Sustainability strategy of tobacco business
Four strategic
focus areas

Aspirational goals

Targets

Progress

SDGs

Reduced-Risk Products
Reduced-Risk Products (RRP) offer real benefits to consumers and society. Our responsibility as a manufacturer is to continuously develop and launch RRP thatmeet consumer expectations and to provide information on them. We will leadin providing a range of consumer choice in the RRP category.

In 2023, the JT Group offered RRP (Reduced-Risk Products) with the potential of risk reduction, social consideration, convenience, and affordability, such as Heated Tobacco Sticks(HTS), infused tobacco products, E-Vapor and oral products in 18 countries. (8 countries in2022)

We have carried out several initiatives looking at design solutions, responsible collection
and disposal, and consumer awareness and education.

Products and services

We will be a total tobacco company
offering consumers an even greater
choice of products by focusing on
quality, innovation, and reduced-risk
potential.

Product Materials and Packaging
We will reduce the environmental impact of our products and packaging
through design solutions, facilitating responsible collection and disposal, andconsumer awareness and education. More specifically, we will reduce our packaging (including plastic) and ensure that the remaining is 85% reusable or recyclable by 2025, rising to 100% by 2030. In total, recycled content will account for
20% of our tobacco business packaging by 2025.

In 2023, our efforts led to 88% reusable or recyclable packaging and 19% recycled content
in packaging, up 1% year-on-year.

2023
2025

2030

88%
85%

Reusable or recyclable packaging

100%2023
2025

19%
20%

Recycled content of packaging

Recordable injury rate*1 declined 47% from 0.72 in 2015 to 0.34 in 2023.
Zero Injuries
In line with our vision of zero workplace injuries, we will reduce injury rates by25% by 2023 and 50% by 2030. (Baseline year: 2015).

2015

Recordable injury rate

Community Investment*
Between 2015 and 2030 we will invest US$600 million to help make communities inclusive and resilient, with our employees contributing 300,000 volunteering hours.
2PeopleWe will be the employer of choice
by investing in people.

2023

2023 2030-47%-50%-25%

Since 2015, we invested USD 500 million in our communities and employees volunteered
218,070 hours on company time.

2015

2023

218,070

Hours employees spent volunteering

Employer of Choice
We will be a certified employer of choice every year in at least 60 countries byfocusing on talent management, rewards, and empowerment.

2030

300,000

We were certified as Top Employer with corresponding certification in 47 countries. Over 10
consecutive years up to 2023, we have also been certified as a Global Top Employer, which
requires being a Top Employer in a company’s home country and a number of other countriesand regions as well. As of 2024, only 17 companies in the world have achieved Global Top
Employer certification.
Global Top Employer annual certification will be a target under the JT Group Sustainability
Targets starting in 2024.

*1 R ecordable injury rate = Recordable injuries/200,000 hours worked. Due to the consolidation of global operations of the tobacco business since January 1, 2022, data of certain business sites are not included as it will take up to 18 months to integrate occupational health and safety standards.
*2 Target for Community Investment is a Group-wide targets.

Sustainability strategy of tobacco business
Four strategic
focus areas

Aspirational goals

Targets

Progress

SDGs

Since 2019, we have reduced Greenhouse Gas emissions from our own operations (Scope 1and 2) by 19 %, while emissions from our leaf and non-tobacco materials (Scope 3 Category1) increased by 3% ※.

Greenhouse Gas Emissions
We commit to be Carbon Neutral for our own operations by 2030 and achieve
Net-Zero Greenhouse Gas emissions across our entire value chain by 2050. In
support of this, by 2030, we will reduce emissions from our own operations(Scope1 & 2) by 47% and emissions associated with leaf and non-tobacco materials*3 (Scope3 Category1) by 28%, against a 2019 base year.

20192023

Supply chain

2030

Scope 1 and 2 GHG emissions

-47%

2019

2030

Scope 3 GHG emissions related to procurement of leaf tobaccoand non-tobacco materials (NTMs)

-28%

3%

※

We will reduce environmental andsocial risks, and enable transparent
and responsible practices across oursupply chain.

2023

-19%

T he increase was mainly due to temporary procurement increases from Tanzania and other countries that will require
more time to shift to renewable energy sources in the leaf-drying process, as a result of business scale expansion andclimatic influences.
To shift to renewable energy sources, we have been putting effort into planting in these countries, with projected positiveeffects in the future. By following through on initiatives like this, we project achieving carbon-neutral operations by 2030
and Net-Zero emissions by 2050.

Since 2015, we have reduced water withdrawal by 29% and reduced waste by 20%.

2015

Water and WasteWe will reduce water withdrawal by 15% and waste by 20%, in relation to ourown operations, between 2015 and 2030.

Forestry
We will replace all wood from natural forests used in the tobacco curing processof our directly contracted growers with renewable fuel sources by 2030.

*3 N on-Tobacco-Materials refers to materials other than leaf tobacco, such as acetate tow, cigarette paper, packaging materials etc.

2030

2023

-29%
Water withdrawal

-15%
2023

2015

2030

Waste generation

-20%
-20%

We planted trees in Tanzania, Zambia and Brazil, and project shifting fully to renewable energy sources by the 2030 crop year.
2015

2030

Renewable fuel for tobacco curing100%Sustainability strategy of tobacco business
Four strategic
focus areas

Aspirational goals

Targets

Progress

SDGs

In 2023, 98.57% of our supplying entities reported against ALP. (94% in 2022)

2023
2018

2025

98.57%
100%

ALP coverage rate: Supplying entities base

100% of our directly contracted growers and 99.99%*4 of our leaf merchants’ growers werecovered by ALP. 89.1% of our volumes were covered by ALP, compared to 83% in 2022.

Agricultural Labor Practices
We will implement our Agricultural Labor Practices (ALP) program in all sourcing
countries by 2025.

Supply chain

We will reduce environmental andsocial risks, and enable transparent
and responsible practices across oursupply chain.

2023
2018

2025

Directly contracted growers

100%
100%

2023
2018

2025

99.99%
100%

Leaf merchants’ growers

2018

2023

2025

89.1%
ALP coverage rate: Volume base

100%

100% of our key suppliers were screened against ESG criteria.
Supplier Screening
We will screen all key suppliers against environmental, social, and governance criteria by 2023.

2023
2019

Supplier screening implementation rate

Regulatoryenvironment andillegal trade

We will ensure the Company isincluded in policymaking leading tofair and balanced regulation, andenhance our cooperation withgovernments to combat illegal
trade.

*4 Growers from India and China are excluded.

2023

100%
100%

Engagement
We will always protect our ability to participate in public policy debate with theaim to achieve balanced regulation that meets societal concern and supportsbusiness growth.

In 2023, we engaged openly and transparently in public policy debate and made our views
known to regulators, NGOs and other relevant stakeholders in the countries where weoperate.

Illegal Trade
We will engage in dialogue with law enforcement agencies, with the goal to exchange intelligence regarding illegal tobacco products, in order to support thereduction of illegal tobacco products.

In 2023, our Anti-Illicit Trade team provided 2,143 intelligence reports to law enforcement
agencies and advised 2,088 law enforcement officers on counterfeit recognition.