|
23
October 2007 – Prime Minister Helen Clark said she was very pleased that
Government Superannuation Fund was divesting itself of its tobacco
stocks. CEO Adrian Orr said the Guardians (the Board) realized that
(their tobacco) shareholders’ objectives were inconsistent with New
Zealand’s commitments to, in particular, the objectives of the
World Health Organization’s Framework Convention on Tobacco
Control. The fund had $37.6 million worth of tobacco shares at 30 June
2007 (0.29% of
total assets). -
www.superfund.co.nz 23 October
Press release; The Press 24 October 2007.
Table 1. Crown Financial Institutions (CFIs) investment in international tobacco manufacture
& marketing
|
Current NZ $
|
Superannuation Fund
|
Government Superannuation
Fund Authority
30 June 05
|
National Provident Fund
31 Mar 05
|
Accident Compensation
Corporation
30 June 05
|
Earthquake Commission
30 June 2004
|
|
At 31 Dec ‘05
|
At 30 June ‘06
|
|
Total invested (total $25 bln)
|
8 406 000 000
|
9 864 415 000
|
3 521 408 000
|
1 899 630 000
|
6 500 000 000
|
4 730 000 000
|
|
Firms selling cigarettes and cigarette
tobacco
|
|
Altria Group (Philip Morris) US
|
7 525 307
|
10 296 406
|
-
|
Yes
|
Yes
|
Yes
|
|
Japan
Tobacco Inc
|
7 189 484
|
4 418 148
|
-
|
Yes
|
Yes
|
|
|
British
American Tobacco UK
|
4 451 438
|
5 622 815
|
-
|
Yes
|
Yes
|
Yes
|
|
Reynolds
American Inc US
|
2 608 060
|
3 878 297
|
-
|
-
|
-
|
-
|
|
Gallaher Group Ltd
UK
|
2 407 028
|
2 315 179
|
-
|
-
|
-
|
-
|
|
KTG
(Korea Tobacco)*
|
2 325 015
|
2 708 500
|
-
|
-
|
-
|
-
|
|
Imperial
Tobacco Group UK
|
1 131 721
|
1 360 134
|
Yes
|
Yes
|
Yes
|
Yes
|
|
Altadis Spain
|
454 427
|
0
|
-
|
Yes
|
Yes
|
Yes
|
|
Gudam Garang Indonesia**
|
394 620
|
0
|
-
|
-
|
Yes
|
-
|
|
Vector
Group Ltd USA
|
224 123
|
82 567
|
-
|
-
|
-
|
-
|
|
CIGARETTE FIRMS total
|
28 711 223 (0.34%)
|
30 682 046
(0.31%)
|
As at 31 Dec
2004
|
At 31 Mar 2005
|
At Feb.
2005.
|
At 30 June 2004
|
|
Firms not making
cigarettes, but making smokeless tobacco.
|
|
UST
Inc. parent of US Smokeless Tobacco Coy.
|
829 848
|
0
|
-
|
-
|
-
|
-
|
|
Swedish
Match (makes snus)
|
326 393
|
499 373
|
-
|
-
|
-
|
-Yes
|
|
TOTAL NON-CIGARETTE
TOBACCO
|
1 156 241
|
499 373
|
|
|
|
|
* Supplied 91% of the Republic of Korea cigarette market in 2000.
**Supplied 36% of Indonesian cigarette market in 2000.
Source: Superannuation Fund, www.superfund.co.nz Other CFIs:
Council for Socially Responsible Investment. www.csriorg.nz
What can and should be done:
·
As of 2007, a bill was in ballot in the name of Marian Street
MP, which Government will support, to promote ethical CFI investment.
- Otherwise, the next
bill amending the Smoke-free Environments Act should include a
clause cross-referring to each CFI’s governing Act, to replace
the weak ‘international reputation’ criterion with a
‘good world citizen’ criterion for investments, which -
in the light of the FCTC treaty-
would discourage CFIs from
investing in cigarette firms. The CFI clause must be inserted in the
bill before it is sent to select committee. The Council for Socially
Responsible Investment can advise on this issue. www.csri.org.nz
- The amendment should
not apply to firms making low risk smokeless tobacco products, which
assist smokers to quit smoking and on balance, are potentially
advantageous to smokers’ health. See product risks www.smokeless.org.nz/cigarettesmokingrisks.htm
Principles at stake
1. Need to promote New
Zealanders’ financial and physical health: dead Kiwis can’t
enjoy their superannuation funds.
CFIs do not major in cigarette manufacture and
marketing investment - 0.31% of the Superannuation Fund, for example.
However:
- Smoking is the main
preventable cause of early death in superannuitants.
It is inconsistent for CFIs to fund
pensions this way.
- Smoking is a cause of personal hardship and deleterious to national
prosperity. $22 billion annually could
be saved by ending cigarette sales in NZ. www.eastonbh.ac.nz
2. NZ needs to avoid
investment in tobacco to be a good world citizen:
CFIs invest so as not to tarnish NZ’s
international reputation and, as cigarettes are legal to sell world-wide,
CFIs felt free to invest. However:
·
Smoking is a cause of early death and poverty in poor
countries, and CFIs invest in multinational cigarette
companies which make and market cigarettes to such countries, where
smoking is increasing, and will account for most of the 10 million
cigarette deaths expected globally by 2020.
- New
Zealand has
ratified the Framework Convention on Tobacco Control (FCTC), a
global treaty to control the tobacco mortality epidemic. At May
2006, 168 countries were signatories and 131 countries were party to
this treaty. Its Article 3 states:
“The
objective of this Convention and its protocols is to protect present and
future generations from the devastating health, social, environmental and
economic consequences of tobacco consumption and exposure to tobacco
smoke by providing a framework for tobacco control measures to be
implemented by the Parties at the national, regional and international
levels in order to reduce continually and substantially the prevalence of
tobacco use and exposure to tobacco smoke.” www.who.int
3. Need for consistency in
government policy.
CFI
investments in cigarettes are inconsistent with New Zealand’s
·
Smoke-free Environments Act 1990 shows NZ law seeks to curb the
powers of cigarette makers.
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