In this section

Our tobacco principles > P.47
Tobacco: health risks, transparency, and regulation > P.48
Tobacco: product innovation > P.49
Tobacco: responsible marketing > P.50
Tobacco: tackling illegal trade > P.52
Tobacco: products’ environmental impacts > P.54
Pharmaceutical: product responsibility > P.56
Beverage and processed food: product responsibility > P.58

06 Product responsibility
and consumer impacts
Across the JT Group, our overarching management
principle – the “4S” model – and our Mission andCodes of Conduct require that we meet our consumers’
needs with the highest-quality products at the same time
as behaving responsibly while conducting our business.
The diverse nature of the JT Group, which includes
tobacco, pharmaceutical, beverage and processed foodbusinesses, raises a wide variety of product responsibility
issues.
In our tobacco businesses, key product responsibility
issues include marketing our products responsibly
and combating illegal trade in tobacco. In ourpharmaceutical business, an ethical approach toresearch and development, and responsible marketingand the reliable supply of products are key issues. In ourbeverage and processed food businesses, our main focus
is on food safety and providing transparent productinformation to consumers.

46 | JT Group Sustainability ReportOur tobacco principles
Our approach to product responsibility in our tobacco business is defined by a set of core principles that reflect the main issues
relating to tobacco products and our attitude to smoking:

1.

2.

3.

Openness about the risks of smoking
Smoking is a cause of serious diseases and everyone should be appropriately informed about
the health risks of smoking

Transparency about our products
Smokers want to know what it is they are smoking and we provide information about the
ingredients we use

Commitment to the development of reduced-risk
products

4.

5.

Youth smoking prevention
Minors should not smoke and should not be able to obtain tobacco products. This belief iscentral to our Codes of Conduct, marketing practices, and the way we do business

Accommodation between smokers andnon-smokers
Many people have concerns about exposure to environmental tobacco smoke. We advocate
tailored, practical, effective solutions that separate smokers and non-smokers whileaccommodating the legitimate interests of bothWith sales in more than 120 countries, our international tobacco business has an additional principle, to ensure we are respectful ofeach country’s culture, norms, legislation, and decision-making process.
For more detail on our tobacco principles, please visit www.jti.co.jp (in Japanese) and www.jti.com (in English).

JT Group Sustainability Report | 47

06|

Product responsibility and consumer impacts

While the health risks of tobacco use cannot be completely eliminated, we are committed todeveloping reduced-risk products

Tobacco - health risks, transparency, andregulation
People smoke for pleasure, but there are real risks that come with that pleasure. Smoking is a cause of serious diseases, including
lung cancer, coronary heart disease, emphysema, and chronic bronchitis. This conclusion has been drawn from studies that, taken asa whole, show that smokers are at a greater risk of developing these diseases compared to non-smokers, and that stopping smoking
reduces this risk over time.
Accordingly, the JT Group believes that tobacco products should be appropriately regulated. We also believe in the freedom of adults
to choose whether they want to smoke and that no one should smoke unless he or she understands the risks of doing so. These risks
distinguish tobacco from most consumer goods, and they place a real responsibility upon the industry. It is a responsibility for which
we expect to be held accountable, together with governments and the rest of society.

A transparent approach
Our principles establish openness about the health risks ofsmoking and transparency on the ingredients in our products
as two core elements of our approach to business. Consumers
also demand transparency, and providing detailed information
is an integral part of helping them make informed decisions onwhether to smoke or not.

Health risks of smoking

The JT Group believes everyone should be appropriately
informed about the health risks of smoking. Our Japanese
domestic and international tobacco businesses explain our
positions on smoking and health through their websites. These
positions are based on our programs of scientific monitoring
and review, as well as wider engagements with the scientificand regulatory community.

Product transparency

Across our tobacco business, we respond to consumers’
demands to know what ingredients are in our cigarettes andother tobacco products by providing information in 54 countries
through online ingredients’ lists. We provide information by
tobacco product type, brand, and location, with full inventories
of key materials and ingredients such as cigarette papers,
filtration materials, adhesives, inks, and flavorings. We also
provide ingredient information when requested by governments
while ensuring that our trade secrets are respected andprotected. For more information please visit http://www.jti.co.jp/
corporate/enterprise/tobacco/responsibilities/guidelines/additive/
brand (in Japanese) or http://ingredients.jti.com.

Regulatory landscapeDue to the risks associated with tobacco products, our positionis that appropriate and proportionate regulation of the tobacco
sector is both necessary and right.
As an industry, the tobacco sector is facing increased review
and regulatory change. Globally, the Conference of the Parties ofthe World Health Organization (WHO) Framework Convention
on Tobacco Control continues to progress guidelines thatcover a wide range of product issues for countries to consider
in implementing regulation. In 2014, the European Union has
introduced further regulation on tobacco products, and in
the United States, the Food and Drug Administration (FDA) isestablishing regulation for many aspects of tobacco productdesign, manufacturing, and evaluation.

48 | JT Group Sustainability Report

We monitor and respond to emerging regulatory developments
to ensure that we are well positioned for constructive dialogue
with regulators on issues affecting the development andcompliance of our products.

A scientific approach

We take a scientific approach to understanding our products
and their quality, health risks, and their development andcompliance with regulation. We apply global standards frombodies such as the International Organization for Standardization(ISO) or from scientific societies such as the industry-supported
Cooperation Centre for Scientific Research Relative to Tobacco(CORESTA). Where such standards do not exist, we have ourown internal research and testing programs.
Our tobacco ingredients are examined through an extensive
range of testing programs to ensure that the ingredients we use
do not increase the inherent health risk of tobacco products.
We also review emerging science to ensure that all of thestandards we apply are updated and adapted to new findings
and techniques.
The aim of these activities is to ensure full compliance withexisting regulations and to provide appropriate understanding of
the health risks associated with tobacco use.

Potentially reduced-risk
products
While the health risks of tobacco use cannot be completely
eliminated, the JT Group is committed to developing potentiallyreduced-risk products that are acceptable to adult users of
tobacco products. We continue to research products that may
reduce health risks, such as oral smokeless tobacco products
and those that heat rather than burn tobacco.
At the regulatory level, work is underway to establish a moredetailed understanding of the health risk of these products. In
the United States, for example, the FDA has provided guidanceon how such ‘reduced-risk’ could be assessed.

Tobacco - product innovation
Product innovation is extremely important to the JT Group and supports our growth and profitability. It is critical to remaining
competitive and responding to evolving consumer trends in a rapidly changing environment. Product innovation focuses on a broad
range of areas, from traditional and emerging products to packaging and manufacturing processes.

06|

Focusing innovation on
consumer needs
The main driving force behind product innovation in traditional
products is meeting consumer needs. We use consumer trends
and insight to identify opportunities for innovative concepts
and technologies that will work in the marketplace. We also
consider industry analysis, market data, and the regulatory
landscape when defining the focus of our product research anddevelopment (R&D).
In 2013, the R&D and EHS teams from our international tobacco
business worked together to assess the environmental impactof our product and packaging design. We are conducting a life
cycle analysis (LCA) study to compare the carbon emissions
and other environmental impacts of using different packaging
materials.

Emerging products

Consumer needs are increasingly diverse, and their interest in
emerging products is evolving. We already have a number ofcommercial products on the market that fit into the emerging
product category. These include Ploom, the only smokelesstobacco vaporizer offered by a major tobacco company, andZero Style, a smokeless tobacco product available in Japan. We
have five main approaches regarding emerging and potentiallyreduced-risk products:• We will strive to offer satisfaction and pleasure to meet
consumers’ evolving needs• We will develop a product portfolio and pipeline focusing on
three areas: tobacco vapor; e-vapor, which is non-tobacco
based; and other emerging products• We will continue to pioneer early commercial launches, aswith Ploom and Zero Style• We will continuously engage with regulators in markets where
we launch our emerging products• We will conduct scientific studies for potentially reduced-risk
products

We are committed to meeting consumer demand for emerging
products. Although the regulatory backdrop for emerging
products is not yet established, we are building our expertise inthis area and continue to research emerging products, some ofwhich may reduce health risks.
JT Group Sustainability Report | 49

Product responsibility and consumer impacts

Ploom - smokeless tobacco vaporizer

Tobacco - responsible marketing
Our view is clear: tobacco products carry risks to health. We therefore support the implementation of evidence-based, practical,
effective, and proportionate regulation that governs the marketing of tobacco products while preserving our right to communicate
with adults who use those products.
We believe that:• Minors should not smoke and should not be able to obtain tobacco products• Adult smokers should be appropriately informed about the health risks of smoking before they make the decision to smoke
We are committed to marketing products responsibly. The JT Group markets its tobacco products to adult smokers in order tomaintain brand loyalty and to encourage adult smokers of competitor brands to switch to its products.
The JT Group does not market its tobacco products to minors and does not market its products in order to encourage anyone to takeup smoking or to discourage anyone from quitting.

Our marketing standards
Today, our Japanese domestic tobacco business complies
with an industry self-regulatory marketing standard set by the
Tobacco Institute of Japan (TIOJ) as well as local laws andregulations. The TIOJ marketing standard is in line with Article
40 of the Tobacco Business Law as the Guideline Concerning
Advertising of Tobacco Products.
With products distributed in more than 120 markets, ourinternational tobacco business applies a single internal Global
Marketing Standard (GMS) wherever our products are sold. We
comply with all national laws and regulations concerning theadvertising and promotion of our products. In addition, we apply
this internal standard when applicable laws and regulations are
more permissive, silent on the particular issue, or wholly absent.
The standard covers all aspects of marketing, including print,
billboards, electronic media, promotional events, brandsponsorship, and health warnings on packaging and on
advertising and promotion materials.

ComplianceIn our international tobacco business, our Code of Conduct
requires that all employees and appointed agencies, third-party
suppliers, service providers, and distributors fully comply with
the GMS.
50 | JT Group Sustainability ReportCompliance reviews are undertaken locally. All marketing
programs are reviewed and approved to ensure compliance withregulations, and to ensure that our internal marketing standard
is correctly applied in all countries where we operate, including
markets where our standard is more restrictive than nationallaws and regulations.

Preventing youth access totobaccoThe JT Group’s position is that minors should not smoke andshould not be able to obtain tobacco products. This is central to
our Codes of Conduct, our marketing practices, and the way we
do business.
We believe that tobacco manufacturers, retailers, regulators, andeducators have a common interest in preventing minors fromaccessing tobacco. Alternative solutions for preventing minors
from obtaining tobacco products include fines and licensing
restrictions for retailers who sell to minors, ‘proof of age’programs, and the criminalization of, or imposing administrative
sanctions for, proxy purchasing by adults. We participate withother tobacco companies and retail associations in ongoingprograms to prevent minors from obtaining tobacco products.

06|

Working with retailers
In our international tobacco business, we focus our activities
on Retail Access Prevention (RAP) programs to prevent youth
access to tobacco. In order to ensure a consistent approachto developing effective local programs, employees around theworld use our Retail Access Prevention Toolkit to guide theirplanning process. The Toolkit provides background information,
recommendations, and checklists for developing various RAP
programs, and includes case studies to share good practice.
Trade seminars are one of the most efficient forms of mobilizing
the retail industry. They are typically focused on helping retailers
comply with minimum age legislation. The seminars help inform
retailers on the problem of youth smoking as well as train
them on how to cope with conflict situations that could ariseat points of sale when complying with minimum age purchaselaws. The seminars for retailers are often accompanied by panel
discussions with local and national authorities, law enforcement
agencies, consumer protection organizations, and media.

Age restrictions on vending
machines
In our Japanese domestic tobacco business, we have worked
jointly with the tobacco industry and the Japanese Vending
Machine Association (JVMA) to ensure that all tobacco vending
machines are equipped with an adult identification system,
such as the ‘taspo’ ID card system. The system ensures thatvending machines will only work once a ‘taspo’ ID card ispresented. Adult smokers must apply for an ID card with official
documentation proving they are 20 years old or over. A photois also printed on the ID card to prevent improper use, such as
lending the card to other people, notably minors. At the endof March 2014, almost all of the tobacco vending machines inJapan were equipped with the ‘taspo’ ID card reader and morethan 10.4 million ID cards have been issued.

A recent example is a new pilot initiative launched with 4,800
retailers in Northwest England, which seeks to improve
independent retailers’ compliance with the law on underagesales. The program provides retailers with the tools and training
to comply with the law and protect themselves and theirbusinesses. If the pilot proves successful, we will roll the schemeout nationally in 2014 with cross-industry support.

JT Group Sustainability Report | 51

Product responsibility and consumer impacts

Retailer training

Tobacco - tackling illegal trade
The illegal trade in tobacco products is a major concern for legitimate tobacco companies, including the JT Group, and for authorities
responsible for regulating tobacco sales.
Illegal trade undermines legitimate tobacco manufacturers, distributors, and retailers. It also deprives governments of excise revenues
and funds organized crime. In recent years, the criminal illegal tobacco market has grown while the legitimate tobacco industry has
suffered major volume losses.
One of the main drivers of the illegal tobacco trade is a steep increase in taxes on tobacco products, and this often leads to large tax
differences between (or within) countries, making tobacco smuggling or counterfeiting attractive to criminals. For more information
please visit www.jti.com.

Counterfeit analysis

An evolving challenge
As governments, the tobacco industry, and law enforcement
agencies work to shut down options for illegal trade, criminals
continually change or develop new approaches to smuggling toremain undetected.
One example that is prevalent in Europe is the recent
phenomenon of minor or local brands that are legally producedin one country with the sole intent of being smuggled and soldcheaply in other countries where they are illegal. Because of
the legal complexities in stopping this production, this part ofthe illegal trade has grown significantly within the EU. A main
contributing factor to this growth is the large tax differences
between EU countries and their bordering states.

Our response
We take a stand against the illegal tobacco trade and ourpriority is preventing genuine JT Group products from entering
illegal distribution channels. In addition, we will not tolerate
the copying of the JT Group brands or the violation of ourintellectual property rights. A key part of preventing our products
entering the illegal trade is making sure we do not oversupply

52 | JT Group Sustainability Report

the markets where we operate. As a result, we take steps toensure that we only supply tobacco products to our markets inquantities that reflect the legitimate consumption in the intended
market of retail sale.

Dedicated team

We have an Anti-Illicit Trade (AIT) team dedicated to fighting theillegal tobacco trade, and we work to ensure that counterfeiters
and others involved in the illegal trade are prosecuted to the full
extent of the law. The team consists of more than 50 employees
around the world, and includes former law enforcement officials,
customs agents, and intelligence officers.
On average, we commit more than US$25 million a year to antiillegal trade activities, including a US$400 million investment in
a 15-year Cooperation Agreement with the EU signed in 2007 tocombat the illegal trade of tobacco products in Europe.
The AIT team works both on preventing the illegal trade, trying
to stop the flow of illegal tobacco products, as well as reactive
activities, such as analyzing trends and data relating to illegal
trade. In 2013, information from the AIT team directly led to theseizure of over 736 million illegal cigarettes worldwide.

06|

Working in partnership

Our prevention activities involve working with and supporting
law enforcement agencies as well as engaging withgovernments and other stakeholders on the causes of theillegal trade and the ways to stop it. Our AIT team provides law
enforcement agencies with information on illegal trade andconducts investigations, forensic examinations, and analysis ofseizures. We also provide law enforcement officials with training
on recognizing counterfeit products and support the training of
tobacco sniffer dogs.
We identify illegal tobacco trends by collecting and analyzing
the latest illegal tobacco data. This includes studies such as
empty pack surveys, which provide a snapshot of a country’s
or region’s exposure to the illegal trade. In 2013, we conducted
empty pack surveys in more than 40 countries.

Using technology

The JT Group invests heavily in developing technology tocombat the illegal tobacco trade. In many markets, we use theindustry’s ‘Codentify’ technology to mark our products with aunique identifying code. This helps to determine where tobacco
products may have deviated from their intended distribution

route and into illegal channels. Codentify looks to replacecommonly used paper tax stamps, which are easy to counterfeit
and have proven to be ineffective in fighting illegal trade.

Secure distribution

With more than 100,000 international shipments of our products
each year, we also have a specialist team focused on the
security of our shipments and the protection of our employees,
factories, distribution centers, and other infrastructure. In thisarea, we have a single common goal to ensure that the JT
Group products reach consumers exclusively through legal tradechannels in their intended retail market.

As a result of our illegal trade prevention measures, thepresence of our products in seizures of illegal tobacco
products continues to decline, and the presence ofrecently manufactured products in the illegal tradereached an all-time low in 2013.

JT Group Sustainability Report | 53

Product responsibility and consumer impacts

Codentify technology

Tobacco - products’ environmental impacts
Our products have a number of environmental impacts related to their use and disposal and the two main issues are environmental
tobacco smoke (ETS) and litter, which we deal with at a market level.

Smoking lounge in Japan supported by JT

Environmental tobacco smoke
Environmental tobacco smoke (ETS), also known as secondhand smoke, is a mixture of the smoke that comes from theburning end of a cigarette and the exhaled smoke from smokers
nearby. Compared to the smoke that a smoker inhales, ETS isaged and highly diluted.
Many people have concerns about exposure to ETS. In poorly
ventilated areas, it can cause irritation of the eyes, nose,and throat. ETS may also worsen childhood respiratory tract
infections, as well as some childhood respiratory conditions
such as asthma. Based on current scientific evidence, we donot believe the claim has been proven that ETS is a causeof diseases such as lung cancer, coronary heart disease,emphysema, and chronic bronchitis.
One of the main concerns over ETS is that it can be a nuisanceto non-smokers. This is why we advocate tailored, practical, andeffective solutions to separate smokers and non-smokers whileaccommodating the legitimate interests of both. We encourage
all smokers to show consideration for those around them andstrongly advise against smoking when children are present.

54 | JT Group Sustainability Report

Practical solutions

We promote practical ways of avoiding ETS that accommodate
the legitimate interests of both smokers and non-smokers. These
include measures such as separate smoking and non-smoking
areas, effective ventilation to control airflow and quality, anddesignated smoking areas, such as smoking lounges.
Properly ventilated smoking lounges can provide a comfortableenvironment for smokers and prevent others from being
disturbed by ETS. We have worked closely with airport
authorities to develop more than 220 smoking facilities in 13
international airports worldwide. One of the most recent opened
at Poland’s Chopin airport in January 2014.
In Japan, we consult with owners of office buildings, shopping
centers, airports, and restaurants to help them create a better
environment for smokers and non-smokers to co-exist. We
also hold a ‘Smokers’ Style’ competition annually calling forinnovative ideas for better smoking spaces.

Litter
Litter from tobacco products, in particular cigarette butts, is an issue that calls for collective responsibility, including from smokers, thetobacco industry, local authorities, NGOs, and businesses. A litter free environment is of benefit to everyone, smokers included.
Some of our initiatives to address this issue include anti-litter campaigns and localized programs to raise awareness and offer
solutions to help avoid cigarette litter.

‘Pick Up Litter and You Will Love Your City’
campaign in action

06|

Long-term commitment inJapan
Our Japanese domestic tobacco businesshas run a community clean-up campaign
called ‘Pick Up Litter and You Will Love
Your City’ since 2004. The campaign
aims to raise awareness of the problemof public littering and to encourage
people to behave more responsibly bypicking up litter from the streets. Now
in its tenth year, the campaign operates
in collaboration with local governments,
companies, and volunteer groups and has
held more than 1,580 events, bringing
together 3,170 participating organizations.
The total number of people involved hasreached almost 1.48 million and in total,
approximately 740 tons of litter have beencollected over the course of the program.

Love your city, love yourmountain
In Switzerland, we launched a campaign
in 2009 called ‘I love my city’ to raiseawareness among smokers about cigarettebutt litter. Through the program, free

portable ashtrays were distributed inseveral cities. The same campaign was
also adapted for Swiss ski resorts under
the tag line ’I love my mountain’. So far,over 100,000 personal ashtrays have been
distributed.

Promoting responsible
consumer behavior in Italy
In Italy, we have been distributing portable
ashtrays to smokers since 2008 througha variety of distribution channels andpartners, such as la Biennale di Venezia,
the Rome Film Festival, Teatro alla Scala
Museum, and marine environmental
association, Marevivo. By the end of 2013,
we had distributed more than four million
portable ashtrays.

Design Week. In 2013, university students
in Italy, Spain, Switzerland, and the United
Kingdom took part in the competition witha theme to design an area where smokers
and non-smokers can socialize.

Volunteering for cleanerparks
In October 2013, we ran a volunteer cleanup initiative in Tbilisi, Georgia. Working in
one of Tbilisi’s central parks, our volunteers
collected over 70 bags of waste, including
cigarette butt litter. The response to theevent from park users was very positive
with many thanking volunteers for theirefforts. We plan to run similar events twicea year.

To support this process, in 2010 welaunched ‘JTI Clean City Lab’, aninternational design competition open to
students of European design schools withthe aim of creating a portable ashtray of
the future. We run the competition every
year with a different design theme, and an
exhibition of entries is held during Milan

JT Group Sustainability Report | 55

Product responsibility and consumer impacts

Portable ashtrays distributed in Italy

Pharmaceutical - product responsibility
The JT Group’s pharmaceutical business has a mission to create original and innovative drugs for patients suffering from diseases
around the world. In doing so, we aim to alleviate patients’ illnesses and to ensure our pharmaceuticals are safe and secure to use.

Responsible research and development
We have a rigorous system of checks in place to ensure new drug development complies with all relevant laws and industry
standards. Our research activities are also carried out in an appropriate and ethical manner, including the control of chemical
substances, animal testing, and gene analysis.

MetricPharmaceutical R&D expenditure *A (billion Yen)

2010 2011 2012 2013
23.4

24.9

30.7

30.5

3-Dimensional structure of trametinib, MEK inihibitor

Complying with pharmaceutical regulations andstandards
New drug development is subject to a range of laws andregulations, including those requiring safety verification of drug
ingredients at the pre-clinical stage and safety assurance fordrug trials during clinical development. We have systems inplace to comply with these laws and regulations and to control
safety within drug development and trials through in-house
audits to check that our operating procedures are correctly
followed. We also gather data to monitor the efficacy andside effects of drugs on the market to help guide future drug
developments and drug safety.

56 | JT Group Sustainability ReportManaging chemical substances

We comply with all relevant laws and regulations on the control
of designated chemical substances, and our employees are
made aware of chemical safety risks and management. Our
Central Pharmaceutical Research Institute leads the JT Group’s
new drug development and is responsible for our chemical
substances management system. Torii Pharmaceutical, ourpharmaceutical subsidiary, separates chemicals into different
categories requiring different levels of management. Eachcategory has specific rules and procedures that respond to theparticular characteristics and safety risks of different groups ofchemicals.

Ethical considerations in research

In order to examine the ethical and scientific validity of ourresearch projects, we have established an Ethics Review
Committee for Clinical Studies, which conforms with the
Ethical Guidelines for Clinical Studies in Japan. Our Ethics
Review Committee on Human Genome/Gene Analysis also
examines our research in accordance with the Ethical Guidelines
for Human Genome/Gene Analysis Research issued by theJapanese Government.
Animal testing is an essential part of pharmaceutical researchand development for determining the safety and efficacy ofdrugs. When conducting animal testing, our pharmaceuticalbusiness examines the scientific rationale, respects the lives ofanimals, and always takes animal welfare into consideration.
We have established in-house standards for managing
animal testing and the breeding of laboratory animals inaccordance with the Japanese Law for Humane Treatment andManagement of Animals and its relevant guidelines.
Our practices for the proper management of animal testing at
our Central Pharmaceutical Research Institute were externallycertified by the Japan Health Sciences Foundation. We havealso established an animal testing committee, which reviews
animal testing and ensures it is conducted in accordance withthe 3R concept, which covers:• Replacement: where possible, opt for test methods that do not
use animals• Reduction: minimize the number of animals used in testing• Refinement: do not let laboratory animals suffer unnecessary
pain

06|

Product responsibility and consumer impacts

Responsible marketing

Across the pharmaceutical industry, medical representatives(MRs) play a crucial role in the sale and promotion of medical
supplies. In Japan, Torii Pharmaceutical markets our products
through a team of 485 highly trained MRs. Outside Japan welicense our drugs to other pharmaceutical manufacturers and do
not have a sales function.
The JT Group is a member of the Japan Pharmaceutical
Manufacturers Association (JPMA), an industry associationof the pharmaceutical industry in Japan, and we comply with
the JPMA’s ‘Code of Practice’. Launched in 2013, the Codeof Practice promotes high ethical and transparency standards
for pharmaceutical companies in the promotion of their
medical supplies and prescription drugs. Part of the Code is arequirement for JPMA members to establish their own company
code of practice in this area.
To comply with this requirement, Torii Pharmaceutical has
established its own code, and we hold training sessions andseminars to ensure employees and MRs understand and abide
by both Torii Pharmaceutical’s as well as the JPMA Code ofPractice.
We also adhere to the JPMA’s ‘Transparency Guideline’, which
promotes public disclosure and accountability for paymentsfrom pharmaceutical companies to healthcare professionals
and medical institutions. For more information on the JPMA
Transparency Guideline and Code of Practice, please visit
www.jpma.or.jp.

JT Group Sustainability Report | 57

Beverage and processed food product responsibility
In our beverage and processed food businesses, we aim to meet consumers’ needs with the highest-quality and best-tastingproducts. Food safety is one of the JT Group’s main priorities, and we will continue to maintain the highest standards for safetycontrol to provide consumers with safe and reliable products.

Delivering safe, high-quality products
To ensure our consumers enjoy high-quality and safe beverage and processed food products we focus on four distinct areas:
food safety, food defense, food quality, and food communication. Activities in these areas ensure we have a rigorous quality andprocess control system to guarantee food safety in every part of our beverage and processed food businesses, from raw materials
procurement to manufacturing and distribution.

FQ

Food Quality

FS

Food Safety

FC

Food

Communication

FD

Food
DefenseFood safety

Each of our beverage and processed food businesses has
an independent Food Safety division to monitor and control
food safety. We analyze product-specific food safety risks andconduct inspections and audits in line with these risks. Across
the JT Group, our beverage and processed food businesses
hold a food safety meeting every quarter to review food safety
initiatives and share best practices.

Factories are subject to regular external certification audits aswell as unannounced audits to ensure compliance. Our beveragebusiness does not have any manufacturing operations, and all
production is outsourced to third-party manufacturing partners.
We encourage our third-party suppliers to certify their factories
to the FSSC 22000, a complete certification scheme for foodsafety systems.

All of our Group and third-party contract frozen food factories are
certified to the ISO 22000 food safety management system.

FSSC 22000 certified beverage business partner factories (%)

66.7

ISO 22000 certified frozen food factories (%)

100

58 | JT Group Sustainability Report

06|

TableMark’s Uonuma Mizunosato Factory in Japan

Food defense

Food quality

Food defense involves protecting our manufacturing processes
and products from the risk of intentional or accidental
contamination. We have an integrated risk management
program in this area and follow established risk management
policies, procedures, and audits. TableMark, our processedfood subsidiary, has created a food defense guideline thatapplies to all factories and distribution centers, as well as
contract manufacturers. The guideline outlines specific security
management measures to enhance our food defense. These
include:• Tight control of facilities, water sources, and toxic substances• Establishing restricted areas for both employees and visitors• Restrictions on personal belongings in factories

Working with business partners on foodquality and defense
In 2013, our beverage business held a quality assurance andfood defense seminar for 23 people from our manufacturing
partners. The seminar focused on measures to raise productquality, which is an important issue for our beverage businessas all manufacturing of our brands takes place in third-party
factories.

Quality management is established across the entire beverageand processed food supply chain through certification to ISO
22000 or FSSC 22000. We collect and monitor consumer
satisfaction data to assess the quality of our products andimplement product improvements on an ongoing basis.

Food communication
We provide a range of information to consumers about our
products, including disclosure of ingredients and traceability
information. We also give details of food safety control
programs on our websites to provide assurance to customers on
product safety.
In our processed food business, we disclose the factory
where products are manufactured and the origin of the main
ingredients. Consumers are also provided with traceability
information on our website for some packed cooked-riceproducts, which includes specific data on where the rice wasgrown, the factory of manufacture, production dates, and details
relating to suppliers.
Customer feedback, both positive and negative, helps us tounderstand and maintain the quality of our products. Ourconsumer complaints management system is compliant with
ISO 10002, the international standard for customer satisfaction.
We also provide toll-free numbers on product labels to give
consumers the opportunity to request additional information.

JT Group Sustainability Report | 59

Product responsibility and consumer impacts

Pre-harvest inspection of vegetables