indeed, it does seem that the number of smokers in the developing world is not only increasing, but it is doing so with drastic implications for the smokers themselves. In 1999, the BBC quoted the World Health Organization as saying that "smoking is set to cause a cancer epidemic in the developing world," adding that smoking "could kill 200-300 million people in the next 25 years" ("World Smoking Deaths"). In fact, the news organization went as far as to call the problem an "epidemic" ("World Smoking Deaths" 1999). But while the death toll from smoking is rising, developing countries economic potential is falling each time another citizen lights up. Because developing countries' smokers are much poorer than American smokers, they use hand-rolled cigarettes without filters, a situation that is more than potentially deadly. Thus, smokers in the third world are at a higher risk for disease, and therefore, a higher risk for medical costs. According to Forbes, each pack-a-day smoker in the third world looses 13.9% of a year of his or her life, in addition to $448.61 a year. In totality, this means a developing country looses just under $500 million each year because of its smokers (Van Riper 2007).

While one cannot accuse tobacco companies of forcing third-world countries to adopt large-scale smoking habits, one would be hard-pressed to defend the argument that they did not help the smokers along. By turning to these countries to grow tobacco once Americans grew displeased with the crops on their land, the companies offered economic incentives that that appeared like water in the desert to the impoverished populations of developing countries. Once these countries had become the manufacturers, tobacco companies also targeted them as consumers, and, until pressured by stockholders, did not put warning labels on the packets, exposing smokers to life-shortening poisons without also exposing them to the facts. While the tobacco companies are businesses and must operate as such, some can characterize many of their dealings in the third world as unethical. As the number of smokers in the United States continues to rise as opposed to the number of developing country smokers in developing countries, which is declining, United States' activists may soon undertake smoking in the third world as a cause for which to rally, like HIV or Malaria.

IV. Ecological and Natural Resources

Unlike many other industries, the tobacco industry relies on a natural resource for its products. According to the International Tobacco Growers Association, tobacco is a perennial plant that is the world's largest grown non-food crop. A natural resource in a host of countries, over 120 countries grow the plant because it can be grown in a number of climactic conditions, although it is indigenous to North America. While tobacco can be grown in a variety of locations and conditions, different locations and conditions require different growing techniques. Tobacco plants are grown for their leaves, the major component in cigarettes and chewing tobacco, which are harvested, curled, and then sold for the manufacturing of such products. About 10 to 20 leaves can be produced from each plant, and the flowers are usually trimmed from the plants to maximize leave growth (nd).

But even though tobacco itself is natural resource, tobacco products can still be harmful to the environment. Ecologically speaking, smoking is one of the worst forms of air pollution encountered in this world. According to Vince (2004), "the air pollution emitted by cigarettes is 10 times greater than diesel car exhaust." The findings of the Italian study published on New Science magazine's web site should be shocking to many who smoke inside and outside the home. With recent attention being paid to pollutants, especially greenhouse gasses such as diesel fuel, and their role in global warming, the findings give credence to the smoking bans that have encompassed locations as small as a restaurant to as large as a community, city, or state. Indeed, Vince (2004) suggests that cigarette smoke may even be more harmful than the exhaust given off by a typical car, as cigarette smoke contains more toxins that can be breathed into a person's body. A person's eyes, lungs, and respiratory tract can be damaged just from breathing second hand smoke (Vince 2004).

And while second hand smoke damage to a person's body is no doubt important, the study has other ecological implications, suggesting that cigarette smoke can damage some plant leaves as well. Furthermore, the casings used to house cigarettes pose even more threat to the environment. In his urgent plea with students and faculty at Ithaca College, student journalist Welch (2003) made an interesting case about cigarettes' ecological damage. For instance, Welch notes that cigarette filters are non-biodegradable, made from a plastic containing toxic chemicals that, when broken down in the land fill or wherever the cigarette butt was tossed, leak poison into the soil, which eventually makes it to the water stream and into people's bodies.

Thus, while tobacco may be a natural resource that is cultivated all over the world, this does not necessarily mean all tobacco products are safe. Biologically, a nonsmoker passing a smoker outside of a building is more harmful than that same nonsmoker passing an idling diesel bus that is emitting large amounts of exhaust. Second hand smoke is not only inconvenient, resulting in a quick cough for most nonsmokers, but it can also be harmful to one's eyes, lungs, and respiratory tract. Ecologically, cigarette smoke can damage the leaves of some plants. Furthermore, cigarette filters, which are non-biodegradable, are often tossed onto the ground after the cigarette has been enjoyed, or, in the best case scenario, sent to a landfill with other poisonous refuse. Once the filters begin to break down, poisons from the plastics used in them are released into the ground, eventually contaminating the water stream, a person's drink, and that person's body. In addition, because most filters are made out of plastic, some would suggest that greenhouse gasses, important elements in climate change and the destruction of the Ozone Layer, were used to manufacture them. Although some have marked cigarette smoking as a personal choice, most non-smokers would agree that smoking in public is not very personal. Instead, the choice not personal at all, but rather biologically and ecologically affects every person who is forced to stand near a smoker or enjoy the leaves on trees. Thus, tobacco is a natural resource, but the tobacco industry's use of a variety of unseemly ecological practices makes them worth questioning.

V. Social Issues

Because the fact that cigarette smoke has the potential to harm so many through second hand smoke, the tobacco industry carries some rather heavy social issues. In the 1990s, as previously discussed, social issues surrounding tobacco threatened to close down the industry, or at least impose limits that would reduce the industry to a shadow if itself. These threats never came to pass, although the industry and its stockholders live in fear of them every day. Primarily, the tobacco industry was not hit with such damaging punishments because it made changes. Companies began putting warning labels on cigarettes sold over seas, and the campaign to target young people was ended, resulting in the demise of Joe Cool, although Camel brand cigarettes still exist. Today, tobacco industry social issues are no smaller than they were years ago. As previously mentioned, second hand smoke and international marketing are still two of the industry's largest social issues. Many governments' reply to the issue of second hand smoke was the institution of the smoking ban. Across the country and the world, smoking is an activity that is soon becoming taboo in public places. In order to protect non-smokers who may breathe the toxins of their smoking counterparts, a variety of smoking plants have been implemented. For instance, Chicago and Indianapolis both have smoking bans in effect, although these bans often permits smoking in certain areas, such as bars. Although some call the bans an invasion of their rights to smoke, Neighmond (2007) reveals information about a study that suggests the bans actually work. The National Public Radio journalist states that banning smoking helps people quit because they do not breathe in tobacco as often, and breathing in tobacco increases a person's desire for nicotine, as certain brain sensors are activated when tobacco smoke is inhaled. Psychological factors are also a prime reason that people stop smoking once a smoking ban is in place. According to Neighmond, what was once the norm is the norm no longer, convincing people that to be "normal" they should avoid cigarettes.

Although second hand smoke, along with the third world expansion of the tobacco industry, is probably the largest social issue surrounding the tobacco industry, advertising is still in the news as a concern. According to the American Heart Association, the tobacco industry continues to target youth, as well as minorities and women ("Tobacco Industry's Targeting" 2008). Although legislative threats and actions, as well as pressure from stockholders resulted in the reduction of youth-oriented advertisement during the late 1990s, the American Heart Association suggests that the industry is continuing to publish advertisements in publications targeted toward youth. Additionally, the industry's advertisement expenditure continues to grow exponentially each year. Furthermore, the association suggests that the tobacco industry places advertisements in more magazines geared toward African-Americans than other magazines. The fact that the nearly doubling of the African-American smoking rate during the 1990s accounts for this fact, according to the association. In addition to African-Americans, the tobacco industry tends to target Hispanics with advertisements such as those on billboards. According to the American Heart Association, the tobacco companies do this because they believe they can make more money from low-income minorities than other groups. Finally, the American Heart Association suggests that the tobacco industry targets women by "introduc[ing]…cigarette brands targeted towards women ("Tobacco Industry's Targeting" 2008). Furthermore, the association suggests that at least one tobacco company's marketing campaign attempted to target women "of a low socioeconomic status who are at high risk of pregnancy" ("Tobacco Industry's Targeting" 2008).

Because smoking is an activity that posses great risk to one's self and others, the social concerns and impact of such an activity are enormous. The tobacco industry's social concerns include second hand smoke and a person's health, second hand smoke and the environment, the sale of cigarettes to those in developing countries, worldwide smoking bans and their effectiveness, and targeted marketing towards young people, minorities, and women. While many are passionate that the solution to each of these questions is to disband the tobacco industry, others are rather passionate about their desire and right to smoke. Until such a time as legal restrictions are put on the tobacco companies, which could be as soon as next year or could never take place, the tobacco industry must learn how to come with these issues if its wants to survive, in addition to satisfying stockholders.

VI. How do you Rate This Industry as to Overall Social Responsiveness

An industry that lends itself to ethical indiscretion, evaluating the tobacco industry in terms of social responsibility is difficult. Because the history of tobacco is almost analogous with American history, it is obvious that the industry evolved, and was Americanized, far before the information about tobacco's adverse health effects became popular knowledge. Thus, calling the industry socially irresponsible just because its products can be used in a socially irresponsible manner would be a fallacy. Instead, one must analyze the industry's ethics in dealing with the material when making this judgment. Based on the tobacco industry's ethical, or rather unethical, decisions, one can conclude that the industry has a relatively low degree of social responsiveness.