“Sustainable Leadership: The Transformation of Philip Morris Bulgaria as a Driving Force for Socio-Economic Impact” was the topic of one of the most compelling panels during the ESG&FRIENDS 2025 forum, organized by ESGnews.bg.
The General Manager of Philip Morris Bulgaria, Denys Strobykin, and the Senior Manager at EY Bulgaria, Miroslav Dzhunev, with the help of the moderator Bozhidara Zhivkova, Editor-in-Chief of ESGnews.bg, were able to shed light on the ways sustainable leadership is fundamental to the success of business transformation. Transformation, which is driven by innovation as an engine of growth, and which also contributes to the development of the social and economic environment.
How important is innovation?
What exactly is innovation? An answer to this important question was offered by Denys Strobykin, PM Bulgaria General Manager, based on his experience at Philip Morris International.
“Innovation not only increases productivity; it is a source of better competitiveness; it improves the standard of living. Businesses have a particularly important role in the development of innovation. Historically, innovation has originated in academic communities, but it has been imposed and developed by business. The greatest innovation in our industry is the development of smoke-free products. This discovery has enormous potential to reduce the harm of tobacco and improve public health. Everyone at Philip Morris and I personally are very proud of the implementation of this large-scale change in the industry. I want to emphasize that our company is fully committed to this transition to a smoke-free future. The scale of the change is gigantic – to date we have invested nearly $ 14 billion. These funds go in different directions – for the development of such products, for research and development, for transforming our factories and the supply of these products. And this is really a completely new direction. This huge investment already brings in less than half of our total net revenue – 40% of it comes from smoke-free products,” explained Denys Strobykin.
He also talked about the challenges of believing in and implementing an innovation and how a company like Philip Morris International operates in the field of innovation on a global and local level.
“Every innovation is initially met with some distrust, skepticism, and sometimes even hostility in society. The amalgam of these sentiments undoubtedly influences regulators. Innovation always starts with a vision. In our case, the vision was to reduce the harm of tobacco by developing and offering less risky alternatives to conventional smoke-free cigarettes to all those adult smokers who would otherwise continue to smoke and then convincing them of the potential of these products. To date, 38 million adult consumers have switched to our smoke-free products globally, which are available in 95 markets worldwide. Our largest investments are in Europe, and we are not just talking about pure investment in the production process. Philip Morris International also supports local communities on the continent. Bulgaria plays an important part in these efforts. 400,000 adult consumers in the country have already switched to our leading smoke-free platform. And for 10 years now, we have continued to support local communities in the tobacco-producing regions of Bulgaria, as well as social and environmental initiatives and causes,” said the general manager of Philip Morris Bulgaria.
He also touched on the topic of sustainable leadership.
“Sustainable leadership requires something very important, namely that our actions shape our future. In my opinion, it is very important that a truly sustainable leader is able to convince his entire company or organization of the right direction to take and the transformation that needs to take place. And last but not least, to convince others that in order to achieve the pre-set goals, a lot of perseverance is needed.”
The socio-economic impact of Philip Morris Bulgaria
Ahead of the publication of the first local report on the socio-economic impact of Philip Morris Bulgaria, prepared by EY Bulgaria, Denys Strobykin and Miroslav Dzhunev shared key highlights from it, emphasizing that the company’s transformation has led to an increase in its overall business investments in Bulgaria.
“There are so many numbers, but I will try to point out some of the most important ones. For example – the number of people we employ in Bulgaria, which is constantly growing. Currently, over 600 people are working for Philip Morris Bulgaria, directly or indirectly through our partners. We are also significantly increasing our investment in the supply chain. Since the beginning of the transformation of our business in Bulgaria, the number of product and service suppliers with which we work in Bulgaria has also been growing. Of these, 75% are Bulgarian companies. When it comes to diversity and inclusion – over 40% of the management positions in our company are held by women. But if we look at senior management, that percentage increases to 72%. And again, I want to emphasize how proud we are that we continue to invest in and support local communities in the regions where tobacco is grown through our social responsibility program “Fun Summer, Caring Autumn”. Let me also mention our program for the return of our electronic tobacco heating devices. In 2024 alone “173,000 devices were returned by our users. Some of them are then given a new life where possible, thus reducing our environmental footprint. But even more importantly, the remaining devices are recycled, together with the accessories that accompany them,” explained Strobykin.
The Philip Morris Bulgaria Socio-Economic Report
Miroslav Dzhunev, Senior Manager at EY Bulgaria, provided more clarity on the mechanism behind the preparation of the document.
“To prepare such a report, we use a proven methodology that includes several basic steps. We start by collecting a huge amount of data – from the company itself, but also information from public organizations, such as the National Statistical Institute and the Ministry of Finance. Then we analyze this data in relation to Philip Morris Bulgaria and the economic, social and environmental impact of the company. Important factors here are job creation, economic contribution, social initiatives. Finally, the report itself is compiled using all of this, and it includes important recommendations for future actions,” he explained.
He added that the report analyzed the period from 2019 to 2023, starting from 1.11% of gross national value added to the economy in 2019 and reaching 1.22% in 2023.
“This is an indicator of the significance of Philip Morris’ presence in Bulgaria. Another indicator of the company’s commitment is that they have tripled their staff since starting business in the country. We must also mention the positive impact that Philip Morris Bulgaria has in local communities with over 2.5 million leva invested in various companies,” he explained.
Miroslav Dzhunev also clarified the reasons why socio-economic assessments are of key importance for businesses when making decisions.
“Socio-economic assessments are of key importance for several reasons, especially in the dynamic environment we find ourselves in, where politics and business must frequently change their position on the sustainability trend. That is why it is very important at this time to have companies that set positive examples. Philip Morris is just such a company, which continues to demonstrate its commitment to change for the better, leaning on pillars such as competitiveness and investment in innovation,” he commented.
According to him, an important aspect of socio-economic assessments is the ability to make an informed decision.
“This is because stakeholders receive important data – these are the people who prepare and make political decisions but can also include the wider public. With the provided analyses, they can better understand the activities of a given company in the country, which is closely related to the implementation of existing regulations or future investments.”
Another aspect, according to Miroslav Dzhunev, is that regularly preparing such reports helps with the company’s accountability and transparency, and this in turn helps build a reliable relationship with the local community.
“By preparing such a report, it can assess where it is on the path to achieving its sustainability goals. This is done by identifying not only positive actions, but also areas in need of improvement and, accordingly, the report helps to prepare future strategies. And finally, a good result from a socio-economic report raises the company’s reputation and thus makes it an attractive player for new partners, for investors, for current and new clients, and also for attracting better quality personnel,” concluded the senior manager of EY Bulgaria.
Translated by Tzvetozar Vincent Iolov
