News story

British American Tobacco Malaysia – OECD guidelines

British American Tobacco PLC is a UK registered multinational involved in the manufacture, distribution or sale of tobacco products. The company…

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government


British American Tobacco PLC is a UK registered multinational involved in the manufacture, distribution or sale of tobacco products. The company is listed in the FTSE 100. The allegations contained in the complaint were directed against British American Tobacco Malaysia Berhad (BATM) which is controlled by British American Tobacco PLC.

The Government’s examination found that BATM acted inconsistently with the OECD Guidelines for Multinational Enterprises by failing adequately to consult an in-house trades union about the restructuring of the company’s workforce before finalising the decision to proceed with the restructuring and to advertise new positions. However, the Government’s examination reached no conclusion on two other alleged breaches of the OECD Guidelines.

Employment Relations, Consumer and Postal Affairs Minister, Edward Davey, said: “The Government promotes responsible business practices and adherence to internationally recognised standards. Clearly any major restructuring of a company’s workforce affects employees and their representative bodies, so it’s important that UK registered companies, and their subsidiaries, maintain an open dialogue with their in-house trades unions and put adequate means of consultation in place”.

The Malaysian Trades Union Congress brought the complaint against BATM under the Guidelines on 11 December 2007, triggering the start of the complaint procedure by the UK National Contact Point (NCP) for the Guidelines.

The UK NCP’s Final Statement on the complaint recommended that British American Tobacco PLC should encourage BATM to establish a permanent and regular process to consult and inform its employees on issues of mutual concern before key decisions of mutual concern are taken by management. This process should be endorsed by both management and employees (and their representatives, where they exist).

Notes to Editors

  1. The UK National Contact Point’s Final Statement on the case is published at []( (under the section “Final Statements”).

  2. The OECD Guidelines for Multinational Enterprises set out standards that adhering States recommend business to apply, wherever they are trading and operating overseas. The Guidelines cover a broad range of issues in business ethics including industrial relations, the environment, corruption and human rights.

  3. The UK National Contact Point (UK NCP), based in the Department for Business, Innovation and Skills, initially aims to bring parties together to mediate a solution to complaints brought against multinationals operating in or from the UK. It is only if mediation fails (or is declined) that the UK NCP fully examines the allegations contained in the complaint. If it considers that a company has not met the requirements of the Guidelines, the UK NCP will issue a statement detailing this decision and making recommendations on how the firm can come into line with the Guidelines in the future. In this case, the UK NCP will also ask the parties to provide, by a specified date, an update on the company’s implementation of the recommendations.

  4. On 11 December 2007, the Malaysian Trades Union Congress submitted a complaint, on behalf of the British American Tobacco Employees’ Union (BATEU), to the UK NCP under the Guidelines in relation to BATM’s operations in Malaysia. The complaint alleged, amongst other issues, that BATM was required to consult the BATEU about the restructuring of its workforce but that it failed to do so adequately or at all.

  5. The OECD Guidelines are not legally enforceable on businesses, but all OECD members are committed to raising awareness of the Guidelines and implementing the Guidelines’ complaint procedure.

  6. BIS’ online newsroom contains the latest press notices, speeches, as well as video and images for download. It also features an up to date list of BIS press office contacts. See []( for more information.

Notes to Editors

Contact Information

Name BIS Press Office Job Title

Division COI Phone




Name Joe Upton Job Title

Division Department for Business, Innovation and Skills Phone 020 7215 5959 Fax



Published 21 March 2011