Background information for Cigarettes Stocks Divestment
1 1 ) 1 Liable Investment Platform The Adults of New Zealand Superannuation (Guardians) have made significant progress in the past year in the progress their liable investment platform. The Guardians approved all their revised Accountable Investment Policy, Standards and Procedures, to encompass both Guardians ethical investment and voting requirements, with regards to the New Zealand Superannuation Fund (Fund). The Accountable Investment Plan, Standards and Procedures cleared up how specific responsible investment issues, such as tobacco, would be considered in a fashion that is consistent with the Guardians mandate. This is pointed out in the recommendations section 1 . 3 in the policy: The Guardians consider responsible investment (RI) to become part of growing best-practice purchase management. This RI insurance plan has been produced to help the Guardians to control the Account in a manner consistent with: В· В· В· Best-practice stock portfolio manageme nt; Maximising go back without unnecessary risk for the Fund as a whole; and Keeping away from prejudice to New Zealand s status as a accountable member of the earth community.
Towards the extent that it does not conflict with their responsibilities above, the Guardians, for their discernment, may consider other concerns arising from the Fund t investments. To do so , the Guardians might take into account factors including whether or not the issue is contrary to Fresh Zealand rules and New Zealand h international deals, or is inconsistent with Crown actions. 2 2 . 1 Board s evaluation and divestment decision Within the Guardians on-going review of a number of problems, the Adults analysed if the Fund s investments in tobacco companies was inconsistent using their responsible purchase standards. This kind of analysis (as outlined in sections 1 . 3 and 3. 2 of the Liable Investment Insurance plan, Standard s i9000 and Procedures)1 included: В· В· В· В· В· the nature of participation by the company and the Finance; the substantialness of the concern or breach of Accountable Investment criteria; the regulating environment, including international events and Fresh Zealand regulation; the effectiveness of shareholder actions; plus the impact on the Fund t portfolio.
The Guardians decisions must not be inconsistent with their require, and therefore the examination gave particular consideration for the impact of tobacco expense on the Guardians requirements to: avoid prejudice to Fresh 1
Dependable Investment Plan, Standards and Procedures dated 27 June 2007
twenty three Oct 2007
Zealand s i9000 reputation as a responsible member of the world community; and to maximise returns devoid of undue risk to the profile as a whole (please refer to parts 5 and 6 of this document for much more details). installment payments on your 2 Based upon the Adults assessment, the Board chose to divest cigarette stocks through the Fund. Although the Guardians consider the energetic use of aktionar rights through engagement and voting as the main system for answering responsible investment concerns2, regarding tobacco stocks and options such efforts would not end up being cost effective, and would risk the Pay for being conflicted. Considering Overhead action internationally, and at the domestic level, the strange characteristics with the tobacco sector, particularly for product security and ethics, and the efficiency of different shareholder responses, the Guardians figured divestment and exclusion with the Fund s tobacco holdings would be the best response. The choice to divest from tobacco should not be seen as an precedent for future decisions or actions. The Guardians have a transparent framework for dependable investment procedures, and a number of choices for action which includes engagement, divestment, and at the xclusion. You should be known that there is not a uniform respond to the issue of cigarette investments by investors having a Responsible Purchase policy. You will find clear sections in the quarrels on regardless of whether to hold...
Cited: in: Protecting against tobacco work with among teenagers. A report of the Surgeon Basic US DHHS, Atlanta, 1994
8 being unfaithful
Different from Cigarettes papers released during trial litigation in www.tobacco.org & Report & Recomm endations of the Ad Hoc Advisory Panel on Cigarettes Investments; University of Michigan; March 17, 2000