Ottawa – October 20, 2011
Alberta moves away from tobacco investments
Health group calls for other governments to protect health and protect pension investments by adopting investment policies against tobacco stocks.
PSC welcomes today the news that the Alberta government had directed the Alberta Investment Management Corporation (AIMCo) to sell-off its direct ownership of tobacco companies.
"Government investments in tobacco companies are wrong-headed on many fronts," explained Cynthia Callard, PSC's executive director. "The initial share offerings provide tobacco companies with the resources to expand their markets and harm new communities. Continued shareholdings push tobacco companies to generate profits through sustained or increased sales."
PSC has long called for all government investment boards, and especially the Canada Pension Plan Investment Board, to stop investing in tobacco companies. This position is supported by the Framework Convention on Tobacco Control, to which Canada is party. The FCTC directs governments to protect public health from tobacco industry interference and recommends that no state agency be involved in tobacco company ownership outside of state monopolies.
"The Alberta government deserves praise for being the first Canadian government to acknowledge, however tacitly, that part-ownership of profit-seeking tobacco companies is inconsistent with its responsibility to protect health," said Callard.
A PSC review of institutional ownership of tobacco stocks last year found that Canadians owned more than $2 billion in tobacco industry shares of the 4 largest companies, and received more than $90 million in dividend payments from the profits of tobacco sales, including at least $36 million from sales in developing countries. About 25% of these shareholdings were direct ownership by investment firms under government control.
"Many countries do not put pension funds in any form of stock market investment. Those that do should follow the example of Norway, New Zealand and Alberta and ensure that pension investments do not worsen the global tobacco epidemic."
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Cynthia Callard, Executive Director, 613 233 4878