Philip Morris Korea Stretches Out Helping Hands to the Needy

Source from:  Korea Times 07/24/2009

This is the first of a four-part series highlighting corporate social responsibility activities of Korea's big four tobacco makers. _ ED. In the aftermath of the currency crisis in 1998, the Korean Council of Food Support (KCFS) was formed to provide impoverished people with surplus food and groceries. It took little time for the KCFS to realize that it needed refrigerator trucks to collect and distribute surplus food but the not-for-profit private entity struggled to secure the expensive items. The KCFS knocked on the doors of many homegrown companies to no avail. The help finally came from an unexpected outfit _ foreign tobacco producer Philip Morris, famous for its flagship product Marlboro. "Back then, no firms were ready to donate the expensive freezer trucks because the economic slump was so severe, with the sole exception of Philip Morris Korea," KCFS Secretary General Lee Yun-hyeong said. "Philip Morris contributed six freezer trucks in 1999, the first ones for us, and the firm has continued doing so over the past decade. Thanks to them, we could operate properly to feed the hungry," she said. Since 1999, Philip Morris Korea has donated a total of 29 vehicles equipped with refrigeration, more than half of the 50 in the KCFS fleet. The price tag for each vehicle is more than 20 million won. Lee said that the company is the most stable and reliable contributor of freezer trucks, which are the minimum must in carrying out food bank activities. "Organizations that offer to give freezer trucks in most cases ask for public relations sessions to get greater media attention or public interest," Lee said. "By contrast, Philip Morris Korea has been different. They do publish their donation every year but their approach is more about not letting the left hand know what the right hand is doing in comparison to others," she said. Unique Approach The example of freezer trucks demonstrates how Philip Morris Korea sees the corporate social responsibility issue, which emerges as one of the three bottom lines for corporations. "What distinguishes Philip Morris Korea from others is that the firm admits in an overt manner that cigarettes are addictive and cause serious illness," said an industry source here, who asked not to be identified. "That enables the company to come up with a unique approach. It thinks it is kind of indebted to society and it tries really hard to act as a responsible corporate citizen," he said. Indeed, such a mantra was shown in April when the company had a press conference to mark its 20th anniversary in Korea. "Philip Morris Korea supports comprehensive and strict regulation of tobacco. Given the hazardous nature of smoking, it supports the government's strong enforcement of regulation in all steps from production, taxation, to marketing, sales and consumption," it said in a press release at the time. Philip Morris Korea also uses a much bigger warning on smoking than required when it promotes its products in journals. Warnings legally must take up around 3 percent of the total advertisement but the in-house rule for Philip Morris Korea is around 10 percent. "We are putting consistency and steadiness on the front burner in seeking social responsibility programs. We will continue to stick to the policy down the road," Philip Morris Korea Director Kim Byung-chul said. "We will try to turn our eyes on areas where others don't." Company-Wide Efforts Kim said that the efforts to give back to society are not limited to a specific part of the company. The company's campaigns are widely attended by everyone from Managing Director Roman Militsyn, head of the Seoul-based entity, to rank-and-file engineers at its Yangsan plant, South Gyeongsang Province. "Volunteers visit centers for senior citizens or the underprivileged every month in Seoul and Yangsan. Whoever has time takes part in the events," Kim said. "Most of our employees participate in the voluntary tasks at least once every year. For me, maybe a couple of times," Kim said while beaming. On top of the periodic activities, the company also holds a set of irregular charity events such as a bazaar to help the poor. Philip Morris Korea's social responsibility programs even include local tobacco farmers. "Starting in 2007, we began helping growers of tobacco leaves to get medical checks," Kim said, adding that farmers are often senior citizens and can't afford proper health care. "After learning that, we decided to help. In 2007, we assisted 130 farmers in North Chungcheong Province and the next year aided as many growers in North Jeolla Province," he said. The checkups actually proved to be life saving, since two farmers were diagnosed with early-stage cancer. After going through surgery, both are healthy now. Philip Morris Korea also held smoking etiquette campaigns for adult smokers and youth smoking prevention campaigns. The firm has also put forth efforts to remove trash from Korean beaches and preserve swamplands in Yangsan. Behind such efforts is Militsyn, who is attempting to ensure Philip Morris Korea is woven into the cultural fabric of the country. The Russian understands Korean culture and traditions better than any other foreign CEOs because he studied Korean at the Moscow-based University of Foreign Languages. Notable Performances To be sure, social responsibility programs can sometimes come at a heavy cost but it seems that campaigns actually provide a boost to Philip Morris Korea. "Our market share in Korea was 12 percent last year, up by more than 2 percentage points from the previous year. We also sold over 11 billion cigarettes in 2008," Militsyn told a press meeting in April. "As for this year, our direction is to advance and to accelerate our business growth. At this point in time, we are finalizing our plans of expanding local production facilities," he said. Philip Morris Korea was honored as one of 10 best companies to work for in 2003 by the consulting firm Hewitt Associates, The Asian Wall Street Journal and a local newspaper. Its Yangsan plant was picked as the first in quality control for three consecutive years in surveys among more than 50 Philip Morris manufacturing plants around the globe from 2006 to 2008. Managing Director Militsyn made it clear that a company can rack up a growth while also seeking more social responsibility programs. "Philip Morris Korea was able to enjoy success for the last 20 years thanks to its rich brand portfolio developed with respect to consumer needs, strict quality control at its plant, and its healthy corporate culture where priority is given to the development of top talent and potential maximization," Militsyn said in the April conference. "We will continue to grow in Korea as a company with close ties to the community and as a responsible corporate citizen meeting the expectations of society and its values," he said. Enditem