Table of Contents
Tobacco industry is composed of all people and corporations that are involved in the expansion, sale preparation, promotion, and distribution of tobacco, as well as tobacco-related products. Tobacco is globally recognized since it can be planted in any warm and moist environment. This implies that all continents are potential farms for tobacco, except Antarctica. Historically, tobacco is associated with Native Americans since it was one of the most essential crops for American farmers. In order to clearly comprehend the history of tobacco industry, it is very vital to examine the origin of the crop tobacco. The scientific name for tobacco is Nicotiana tabacum, which draws its nativity from tropical America. It is widely grown for its leaves, which are dried and processed, are ready for smoking through cigars and pipes. Basically, it is grown in South and North America. Tobacco plantation began with Christopher Columbus, who received tobacco leaves from an Indian American in 1942.
Initially, tobacco was grown based on its healing properties. During the onset of American colonization, the European strongly believed that tobacco had a medicinal value and could be used to treat many diseases including cancer. In his book, Nicolas Monarde documents that tobacco as a medicinal plant could cure up to 36 health problems. Tobacco gained popularity at the onset of seventeenth century. Conversely, many people also began to experience the negative impacts of tobacco. This was mainly because of the addiction that caught up with many. For instance, Sir Francis Bacon found it to be a very daunting task to quit smoking. As a result, Massachusetts became the first state to ban public smoking. Such move was basically driven by the highly esteemed morals of the time and not much of the health issues. Tobacco usage continued to spread in North America, and, as a result, Pierre Lorillard established the first tobacco processing company in 1760. The main objective of this company was to process cigars and snuffs. Current, Pierre Lorillard is widely known as the ancient tobacco company in USA.
Tobacco was very instrumental in financing the American revolutionary war in 1776. Tobacco farms acted as collateral for loans that Americans borrowed from France. As years advance, many researches, which tended to expose the chemical components of tobacco, as well as the health impact of tobacco on the consumers, were conducted. Nevertheless, demand for tobacco increased, and at the onset of World War I, its usage had exploded, especially among soldiers. Many other companies emerged, such as Camel and American Tobacco Company. By 1923, 45% of the US market share was under the control of Camel Cigarette Company. The sale of cigarettes continued to escalate during World War II. However, many negative impacts of tobacco began to surface since it was linked to lung cancer. The industry reacted by refuting such claims as baseless and ill-intended. In 1964, Surgeon General released a report on impacts of smoking on health. The data in this report acted as base upon which the government imposed regulatory measures on tobacco industry. As many negative reports began to surface, many tobacco companies began to diversify their products. For instance, American Tobacco was rebranded as American Brands, Inc.
In the recent past, tobacco industry has received many lawsuits that granted the harmful effects of smoking. As a result, smoking was forbidden in public places, and many politicians deemed smoking as incorrect. Consequently, the market share of tobacco industry in USA dropped by a huge margin. Tobacco companies reacted by launching international marketing in other developing nations on the Asian continent.
Recently, evidence has been released which shows that tobacco companies are acquainted with the harmful effects of smoking despite their continual marketing and sale of the product. It is also alleged that the industry exploited the addictive quality of nicotine to get many people into smoking and hence guarantee them market.
Corporate Stakeholders and Response to Their Issues
The corporate stakeholders in the tobacco industry include the industry owners, government agencies, and employees. Tobacco growers benefit from the sale of tobacco given the huge profits accrued from the products. However, there has been a rift between tobacco companies and the tobacco growers with regard to share of returns. Tobacco growers’ voices have been declined. As a result, they have formed lobby groups to help in pushing their agendas forward.
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Another important stakeholder in the tobacco industry is the advertising. Tobacco industry has been working in collaboration with these agencies to throw away the debate on health hazards associated with smoking. These agencies, at the urge of tobacco industry, have downplayed the harmful effects of tobacco by creating an impression that life is full of pleasure when one smokes. Amazingly, the advertising has never served the interest of tobacco consumers but rather they work to further the interest of tobacco companies at the expense of the general public.
Anti-tobacco stakeholders include government regulatory bodies and the medical practitioners. The main objective of this body is to regulate the operations of tobacco industry so as to reduce the harmful impact on the public. The medical practitioners have always voiced their concerns with regard to the harmful effects of tobacco on the consumer’s health. Organizations of nurses and doctors have come together to lobby for increased prevention programs on the production and sales of tobacco and tobacco-related products.
The role of the government as stakeholder is to implement regulatory policies that serve the interest of the general public.
The Role of the Industry in Its Social Setting
Currently, tobacco industry has attracted many opponents from the various social arenas. The medical researchers and scientists have blamed many health problems on tobacco. Tobacco has very detrimental effects on health, as well as the morals of its consumers. It is alleged that most of the soldiers in World War I were smoking, and this could have been the leading cause of deaths and merciless assassination in US. In addition, many rape cases reported during the period of WWI were alleged to have been committed by soldiers.
Smoking has been associated with grave health hazards, such as lung cancer and chronic illnesses. Many youths who are juvenile delinquents have been reported to be smokers. The main objective of tobacco promotions is to encourage smokers to carrying with the habit, as well as to initiate other people into smoking. Just like any other ad or promotions, tobacco promotions aim at enhancing the amount of cigarettes being smoked daily. It is worth noting that cigarette smoking has increased significantly among the youths as a result of advertisements. Many cigarette ads are tailored for women, youths, and black Americans. As a result, a greater percentage of people who smoke in US are teenagers aged between 13 and 19 years. The average entry age is calculated to be 14 years.
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Cigarette ads often give an impression that smokers have lots of pleasure when in the actual sense the opposite is true. Cigarette has been marked as a dangerous drug for the body and should be avoided at all cost. Cigarette is the leading cause of many serious illnesses, such as lung cancer, cardiac disease, and other chronic-related sicknesses. The question that the entire society struggles with is whether to place a total ban on cigarettes or to allow unrestricted smoking. Ethically, tobacco industry is in a great dilemma. The main aim of tobacco industry is to be part of the overall corporate social responsibility. However, they have a real ethical dilemma of harmonizing the fact they are selling deadly products, and at the same time they want to achieve corporate social responsibility. In all its operations, tobacco industry violates ethical values and has no respect for employees, as well as consumers. They cannot claim to be promoting transparent practices in their business, while it is widely known that actions, as well as marketing strategies are aimed at concealing the deadly nature of their products.
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Apparently, tobacco industry is widely recognized by many countries, and their products are legal despite being lethal. As a matter of fact, tobacco is the only legalized product that kills up to two thirds of its users. Therefore, they cannot be ranked with other consumer goods that are of great benefit to users, such as food beverages or fast foods. It is an inherent contradiction for Tobacco Company to aim at achieving corporate social responsibility, while, on the other hand, over half of its consumers die regularly
However, the industry reacted by refuting such claims as baseless and ill-intended. This was done and still continues numerous ways.
The Role of the Industry in Its Economic Setting
The economic system of US is governed by capitalism, in which two or more people can get together and create a company charged with responsibility of making and selling a specified product. The primary objective of creating such a company is always to make money. A company that is capable of selling more than it spends is said to be profitable. A company can also sell its products to other regions or nations. This is known as exportation, and the products are known as exports. Buying of products of foreign nations is referred to as importing. In a normal market, when imports are far less than export then trade surplus occurs. Similarly, when the imports are higher than exports then trade shortage occurs.
Historically, tobacco has played a major role in the economy of US. It constituted a huge percentage of the entire exports. Data reveals that in 1992, US recorded $5.65 billion dollars as trade surplus. In addition, US draw a lot of tax from tobacco companies. For instance, Philip Morris (a renowned cigarette company) is the largest tax paying corporation in US. Other products that are exported by tobacco companies include cigars, snuffs, and chewing tobacco. These products are often destines to about 146 countries worldwide. Such countries include Saudi Arabia, South Korea, Hong Kong, United Arab Emirates (UAE), Turkey, Russia, Singapore, and China, among others. Growing of tobacco is very profitable granted that the costs are relative reduced. The process of manufacturing cigarettes is automated and hence no need for human labor. Tobacco leaves are crushed and cleaned by using machineries which then mix them with nicotine. Other processes that are automated include rolling, filtering, cutting the cigarettes into lengths, and, finally, packaging them.
It is worth noting that US is home to the six most powerful cigarette companies which contributes significantly to the overall economy of the nation. As a matter of fact, tobacco companies work in collaboration with US government. Tobacco industry contributes to the economy of US by creating jobs, revenues, and providing a huge tax value.
The Role of the Industry in Its Political Setting
Recently, tobacco has experienced a sharp decline in its sales in US. Nevertheless, their overall consumption has increased by ten percent in the last decade. This is attributed to the expansion of tobacco companies to others regions globally, particularly in developing nations of Asia and Africa. According to the research conducted in the third world countries, tobacco consumption increases annually at the rate of three percent.
Tobacco contributes much to the political arena. It is worth noting that tobacco industry spends a huge junk of money in political donations with TAN aim of winning the favor of politicians. For instance, during the 1999-2000 election cycles in US, Philip Morris donated thirty four million dollars to aid in election procedures. Even though US has increased regulations on tobacco and enhanced anti-smoking campaigns, it is evident that political contribution of tobacco has not reduced at all. This is mainly because of the known principles that “money follows power”, and at the end of the game both “participants get rich”.
Domestic and International Ethics
Locally, the sales of tobacco have received a lot of obstacle, especially from political activists. This has forced the industry to expand its market to developing nations in Asia and Africa. Evidence shows that the international expansion of tobacco is a move by US to reduce its local consumption within the countries. For instance, much of tobacco products were politically financed for export in third world countries. It is an undeniable fact that tobacco industry takes advantage of the primitivity and the lack of financial mobility in the third countries to further its harmful products. Their promotional strategies downplay the evident health complications that are associated with tobacco consumption. Tobacco industry has strong connections with the policy making agencies and the underprivileged voters have less to say.
Ecological and Natural Resources
Tobacco industry has detrimental impact on the environment. In America, a lot of agricultural land was cleared in a bid to pave way for increased tobacco plantation. The ecological well-being is also endangered by increased tobacco production.
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