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Australia's Future Fund Stubs Out Tobacco
The sovereign wealth fund has extricated itself from its health-hazardous tobacco investments.
Australia’s Future Fund has extinguished its tobacco industry stakes. Announced in February, the move had been widely anticipated since David Gonski, chairman of the A$82.4 billion ($85.5 billion) sovereign wealth fund’s board of guardians, said last October that the board would review these holdings.
The $222 million divestment may carry extra symbolic weight given that Australia recently became the first country to enforce strict plain-packaging laws for cigarettes and other tobacco products. Although the Future Fund held 14 individual positions in tobacco producers, including Altria, Imperial Tobacco, Japan Tobacco and Lorillard, they added up to just 0.3 percent of its assets.
The news pleased the Australian Greens, who waged a publicity campaign last year to push the fund to sell its tobacco-related investments. “Most people didn’t even know about them,” says Senator Richard Di Natale, the party’s health spokesman. Although the Future Fund makes investment decisions irrespective of Australian politics, its board considered tobacco’s “very particular characteristics, including its damaging health effects,” Gonski explained.