S-Bank’s asset management service and Varma Mutual Pension Insurance Company have joined the international Tobacco-Free Finance Pledge. The objective of the pledge is to raise awareness among financial institutions of the essential role they play in promoting anti-tobacco policies in the sector.
Both S-Bank’s asset management service and Varma have already excluded tobacco companies in their respective responsible investment policies. This means that S-Bank and FIM funds do not make direct investments in tobacco manufacturers, and Varma does not invest the pension funds it manages in tobacco companies. By joining the pledge, S-Bank and Varma want to highlight the entire finance sector’s responsibility to limit investments in the tobacco industry worldwide.
“Responsibility is an important guiding principle for our operations. That is why we want to raise awareness of the important role the finance sector plays in establishing a tobacco-free world,” says S-Bank’s Chief Investment Officer, Mika Leskinen.
Tobacco causes seven million premature deaths worldwide each year[i]. Roughly 80 per cent of the world’s 1.1 billion smokers live in low- and middle-income countries[iii], where the tobacco industry now targets its marketing, since smoking in Western countries has decreased.
“There is very little anti-tobacco regulation in developing countries. Low-income consumers in developing countries spend a significant proportion of their meagre income on cigarettes, on top of which they suffer tobacco-related illnesses. As a responsible investor, we do not want to invest pension funds at the cost of people’s health and standard of living,” says Varma’s Director of Responsible Investment, Hanna Kaskela.
In Finland, tobacco is responsible for one in five adult deaths a year. Every year, approximately 5,000 Finns die from tobacco-related illnesses[ii].
105 international finance-sector organisations already pledged
S-Bank’s asset management service and Varma are the first Finnish organisations to join the international anti-tobacco alliance. The Tobacco-Free Finance Pledge was initiated and developed by the not-for-profit organisation Tobacco Free Portfolios.
Signatories to the pledge commit to, among other things, encourage the adoption of tobacco-free finance policies. This promotes the goals of reducing smoking worldwide and achieving a tobacco-free world. The signatories furthermore commit to increasing the popularity of tobacco-free finance by building knowledge and understanding of the dangers of tobacco. 105 banks, asset managers, pension companies and investors from around the world have signed the Tobacco-Free Finance Pledge, and with the addition of S-Bank’s asset management service and Varma, the number rises to 107.
“The first organisations from Finland – Varma and FIM Asset Management – are welcome additions to the pledge. They bring the assets under management represented by the signatories to more than 8,360 billion euros. This indicates that tobacco-free finance is becoming increasingly common and important around the world,” says Dr Rachel Melsom, Director of Tobacco Free Portfolios, UK and Europe.