Australian pension funds and tobacco investments: promoting ill health and out-of-step with their members

Abstract

There has been no systematic examination of issues surrounding pension funds and their tobacco shareholdings. This paper describes two studies designed to document the tobacco investment policies and practices of pension funds, and to assess community and fund member attitudes to pension fund shareholdings in the tobacco industry. Chief executives (n = 282) of Australian pension funds were mailed questionnaires. Of 241 eligible funds, 107 (44.4%) returned questionnaires, representing about 61% of total Australian primary superannuation accounts. Twelve percent indicated that they did not currently hold tobacco investments, 30% held tobacco shares and 58% did not know or failed to answer. Overall, 6% of respondents said that they held no tobacco investments and would not consider future investments; 2% had formal policies precluding tobacco investments. Funds with 10,000 or more members were more likely (p = 0.0006) to report tobacco investments. External fund manager advice was the most important factor influencing the funds' position. In the second study, a one-third random sub-sample of consenting subjects from 12,000 households randomly selected from the New South Wales Electronic White Pages completed phone interviews. From 7141 eligible households, 3503 (49.1%) subjects consented. One-third (n = 1158) were asked the pension fund questions. Over three-quarters (77.4%) of all respondents disagreed that pension fund investments in tobacco were ethical. Approximately two-thirds (63.6%) of fund members (n = 852) agreed that their funds should not make tobacco investments. There were three statistically significant predictors of opposition to such investments: being female, more highly educated and non-smoking status. Nearly all pension funds treat tobacco investments like any other investment. In contrast, most of the public including fund members are strongly opposed to such investments. Suggestions for public health advocacy strategies to reduce the negative health promotion effects of pension funds in this area are outlined.