Economic responsibility

Swedish Match’s operations, goals, and strategies impact and affect the society in which the Company operates. Swedish Match’s overall ambition is to deliver growing and sustainable long term profits to shareholders, while maintaining strong cash flows, thus helping to create economic prosperity among the Company’s stakeholder groups.

From a financial perspective, in order to ensure long term economic sustainability and financial performance, the Company will continue to leverage the strengths of its operations and product areas to help to achieve the vision of a world without cigarettes. The Company will also play an active role in working with its partners and associated companies for future organic growth.

Creating value for stakeholders1)

Swedish Match develops, manufactures, markets, and sells products across the globe and is a part of many communities all around the world. By conducting its business operations in a responsible way, Swedish Match contributes to economic development in these communities. It also benefits Swedish Match which has an economic interest in supporting these communities which in turn can help Swedish Match achieve its long term goals. Swedish Match contributes to economic prosperity and development among its stakeholders, both directly and indirectly. The economic value generated and distributed by Swedish Match benefits the Company’s stakeholders in many different ways:

  • Employees receive wages, salaries, and other benefits, enabling them to improve their standard of living.
  • Suppliers benefit from payments for delivered goods and services.
  • Governments benefit from tax revenues as well as Swedish Match’s involvement and investments in community projects, which support their national or local economies.
  • Customers are given the opportunity to work in true partnership with Swedish Match to build their own businesses by optimizing their selling of Swedish Match’s products to consumers.
  • Consumers benefit from the high quality products offered by Swedish Match.
  • Shareholders benefit through sustainable returns from both dividends and share repurchases, in addition to any share price appreciation.

The total direct economic value that Swedish Match generated in 2015 amounted to 14,852 MSEK, up 9 percent from 2014. The total economic value distributed amounted to 13,455 MSEK in 2015, up 8 percent from 2014. Economic value retained amounted to 1,397 MSEK in 2015, up 19 percent from 2014.

Operating costs accounted for 64 percent of total economic value distributed in 2015, followed by employee wages, salaries, and benefits (16 percent), and payments to providers of capital (14 percent). Payments to governments accounted for 6 percent of total economic value distributed. Payments to governments by country are more relevant locally and Swedish Match does not collate global data on it.

Operating costs increased by 8 percent in 2015 compared to 2014. While payments to providers of capital decreased by 2 percent, employee wages, salaries, and benefits increased by 15 percent. Payments to governments increased by 15 percent. Community investments were increased by 31 percent, from 5 MSEK to 7 MSEK.

Read the 2015 Sustainability Reporting Document.

1)  The figures for economic performance using the GRI methodology do not correspond to figures reported in Swedish Match’s annual report due to definitions set forth by GRI which may differ from Swedish Match’s reporting under the IFRS methodology.

Source: Swedish Match Sustainability Report 2015.