The second largest tobacco producer in the United States, Reynolds American said Thursday it will ban smoking in all indoor office spaces, bowing to smoke-free social norms.

The manufacturer of Pall Mall and Camel cigarettes said starting from January 1, 2015 smoking cigarettes, cigars and pipes in conference rooms and elevators will be prohibited.

Designated smoking rooms will be opened by 2016 at the company's headquarters in Winston-Salem, North Carolina, and at its two other offices in Tennessee and New Mexico.

Until then, employees can still light up in hallways and in closed offices.

The company said the new regulations respect the rights of smokers and non-smokers alike, and make more sense in an increasingly smoke-free world.

"We recognize that indoors restrictions are the norm today, so most people expect a smoke free business environment," Reynolds American spokesman David Howard.

"We respect the rights and personal choices of employees who choose to smoke or use other tobacco products and those who don't."

E-cigarettes and chewing tobacco are still permitted.

Smoking is already banned in the company's production factories, cafeterias and fitness centers, and the move to extend the no-smoking zone was in line with the public standards, according to Howard.

"We are simply better aligning our tobacco use policies with the realities of what we're seeing in the general public today," he said.

Around 20 percent of Reynolds American employees smoke, the spokesman noted, compared to 20 percent of American adults who have not kicked the habit.

Smoking is banned in most public spaces in North Carolina, including bars and restaurants, but Reynolds America's offices are exempt from the law, Reynolds said.

The company announced in July it will acquire tobacco behemoth Lorillard, the number three US firm and manufacturer of the Blu e-cigarette.

The merger, will make Reynolds American the country's largest tobacco firm, with about 50 percent of the market.

It is looking to conquer the growing e-cigarette and cigar market as smoking cigarettes declines.

Reynolds American currently holds 25 percent of the US tobacco market, while Lorillard holds 15 percent, and Altria, producer of the iconic Marlboro cigarettes, controls about 50 percent.