Anne Landman's Collection
Corporate Affairs Five-Year Plan 930000 - 970000
Abstract
This Philip Morris Corporate Affairs Plan describes the company's strategic rationale for befriending and contributing financially to ethnic and minority groups, making clear that such affiliations are a strategy to undermine the "antis" (public health authorities): "Develop offsetting relationships among groups that are often used by the "antis" suggesting they are victims because they use the company's products. The relationships developed are designed to insure that our case is understood, thus undermining the opposition's ability to organize against the company's interests with leading community organizations..."
(This description is found under the "Public Affairs" section of the report, which describes the function of PM's Public Affairs group as focusing on contributions.)
The document also shows that PM realizes that strong smoking restrictions throughout the country are inevitable:
"At the end of the planning period it is likely that smokers will elect to smoke only in designated smoking areas when in public or at homes or the homes of friends who smoke. It is also likely that only a fraction of workplaces will allow smoking at all inside buildings. These assumptions are based on an analysis of well established trends."
The document also makes clear that PM believes the worst possible tax is one that ties cigarette sales to health care funding:
"Indeed, no tax threat is as great as being included in some way in a health care funding program."
Fields
- Company
- Philip Morris
- Author
- Philip Morris Corporate Affairs
- Recipient
- Philip Morris
- Region
- United States
- Named Organization
- Congress
- Defense Commissary Agency
- Dept of Defense
- *EPA ( use United States Environmental Protection Agency)
- United States Food and Drug Administration
- Federal Trade Commission (Enforcement agency for laws against deceptive advertising)
Enforces laws against false and deceptive advertising, including ads for tobacco products. Ensures proper display of health warnings in ads and on tobacco products;collects and reports to Congress information concerning cigarette and smokeless tobacco advertising, sales expenditures, and the tar, nicotine, and carbon monoxide content of cigarettes.- Kraft General Foods Inc. (A unit of Philip Morris, circa 1994)
A unit of Philip Morris, circa 1994- North American Free Trade Agreement (NAFTA)
- Dept of Water Quality
- Senate
- Southern State Solid Waste Coalition
- Special Situation Task Force
- TI, Tobacco Institute
- Ca Integrated Waste Management Board
- Philip Morris Corporate Affairs (Goal is to favorably position PM with key audiences)
- Defense Commissary Agency
- Litigation
- Stmn/Produced
- Named Person
- Yeltsin, Boris
- Type
- REPT, REPORT, OTHER
- CHAR, CHART, GRAPH, TABLE, MAPS
- Subject
- smoking attitude
- smoking restriction
- Target/ethnic (targeting ethnic markets)
- Target/Low-Income (Target Groups)
- Corporate philanthropy (Company giving behavior)
The giving of money to causes by a company, usually in a manner that makes the company appear altruistic to the public. Corporate philanthropy is usually done to achieve public relations or political gains.- Corporate strategy
- smoking restriction
Document Images
CORPORATE AFFAIRS
FIVE-YEAR PLAN
1993 - 1997
V0090MM
Corporate Affairs Mission/Objectives 1993 - 1997
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Coroorate Affairs Mission
It is the principal goal of Philip Morris Companies Corporate Affairs organization to
favorably position with key audiences Philip Morris as the world's most successful
consumer packaged goods company.
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Organization
In pursuit of this goal, Corporate Affairs at Philip Morris Companies is organized into
five groups:
Public Affairs
Washington Government Relations
Communications
External Affairs
Policy and Administration
Each group has its own specific goals and objectives all designed to favorably position
the company and to contribute to the mission of Philip Morris Companies Inc.
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CorporateAffairs Trends 1993 - 1997
During the planning period major changes are likely to occur around the world that
will impact our businesses. Leadership changes are approaching in France.
Additional changes will occur in Asia, where almost every new head of government
has come to office within the past two years. Looking at their standing today, we can
assume that new heads of government will come into office during the plan period in
Canada, Britain and perhaps Germany. It is increasingly doubtful that Yeltsin will
survive in office, suggesting changes in Russia and the CIS countries.
Here in the United States we will go through two congressional elections and a
presidential election. It would not be surprising during the planning period to see
the leadership of the Senate change at least once and a new president elected in
1996.
It is reasonable to ask, with this magnitude of change, whether it is possible to project
any meaningful trends during the plan period. To the extent it is possible to forecast
critical issues, the following issues are offered because they seem to have relevance
regardless of who holds major public office across continents.
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Central issues for the planning period:
FundinQ the Public Sector. Governments around the world are seeking additional
revenues for increasingly costly services, especially health care. Without rapid
economic grow rates, the need for added tax revenues will put strong pressure on
governments to acquire additional revenues through various consumption based
taxes. Not only are we vulnerable across the board to many of these tax schemes, we
may be required to bear a larger burden through the imposition of so called sin taxes
that would be placed on tobacco and beer products.
Health Care. There is no reason to believe that public concern about health issues
will abate. The health industry is large and growing and it is supported by a large
and aggressive health care lobby. All of our products are likely to come under ever
closer scrutiny by health advocates.. Here we are vulnerable to adverse regulation
that might restrict what we market and how we market it. We are also vulnerable to
taxes designed as much to modify behavior as they are meant to raise taxes. Indeed,
no tax threat is as great as being included in some way in a health care funding
program.
Environmental Activism. Environmental issues tend to receive less attention
when the economy does poorly. As it improves during the plan period, look for more
activism in this area. Throughout the US recession, there was serious focus given to
the nation's solid waste problems. This issue will grow in significance at both the state
and federal levels in the US which is behind many European nations in managing the
growth of solid waste generation. Solutions to the problem will present serious
challenges to all lines of our b usiness.
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Trade Policy ChallenQes. As we enter the planning period, slow growth is evident
in key markets; however, few are looking for rapidly accelerating growth rates in any
region other than Asia. This suggests that managing trade relationships will
continuing to be a significant challenge as countries seek to protect markets on the
one hand while expanding international trade opportunities on the other. We will
need to constantly build strategic relationships in the countries in which we do
business to manage international trade tensions. And, in some countries, gaining
consumer acceptance will be a second priority to gaining less restricted access to the
consumer.
DeterioratinQ Attitudes About Smoking. During the plan period we assume that
attitudes about the use of tobacco will continue to deteriorate among the smoking and
non-smoking populations. This assumption may present one of our most significant
challenges. At the end of the planning period it is likely that smokers will elect to
smoke only in designated smoking areas when in public or at home or the homes of
friends who smoke. It is also likely that only a fraction of workplaces will allow
smoking at all inside buildings. These assumptions are based on an analysis of well
established trends. [SEE APPENDIX A.]
Unabated Activism. We must assume that the activists will continue their assault
on smoking. The pattern of adverse change in state and local laws escalating at a
more rapid pace is expected to continue during the plan period. [SEE APPENDIX B.]
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EnQaQinQ in Public Challenges. With the near universal acceptance of smoking risks
by the public, it will become more difficult for the industry to mount public policy
challenges which move public opinion. Indeed, public debate tends to reinforce
positions people hold and raise new issues on which some people have not previously
focused.. Nonetheless, when threatened in a fundamental way, such as by punitive
excise tax increases, the industry must close ranks and mount a campaign.
Strengthening Credibility and Stature. During the plan period, Philip Morris
Companies will be viewed more positively when it is understood to be a truly great
global company. Continuing to state the c-ompany's established position regarding
risks associated with smoking and the desirability of a com mon courtesy approach to
accommodating the choices of smokers and non-smokers will build both credibility
and stature. At the same time it will be important to expand understanding of the
company's diverse operations in food and beer around the world.
DevelooinQ and Maintaining Respect From flpinion Leaders. While many of our
messages will be difficult to communicate effectively to the general public, it will be
increasingly important to build support for the company and our positions among
opinion leaders.. Opinion leaders who influence public policy and media coverage
affecting the company will be very important throughout the plan period.
Communication Fundamental.. During the plan period, the company will face many
changes and challenges. It is critical that the internal and external communications
effort manage the com munication process in a way that insures our internal and
external audiences understand the company's position and direction. This will
require understanding and adapting rapidly changing technology by which people
will acquire information in very reduced time frames.
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StrateQic Objectives
During the plan period, each of the functional groups within Philip Morris Companies
Corporate Affairs will pursue strategic objectives meant to fulfill the mission. The
following general strategies will guide each group's activities:
Protect Marketing Options and Consumer Choices. Of paramount concern is the
ability of the company to market our products around the world to consumers who
are free to choose which combination of our products they wish to consume. Laws
and regulations that restrict either the company's ability to market products or the
consumers ability to buy and use them will be opposed.
Purs-ue Policy of Aggressive De-escalation. Evidence suggests that the more
attention is drawn to a public debate on smoking the more likely attitudes about
smoking among both smokers and non-smokers will worsen. It is time to de-escalate
- -
the public debate while at the same time moving aggressively to get third party
sources and key opinion leaders to challenge anti-smoking and other initiatives
designed to limit the use of our products. This suggests a program of "fighting
smarter" and not engaging in public debate unless absolutely necessary.
Develog Strategic Relationshios/Alliances. Wherever in the world we are working
in support of the Company, we will be more effective by working with a network of
strategic relationships. Identifying and building these relationships is critical during
the plan period in key locations around the world.
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Sunoort Operating Companies. The corporate affairs staff found in the operating
units around the world are on the front line every day. Giving them strategic
support and collaborating with the operating units on issues of company-wide
significance is essential. It is -also important to develop the best talent possible in the
operating units. While always standing ready to assist, it remains important to have
as many tasks as possible dealt with by the corporate affairs staff at the operating
level.
Develon Research Base for Actions Taken. Our strategies and our action plans in
corporate affairs will be based on the best available research and a clear evaluation
of options. Part of any implementation plan should be a program for evaluation in
order to understand the extent to which our efforts are achieving the expected
results. It is also the case that research should be aci,ionable .
I
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Public Affairs Objectives
The Public Affairs group within Philip Morris Companies focuses on Contributions,
Public Affairs Programs and International Public_ Affairs.. The staff in each of these
areas is committed to enhancing support for the company's pursuit of favorable
public policies and efforts to improve our standing with opinion leaders throughout
the communities in which we do business. Opinion leaders judge the greatness of a
global company, in part, on the extent to which it gives something back to the
communities in which they operate. Public Affairs fulfills this objective for the
company across a diverse set of key opinion leaders and select audiences.
During 1993 and the remainder of the plan period, specific objectives for the Public
Affairs Group include the following:
Insure that Public Affairs activities are more fully integrate -d into the other
corporate affairs functional groups and that priorities are commonly understood,
especially with regard to activating support among constituency groups for
government affairs objectives.
Develop offsetting relationships among groups that are often used by the "antis"
suggesting they are victims because they use the company's products. The
relationships developed are designed to insure that our case is understood, thus
undermining the opposition's ability to organize against the c.ornpany's interests with
leading community organizations.
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Develop relationships with groups and individuals who have an inclination to
support positions taken by the company on public policy concerns.
Maintain Philip Morris Companies' reputation as the leading corporate supporter of
the arts, using the 35th Anniversary of our support of the arts as an event marking
historic achievement by a single company.
Continuously evaluate our giving programs to insure the most favorable impact
possible in the communities in which we op;erate.
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Work to enhance understanding among opinion leaders about the extent of the
company's giving programs.
Coordinate with our international operating units to b uild the proper role and
reputation for the company outside of the US in the contribution and public
programs functions.
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Washington Government Relations Objectives
The Washington office of Philip Morris Companies represents the company in a
critically important power center of the world. Laws, regulations, attitudes and news
stories emanating out of Washington, DC have a tremendous impact on our company
around the world. This has been true for many years. Now, the impact of
Washington may be even greater as it relates to commerce following the end of the
Cold W ar.
The operating units of Philip Morris Companies were put under one roof in
Washington about two years ago. Now, the management of the staff of about 30
people has been brought directly under the supervision of the Philip Morris
Companies Vice President charged with running the office. Additionally, staff has
expanded to give the office the resources necessary to run programs supporting the
lobbying functions.
During 1993 and the remainder of the plan period, specific objectives of the
Washington Government Relations Office include the following:
Federal tobacco issues....
Oppose/minimize excise tax increases as part of deficit reduction plans and oppose
any attempts to earmark excise taxes on our products to fund health care programs.
Stabilize the tobacco support program.
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Oppose advertising non-deductibility and organize grassroots efforts to block
passage by the Congress.
Design and implement a program to minimize the impact of omnibus tobacco
regulatory legislation.
Support a review of EPA risk assessments as part of the indoor r air quality
regulatory process.
Develop a commercially acceptable solution to the fire-safe cigarette issue working
with PM USA (the Congressionally mandated study is due in August 1993).
Prevent any US government restrictions on the export of US cigarettes.
Oppose Department of Defense tobacco sales restrictions.
Maintain the flexible packaging exemption in federal solid waste legislation.
Prevent bilateral or multilateral international airline smoking bans.
Preventiany legislative attempt to restrict protective orders in federal civil cases
as part of product liability legislation.
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Federal food issues....
Assure adherence to the food safety provisions adopted in 1992 as debate begins
in 1993 on the solid waste (RCRA ) deb ate.
Support food safety legislation which provides a negligible risk standard for
pesticide residue and federal preemption.
Oppose unnecessary and arbitrary grants of authority to the Food and Drug
Administration that might be presented in FDA enforcement legislation.
Develop and support least-cost optrons if user fees become part of a program to
fund FDA activities.
Monitor and be prepared to shape dairy price support legislation in a manner
favorable to the company.
State food issues....
Advance state solid waste legislation in Vermont, Texas and Colorado.
Seek to incorporate the major elements of the model bill into the strategic plan of
the Southern State Solid Waste Coalition.
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Support the adoption by the Oregon Department of Water Quality of a food
exemption in current law as well as supporting broad consumer product safety
legislation which includes food safety provisions.
Seek food safety exemption in California while working with the California
Integrated Waste Management Board to gain support for our positions.
Oppose rates and dates legislation in key states..
Federal Beer issues....
Oppose increased excise taxes as well as any effort to equalize.
Increase grassroots involvement of the wholesalers, retailers, suppliers and labor
unions.
Oppose advertising restrictions such as required voice overs and warning labels.
Defeat any attempt to enact bottle bills or other forced deposit legislation.
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Corporate issues....
Seek agreement on FTC unfairness authority as part of FTC re-authorization.
Seek retroactive and prospective uniform tax treatment of intangibles.
Seek passage of maximum resale price maintenance provision enabling a
manufacturer to establish price ceilings for the resale of goods.
Seek Congressional oversight of the Defense Commissary Agency to resolve PM
USA and KGF accounts receivable problems.
International issues....
Support lower EC duties, particularly for US cigarettes in GATT.
Support the NAFTA when it comes before the Congress.
Support MFN status for China.
Expand relationships with foreign embassies in Washington in support of PMI/KGFI.
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Tort reform projects....
Enact product liability statute in Texas.
Enact the product liability and punitive damages reform legislation in Mississippi.
Protect product liability statutes in California and Louisiana.
Corporate Affairs projects....
Develop and implement a comprehensive plant tour program for federal, state and
local official visits throughout the country.
Develop and implement an employee grassroots program.
Develop and implement an extension of the grassroots program to suppliers.
Organize a strong W ashington contrib utions program to reach select audiences
working in conjunction with the Public Affairs staff in New York.
Develop and implement a new member, key member and new administration
program to acquaint Washington officials with Philip Morris Companies.
Coordinate and maximize PM executives involvement in Washington visits and
Washington-based activities.
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Organization issues....
Organize tobacco, food and beer strategy groups and hold at least quarterly
meetings to guide and direct the government affairs strategies of the operating
companies.
Improve the quality of the people and their performances in Washington through
closer supervision, training and recruitment.
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Communications Objectives
The Communications group has responsibility for presenting Philip Morris Companies
to both internal employee audiences through the PM GLOBE /PM in Motion and
external audiences through its media relations efforts. The Communications group
coordinates with the operating units reviewing media relations opportunities and
challenges.
During 1993 and the remainder of the plan period, specific objectives of the
Communication group include the following:
Develop more extensive and improved relationships with key media contacts
following the industry and PM Companies.
Develop and execute a communications strategy involving the CEO and other
senior officers in a program which has a consistent theme and message.
Develop a crisis communications strategy for PM Companies and integrate the
strategy with the Special Situation Task Force.
Strengthen the company's financial communications program to press,
shareholders and analysts through improvements in the annual report and
quarterly releases.
Improve internal communications capabilities by strengthening the content and
distrib ution of PM in Motion and other special editions of PM in Motion; additionally,
improve other internal publications (PM GLOBE, FYI, Happenings).
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External Affairs Objectives
External Affairs is designed to develop relationships of strategic importance to the
company through a series of meetings, conferences and exchanges arranged through
the private foundations in which positions of leadership are maintained. In addition,
support is provided to the operating units when previously established contacts can
be drawn upon for assistance to the company.
Objectives for 1993 and the remainder of the planning period include the following:
Develop a clear set of priorities on an annual basis for use in evaluating
opportunities during the calendar year.
Report on program activities regularly to inform senior management of both
activities and to identify areas where support can be provided.
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Corporate Affairs Policy and Administration Obaectives
The Policy and Administration group was formed last year to better manage the
work of the department and to insure proper coordination with the operating units.
The objectives of the group for 1993 and the remainder of the planning period
include the following:
Establish systems and procedures to ensure tighter financial control on corporate
affairs expenditures.
Establish system to identify and track significant goals and objectives for Corporate
Affairs.
Participate in the overall review of corporate contributions and the ongoing efforts
to insure communication among the corporate affairs staffs in supportof the
contributions program.
Establish system to centrally track requests/assignments received from the
Chairman and other senior corporate officer-s..
Effectively analyze critical issues affecting the company on an ongoing basis (e.g.
consumption-based tax alternatives, ETS risks, environmental issues).
Maintain effective relationships with public policy groups to maximize the benefit to
the co m p any.
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Coordinate the company's environmental policy initiatives.
Design and execute ute strategic technical com m unications on the ETS issue in
coordination with PM USA.
Design and execute strategic technical communications regarding solid waste
management utilizing a network of policy groups and media contacts.
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APPENDIX A
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SHOULD SMOKING BE ALLOWED IN
THESE PUBLIC PLACES?
(% WHO SAY NO)
BARS
WAITING AREAS
SHOPPING MALLS
RESTAURANTS
OFFICE OR WORKPLACE
PUBLIC TRANSPORTATION
0%
El
SMOKERS . NON-SMOKERS
90% 100%
Base: 1012
National Quorum
Early February 1993
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RESTRICTIONS ON SMOKING IN PUBLIC PLACES
(AFTER HEARING EPA ANNOUNCEMENT)
- General Public -
MORE THAN TODAY
0% 10% 20% 30% 40% 50% 60% 70% 80%
SMOKERS
NON-SMOKERS
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CONCERN ABOUT SECOND-HAND SMOKE
(AFTER HEARING ABOUT EPA ANNOUNCEMENT)
- General Public -
MUCH MORE CONCERNED
SOMEWHAfi MORE
A LITTLE MORE
NO CHANGE
17%
30%
15%
309/b
21%
21%
t27%
38%
, , . , T
0% 5% 10%
15% 20%
25% 30% 35% 40%
SMOKERS
NON-SMOKERS
Base: 1831
EPA Brushfire
January 1993
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WILLINGNESS TO TOLERATE 2ND-HAND SMOKE
(AFTER HEARING ABOUT EPA ANNOUNCEMENT)
- General Public -
MUCH LESS WILLING
SOMEWHAT LESS
A LITTLE LESS
NO CHANGE
SMOKERS
NON-SMOKERS
Base: 1831
EPA Brushfire
January 1993
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APPENDIX B
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STATE SMOKING RESTRICTION LEGISLATION
1985 -1992
'N '86 '87
'88
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IN
'91
1
~ INTRODUCED
~ APPROVED
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LOCAL SMOKING RESTRICTION LEGISLATION
1985 -1992
~ INTRODUCED
~ APPROVED
YEAR
SOURCE: TOBACCO INSTITUTE
December 1992
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STATE MARKETING*
LEGISLATIVE TRENDS
1985 -1992
.85
IN
'87
IN IN
YEARS
.w
'91
* MARKETING RESTRICTIONS INCLUDE SALES, SAMPLING, AND ADVERTISING LEGISLATION
73
'92
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LOCAL MARKETING*
LEGISLATIVE TRENDS
1985 -1992
.N
.N
'87
.
OA
.W
YEAR S
.90
'91
' Marketing restrictions include: Vending, Advertising, Sampling & Sales Restrictions
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